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ERP and SCM

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Distinguish between ERP and SCM software. In what ways do they complement each other? Discuss the need for, and ways to integrate, these products with other types of enterprise systems

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ERP or enterprise resource planning software is an enterprise software implemented to cover all the functions of the organization, be it supply chain, HR, marketing, sales or finance function of the organization. ERP integrates all the functions of the organization over a centralized platform. SCM, on the other hand, is an enterprise software aimed at streamlining the supply chain function of the organization by facilitating effective and efficient collaboration between the organization and its suppliers and distribution partners.

The main objective of ERM is to streamline and improve the various internal processes, systems and tasks in the organization. It often requires restructuring or reengineering of the existing processes and systems in the organization. Most often the boundary of ERP system is that it is confined to the organization whereas supply chain systems extend to external parties such as vendors, distributors, etc.

Therefor, ERP is different from SCM in the sense that it is a comprehensive system covering various functions processes and systems in the organization including logistics and supply chain whereas SCM is a specialized software that focuses exclusively on the various elements or components of the supply chain system in the organization. The scope of ERP ...

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Sandeep Bardia, MBA
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  • BCom, SGTB Khalsa College, University of Delhi
  • MBA, Rochester Institute of Technology
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