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Checklist for Successful ERP Implementation

The roots of Enterprise Resource Planning (ERP) started in the late 1960s and early 1970s with the use of computers and computer systems in manufacturing companies. Those early applications of the computer as a tool to manipulate and store data began in the finance area. Finance used the computer to reduce manual record keeping and filing systems for payables, receivables, general ledger and payroll. The logical progression of the computer as a tool to help run the business was to apply computer capabilities on the operations side of the business, specifically to help plan, schedule and order material. This technique was called Material Requirements Planning (MRP). By the end of the 1970s, with computers now affordable for almost all businesses, thousands of companies began MRP implementations to better manage their businesses. Companies rushed to implement this new tool to help them better manage inventories, improve material shortage conditions on the factory floor, reduce purchasing costs and improve on-time customer delivery.

As more companies began to implement and use MRP to plan, schedule and order material a select few companies began to realize that to yield the full benefit of MRP, it must be viewed and managed as a company operating system. This second generation of MRP, known as Manufacturing Resource Planning (MRPII) provided an expanded range of functional tools. This improved capability meant that all functions in the business, including senior management, sales, engineering, finance and quality, now began to utilize an integrated set of tools to help manage their operations.

The latest version of business system software is Enterprise Resource Planning. The ERP model (Figure 1) is a method to effectively manage the total resources in a business enterprise. Today, with the capability of current ERP systems, business system integration has been extended to the customer and the supply chain.

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