Learn about ERP system

What is the ERP system?

It is one of the accounting systems used to improve the efficiency of all business processes across all departments: technologies, services, human resources and enterprise resource planning. It can be applied whatever the type of the business (industrial, commercial, etc.) without using different systems and software from multiple companies.

ERP system features:

Helps improve operational performance efficiency to achieve higher quality, lower cost, responsiveness and ability to achieve goals. Many features must be available in the ERP system for companies and factories.

– An integrates system

– supports common database for all applications.

– All indoor units operate in real time

– Flexible and with an open design

Different types of ERP systems

Several different types of ERP software are designed for many industries to meet their specific needs, and these types are divided according to their purpose into: the nature of their construction, type of organization operating system and user interface and type of license.

Types of ERP system depend on how they are built:

ERP system usually consists of three components (hardware, software, documentation), so it is necessary for business owners to understand the nature of the build system before purchasing to ensure that it aligns with the activities of their organization. There are three types according to the nature of their construction: divisible systems, non-divisible systems and unit based systems.

Types of ERP systems according to their purpose:

Most organization have their own needs and therefore may require specialized ERP system which can be categorized according to the required use: systems suitable for industrial use, systems for general purpose and systems for e-commerce.

Types of ERP systems by type of organization:

These systems are very complex and can be divided into: public cloud, private cloud and hybrid cloud.

Types of ERP systems by operating system and user interface:

Operating system are categorized globally according to their operating systems: computer systems, smartphones and tablets.

ERP systems by type of licenses:

The cost of obtaining licenses for these applications constitutes a significant portion of the total cost of the application, and these systems can be categorized according to the type of license: proprietary systems and open source applications.

How to choose an ERP system

When choosing an ERP system for your organization, you should consider several tips you need to be aware of issues that are delaying the project and Problems you face at business and it needs an integrated system to treat it. Define clear and comprehensive requirements that were previously required by an organization or company before you start researching the system itself. The quality of the hardware and the operating system must be determined within an organization or company to determine the quality of the system. System priorities should be identified and not selected for high functionality that cannot be used because highly customizable systems cost more. Qualify the employees or the person in charge of the system before you start and choose it, because changes in company culture can destroy what has been built.

The role of the accounting ERP system for companies and institutions

It is important to understand the role of the ERP system within an organization or company so that it is easy for employees to understand how to deal with it Therefore, the role of the ERP system can be summarized as follows:

Management of all departments of the organization or company (financial management – inventory control management – procurement management – point of sale system – production management – project management). Get a complete view of all your daily transactions and keep them in an integrated and organized manner. Linking all departments within an organization or company to one integrated and organized system. The possibility of dealing with the system online. Create a control panel and an operating system that allows you to know the status of receivables, collection, and other performance indicators and workflow.

Advantages and disadvantages of an ERP system

The advantages that Enterprise Resource Planning (ERP) systems offer for organizations and businesses are:

– Optimizing business processes as the results of each sector are determined very precisely in a short period of time.

– Ability to systematically share data and information across all departments.

– Delete unnecessary processes and data immediately.

– Avoiding duplicate records by writing each unit of the ERP system enters the same database in real time.

– Accurate access to information between departments and units in the system saves time for manual reporting.

– Saving the necessary time and manpower, and reducing the actual cost of the project.

– When a company has an ERP system, it is more competitive in its operating environment.

Disadvantages of (ERP) systems for organizations and businesses are:

– It is expensive to install an Enterprise Resource Planning (ERP) system.

– Success depends on employees’ skills and experience, including education and how to make the system work properly.

– Sharing false internal information between departments can reduce program efficiency.

– Some systems are difficult to use.

– The effectiveness of the ERP system can be reduced through drastic changes and poor training.

– The benefits of the ERP system do not appear immediately with the implementation of the program.