Enterprise Resource Planning Paper

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Introduction

Enterprise Resource Planning (ERP) systems are widely used by companies around the world. When implemented successfully, it has countless advantages and benefits such as improved productivity, decreased costs, increases efficiencies, and streamlined processes. Although ERP systems offer many advantages, if not implemented correctly, it can cost a company a lot of money as well as years of struggle. An ERP system must fit well with the businesses existing processes and operation. It is important for corporate and management to incorporate consultation, training and support during the installation and integration. The purpose of this paper is to describe the key components of an ERP system, it’s benefits, and issues that might arise
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It is a collection of integrated applications that a company uses to connect activities across all of its departments so that every employee is working with the same information. (Shacklett, 2015) By implementing an ERP system, companies can streamline their operations and standardize business processes, which saves them time, effort, and most importantly, money.

Companies often choose what ERP tools they need based upon which business processes they want to be improved. It also depends on what type of business they are running, such as if they sell products or services. If they sell products, they might want to choose ERP tools that will help them address problems regarding manufacturing, distribution, or supply chain management. If they sell services, they might decide to go with ERP tools that support service engagements and field services. An ERP system can be customized to fit the needs of your company.

Along with the capability to choose and pick which ERP tools you would like to use, ERP systems are also equipped with a core set of components that most companies need in order to operate. These include finance, human resources, purchasing/procurement, business intelligence, and customer relationship management. (Shacklett,
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The component records each transaction, tracks the status of the transactions, and consolidates all the sales information into one system. This is done through a centralized general ledger, accounts receivable, accounts payable, and payroll. (Shacklett, 2015) The human resources component allows businesses to keep track of employee hours, benefits, performance evaluations, and staff development. The purchasing and procurement application integrates the procurement process from the creation of purchase orders and vendor management to collecting payments and creating reports of these transactions. This process can also be customized to have purchase orders and payments be sent to management to be approved before the purchase order is filled. Business intelligence is also a major component to ERP systems. Organizations not only want to collect data in one centralized storage system, but they also want that data to be analyzed and turned into something that can help them make decisions. ERP systems provide data analytics that create easy-to-understand reports with real-time data that allow companies to assess the current health and performance of the company. Decision-makers can also use data mining tools to help customize data and develop reports for specific division heads. Customer relationship management is another application that ERP systems provide for

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