How does ERP work?

ERP integrates all business processes like finance, HR, manufacturing, supply chain, services, procurement, and others into a single system.

ERP provide visibility, analytics, and efficiency across every aspect of a business. Using the latest technologies, ERP systems facilitate the flow of real-time information across departments, so businesses can make data-driven decisions and manage performance – live.

ERP systems perform financial and business planning functions, which might formerly have been carried out by many smaller standalone applications.

Components of an ERP Solution:

ERP software integrates many business applications and activities which enables the system to cater to most of the processes and department if not all.

The vital functional modules of ERP software:

Accounting and Finance

  • General Ledger
  • Accounts Payable
  • Accounts Receivable
  • General Journals
  • Trial Balance and Financial Reporting
  • Bank Reconciliation
  • Cash Management and Forecasting
  • Budgeting

Manufacturing and Distribution

  • Purchasing, Tracking & Sales Shipments of Inventory Items
  • Track by Lot and Serial numbers
  • Track Quality Tests
  • Warehouse Management functions
  • Conversion Tracking
  • Tracking Labor, Overhead and Other manufacturing costs
  • Provide the total cost of production


  • Sales order creation
  • Sales order processing
  • Purchase order processing
  • Online sales

Service Management

  • Track and monitor post-sales service to products in the field
  • Warranties
  • Service Contracts
  • Product Lifetime Costing has become standard functionality in current ERP solutions.

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