A Brief History of ERP

Enterprise resource planning helps firms improve the efficiency of their vital processes for employees and customers. Additionally, ERP solutions enable supply chains to gain a competitive edge and considerably enhance sales and customer service performance.

Early History

In 1940, the ERP industry began. Firms initially used enterprise resource planning to manage and monitor their inventory. Numerous businesses were looking for a way to calculate equipment and assist with the whole operation. As a result, inventory management and control were built by integrating information technology and project activities. Then, in 1960, Material Requirement Planning (MRP) solutions became available, which were widely regarded as the forerunners of today’s ERP systems.

The original MRP system is based on massive, complicated computers that require significant maintenance. This is why it is utilized only by those who can afford it. In the 1970s, many companies focused on developing cost-effective software solutions. They allowed MRP technology to expand its capabilities for manufacturers.

Cloud-based ERP became popular in the 2000s. It is gradually displacing on-premise ERP systems. Furthermore, Cloud ERP is significantly less expensive than traditional ERP due to eliminating the need for private servers. This boosted the attractiveness of ERP to small and medium-sized firms (SMEs), hence increasing market competitiveness.

SaaS provides ERP solution, particularly for small and medium-sized organizations, by allowing them to subscribe to their ERPs rather than purchasing expensive servers. It is a critical benefit for businesses trying to expand.

For additional information, see this infographic from Integral Management.