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What is ERP? Enterprise resource planning systems explained

Enterprise resource planning (ERP) is a system of integrated software applications that manages day-to-day business processes and operations across finance, human resources, procurement, distribution, supply chain, and other functions. ERP systems are critical applications for most organizations because they integrate all the processes necessary to run their business into a single system that also facilitates resource planning. ERP systems typically operate on an integrated software platform using common data definitions operating on a single database.

ERPs were originally designed for manufacturing companies but have since expanded to serve nearly every industry, each of which can have its own ERP peculiarities and offerings. For example, government ERP uses contract lifecycle management (CLM) rather than traditional purchasing and follows government accounting rules rather than GAAP.

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