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Chapter: Business Science - Enterprise Resource Planning - Solutions And Functional Modules

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Functional Modules of Enterprise Resource Planning(ERP) Software

ERP software is made up of many software modules. Each ERP software module mimics a major functional area of an organization.

Functional Modules of ERP Software

 

ERP software is made up of many software modules. Each ERP software module mimics a major functional area of an organization. Common ERP modules include modules for product planning, parts and material purchasing, inventory control, product distribution, order tracking, finance, accounting, marketing, and HR. Organizations often selectively implement the ERP modules that are both economically and technically feasible.

 

However, it is not necessary that every enterprise system application will have all modules mentioned above. Some organizations intending to use customized ERP software generally implement specific ERP modules that are technically feasible and also economical to implement. Such business organizations approach ERP Software Company with their enterprise resource planning software requirements and ask them to study and design enterprise system software as per their business requirements. Let’s take a look at some main functional modules of Enterprise resource planning system in detail.

 

FIGURE:2.2 FUNCTIONAL MODULE


 

1 ERP Production Planning Module

 

In the process of evolution of manufacturing requirements planning (MRP) II into ERP, while vendors have developed more robust software for production planning, consulting firms have accumulated vast knowledge of implementing production planning module. Production planning optimizes the utilization of manufacturing capacity, parts, components and material resources using historical production data and sales forecasting.

 

2 ERP Purchasing Module

 

Purchase module streamline procurement of required raw materials. It automates the processes of identifying potential suppliers, negotiating price, awarding purchase order to the supplier, and billing processes. Purchase module is tightly integrated with the inventory control and production planning modules. Purchasing module is often integrated with supply chain management software.

 

3 ERP Inventory Control Module

 

Inventory module facilitates processes of maintaining the appropriate level of stock in a warehouse. The activities of inventory control involves in 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.

 

4 ERP Sales Module

 

Revenues from sales are live blood 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.

 

5 ERP Market in Module

 

ERP marketing module supports lead generation, direct mailing campaign and more.

 

6 ERP Financial Module

 

Both for-profit organizations and non-profit organizations benefit from the implementation of 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.

 

7 ERP HR Module

 

HR (Human Resources) is another widely implemented ERP 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. Advanced HR module is integrated with knowledge management systems to optimally utilize the expertise of all employees.

 

Each of these above functional modules of ERP software plays an important role. The organizations can choose to implement some of the modules or all according to their requirements. The companies opt for the modules which are technically and economically feasible to them. These modules streamline the flow of the communication across the company by integrating the various functional departments. The enterprise resource system is bound with all these functional modules. These distinct yet seamlessly integrated modules cover most of the functional needs of an organization. The functional modules of ERP software help to achieve efficiency of operations, cost savings and help to maximize the profits.


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