The Need, History and Evolution of Enterprise Resource Planning (ERP)
If you were to talk to multiple business owners about their software solutions systems and ERP integrations, you are likely to get different opinions and experiences. That is the best part about ERP, it’s customisable and caters to each businesses individual needs.
Today ERP systems are still evolving, making huge business processes simpler. However, nothing starts easy. ERP too has a long history and stages of evolution that it has crossed to become something so essential today.
It all dates back to the 1960's. During this time, companies needed a system for inventory management as production was increasing due to globalisation. MRP’s, that is material requirement planning, were inventory management systems to track and control materials in a business. J. I. Case, a manufacturer of tractor and construction machinery, worked with a computer hardware and developer company to develop the first MRP system. MRP’s were complex, needed space and were expensive to create. In the 1960’s professionals had to be hired to take care of the system and maintain them.
Other manufacturers soon started adopting this system and in the 1970’s MRPs started gaining traction. Large manufacturers started developing these systems on their own. MRP’s did the bare minimum though, they included very basic functions.
The 1980's, the era of technological breakthroughs, brought with it MRP II, which is the precursor for modern ERP systems. Along with inventory management now these systems could handle different departments and scheduling. MRP II was a much more advanced system with more capabilities.
Then came the era of prosperity, 1990’s, in which ERP systems were introduced. A firm Gartner introduced this term enterprise resource planning. ERP systems were created to control other departments like accounting and sales. All business operations could be handled by a single database. Early ERP systems laid the foundation for today’s ERP and increased overall business and industry efficiency. In the late 90’s, cloud ERP was introduced. This meant that businesses needn’t maintain hardware or experts to guide them through it all.
This made ERP less costly and now could be used by smaller companies. Afterall ERP is for the resource planning of enterprises, not just large enterprises. Small and medium enterprises now had the benefits of ERP and could handle their business processes better.
In 2000’s, ERP became something that kept having more and more potential for businesses and planning. Customer relationship management, Marketing, Human relations, all could be handled and managed by ERP systems.
Today ERP systems are essential for businesses. Still there are many who won’t adopt it. ERP systems now have features like reports. The best part about ERP is that it stores all business transactions and just how we went through the history of ERP, businesses can go through the history and evolution of their brand and company. Technological advancement has allowed businesses to integrate ERP and twist and turn it to their individual preferences.
ERP is secure, safe and helps businesses run effectively. Businesses can access their data in real time just with the help of an internet connection. ERP saves manual efforts, time and is cost effective. Imagine having to deal with all that hardware storage? Actually, don't imagine. Today, we have software solution systems that have advanced so much that they even help us realise our goals and targets for our business.
What may seem like a lot of advancement, is just the starting. ERP systems still have a lot of potential. ERP is to be integrated soon with AI (Artificial Intelligence). ERP could even help us do business in a way we never imagined. That is the beauty of ERP systems and technological advancements. Businesses are growing and so will ERP systems.
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