Friday, June 11, 2010

ADVERNTAGES OF ENTERPRISE RESOURCE PLANNING

INFORMATION SYSTEMS have played an increasingly visible role for several years in improving the competitiveness of business. More than just tools for handling repetitive tasks, these are used to guide and advance all of a company’s daily activities. Today, integrated management software is very often the key source of significant competitive advantage.

The standard response to the need for responsiveness, reliability, and rapidly increasing expectations is to create an organisation based on departments with a clear linear structure, but integrated around your operating processes. To promote efficiency amongst your salespeople, accountants, logistics staff and everyone else you should have a common understanding of your problems.

For this you need a common language for shared references, policies and communication. An ERP (Enterprise Resource Planning) system makes the ideal platform for this common reference point.

Risks and integration costs are important counterweights to all the advantages you gain from such systems. That’s why, today, few small- and medium-sized companies use ERP. In addition, the larger ERP vendors such as SAP, Microsoft and Oracle haven’t been able to reconcile the power and comprehensive cover of an ERP system with the simplicity and flexibility wanted by the users. But this is exactly what small and medium enterprises are looking for.

OPEN ERP

The development processes of open source software, and the new business models adopted by its developers, provide a new way of resolving such problems of cost and quality for this kind of enterprise software.

To make an ERP system fully available to small and medium enterprises, cost reduction is the first priority. Open source software makes it possible to greatly reduce development costs by aggressive reuse of open source software libraries; to eliminate intermediaries (the distributors), with all of their expensive sales overhead; to cut out selling costs by free publication of the software; and to considerably reduce the marketing overhead.

Since there is open interaction among thousands of contributors and partners working on the same project, the quality of the resulting software benefits greatly from the scrutiny. And you can’t be everything at once: Accountant, software developer, salesperson, ISO 9001 quality professional, specialist in agricultural products, expert in the customs and habits of pharmaceutical vendors, just as a start.

The results are quite impressive. Tiny ERP, now OpenERP, is a management software that is downloaded more than any other in the world, with more than 600 downloads per day. It’s available today in 18 languages and has a world network of partners and contributors. More than 800 developers participate in the projects on the collaborative development system of Tiny Forge.

To our knowledge, Tiny ERP is the only management system, which is routinely used not only by big companies but also by very small companies and independent companies. This diversity is an illustration of the software’s flexibility: A rather elegant coordination between people’s functional expectations from the software and great simplicity in its use.

And this diversity is also found in the various sectors and trades, which use the software, including agricultural products, textiles, public auctions, IT, and trade associations.

Lastly, such software has arisen from the blend of high code quality, well-judged architecture and use of free technologies. In fact, you may be surprised (if you’re an IT person) to find that the size of Tiny ERP is less than four MB when you’ve installed the software. We’ve moved a long way from the days when the only people who could be expected to benefit from ERP were the owners of a widget factory on some remote industrial estate.

OPEN OBJECT

OpenObject allows you to develop, design or customise business applications within a few minutes. It can be used as a complete application framework for developers or a rapid application development tool for end-users. Each application or business module made with OpenObject is completely different from another and all those modules can be connected together to perform a powerful and complete application.

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