The ERP system (Enterprise resource planning) is a computer software system used in combining all of the information and processes and to have them working together in one system.

This usually involves many different pieces of software and hardware, and the ERP system relies on a database to be able to draw from in order to better organize the functions used through the system, and communicate all over a LAN (Local area network). This design helps for the business to be able to add or remove modules to their liking. Integration of this data also plays a key role in maintaining organization and work flow. In order for an ERP system to be considered as one, it must function fro more than one system. It wouldn’t be managing anything if it were just one! Some examples would be BlueERP (PHP based),  Compiere (Java based), ERP5 (Python based), and SAP ERP.

An ideal ERP system should contain all database entries for software modules, which are as follows:

• Manufacturing - Bill of materials, capacity, cost management, engineering, scheduling, manufacturing process, manufacturing projects, manufacturing flow, work flow management, and last but not least quality control.
• Human Resources - Training, time, payroll, attendance, benefits, rostering
• Supply Chain Management - Inventory, supply chain planning, supplier scheduling, inspection of goods, order entry, purchasing, commission calculation.
• Financials - Fixed assets, accounts payable, accounts receivable,  and general ledger
• Customer Management - Commissions, service, customer contact or call center support (somewhat the same thing), sales and marketing.
• Project Management - Activity management, billing, costing, time and expense, and  performance units
• Access Control - Setting user privileges on process execution
• Customization - Though this is somewhat limited, this involves changing process flow and other additions.
• Data Warehousing - the various self-service interfaces for the customers, employees, and suppliers to use.

Some advantages to using ERP system include design engineering (which is all about how to make the best product you can), order tracking, and data centralization, increased productivity, and many other benefits.

Disadvantages of the ERP system are that the customization of the software is very limited, the cost to purchase ERP systems can be quite expensive, the overall complexity in relation to what customers actually want, and another disadvantage is that although data centralization may eliminate problems with data synchronization, it also makes the data more vulnerable to be lost since it’s all in one place. However, many ERP systems include security measures to help make sure this type of problem does not arise.

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