An ERP (Enterprise Resource Planning) system is a fully integrated software solution that addresses all the operating functions of a business and ERP modules represent functions for each area of the business.
What are ERP and its functions?
One of the benefits of implementing an ERP solution is that it creates a single unified business with all departments operating with one shared set of data. ERP systems are usually modular to ease timing of implementation.
The ERP modules each represent a piece of the entire picture. These modules break out to accommodate different skill sets, duties, and information. Common module examples found in most enterprise resource planning platforms are:
Inventory functionality concerns unit counts, and every action taken to produce a product from the time production begins until it is ready to be shipped to the customer. Features designed for inventory will track and trace raw materials and products from the first barcode scan (or manual data entry) through every process until the item is sent out for fulfillment.
The sales module tracks customer purchases, pricing tiers, commissions, sales orders, quotes, invoices, taxes, and shipment tracking. The process can begin with an inquiry and, hopefully, a sale, then moves to other departments to produce product, fulfillment and finally to accounting.
The acquisition of products and raw materials from suppliers requires lists of vendors, their contact information, lead time, quotes, pricing, and material availability. This functionality can be initiated when items reach their reorder points, triggering a purchase order action to replenish supply.
Assemblies, kits, builds, and bills of material are all part of the production ERP module. These tasks are specific to manufacturers who turn raw materials into products and (for process manufacturing) byproducts. Manufacturing ERP software covers all types of ERP manufacturing processes.
Supply Chain Management/Fulfillment/Distribution:
This module handles the logistics of moving finished goods to the customer, entailing the retrieval from the warehouse, packing, labeling, and sending out for shipment. If product is returned, it will also be processed through this module.
All customer contact information, purchase history, shipping, correspondence, and marketing history falls under the customer service module. Some tasks may cross over to the marketing department as old customers are referred for cross-selling products, replacements, or upgrades.
All costs, payments, invoices, taxes, banking, reporting, etc. are handled by the accounting module. Any data related to money must be relayed to accounting for accurate reports, tax filing, and business decision making.
Payroll & Human Resources:
HR adds all employee information to the system which includes attendance, reviews, benefits, skills, vacation, payroll, reimbursed expenses, etc. After inventory, labor is often the largest investment a company will make.
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