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A Brief Historical Look at the Evolution of Enterprise Resource Planning

Enterprise resource planning (ERP) is an integral component of today’s complex global marketplace. ERP software helps companies streamline business processes.

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Enterprise resource planning (ERP) is an integral component of today’s complex global marketplace. ERP software helps companies streamline business processes, including:

  • Product planning, cost and development
  • Manufacturing or service delivery
  • Marketing and sales
  • Inventory management
  • Shipping and payment

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The Evolution of Enterprise Resource Planning

The 1960s – Growth of Enterprise Information Systems (EIS)

Early systems were based on automation for individual functions, like financial accounting or inventory management.

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The 1970s – Shift to Material Requirements Planning (MRP)

MRP systems tapped into the master production schedule, allowing businesses to plan the parts and product requirements.

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The 1980s – Manufacturing Resource Planning (MRP II) Introduced

MRP II software emphasized an optimized manufacturing process that coordinated materials and production requirements, extending services to:

  • The shop floor
  • Finance
  • Human resources
  • Engineering
  • Project management
  • Distribution management

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The 1990s – Birth of Enterprise Resource Planning

By the early ‘90s, MRP-II had been extended to include enterprise-wide functions and integration.

Extended MRP II systems were renamed enterprise resource planning systems.

ERP uses a single database containing all the data that keeps the processes running smoothly, ensuring visibility, accessibility, and consistency.

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2000s and Beyond – Extended Enterprise Resource Planning

Extended ERP systems include:

  • Customer relationship management
  • Supply chain management
  • Advanced planning and scheduling

Continuing ERP trends include capabilities for:

  • Cloud
  • Mobile
  • Analytics

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Sources:

  • https://faculty.biu.ac.il/~shnaidh/zooloo/nihul/evolution.pdf
  • http://www.slideshare.net/Monojit.Banerjee/evolution-of-erp-10579857
  • http://acumaticaclouderp.blogspot.com/2013/09/evolution-of-erp-software-for-small-and.html