The history of ERP development, the five stages of ERP development

The development of ERP (Enterprise Resources Planning) has gone through 5 stages:

The order point method determines the order point based on the demand for the inventory replenishment cycle** and retains a certain safety stock reserve. Safety stock is set up to respond to fluctuations in demand, i.e. once the stock reserve falls below a pre-specified amountOrder point, place an order to replenish the inventory.

The basic formula for the order point is:

Order point = demand per unit time zone x order lead time + safety stock

Most of the basic assumptions of the ordering point method are wrong, and many problems will be encountered in the actual use process. The order point assumes that the requirements for the various materials are independent of each other and that the material requirements are continuous. However, the reality is that it should be oriented towards product orders rather than materials, and each material is related to each other; In the manufacturing industry, the demand for product parts is uneven and unstable, and the consumption of inventory is intermittent.

In order to solve the shortcomings of the ordering point method, MRP (Material Resources Planning) was developed.

There are three differences between MRP and the order point method:

There are no time coordinates in traditional inventory. The contents of the record usually contain onlyInventory levelswithOrdered quantity

Inventory + Ordered Quantity (Minimum Stock PointIn this way, the concept of time is expressed in an indirect way.

As a result of the improvements, two data items have been added to the inventory status record: Demand and Availability.

Demand refers to the currently known demand;

Available quantity refers to the quantity that can meet future demand.

Inventory + Ordered Quantity - Demand = Available Quantity

Two premises for MRP:

Estimated availability in a time zone = Estimated availability in the upper time zone + Planned acceptance in the time zone - Gross demand in the time zone

MRP is only limited to material requirements, which is only a part of production management.

On the basis of MRP, a closed-loop MRP system has been proposed.

The so-called closed loop has two meanings:

The working process of the closed-loop MRP system is a process of "plan-implementation-evaluation-feedback-planning".

With the advent of closed-loop MRP systems, various subsystems in production planning have been unified.

The production, finance, sales, engineering technology, procurement and other subsystems are integrated into an integrated system, which is called Manufacturing Resource Planning (Manufacturing Resource Planning) or MRP, which is recorded as MRP in order to distinguish it from the basic MRP.

ERP stands for Enterprise Resource Planning, as a new generation of MRP, and was proposed by Gartner Group in 1990.

The traditional MRP system is problem-oriented, and the environment and principles of the decision-making process can be clearly described in clear language (mathematical or logical, quantitative or qualitative).

The decision support function of ERP should be extended to deal with semi-structured or unstructured problems.

Dear, I am glad to answer for you how to look at the development process of ERP, pro, hello<> the development process of ERP has been a technology that everyone knows in the manufacturing industry, as early as more than ten years ago ERP was born, but for the ERP system, it is not the case. Technology is evolving rapidly, but ERP systems can be fatal to enterprises. Whatever the technology, it will undergo rapid and lasting change.

Speaking of which, we inevitably think of the newcomers in the technology world in recent years - smartphones, tablets, cloud technology. The change of technology has had a huge impact on the world, and resting on its laurels will only leave companies behind and in a desperate situation. It's the same with ERP.

This means you can access the system from anywhere. Mobility increases business efficiency, accelerates growth, increases competitiveness, and is more adaptable. Modern ERP systems are customizable.

A one-size-fits-all ERP system is outdated. Customization is an effective way to improve the ERP experience. In a technology-led era, solutions must meet the functional needs of users.

Customization gives users the tools they need to compete in their respective industries.