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What is ERP?


ERP, or Enterprise Resource Planning, is a type of software system that assists organizations to manage nearly every aspect of their business processes. ERP software is able to simplify and automate individual tasks, such as accounting, operation, and sales, all integrated into one single system. ERP solutions have been evolving over the years, and now is most commonly presented as a web-based application where it can be remotely accessed by users. When implemented correctly, an ERP system glues the company together, and builds transparency and productivity for the company. 

Essentially, an ERP system is like the brain of the company, synchronising different departments of the enterprise. Without the ERP system, each department would have their own independent system. However, with an ERP system, these independent systems would come together in one application, making it more accessible for everyone around the company. With one cohesive system, sharing information and communicating are easier, especially between departments. Information and activities in other departments are available company-wide, so this information can also be utilized effectively. The real-time data reporting also smoothens up the operation, and with the external website connected with the ERP system, client orders can be requested real-time, giving a better customer experience and an easier transaction process. 

There are 3 main aspects of an ERP system that creates a strong backbone of the company’s operations. 

To manage the sales operation using an ERP system, it’ll commonly provide applications like:

CRM (Customer relationship management):

Pretty self explanatory — CRM is a service that helps build customer relationships, through things like customer services, email marketing, follow ups, and email integrations. Having a programmed application to support the CRM aspect basically means that, for example: there is a birthday month promotion going on, and since the database already has all the customers’ information and birthdays, this application can easily organise the customers’ emails according to their birthday month, and hence, you can easily send out the appropriate promotion without much hassle. Moreover, pipeline management is also implemented in CRM systems. Pipeline management allows you to oversee and direct future opportunities in sales. With the pipeline management function, the sales team will be able to identify the weak spots and bottlenecks in their sales cycle and understand why some sales fail more than others. Additionally, it also aids them into spotting potential growths or sales slumps. Overall, pipeline management is a great function in an ERP system that provides more insights to the company’s sales. 


This is an application that generates graphs and data based on the sales of the company. These graphs can help the company with spotting the trends of sales and what days the sales might be the most successful. With these trends spotted, the company can build stronger tactics for better sales. And, since this information is in one shared system, all users can see it and utilise it in their departments for different purposes. Furthermore, this application can also track sales and manage the orders. Because this is implemented in one shared system, everyone can access the sales records and any changes will be shown real time, this can avoid a lot of miscommunication. 


Here’s where all of the customer information is stored, with all contact information stored in one system, customers can be reached by any user, and this information can be used for promotions and to build a better customer relationship. 

To aid the accounting department, here are the most common applications implemented in an ERP system:


The accounting software assists the accounting department on recording and reporting the transactions made by and in the company. The software also generally includes accounting equations and calculations that’ll make the process of understanding and analyzing the numbers easier and more efficient. A lot of data can be stored in this software, so not only would it save space, but you can also pay less rent with this remote database. Moreover, this function allows past data and records to be easily found for present references. Ultimately, this application is so important for the company’s numbers, and generates more productivity in the accounting department. 


In the payroll application, all employees’ information and salary can be stored and are automatically generated, which can be sent off with a click of a button. You can also easily edit the amount based on the employee’s attendance and performance during the month, making the payroll process easy and automated. 

To allow the company to operate in an organised manner, these applications that are commonly in an ERP system can do a great help:

Project management: 

Project management is really crucial among all businesses, and with ERP, there would be a linked application that assists the planning and tracking of the project. Especially being a real-time system, the project management system can be brought to a new level of productivity. The tasks are assigned and clear, and the progression is shown, meaning, the whole process of the project is transparent and visible, allowing it to be managed easier and more conveniently. 

Inventory management:

Since the inventory management system is integrated with a centralised database, the whole tracking process in the business can be easily accessible and easy. Especially since the database is in real time, it gives much more accuracy to all the employees, as well as saves time for them to not waste their time simply tracking a specific piece of stock. Furthermore, knowing what exactly the warehouse has on hand will be efficient for production.


In this application, all business expenses can be recorded and kept accountable. Expenses such as advertising and marketing expenses, credit card processing fees, education and training expenses for employees, certain legal fees, wages paid to contract employees, rentals, etc. are able to be held accountable in one centralised system. This gives an easier process when dissecting the money-usage of the business, and gives transparency to every user. 


Overall, an ERP system is a very crucial aspect in order to operate a company smoothly and effectively. ERP systems bring transparency, efficiency and productivity to the business and bonds the company together with one centralised system. 

What is ERP?
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