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What is an ERP?

Yitzchak Lieblich
July 25, 2019

Any business or corporation is undoubtedly made up of many parts. These parts remain independent of each other but must ultimately be able to connect in order to create one whole company. These different parts of the company may be known as departments or branches. There are entities that handle finances, inventory management, sales, and  human resources to name a few.

How do these departments communicate information to each other in a way that will better the company as a whole? There needs to be some sort of system that keeps things organized and integrated. 

What is an ERP?

The abbreviation ERP represents the term Enterprise Resource Planning. It describes a process often used by companies who manufacture products to manage and integrate all aspects of the business. A company is made of many parts that all need to flow together in order to be successful. The larger the company, the more intricate this can be. With a large scale of departments all trying to work together while still maintaining the processes which normally go on within the department itself, things can get messy and lost in the shuffle. In a company where each department or part of the company has its own computer system or intricate system of any kind, some say ERP acts as a glue which binds together the computer systems. The systems remain independent, but are now seamlessly flowing together to communicate forward one common goal. 

How do all of these separate entities communicate with each other to become part of a whole?

ERP usually exists in the form of a software which is made to integrate these parts. Large applications have been developed in order to help companies implement such ERPs. 

Some say that the ERP software is comparable to a central nervous system. It works to collect information from each separate part and then makes this information available to all of the other parts. It also helps a company to become much more self aware about how they are doing as a business and how they can improve. There will now be an awareness about each part of the company as well as organization of inventory, finances, marketing strategies. This all comes together to benefit the business.

There are countless systems needing to be connected within a company. These systems are unique to each business but commonly include

  • accounts payable
  • stock-control systems
  • order-monitoring systems
  • customer databases.


History of ERP

The first ERP system was developed by SAP. SAP was a software firm created by five former IBM analysts from Germany in 1972. The goal of this software was to link different parts of a business by sharing information gathered from those parts to help the company operate more efficiently. This seems like a logical enough goal to want to attain for the betterment of a company. It provides organization and communication that would be impossible without such a link.

Problems with Implementing an ERP

Although it’s always a good idea to have communication between your company’s parts, problems can arise if it’s not done correctly and at the right time. Some companies are reluctant to let go of software that they and their team members are used to. However, with very old technologies, it’s going to be a lot more complicated to integrate everything than it would be to just use brand new software for some aspects of the business. Also, the key is to prevent ERP projects from being split into many smaller projects, which can result in cost overruns. 

If done correctly however, having ERP can reap many benefits including

  • improved productivity within the company
  • increased efficiencies
  • decreased costs
  • streamlined processes 

Implementation of ERP

How does one go about implementing ERP within their corporation? The exact process is going to depend on which ERP software is going to be utilized, but generally speaking, it will be broken down into three phases. The first is when the software is first introduced to staff, and is first installed. Next, the ERP system will be tested and employees will be trained with it further. Lastly, the model of the ERP system is finalized and assessments are conducted to assure that it is ready. 

SkuNexus is the Link You’re Missing

While the software, SkuNexus, identifies itself as an order/inventory/management software, it is the exact solution you need to integrate all parts of your company’s workflow. SkuNexus will organize and manage all warehouse processes from ordering products into the warehouse to picking, packing, and shipping. It is fully customizable and built around your company’s needs. 

Contact us today to schedule a demo and find out exactly how SkuNexus can help your unique business.

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