ERP software definition: what is an ERP?

ERP software: definition

ERP stands for Enterprise Resource Planning. There is also an equivalent French name: PGI (Progiciel de Gestion Intégrée).

It is a computer system capable of managing and monitoring all the information related to the main operational processes of a company on a daily basis, such as the management of orders, invoicing, management of each accounting entry, commercial management or resource planning, for example.

An ERP is therefore a software used by all departments that allows the homogenization of existing solutions in the company. The main characteristics of an ERP are:

• A modular approach
• A communication of the different modules
• A single database

Other software can be added to an ERP solution by adding other management software, either because the ERP lacks functional coverage, or because a module has not been deployed, etc. This is the case for some companies with the addition of a CRM (Customer Relationship Management) or a TMS (Treasury Management System) solution, for example.

What are the main advantages of an ERP software?

For the managers of a company, an ERP offers a global vision of the activities, easily accessible thanks to the pre-configured dashboards. Such a tool necessarily contributes to improving the company’s management.

The single, centralized database guarantees the uniqueness, integrity and reliability of the information used by all departments. The documents are also accessible by all (within the limits of the access rights granted) and in real time.

ERP software also has a strong impact on the overall productivity of a company. Indeed, it facilitates the flow of information, the automation of flows, as well as the rationalization of processes, and favors the exchange of data between the various departments. An ERP contributes to the optimization of resource planning in general.

The limits of management software packages

Despite its indisputable advantages, the implementation of an ERP is not the answer to all the problems of a company. Implementing an ERP can represent a significant human and financial investment. It is therefore essential to measure this investment before embarking on such a project and not to neglect this pre-framing phase.

An ERP project can therefore be a long-term project depending on the number of modules to be deployed and the size of the organization. This is a global project that must mobilize a large part of the teams, beyond the IT teams.

Contrary to what some business leaders may have believed, an ERP does not allow you to revive a business at half-mast or to reorganize a non-performing organization, for example.

It is therefore essential to have a vision of the company’s human and financial resources and to choose the right people to support you in this process.

Also read in our " ERP Finance project " file:

• What are the key challenges facing finance managers today?
• What are the key regulatory issues for CFOs in 2019?
• Digital transformation of the finance function : where do you stand?
• Digitization of the finance function: what should we expect in the future?
• What changes does dematerialisation bring to the finance function?
• Finance management: what technological tools are available to CFOs?
• ERP software definition: what is an ERP?
• What is the use of an ERP solution for the finance function?
• ERP finance: what do you need to know as a finance manager?
• CFO: what are the advantages of an ERP for the finance function?
• Finance software: which ERP to choose for your company?
• Postmodern ERP: the right choice for your company?
• Should you consider a Postmodern ERP solution?
• The challenges of a post modern ERP
• Post-modern ERP: the checklist
• Help in choosing ERP finance: why use a firm?