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Advantages
In the absence of an ERP system, a manufacturer in need of what
it has to offer, may find itself with many software applications
that do not talk to each other, do not effectively interface:
design engineering how best to make the product; keeping track
of the status of customer orders from acceptance thru fulfillment;
managing interdependencies of complex Product Tree Management product
structures in the real world of evolving Engineering and Revision
changes and improvements, and the need to make material substitutions,
during temporary inventory shortages; 3-way match between Purchase
orders (what was ordered), Inventory receipts (what arrived),
and Costing (what the vendor invoiced); Accounting for all of
this, including tracking Costs and Profits on a granular level.
But the advantage of having an ERP is that all this, and more,
is integrated.
Change how a product is made, in the engineering details, and
that is how it will now be made. Effectively dates can be used
to control when the switch over will occur from an old version
to the next one, both the date that some ingredients go into
effect, and date that some are discontinued. Part of the change
can include labeling to identify version #s.
Computer security is included within an ERP, to protect against
both outsider crime, such as industrial espionage and insider
crime, such as embezzlement. Can some terrorist mess with the
Product Tree Management so as to put poison in food products, or other
sabotage? Preventing abuse is part of what ERP security takes
care of.
There are concepts of Front office (how the company interacts
with customers}, which includes CRM or Customer relationship
management, Back end (internal workings of the company to fulfill
customer needs), which includes quality control, to make sure
there are no problems not fixed, in the end products], Supply
chain (interacting with suppliers and transportation infrastructure),
all of which can be integrated through an ERP, although some
ERP have some gaps in what is supported, or works effectively.
Without an ERP that integrates this stuff, it can be a nightmare
for a manufacturer to manage.
Source: http://en.wikipedia.org/wiki/Enterprise_resource_planning
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