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What is an Enterprise Resource Planning (ERP) System?

In order to understand what an Enterprise Resource Planning System is let us look at a classic American kids snack, the Rice Krispy Treat if we conceptually view the treat as a company’s internal applications as a whole.  Furthermore we can view a company’s departmentalized software applications as the theoretical Rice Krispies in the treat. In addition, the Rice Krispies consist of a combination of ingredients that be broken down into data, user interfaces and business logic. Next, we have the margarine or butter that is used to help the marshmallows bind with the Rice Krispies; this role in our conceptual view is taken by a data source typically as a relational database management system.

Finally we have the melted marshmallows which act as the ERP software that connects all of the individual departmental software applications in to one unified system that allows all user one unified system to interact with all of the individual dispersed systems. An example of this would be if a customer places an order with a telephone operator and once the orders is processed an employee in the shipping department can see the order ready for fulfillment on his order screen. The ERP acts a go between for various independent departmental systems so that they can integrate with one another.

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