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What is an ERP program?
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An ERP program (Enterprise Resource Planning), abbreviated as ERP, is a system that helps manage an organisation, connecting the management of every part of the organisation together, based on the following ERP concept:
- Centralized Database — the ERP system brings all of the organisation’s data into one central place so that every employee can access the same data.
- Reduce Redundancy — the ERP system connects all work processes together, so that work continues without having to redo a process that has already been completed.
- Traceability and Accountability — the ERP system can store data so it can be traced back, with data that is correct and factual.
- Real Time — the ERP system displays data that is updated and current, so as to keep up with the situation in conducting business.
There are 8 core modules in an ERP system:
- Sales
- Purchase
- Account Payable
- Account Receivable
- General Ledger
- Inventory
- Material Requirements Planning
- Shop Floor Control
Once an organisation has implemented an ERP system, the benefits the organisation will gain are as follows:
- Increased efficiency: the ERP system helps reduce the time taken for various operations within the organisation.
- Better decision-making: the ERP system helps executives make more accurate decisions based on correct data.
- Cost control: the ERP system helps control various costs, with reference to actual costs.
- Adapting to change: the ERP system can adapt well to a changing business environment.
Conclusion
An ERP program is a system that manages an organisation so it can operate more efficiently, including connecting all of the organisation’s work processes together, for the organisation’s maximum business benefit.