Full Form

ERP Full Form

Enterprise Resource Planning is ERP Full Form, ERP is a business management software that implemented to streamline the business functions within a centralised and integrated system. ERP is used to automate back-office tasks and smoothly run cross-departmental workflows, providing efficiency, lower costs and increase profitability.

ERP Full Form


Gartner introduced the term ERP. The concept of ERP can be traced back to the 1960s when it covered the scope of inventory management and control in the manufacturing sector. Software Programmes were created by the engineers to monitor inventory, reconcile balances, and report on status. By the 1970s, it was scheduling production processes brought under the system naming it as Material Requirements Planning (MRP) systems. In1980s, the scope of MPR became broader, including more manufacturing processes, prompting to regard it as Manufacturing Resource Planning. By 1990, these systems expanded to cover other back-office functions like accounting and human resources, setting the stage for ERP.

Features of ERP systems:

  • The main feature of all ERP systems is a shared database that supports business processes used by different business units. 
  • ERP encompasses the integration and simplification of multiple processes used by different units such as data collection, sophisticated manufacturing and customer service tasks. It uses quality and innovative concepts to meet the demand of the volatile technological infrastructure.
  • Cloud-based system approach of ERP makes its implementation and management easier and affordable by enabling real-time reporting and business intelligence. 
  • Software-as-a-Service (SaaS) solutions, a variety of cloud service methodologies, uses the underlying cloud model to deploy applications to end-users via the internet, making data and application interfaces available through any connected device.

Modules of ERP:

  • HRM– This module generally contains standard HRMS tools like timesheet, time recorder, a database for employee records, job profiles, skills matrix, performance reviews and payroll system. Payroll system is tightly integrated with the financial management module to manage wages and allowances.
  • Financial management– This module manages capital inflow and outflow. It covers standard Accounting and Finance transactions like expenditures, general ledger, balance sheet, bank reconciliation, tax management, payments, and produces financial reports for different departments and business units.
  • Sales and Marketing– The module works to manage sales inquiries, quotations, sales orders and sales invoices along with taxation rules, shipping tracker, sales force automation, marketing automation and e-commerce CRM. The CRM module enhances the quality of customer service by managing leads, opportunities and customer issues. 
  • Manufacturing- This module helps in the areas such as product planning, materials sourcing, daily production monitoring, and product forecasting by managing bill of material, production scheduling, shop floor control, and distribution planning. 
  • SCM– This module manages the supply chain including purchase order management, product flow from production to consumer 
  • Purchasing– This module controls the materials procurement including supplier listings, quotation requests and analysis, purchase orders, stock updates, goods receipt notes etc.


ERP system grouped by functional levels, business size and deployment, such as-

  • Generalist ERP
  • Open-source ERP
  • Vertical ERP
  • Web-Based ERP

Advantages of ERP

  • It increases customer base by providing them with high-quality services.
  • It facilitates employees to do their job more efficiently.
  • It automates core business operations, thereby providing time to employees to focus on the more critical initiative to boost productivity.
  • ERP software is flexible enough to be installed in any country due to its feature of multiple languages and currencies support.
  • If selected the right solution by the right vendor, it can provide a good return on investment by reducing the operation costs.
  • It helps to improve the accuracy, consistency and security of the data with the help of the built-in resources and the firewalls. 


  • The system involves high implementation and maintenance cost. (High initial investment) as well as employees training cost to use the system efficiently
  • If not applied correctly, it can be a mess for the company.

Successful ERP Implementation

  • A thorough understanding of the reason behind installing ERP
  • Analysis of business processes and needs.
  • Get experts for resource and project management.
  • Get the right ERP vendor
  • Provide sufficient training
  • Monitor ROI.

Top ERP Vendors

  • SAP
  • Oracle
  • Microsoft
  • Epicor
  • Infor
  • QAD
  • Lawson

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Lokesh Joshi

My Name is Lokesh Joshi and I am Computer Science Engineer by the profession and I am passionate about technology and integrating it with innovative ideas to give startups the initial boost that they require.

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