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What is an ERP and What are its Functions

What is an ERP and What are its Functions

As much as many businesses may want to embrace ERP software in their businesses,  there’s a need to fully understand what it is and how it works to give the desired expectations.

Meaning of ERP

ERP stands for “enterprise resource planning”.  The main function of this system is to integrate,  organize software data.  It also contains functions that automate business functions.

It also works to increase the efficiency of an organisation by managing and improving how the company’s resources are centralized.  Improving and reducing the number of resources without necessarily sacrificing the important data of the organisation.

Modules of ERP systems

  • Product
  • Life cycle management
  • Supply chain management; purchasing, manufacturing and distribution,
  • Water house management
  • Customer service management(CSM)
  • sales order processing
  • online sales
  • Financials
  • Human resource
  • Decision support

Types of ERP Deployment

ERP system is divided into two main categories;

  • Private deployment
  • Public deployment

They are further divided into three different categories;

  • Cloud ERP deployment; software runs on a provider’s cloud, providing a computing platform.  Maintenance  is handled by the providers
  • On-premise ERP deployment; this is the most traditional model of deploying software where you control everything. learn more about software deployment at https://www.sumologic.com/glossary/software-deployment/
  • ERP software is installed in your data center and the location of your choice. In this deployment though,  installations and maintenance of hardware and software are done by staff.
  • Hybrid ERP deployment; in this deployment module installation and maintenance of both software and hardware is done by both the provider and the organisation. Responsibility is shared depending on the organisation.

What is an ERP and What are its Functions

How ERP Software Systems work

ERP software systems are used in an organisation to perform several tasks that improve the efficiency of an organisation.  Here are some areas where ERP software systems are essential

1.  Human Resource

ERP software systems help in managing company data. This includes the streamlining of employee tasks at hand e.g hiring and payroll.

It can also help in tracking how the employee performance record is.  This will help in identifying issues and solve them first hand.

2.  Supply Chain Management

ERP software system helps in ERP Project Management.  A clear record is available where product and services can be tracked. In turn, it gives the business a better performance.  Delays and misplaced information is taken care of.

3.  Manufacturing

whether a company offers product or services or both,  there’s the aspect of manufacturing.  ERP software systems assist in business communication.  communication between departments in a company is essential.

ERP software systems help to achieve this goal efficiently. The ERP software system also helps me. Automated daily processes, optimize projects,  cost management  and production planning. The ERP system runs on the internet and have cloud storage also, learn more information about the internet as a media of communication by clicking here

4.  Finances

ERP software suite provides a dashboard that assists in giving financial information of the company.  By using an ERP software suite helps in cutting down on information being entered manually.  In addition, it helps in business regulatory compliance.

5.  Data and Cloud Security

Whether the information is stored in the individual company Traditional ERP systems or a provider’s ERP software system, there is guaranteed data security.  Separate software like an modern ERP gives a company an advantage of data security.

You don’t have to deal with the misfortunes of lost data,  which at times incur a lot of unnecessary costs when trying to retrieve the lost data.

6.  Customer Service

In any business,  customer service is key.  With implementing an ERP project,  customer service is guaranteed.  All the necessary data needed for both the company’s and the customer is catered for and also tailor-made to fit the particular customers for the particular company.


There’s no doubt that an embarrassing ERP software system can get a company to the top.  It’s also advisable for any company to get clear information on an ERP software system before getting it installed.