Enterprise Resource Planning (ERP): Past, Present and Future

Enterprise Resource Planning (ERP): Past, Present and Future

Ronald E. McGaughey (University of Central Arkansas, USA) and Angappa Gunasekaran (University of Massachusetts, Dartmouth, USA)
Copyright: © 2009 |Pages: 13
DOI: 10.4018/978-1-60566-090-5.ch023


Business needs have driven the design, development, and use of Enterprise Resource Planning (ERP) systems. Intra-enterprise integration was a driving force in the design, development, and use of early ERP systems, but increased globalization, intense competition, and technological change have shifted to focus to inter-enterprise integration. Current and evolving ERP systems thus reflect the expanded scope of integration, with greater emphasis on things like supply chain management and customer relationship management. This manuscript explores the evolution of ERP, the current status of ERP, and the future of ERP, with the objective of promoting relevant future research in this important area. If researchers hope to play a significant role in the design, development, and use of suitable ERP systems to meet evolving business needs, then their research should focus, at least in part, on the changing business environment, its impact on business needs, and the requirements for enterprise systems that meet those needs.
Chapter Preview

Erp Defined

The ERP system is an information system that integrates business processes, with the aim of creating value and reducing costs by making the right information available to the right people at the right time to help them make good decisions in managing resources productively and proactively. An ERP is comprised of multi-module application software packages that serve and support multiple business functions (Sane, 2005). These large automated cross-functional systems are designed to bring about improved operational efficiency and effectiveness through integrating, streamlining, and improving fundamental back-office business processes. Traditional ERP systems were called back-office systems because they involved activities and processes in which the customer and general public were not typically involved, at least not directly. Functions supported by ERP typically included accounting, manufacturing, human resource management, purchasing, inventory management, inbound and outbound logistics, marketing, finance, and, to some extent, engineering. The objective of traditional ERP systems in general was greater efficiency, and to a lesser extent effectiveness. Contemporary ERP systems have been designed to streamline and integrate operation processes and information flows within a company to promote synergy (Nikolopoulos, Metaxiotis, Lekatis, & Assimakopoulos, 2003) and greater organizational effectiveness. Many new ERP systems have moved beyond the backoffice to support front-office processes and activities. The goal of most firms implementing ERP is to replace diverse functional systems with a single integrated system that does it all faster, better, and cheaper. Unfortunately, the “business and technology integration technology in a box” has not entirely met expectations (Koch, 2005). While there are some success stories, many companies devote significant resources to their ERP effort only to find the payoff disappointing (Dalal, Kamath, Kolarik,& Sivaraman, 2003; Koch, 2005). Let us examine briefly how we have come to this point.

Complete Chapter List

Search this Book: