The modern ERP solution as we recognize it today has become a vital component of business technology, especially for manufacturing firms at the mid-range level. But the modern ERP solution has come a long way, and those who are investigating the possibility of an ERP solution implementation in their small or mid-size firm may benefit from an understanding of enterprise resource planning a broader context.
The earliest enterprise resource planning systems were made available in the late 1980s. These systems offered large, slow, and often unreliable modules that facilitated scheduling and other operations on manufacturing shop floors. These early MRP systems and the manufacturing field in general have had a powerful influence over the development of ERP solution options over the course of the past thirty years.
The earliest MRP systems were typically only available as in-house architectures, with all hardware and servers located on the premises and owned and maintained by the company. This usually required the retention of a full time IT staff, which could quickly place most ERP solution options out of reach to all but the largest fortune five hundred companies, university systems and government offices. Even though early MRP systems had the potential to bring high returns, they were often cost prohibitive and they were prone to failure, both during and after the implementation stage. Poor or insufficient employee training could often result in low returns on a staggering upfront investment and could lead to limited long term improvements in productivity and efficiency.
But in spite of their drawbacks, early MRP systems rose steadily in popularity throughout the 1990s, and by the approach of the new millennium they had become a standard aspect of business technology at the high budget level, both within and beyond the manufacturing sector. Now, the market landscape is shifting downstream, and developers and providers are turning their attention toward meeting the needs of smaller and smaller business clients. This is partly due to slowing of demand at the high budget level, but it’s also due to rising interest in ERP solution options among smaller firms who are looking for any possible way to cut costs and stay ahead of the competition during the current challenging business climate. This downstream shift has paved the way for offsite infrastructures like cloud computing, software service providers and hosting solutions. These relatively new intermediary firms make ERP systems increasingly feasible by lowering costs and improving data security and reliability.
Modern ERP solution options are increasingly user friendly, and can offer a wide variety of both industry specific and general business applications. Standard modules available to manufacturing firms include supply chain management, human capital management, payroll, financial management applications that can control accounting functions across multiple business units, and warehousing, lot tracking and inventory management features.
Most of these modules can be customized and shaped to fit individual process or product manufacturing needs. They’re also designed to be upgrade ready so they can grow as a company grows, and they can be run on standard operating systems so they’re increasingly easy to implement or download.
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