What is ERP (Enterprise Resource Planning)?
Integrated business management software that connects finance, manufacturing, supply chain, HR, CRM, and other core business functions.
Definition
Enterprise Resource Planning (ERP) is a category of integrated business management software that connects and automates core business processes across an organization. ERP systems provide a single source of truth by centralizing data from finance, manufacturing, supply chain, human resources, customer relationship management, and other functions into one unified database. This eliminates data silos, reduces manual processes, improves decision-making, and enables real-time visibility across the organization. Modern ERP systems are increasingly cloud-based and incorporate AI, machine learning, and advanced analytics.
How ERP Works in ERP
ERP works by providing modular applications that share a common database. When a sales order is created, it automatically triggers inventory reservation, production planning (if needed), financial transactions, and shipping logistics — all within the same system. This integration eliminates duplicate data entry and ensures all departments work from the same real-time information.
ERP Vendors with Strong ERP
SAP S/4HANA Public Cloud
Standardised cloud ERP with quarterly auto-upgrades and low TCO
Oracle NetSuite
The original cloud ERP — built for fast-growing companies
Microsoft Dynamics 365
Modular ERP + CRM tightly integrated with Microsoft 365
Acumatica
Resource-based cloud ERP — unlimited users, pay by usage
Frequently Asked Questions
What is ERP used for?
ERP is used to manage and automate core business processes including accounting/finance, manufacturing, supply chain, inventory management, human resources, customer relationship management, and business intelligence — all in one integrated system.
How much does ERP cost?
ERP costs vary widely: open-source options are free to host, cloud ERP starts at $25-180/user/month, and enterprise ERP can cost $500K-$5M+ for implementation. Total cost of ownership over 5-10 years is the best way to compare.