ENTERPRISE RESOURCE PLANNING SYSTEM

Enterprise Resource Planning System

Table of Contents

1 Introduction3

2 General Overview: ERP Systems3

2.1 Functions4

2.2 Main Components6

2.3 Implementation7

2.4 Benefits and pitfalls of implementing an ERP system9

2.5 Outsourcing ERP10

3 Open source software10

3.1 Open source software development12

3.2 Definition and software licenses13

3.3 Business models16

4. Open Source ERP software17

4.2 Definition of criteria for system description18

5.3 Description of the systems19

Enterprise Resource Planning System

1 Introduction

Nowadays, information technology is unavoidable in every part of life and business management is also not an exception. One of the most widespread solutions is the use of enterprise resource planning (ERP) systems that has proved to support the integra tion and automation of the processes, the improvement of the performance, and the reduction of costs. Yet, several mostly small and medium enterprises (SME) cannot afford the time, the uncertainty and the resources that are required by the imple mentation of an ERP system. This paper provides a brief overview of the functions, implementation steps, benefits and difficulties of these planning systems in general, as well as a catalogue of open source ERP systems. The descriptions of the systems are guided by common criteria that help the comparison of the different solutions. This study is intended to inform IT practitioners and managers about the existing open source planning systems and support the software selection.

2 General Overview: ERP Systems

The concept of customer-orientation has gained greater importance in the last few decades of global competition, requiring very quick or instantaneous responses to market changes. The ability to consistently meet customer expectations can be supported by improving the overall organizational efficiency through integration and automation of the value chain. This kind of automation is only possible through standardization and integration. Looking at the different business functions separately and supporting them with completely isolated software systems, however, makes the continuous improvement process difficult or even impossible Enterprise Resource Planning systems are standardized, integrated applications to facilitate the information flow between the business functions of an organization and to manage relations with partners in a unified way. A good ERP solution must provide wide functionality that often covers several business areas of an enterprise For this reason, most systems are designed in a modular way to allow users to combine the required components. Every component uses a common database for increasing data consistency and assuring communication across departments. A further requirement is that ERP systems should support standard best practice processes and, above all, provide flexibility and customizability, since every organization has its own unique conditions to be considered and respected.

2.1 Functions

The traditional functions of enterprise information systems cover the operational tasks. The common characteristics of these are the focus on short- or medium-term, mostly daily decision making and control. These tasks need very detailed and accurate data, and due to its dynamic nature, real-time tracking of changes is required. The advantages of the operational functions are that they can be relatively easily automated, or at least supported and administered by appropriate software ...