Enterprise Resources Planning (ERP) is an outgrowth of Material Requirements Planning (MRP) initiated in the 1970’s as a new computer-based approach to planning and scheduling of material requirements and inventory, featuring the time-phased order point. MRP evolved to MRP II (Material Resources Planning) the “closed loop” process, to Business Requirements Planning (BRP) and eventually to ERP. As MRPII came into vogue in the late 1970’s and early 1980’s, software companies began to develop software packages around MRPII concepts.
At the same time, research of integrated data bases was in progress at a university, and out of that research emerged data base management systems (DBMS) pos 系統香港. One of the earliest successful commercially-produced data base management systems was IDMS (for IBM-based systems) and DBMS (for DEC-based systems) produced by Cullinane, who’s company name was later changed to Cullinet. IMS, a structured data base management system for high transactions, was another data base management system produced by IBM.
The idea of the integrated data base as the engine for fully integrated software was probably one of the greatest outgrowths of Ollie Wight’s and Dave Goddard’s MRP. Eventually, the acronym ERP was conceived to represent what had already been developed by software companies.
The early software packages were developed by way of a transactional approach, and were highly unfriendly to a user. With the advent of the personal computers, the development of Microsoft’s Windows NT, and the mid-range IBM AS/400 computer, client-server systems began to emerge. Windows, used as the base operating system, allowed software packages to become more and more user-friendly. Multichannel business managers frequently voice the desire to have one system or software package that is capable of managing the entire enterprise, encompassing all functional areas. Enterprise resources planning (ERP) systems have been available for years. Because the multichannel phenomenon–traditional brick-and-mortar businesses reaching into direct marketing, and traditional direct-to-customer companies developing brick-and-mortar stores as well as a Web presence–is so recent, it has in many cases outstripped the ability of software vendors to keep pace.
Having a single computer system control all functional areas in a business and use a common customer, inventory, order, and item database makes perfect sense, and the potential synergy between channels and the ability to maximize the customer experience are clear opportunities. Unfortunately, the search for and implementation of such a solution has frequently proved difficult.
The push to provide an overall multichannel solution has generally manifested itself in two ways. Traditional ERP vendors, whose genesis was in manufacturing, have tried to develop functionality geared to the specific needs of multichannel companies. Existing niche vendors in the direct-to-customer or retail worlds are trying to broaden their offerings to include more functional areas and look more like true ERPs. Both approaches have met with limited success so far. In general, niche or best-of-breed solutions fit more complex environments, while the ERP solutions better fit the very broad but less complex environments.
There are many interpretations and definitions of “ERP” floating around. One of the clearest is that an ERP is a business management system that integrates all facets of the business, including planning (merchandise, staff, growth), manufacturing, sales, marketing, inventory control, fulfillment and replenishment, customer service, finance, and human resources. The system attempts to integrate all departments and functions across a company into a single computer system that serves independent departments’ needs.
Many existing ERP packages are geared to larger businesses with multinational or broad business control needs. Many ERP systems have come from the manufacturing world and are now being developed to handle the very different operational requirements of the multichannel retail world. The relatively unique and complex nature of multichannel retail, combined with the large numbers of small and medium-sized multichannel businesses, has helped to create a void between traditional, deeply functional niche systems vendors and the functionality provided by ERP vendors. Finding an ERP solution with deep niche functionality geared to a medium-sized multichannel business can be an enormous challenge. But conversely, finding a niche player with deep functionality that can manage an entire multichannel enterprise is an equally difficult proposition.