What do you mean ERP? What are its functional areas?

A Management Information System ICT Revision Questions and Answers

Enterprise resource planning (ERP) software is a group of programs and functions integrating all the functional business information modules into one system. ERP is thus a cross-functional enterprise system, which the data information is exchanged among various departments without

any hindrances. For example, it integrates corporate accounting and resource management with production schedules and customer orders. It deploys integrated approach of information system of all the functional areas of the organization. ERP helps all level of organizational staffs in proper utilization of man, machine and money.
Its functional areas of implementations are as:

Production Planning

This module is used in production planning optimizes the utilization of manufacturing capacity, parts, components and material resources using historical production data and sales forecasting.


Purchase module streamlines procurement of required raw materials. It automates the processes of identifying potential suppliers, negotiating price, awarding purchase order to the supplier, and billing processes.

Inventory Control:

Inventory module facilitates processes of maintaining the appropriate level of stock in a warehouse. The activity of inventory control involves identifying inventory requirements, setting targets, providing replenishment techniques and options, monitoring item usages, reconciling the inventory balances, and reporting inventory status. Integration of inventory control module with sales, purchase, finance modules allows ERP systems to generate vigilant executive level reports.

ERP Sales Module
Revenues from sales are lifeblood for commercial organizations. Sales module implements functions of order placement, order scheduling, shipping and invoicing. Sales module is closely integrated with organizations’ ecommerce websites. Many ERP vendors offer online storefront as part of the sales module.

ERP Marketing Module

ERP marketing module supports lead generation, direct mailing campaign and more. ERP Financial Module
The financial module is the core of many ERP software systems. It can gather financial data from various functional departments, and generates valuable financial reports such balance sheet, general ledger, trail balance, and quarterly financial statements.

ERP HR Module
HR module streamlines the management of human resources and human capitals. HR modules routinely maintain a complete employee database including contact information, salary details, attendance, performance evaluation and promotion of all employees.

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