Enterprise Resource Planning (ERP)
What is ERP?
ERP—Enterprise Resource Planning— refers to the strategic coordination of core business processes—such as finance, supply chain, HR, and operations—to help organizations align resources with their goals.
It involves forecasting demand, managing capacity, and optimizing workflows to enhance efficiency, minimize waste, and facilitate data-driven decision-making throughout the organization.
What started as a term for companies to better coordinate their business processes and eliminate department silos, has turned into an entire software industry, as the ERP software market is a billion-dollar industry now, with hundreds of thousands of companies running ERP software to manage their business end to end.
What is an ERP system?
An ERP system is a centralized platform that connects and manages an organization’s essential operations through shared data and streamlined workflows. It replaces disconnected tools with a unified system that supports planning, coordination, and execution across departments, helping teams stay aligned, reducing errors, and enabling a faster response to changing business needs.
An example of an ERP platform in action
A rapidly growing e-commerce retailer uses NetSuite ERP—a cloud-based ERP system—to manage its order-to-cash process. When a customer places an online order, NetSuite automatically updates inventory levels, generates an invoice, and triggers order fulfillment from the nearest warehouse.
The finance team uses real-time dashboards to track sales performance and reconcile revenue.
Meanwhile, procurement uses the same system to restock popular items based on current demand and supplier lead times. With NetSuite handling end-to-end operations, the retailer improves order accuracy, speeds up delivery, and gains real-time financial insights.
Is my organization ready for an ERP system?
You might be ready for an ERP system if your business is struggling with disconnected tools, slow business processes, or limited visibility, especially data, across departments.
Common signs include rapid growth that outpaces your current systems, systems siloed to specific departments, excessive manual work leading to errors, inconsistent data, or difficulty meeting reporting and compliance requirements. If these challenges are holding you back, it’s time to consider an ERP.
What ERP solutions should an enterprise consider?
1. Microsoft Dynamics 365 Finance and Supply Chain Management
Microsoft’s enterprise-grade tier 1 ERP is designed for midmarket to large businesses with complex, multi-entity, or global operations.
2. SAP
Offers ERP solutions for a wide range of company sizes. SAP Business One is tailored for SMBs with strong inventory and manufacturing capabilities, while SAP S/4HANA Cloud is geared toward larger, more complex midmarket firms. Choosing the right system depends on your current challenges, tech stack, and future goals. Also, consider your industry, budget, and growth plans when evaluating vendors.
3. Oracle (Oracle Cloud / Oracle EBS)
A powerful ERP suite typically favored by large enterprises, Oracle E-Business Suite (EBS) and now Oracle Cloud Fusion both offer more modular and scalable options for mid-size and enterprise companies, though cost and complexity may be high for smaller SMBs.
4. Salesforce
Not an ERP system, but a top-tier CRM often integrated with ERP platforms. With ecosystem solutions like FinancialForce or Rootstock, Salesforce can extend into ERP-like functions, but is best viewed as a front-office tool.
5. Workday
A cloud platform focused on finance and HR, Workday is often chosen by mid-sized to large service-oriented organizations. It delivers strong analytics and planning capabilities but may lack support for manufacturing or supply chain operations typically found in full ERP suites.
What ERP solutions should an SMB consider?
When ERP software first emerged, it primarily served large enterprises with complex operations and multiple departments. Automation was critical to managing financials and streamlining workflows. Today, with cloud-based ERP solutions, small and mid-sized businesses (SMBs) can access the same capabilities—without the complexity or cost that once limited them. It’s a major shift that gives SMBs greater control, flexibility, and insight into their operations.
SMBs should consider ERP solutions that are scalable, user-friendly, and tailored to their industry and stage of growth, such as Sage Intacct and IFS Cloud. Commonly researched options include:
1. Microsoft Dynamics 365 Business Central (BC)
Microsoft’s modern cloud ERP is built specifically for SMBs. It combines financials, operations, and project management, with tight integration into Microsoft 365 and a familiar user experience.
2. NetSuite
A leading cloud-native ERP for fast-growing SMBs, offering an all-in-one platform for finance, inventory, CRM, e-commerce, and more. NetSuite is known for its quick deployment and strong scalability, requiring minimal IT overhead.
3. Oracle (Oracle Cloud)
A powerful ERP suite typically favored by large enterprises. Oracle Fusion Cloud offers more modular, scalable options for mid-size companies, though cost and complexity may be high for smaller SMBs.
4. Microsoft Dynamics GP
An established ERP system with roots in Great Plains Software, Microsoft Dynamics GP has long served SMBs with strong financial management capabilities. While still in use, Microsoft is no longer actively developing new features and has announced plans to end support. Many businesses continue to rely on GP as they plan future transitions.
5. SAP
Offers ERP solutions for a wide range of company sizes. SAP Business One is tailored for SMBs with strong inventory and manufacturing capabilities. It helps manage small businesses—from accounting and financials, to purchasing, inventory, sales, and customer relationships, as well as reporting and analytics.
Choosing the right system depends on your current challenges, tech stack, and future goals. Also, consider your industry, budget, and growth plans when evaluating vendors.
More ERP resources:
Blogs
Include security and compliance from the start of ERP implementations
Best practices for managing access controls in your ERP System
Whitepaper
Managing risk & discovering value with Fastpath during an ERP implementation or upgrade
Webinar