The ERP Business Model Explained

Enterprise Resource Planning [ERP] offers a three-tier business model that any industry can use to find success. It is focused on the implementation of enabling technologies that will help a business network, manage, and warehouse appropriately. Wireless, infrastructure management, and cross-company integration are also components of the ERP business model. Once a business has adopted the enabling technologies, they are ready to focus on their marketplace strategies.

The ERP Business Model Has 3 Primary Levels

The ERP business model is a global business process that represents a specific product or an entire company. To use this business model, an understanding of its three primary components is necessary. The first step is to construct information from the global overview by going through databases, modules, and sessions to construct the overall model that will be used. Then these three additional steps will be put into play.

1. The System Configuration Level.
This takes a look at the high-level options of the entire business model. It is a static system and cannot be changed once it has been implemented. It is the choice that will govern all other choices within the system.

2. The Objective Level.
This is the level that will focus on the single objects that exist within the entire business model. It is a dynamic component because it offers options based on the components that are being evaluated.

3. The Occurrence Level.
This level looks at single processes. It requires object parameters that must be elaborated upon, so it is the most altered of the three different levels of the ERP business model.

What is unique about the ERP system is that there isn’t a defined business model that must be used with this approach. Any business model can find success when it decides to incorporate elements of ERP within its systems.

What Are the Advantages of the ERP Business Model?

Outside of its flexibility, the primary advantage of incorporating ERP is that it quickly aligns needs with solutions. This business model looks at the alignment process of the business and will define solutions that are based on those processes. It is an outside-the-box type of system, so many solutions that are identified often required changes to the overall business model that is being practiced.

It is also a business model that seeks to identify best practices within an organization. Many times an organization will get stuck in the attitude that “the way things are” will always be the best solution. As the world evolves and develops and innovates, so must a corporation. This is where the ERP business model helps. Because it is solution orientated and is based on real-time data that is taken from processes, policies, and procedures, the right footsteps on the path a corporation walks can always be taken.

What Are the Disadvantages of the ERP Business Model?

The problem that businesses will face by implemented ERP is that there are a number of required values that must be in place for it to work. From abstraction to augmentation, or context to coverage, there are required values for each attribute that must be in place. These are all attributes of the organizational environment and internal systems, so without the required values in place, the ERP business model will ultimately fail to function.

There must also be an aim of representation that is focused upon when implementing this business model. There must be a description of at least one method of achieving business goals. A successful ERP will explore multiple options and include explanations about why certain plans are better than others to achieve goals. Without this aim, there really is no way to achieve success.

Here’s the Secret of the ERP Business Model?

What many businesses don’t realize is that when they are creating a business plan or constructing a 5 year plan of growth, they are already implementing aspects of ERP into their own business models. That’s how influential this system of business happens to be. It outlines specific strategies and goals and helps to simulate outcomes. This is why it is so invaluable and naturally used.

The easiest way to implement an ERP system is to adopt a software package that includes all of these elements. This eliminates the need for manually tracking data. Businesses receive push alerts for when actions need to be taken through the constant analysis of action and response so that meaningful actions can always be taken.

The ERP business model can lead every corporation to success. Implement it today in some part of your business model and you will see immediate results.