What is ERP Software? Types of ERP Software

In recent years, ERP systems have become a viable option in all areas of business.  Such modern systems ensure the implementation of all the main functions of the enterprise, regardless of the scope and scale. ERP systems are used both in commercial and non-commercial structures, in governmental and non-governmental organizations.

Generally, ERP (Enterprise Resource Planning) serves to integrate all data and processes of the organization into a unified system. A key feature of an ERP system is the integration of data from all aspects of the organization. For this, a single database and numerous software modules are used to handle the implementation of various business functions. ERP software also performs the functions of the accounting and management departments. For example, a popular sage 300 ERP software helps the company to manage the budget, personnel, clientele, and logistician. 

ERP software typically manages production, shipping, distribution of goods, invoicing, quality control, inventory control, shipping, invoicing, and business accounting. Replacing such software with two or more independent applications eliminates the need for external interfaces between systems and provides additional benefits. It also provides different versatile advantages, from standardizing business processes and cheaper maintenance to simplifying and improving reporting, since all data is stored in a single database.

Do you want to know in detail about ERP software and its various types? Then this following guide will help in knowing more about it. So, let’s get started.

What is ERP Software?

ERP software is a special program to effectively manage the resources of various organizations. This is a corporate planning system that brings together multiple modules and departments of the organization in one place.  It can automate processes like planning, accounting control, invoicing, inventory control, manufacturing, human resources, and many others. 

They connect all the constituent parts of a particular company for improving production and sales. The use of such systems makes it possible to serve the requests of each department as accurately as possible and coordinate their overall work. So, thanks to this approach, data entry errors, loss of documentation, and many other troubles are eliminated. This allows you to get the job done more efficiently, avoiding multiple delays and errors.

Why Implement ERP?

ERP systems contribute to solving monitoring and planning tasks. In addition, they speed up the work of each department and specific employees. Here are the results of some ERP implementations:

  • Management can at any time get an idea of ​​the current situation or analyze the company’s activities for a selected period;
  • The time spent on routine operations has been reduced by an order of magnitude, as well as the risks associated with the human factor;
  • The company received a logical and transparent document flow;
  • Each employee and manager can access the necessary information in productivity.

So, ERP systems immediately reduce the cost of maintaining production and business processes. In general, it is worth paying attention to the optimization of all processes and saving a variety of resources.

Types of ERP Software

ERP software can be classified into different types, based on the modules like a type of business, architectural design, and the diversity of factors affecting it. One of the most effective ways to classify ERP Software is a business perspective. Because this gives a deeper understanding of what type of software you exactly need for business benefits.

Generalist ERP

The cloud and legacy ERP systems are generalists. Typically, this is an ERP system that spans industries and all the processes across a single organization. With the availability of strong customization and integration procedure, it becomes easy for companies to handle their different requirements. 

Open-Source ERP

An open-source ERP system is a cheaper alternative for many small and medium-sized organizations. The flexible modular of this open-source ERP will allow the companies to only pay for the features and customizations they need. Organizations can simply enter the open-source code for free and customize the software themselves without any help. 

Small Business ERP

The small business ERP systems can handle anything and everything without acquiring an ERP full-package suit. This provides an affordable, easy-to-use, and secure way to handle business operations, financials, and sales. ERP systems typically include modules that you can pick from based on your company’s requirements.

Vertical ERP

These industry-specific ERPs are for smaller and startup companies. Such type of ERP concentrates on a niche like construction, supermarket distribution, or retail fashion. one of the most popular representatives of this distinct program is Microsoft Dynamics AX.

Industry-Specific ERP

Often. such type of ERP system is considered as customized ERP systems. This custom-built software is the best option for fulfilling the business requirements. Developing these varieties of ERP systems begins with knowing the business requirements, designing, developing a software system which is very explicit to the carried company.

Web-Based ERP

Web-based ERP software is also known as cloud ERP and more technically referred to as ‘Software as Service (SaaS)’. Such type of ERP software allows the user to access the ERP applications using the internet. These systems are capable of handling and accessing the organization remotely anytime and anywhere. Through a subscription module, a business owner can maintain business requirements. This means you do not need to buy a perpetual license. This ERP software system is best for a business who have strong network connections and bandwidth.

Hybrid ERP

A hybrid ERP is also known as two-tier ERP software. It is the combination of core on-premise ERP capabilities and cloud capabilities. It includes collaboration, Customer Relationship Management (CRM), and sales.

Wrapping Up!

Well-functioning enterprise ERP systems enable businesses to reduce the time it takes to complete virtually every business process. Generally, companies choose ERP based on the solution’s key benefits and practical considerations. But, while selecting such software for your organization, there are many functions and possibilities to consider. In fact, with the help of above-mentioned ERP types, it can become easy for an organization to choose a reliable and more efficient system for it.