ERP

ERP (Enterprise Resource Planning) explained simply

Imagine your company as a human body: heart, brain, digestion – different, but inseparably connected. An ERP system is the central nervous system that links together all key business processes – purchasing, production, warehousing, accounting, HR and sales. It ensures that data does not lie isolated in departments, but is consistent, transparent and available in real time.

Background information

Enterprise Resource Planning (ERP) refers to software solutions that enable companies to manage their core functions such as finance, procurement, production, logistics, human resources, sales and services in an integrated system. ERP systems are based on modular architectures that allow the flow of information between all areas – for example by automatically transferring a purchase order into the warehouse and into financial accounting.

ERP developed in the 1960s from Material Requirement Planning (MRP) and MRP II – the former optimised material planning, the latter added resource, cost planning and capacity. ERP eventually integrated these functions into a comprehensive platform that synchronised virtually all areas of a company. Modern systems support management decisions through a unified data basis, real-time reporting and automation. Today they form the backbone for controlling and planning business processes.

Typical ERP modules and how they interact

Modern ERP systems are modular in structure – each module covers a business area and contributes to holistic planning:

  • Finance and accounting (general ledger, bookkeeping, cost planning) often form the core module.
  • Procurement and materials management, including warehousing, scheduling and purchasing, control material flow and inventories.
  • Production & manufacturing planning includes bills of materials, production orders, quality control and capacity planning.
  • Supply Chain Management (SCM) coordinates suppliers, inventory, distribution and supply chain processes.
  • Customer Relationship Management (CRM) (sales, marketing, service) – sometimes integrated as a module, sometimes separate – ensures customer satisfaction and sales management.
  • Human Resources (HRM) covers employee management, payroll, recruitment and personnel planning.
  • Other modules such as project management, business intelligence, asset management or risk management extend the benefits depending on industry or company size.

Thanks to the modular architecture, all modules share the same data basis – updates from purchasing appear immediately in stock levels, which in turn influence production planning. This creates a seamless, company-wide cockpit for strategic and operational decisions.

ERP integration in the IIoT environment

The merging of ERP and IIoT (Industrial Internet of Things) opens up completely new potential: IoT sensors collect real-time data directly from machines, plants or goods. This data can flow into the ERP and, for example, enable automated inventory management or predictive maintenance.

A practical example: RFID tags track warehouse movements live. The ERP receives this information immediately, updates stock levels and can automatically trigger reorders – without human intervention. Manufacturers thus benefit from better efficiency, higher transparency and more well-founded decisions in real time.


At the same time, this networking requires robust IT security, since IoT devices represent potential entry points. Successful integration between ERP and IIoT therefore requires careful planning, clear objectives and technical diligence.

Further information and links

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