ENTERPRISE RESOURCE PLANNING
What has football got to do with it? asks management guru Michael Hammer in his latest best seller Beyond Reengineering. The answer is almost everything. Football is indeed a good analogy of the modern business environment. Companies have to play like teams of people with diverse skills for a common goal under some of the toughest competitive conditions.
For organizations to stay ahead and remain profitable, the entire company must be able to block, dribble, pass and run better than competition. In other words read markets quicker, manufacturer faster, deliver outstanding customer value at lower operating costs.
The company’s challenge lies in understanding the markets and determining their goals. On this basis identify what and how every function can do towards this end, not as individually efficient units but as a coordinated team. In short, be a focused enterprise having an integrated operating structure.
Information is the key towards this. Information system couple the various activities of the firm leading to efficient operations and effective management. Easy access to timely accurate and relevant data leads to informed decision making, minimizing the response time and enabling better coordination in the firm. Computer-based information systems are the obvious solution to the vast information requirements of companies today. For professionals and entrepreneurs, a basic understanding of information system has become imperative. There is no escape from the fact that computers are here to stay and change the way companies compete. Making skillful use of the available host of information technologies today is no longer a matter of choice, it is a matter of competitive survival.
The latest tool, information technology has lent to business applications is ERP. ERP stands for enterprise resource planning. It is enterprise wide systems solution. It comprises of a single system which has organization wide applications built into it. The ERP solutions seek to streamline and integrate operational processes and information flows in the company, hence synergize the resources of an organization viz., men, money, material, machine through information.