ERP is an acronym for Enterprise Resource Planning. A simple sounding term with a long and storied background.
What does ERP stand for?
Simply put, ERP is an acronym for Enterprise Resource Planning. A simple sounding term with a long and storied background.
Originally, ERP systems were actually described by the acronym MRP, which stands for Materials and Resource Planning. This is a much clearer description of the core features of ERP software platforms as they were designed to manage material data such as inventory, bill of materials, supplier information, as well as resource data such as the work cycles and time required to complete a product along with the capacity planning for the organization.
Over the course of time, MRP vendors added value to the software platforms they had created by expanding the types of data they managed and bringing in more facets of their customers teams. By adding these teams across an enterprise, the term ‘Enterprise Resource Planning’ began to better differentiate this newly expanded system over its predecessor, the MRP platform.
But not all ERP comes from the same origins. Financial software, which was closely tied to the accounting needs of a business, had its capabilities expanded as well for the same reasons. To add value to the customer as well as remain competitive in a changing industry. As these facets were added, the financial software sector began to label their offerings as ‘Enterprise Resource Planning’ as well. This can obviously create some confusion for a customer evaluating ERP platforms for the first time, but understanding this variation exists can help a company prevent a misinformed platform selection and potentially years of grief and lost investment and opportunity.
To be clear about which particular flavour of software platform Apollo ERP represents, it is very much from the MRP side of the equation. Apollo ERP focuses on helping manufacturers manage the complicated daily operations related to materials and resource planning, as well as other facets of the business, such as customer relationship management, quality assurance, purchasing, inventory controls, distribution, and a variety of other features that are covered in our About Apollo ERP section.
What is an ERP system?
An ERP system is, at its core, an information management platform. The mission critical data that each member of your team collects, stores, and shares within your organization is what an ERP platform will readily manage through the utilization of a powerful centralized database. On top of this core dataset, known as the Master Data, there are often a number of relationships, with varying levels of complexity, established between the datasets as well as between your team members. This facilitates a more efficient methodology at each step in your organization's workflow steps. Interfaces can be easily established to capture or retrieve important information, and that information can then be shared with other areas of your organization immediately and accurately.
What kind of business would use ERP?
ERP tools, of the MRP variety, are designed around the short and long-term needs of most manufacturers and distributors.
What are the advantages of ERP?
While there are some differences between advantages of ERP software for your organization depending on what manufacturing sector your company works in, as well as the size of your organization, many of the following advantages are enjoyed by companies that use an ERP system to help run their business.
Increased Productivity - When all of your business data is available to all of your departments at once, employees save time and effort in having to either contact or negotiate with other parts of your organization to extract crucial data required to help them make decisions. Additionally, on the shop floor, ERP software can help manufacturing businesses manage their equipment, machine cycles and manpower to increase productivity, safety, and reduce both man-hour and raw material or ingredient waste.
Streamlined Data Flows - With ERP software, fast growing businesses that have not been able to keep up with the explosion of data in their company can now rely on having access to financial, business or inventory data that might not have been accessible previously.
Decreased Operating Costs - By optimizing various production processes and improving access to analytical data tools, areas of waste can be quickly identified and eliminated, resulting in cost savings.
Providing A Standardized Interface - By providing a standardized view into your business, and connecting various aspects of your company such as sales, manufacturing, accounting and other departments, every aspect of your business can now be quickly and reliably quantified. This means better forecasting and better reporting.
Improved Customer Response & Service - Global manufacturing pressures can affect even small and mid-sized manufacturers. That's why it's increasingly important to gain a reputation for being able to meet your customer's needs in a timely manner. An ERP software system like Apollo ERP can help decrease your response times to customer demand and changes to orders and product specifications.
Reduced Reliance on Archaic Systems - If you're still relying on old computers simply designed to run archaic software or the memory and expertise of a few select employees who hold the knowledge of operating the few crucial Excel spreadsheets that can make or break your business, it's time to switch to an ERP software system. Doing so will not only improve your efficiencies but also reduce your risk and exposure to catastrophic failures.
Better Business Decisions - Better data leads to better business decisions. With an ERP system you can trust your data and extrapolate the necessary analysis to make crucial decisions that will transform the way you think about various aspects of your manufacturing business.
Increased Ability to Adjust to New Regulations - Most ERP software is built to improve your organization's regulatory compliance, and often goes above and beyond what is necessary for financial accounting, data security, product part traceability, and product safety.
Empower Employees to Generate More Revenue - In small and midsize businesses, inefficiency and waste can lead to larger labour costs than necessary. This means less resource for companies to grow their business. ERP software can help automate and streamline a variety of processes freeing up employee time and give them insights into data that allows for creative solutions and strategies to increase both product quality and efficiency. Just one example is tying sales orders to the accounting system or allowing the running of reports without the need for complicated or increasingly bulky spreadsheets.
Mobile Accessibility - Modern ERP systems offer a variety of critical functions and KPI's in dashboards that show real-time data on sales, revenue, customer acquisitions, manufacturing output and other data accessible in a light-weight and mobile format.