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What is ERP and how does it work

Enterprise software (ERP) is quite different from the everyday software most people interact with on a daily basis.

It is designed with corporate needs in mind and intended for use in a business environment.

While not much use outside of the workspace, it can completely transform the entire workflow of an organization.

,As a result, in most cases, it is not free and may require additional funds to integrate.

However, it can bring profits just as well.

For example, business process automation solutions convert the menial and repetitive tasks to something that is done in the background allowing staff to focus on other pressing matters.

ERP system examples

The simple answer to your question is no, ERP systems and a Data Warehouse are two separate types of systems and the presence of a reporting function does not make a system a Data Warehouse.

nThe long answer is in describing what an ERP system is versus what a Data Warehouse is.

I dont deal in ERP systems.

Im a Data Warehouse guy, so for the ERP side of this, I have to rely on Gartner.

,Gartner defines an ERP system as:nEnterprise Resource Planning (ERP) | GartnernEnterprise resource planning (ERP) is defined as the ability to deliver an integrated suite of business applications.

ERP tools share a common process and data model, covering broad and deep operational end-to-end processes, such as those found in finance, HR, distribution, manufacturing, service and the supply chain.

nTake PeopleSoft for example.

It is a singular application that has modules and functionality to automate multiple business functions, HR, Finance, etc.

n nA data warehouse on the other hand deals only in data.

The sole purpose of a data warehouse is to bring in data from disparate sources, cleanse it and store it on a single common platform for the use in enterprise wide data analysis, reporting, or integrating data into other systems.

A data warehouse is not a transactional system like an ERP system would be.

,There is a key difference between the two systems that I think is important to point out is around conforming to a common process.

An ERP system lives on common process.

The systems are designed to reduce cost and effort by adopting a common process.

nWhile it is best practice in a DW to do things in a similar and common fashion - depending on your source system and what you want to do with the data, various source feeds may come in very different ways.

Inventory data may come real or near real time off of a messaging queue, while sales come in a nightly batch feed that goes through a cleansing process.

The output of data from a warehouse may follow multiple processes - it may be outputted as an extract file, a report, or integration to an application such as SAS, or even a transactional system.

n nMy personal opinion is that the strength and value of the warehouse comes from the flexibility it gives you for your data.

Donu2019t get me wrong, I would always advocate for following a common ETL or ELT methodology and tool set, but the processes can be tweaked and managed to do so much more with data than what an ERP or transactional system allows.

n nThe other aspect of your question I want to address is that both systems produce reports.

Just because a system produces a report doesnu2019t make it a data warehouse.

Many systems produce reports.

You could have data sitting in tables on a mainframe that you write reports off of.

A data warehouse has less to do with reporting and more to do with how the data is brought in, cleansed and stored.

What is an ERP system in accounting

Unlike CRM, an ERP system mostly focuses on your organizationu2019s internal processes.

For example, when youu2019re under a deadline to submit an accounting report and it takes ages to retrieve the required information, ERP can help.

Here are some other issues that could indicate you need an ERP solution:,Youu2019re using disparate systems,After your software has been updated, the disparate systems you have might not work well together.

For instance, new accounting software isnu2019t compatible with an old HR system.

ERP provides a platform that keeps all these systems under one umbrella, ensuring their full compatibility and easy coordination.

,Generating reports takes tons of time,Let us imagine a situation when you need to provide your stakeholders with an all-in-one report that includes your companyu2019s spending, revenue, and the number of new customers for the last three months.

Digging into each Excel spreadsheet and combining them into one report will take days.

This is too much effort and precious time wasted on something that could be done automatically.

ERP gathers all this data in a single database with convenient and simple reporting options so that you can consolidate the necessary information into a beautiful report within minutes.

,Youu2019ve outgrown the existing software,If the software sets limits on your market expansion and ability to develop by making it increasingly hard for the staff to complete tasks, chances are that your business has outgrown your legacy software.

The good news is that you donu2019t necessarily have to dump your outdated system.

If done carefully, the integration of the existing databases and software with new ERP solutions will become a success u2014 just make sure that youu2019ve analyzed your current software, discovered any flaws in the processes, and made the necessary fixes.

,Inaccurate inventory,Keeping track of the inventory, especially in big companies with many remote warehouse locations can be a challenge.

When your sales, customer, and inventory data is not synced, the situations wherein you have insufficient or excessive stock will become commonplace and can impact your company.

ERP inventory management system keeps all items in one single easily managed database reducing human errors, eliminating guesswork, and helping efficiently manage available resources.

,Accounting management is tedious,As you watch your staff spending hours every week manually entering paper-based invoices and sales orders into different accounting and sales systems, you are probably wishing that there could be some system that could simplify and automate the process.

Since an ERP keeps all information in a central database, there is no need to enter data into multiple systems.

Moreover, with effective electronic document processing available through ERP, paper-based invoices and orders are quickly becoming a thing of the past.

,IT management is a nightmare,Managing multiple software systems simultaneously can be quite painful for your business.

Customizing these systems, integrating them, and updating with patches and upgrades is complex, costly, and saps critical time.

If your patchwork of systems includes on-premise legacy software, system upgrades can be more trouble than theyre worth, whereas having an ERP instead of multiple disparate systems requires way fewer resources spent on its enhancement.

Not to mention a cloud-based ERP, which is updated automatically.

,I hope my answer was helpful!

ERP system, SAP

They have Oracle ERP as their main accounting system.

I would not call it their ERP system and they have multiple in-house and other systems that augment Oracle ERP.

Alphabet has a slightly different strategy to have NetSuite as their system for smaller companies and then when they mature, move them into Oracle.

,I do not work for Google and this is all from sources not verified.

So you better wait for somebody more authentic to confirm :-)

ERP stands for

Erp stands for enterprise resource planning.

On the supply chain side it stands for inventory and replenishment.

Oracle ERP

Oracle ERP clients list is too big to mention here.

Just a simple Google search will give you different levels of Small, Medium and Large business that use Oracle ERP products.

,IMHO, now Oracle is focusing towards Oracle ERP Cloud.

This is the new approach to Oracle ERP products that can be used by multiple kinds of companies.

,You can choose and pay your options according to the features and scale at which you want to use Oracle ERP Cloud.

,Follow me at Gautam Gupta if you want to know more about Cloud Computing and Oracle Products.