What is ERP (Enterprise Resource Planning)?

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What is ERP (Enterprise Resource Planning)?

July 4, 2022

What is ERP?

  1. Used to manage day-to-day business operations
  2. Designed around a single schema
  3. Utilizes modules
  4. Provides significant value for businesses
  5. Compatible with SaaS technologies

ERP is the acronym for “Enterprise Resource Planning”. It is a type of software that today’s most successful organizations have. If you’ve heard of it before, you might know it is an important software that manages day-to-day business activities using the latest technologies. You might even know that it provides businesses the collaboration, agility, and speed they need for a strong competitive market edge. But, what is ERP, exactly?

ERP is one of the most important tools you can invest in today to run your company efficiently and productively in the long run. Below, we cover everything you need to know about what ERP is, and why you should consider it for your organization’s daily processes. 

Used to manage day-to-day business operations

Used to manage day-to-day business operations

An ERP system — also known as an ERP suite — is a type of software that businesses use to run their daily activities via integrated modules and applications. In a single system or software, you get to consolidate activities such as accounting, procurement, project management, risk management, supply chain operations, finances, and more. 

In simpler terms, ERP can automate your time-consuming business operations, across every department. It is a tool that helps you organize business data, facilitate your daily tasks, and improve how you handle business resources. 

With ERP systems, businesses can pick and choose the modules they need to integrate in order to scale up. ERP systems can be used by organizations of any size — even start-ups and mid-sized businesses. 

This software system can also support industry-specific requirements such as tax filing for finance, barcoding for logistics, and firewall security for data transfer. This is possible through the system’s core functionality or through application extensions that can be added seamlessly into the system. 

ERP systems and modules can be purchased in many ways. Most providers sell them on a licensing model, which is hosted onsite in your office. Or, you have the option of buying a cloud subscription model. 

Designed around a single schema

ERP is sometimes called the central nervous system of a business because it is designed around a single data structure known as a schema. All ERP modules are connected through this schema and driven by the work across departments, such as finance or human resources.

All the data gathered by ERP modules are stored in a common database. This is important for keeping information as accurate as possible and to provide a single source of truth across the business.

With an ERP system, you don’t have to deal with inaccurate or repetitive data entries. ERP systems make it easier to collect, organize, analyze, and take action on important data points. Since data is the lifeblood of any company, this is a huge benefit. 

Utilizes modules

We mentioned that ERP systems use a variety of different modules to support different business operations. These modules empower your people in each department with the tools, data, and insights they need to do their jobs.

Common ERP modules include:

  • Finance — manages the general ledger and automates key financial tasks. It can track several accounts, help close the books efficiently, generate financial reports, comply with financial regulations, reduce financial risk, and more.
  • Human Resources Management — assists core tasks for HR, such as attendance and payroll. ERP can also help with workforce analytics, employee experience management, and more.
  • Procurement — Helps businesses efficiently find the goods and services they need to create their products. This automates purchasing, quotations, contract creation, and contract approvals. 
  • Sales and Marketing — Keeps track of transactions between customers. Also provides data-driven insights to help increase sales or marketing effectiveness. It helps automate sales contracts, billing, performance management, and more. 
  • Manufacturing — A key tool for ensuring production is in line with demand. Helps make production scheduling, manufacturing timelines, and quality management easier.
  • Logistics and Supply Chain Management — Tracks the movement of supplies throughout the supply chain. Also provides real-time inventory management, and facilitates warehouse and logistics operations. 
  • Research and Development — Provides tools to help with product design and development. Provides data for product lifecycle management (PLM), and helps meet product compliance regulations. This helps you make new products quickly and cost-effectively. 

Provides significant value for businesses

Businesses that use ERP systems experience many benefits. They can automate daily procedures through a centralized system. This helps eliminate error and redundancies, while also making work more efficient and productive overall. 

Communication and collaboration are also improved across departments, as everyone can easily access the data they need for their work. This helps synchronize efforts and create better work outcomes. 

Businesses also benefit from the real-time data reports that can be generated by ERP systems. This helps you plan, budget, and capture more opportunities for your businesses. Thus, it improves your business agility — you become equipped to better adapt and respond to any disruptions or changes in the market. 

ERP systems also allow you to quickly and accurately communicate important information to your customers, partners, and other stakeholders. Thus, customer and investor satisfaction is improved. 

ERP systems automate time-consuming tasks, completing repetitive operations or running reports from multiple systems. By investing in an ERP system, you can dedicate more of your time to your team and your most pressing business requirements. 

ERP software has a big impact on how businesses are run today. They align separate departments, automate operations, sort inventories, and enhance workflows — resulting in significant improvements to your bottom line. 

Compatible with SaaS technologies

ERPs, as we mentioned, can be bought through cloud subscription models. This is known as a software as a service (SaaS) cloud application. When it is delivered in this way, ERP runs on a network of remote servers, rather than a single server located in your company office.

Cloud-based ERP systems, like Business One, are a great technological solution as we shift from on-premises operations to remote work environments. Business One is an ERP system that supports new business needs and enables hybrid teams the same powerful, accessible tools that businesses use ERP for, even when they’re on the go.

This dynamic product is maintained by a cloud and service provider, like DynamIQ. We patch, manage, and update the software several times a year. This is a cost-effective way of delivering up-to-date ERP software to our subscribed clients. 

Thus, you can reduce the need to host expensive IT hardware and the costs of purchasing new software with a SaaS-delivered ERP system. You can make the most out of the advantages this software offers, while also ensuring the system uses only the most recent ERP software. With DynamIQ’s ERP system, you can shift your focus from tedious but necessary options to value-added tasks to drive business innovation and growth.

Key Takeaway

To answer the question “what is ERP” simply, it is a much-needed digital solution for any business, big or small. It transforms the way you operate for the better. ERP systems provide flexibility, connect teams, unify data, and generate real-time insights to help you make better business decisions. 

With ERP moving to cloud-based applications, it is now more accessible than ever. Contact DynamIQ today to learn more about the benefits of our software, and how we can help you. We offer the top ERP solutions in the Philippines!

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