The primary information an executive's guide to ERP software can give is that today's ERP is an incarnation from manufacturing industry where software were initially developed for calculating material requirements. Though with the growing demand customer demand forecast, cyclic behaviors, requirement forecast, production costing, availability of raw materials, purchasing, suppliers pool were also included to pave the way for today's enterprise resource planning software.
Today enterprise resource planning software includes all the major working aspects of small to large business organization. To sum up the functionality or quality of ERP software with an executive's perspective is that it works as sophisticated central information system for all the departments of an organization and responds in real time irrespective of its size and geographical locations. The power of ERP lies in its capability to combine all the divisions, departments, lines of business and working units under one single compact system where all of these are able to interact with each other as well as share and analyze information in real time.
Generally all the popular enterprise resource planning software cover areas like Financial accounting, Supply Chain Management, Human Resource Management, Manufacturing and Customer Relationship Management. An executive guide would define ERP software as software which covers all of these five key aspects of business in one single integrated system and stores all the data related to these in one single repository with intelligent analytical tools for reporting. To an extent this is real and theoretically correct definition of ERP software. Though today with the introduction of SaaS model this definition may not seem to be correct as in this model ERP software are available in modules and user can use one part of the ERP instead of using whole software.
ERP implementation ensures quick and correct transfer of information across the organization in real time which eliminates the need of consolidating and synchronizing the data of different departments of the organization. The availability of information at a click ensures better decision making and deep insight into the company's working at any point of time. Compliance of different rules and regulations, norms and best practices becomes very easy which eventually increases business and profit margins. Ability to read the market trends and foresee the change in demands of customers is another benefit of ERP. Standardization of different processes has been the biggest headache of management of large organizations which have divisions working at different geographical location.
By implementing ERP software management can ensure that even lowest level executive of the organization should follow the guidelines of the company's policies. Sales force automation and web stores are few features which have been made possible by ERP and has given a new dimension to business. Opting for ERP on demand even small and medium sized companies can make their presence felt in the global market through web stores.
An executive's guide to ERP is not complete without describing the pitfalls of ERP implementation. Hiring independent agencies for functional analysis of the organization helps in right selection and proper implementation of the ERP. Executives of such agencies can guide the management in identifying the problem areas and matching them with the ERP software for solutions. Training and building confidence of the staff in new system is another aspect of ERP implementation which contributes in its failure if not given due importance and attention.