Enterprise software vs ERP: Are they alike?

Although the difference between ERP and enterprise systems is obvious, many people confuse these two notions. Probably, it’s because both terms contain the same word. Enterprise software vs ERP is the topic of our article. Here, you will learn what things differ these IT products and what value they are able to add to your business.

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ERP is an acronym that means enterprise resource planning. Here is a concept of ERP:

enterprise software vs ERP

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ES is another common acronym to denote enterprise systems.

ERP is typically one application that is a set of modules. This software is focused on several back-office functions of a business, like finance processing, manufacturing, and inventory control. It relates to the planning resources for the enterprise. The core resources are as follows:

People (human resources)
Things (asset management, facilities management, inventory, etc.)
Money (payroll, accounts receivable, accounts payable, general ledger, etc.)

ERP is typically modular, so the companies can select to use different components of a system. Major examples of ERP players are SAP, PeopleSoft, and Oracle. This sort of software is aimed at improving and interrelating all the internal processes across a company. With the help of these systems, employees can get real-time data and reports quickly and accurately.

The main benefits of ERP software would be to optimize the internal operational processes and contribute to data-driven decision-making with the help of reports in a unified format to the managers.

At the same time, enterprise systems are just systems that operate at the level of an enterprise. These systems deal with concerns related to employees, suppliers, and buyers.

Simply put, ERP is just one type of enterprise system. Other good examples are CRM (customer relationship management) and SCM applications (supply chain management).

Let’s consider the example. ERP software starts acting when orders arrive. The system checks if raw materials are available, plan the production, and manages materials. All these processes are monitored by the system until the goods are shipped and delivered. On the other hand, enterprise systems act beyond those processes. They deal with new orders, unique offers, customer relations, and agreements with suppliers and vendors. In other words, enterprise systems address issues related to the external relationships of a company.

Enterprise systems and ERP apps differ technically as well. Usually, ERP comes with databases and a particular architecture, whereas ES has no architecture. Enterprise systems leverage the data that is already available across the company.

In most cases, ERP applications need to be customized, whereas ES doesn’t need any changes. Another thing that makes ERP and ES different is the implementation time. Systems take a long time to launch and implement because the large scope of data needs to be gathered and analyzed. Unlike ES, ERPs are fast to integrate with the existing software.

Need a good ERP system? Learn more about the types of ERP software.

The key difference between ERP and EMS

A lot of people also confuse ERP with EMS. Therefore, let’s figure out what EMS means and why it differs from ERP. EMS stands for enterprise management system. It is an enterprise-grade solution that meets business demands for technology and software. They are similar to enterprise planning systems but have a slight difference.

Most management systems provide such key functionalities as human resources management, finance, customer relationship, sales, supply chain management, etc. Some companies develop bespoke software that addresses their specific needs.

This type of enterprise system is aimed to serve mainly large companies. However, more and more S&M businesses think about what benefits they can get from implementing ERP or EMS.

So, let’s see what differentiates these two systems. As a part of the software suite, ERP may be included in the EMS. However, ERP is considered to be a standalone solution that has its modules and functions. Resources planning apps can check the inventory and help in managing and planning. In contrast, management apps can control competitors, analyze data, suggest new markets, offer new means of promotion, and monitor all other external activities of a company. EMS systems are more data-focused than ERP, they use the available information to improve efficiency and automate processes.

Here’s a related information which may be interesting for you: Is there any difference between MIS and ERP?

Undeniable Benefits of Enterprise Systems

As we mentioned, ERP and EMS are just parts of enterprise systems. They both add value to the business. Below are the key benefits of these applications:

Fewer employees needed to work with complex software infrastructure and operations.
Lower costs for management operations (internal and external) within a company.
All necessary functions are included in one system and available in one place.
Improved collaboration between different departments of an organization.
High scalability and flexibility. EMS software is cloud-based, which makes it possible to access the system from any place at any time.
Customization is available.
Enhanced productivity of employees, better customer relationships, and intensive business growth and sales.

Modern companies look for opportunities to improve their businesses with smart solutions provided by technology providers and developers. Various enterprise systems are a good choice to start changing how technology is used in companies. These systems contribute to the effectiveness and productivity of any industry and company.

Here are more advantages you can get if you implement these solutions into your organization.

Advantages for managers

Managers benefit from the launch of enterprise systems as they should not worry anymore about key business operations and goals. They are achieved more efficiently with new systems. Managers can access all the necessary information in one unified repository. Besides, the decision-making process becomes data-driven and brings better results.

Operational benefits

By implementing enterprise-grade solutions, organizations can synchronize their functions in multiple departments and even offices. The systems integrated with the existing software and processes help reduce the time for document processing. Data becomes more transparent and visible within an organization. All these changes lead to an increase in efficiency across the entire organization.

Storage challenges

Every 5 years, enterprise systems should be upgraded to meet modern enterprise management standards. Information within companies accumulates rapidly. It may be difficult to process and store large volumes of data using only one software. It can lead to slowdowns and data overflow, which in its turn affects the other processes across a company.

Lower costs

Systems like CRM and ERP can reduce the costs for employees supporting the IT infrastructure of an organization. Despite high prices for developing enterprise systems, the latter can save your costs in the future, in 2-3 years after the implementation. However, you must choose a software vendor carefully and make a complete list of the specifications of the system to meet the needs of your enterprise.

To sum it up, we can say that ERP and EMS are just types of enterprise software. Sometimes these systems can become a part of each other that’s why people confuse their meanings so often. In any case, such software is advantageous to a company of any size. If you are on your way to success, think of a proper enterprise software solution.

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