Evolution of ERP System - Brief History of ERP

Evolution in ERP: 

In 1960‟s business had to depend on the traditional ways of managing all major business processes to ensure smooth functioning of the company. These theories are called classical inventory management. In  this the most popular technique as EOQ (Economic Order Quantity). This technique was based on ordering cost and inventory carrying cost of each item in stock. 

In 1960‟s, a new technique known as MRP (Material Requirements Planning) was evolved. This technique was focused on end product demand obtained by Master Production Schedule (MPS) for a particular product structure which is obtained from bill of material. MRP successfully showed the effectiveness by avoiding delays and better coordination. 

In 1970‟s modified technique of MRP evolved this technique popularly known as Capacity Requirements Planning (CRP). 

In 1980‟s financial resource with manufacturing activities integrated together. This gave birth to Manufacturing Resource Planning (MRP II). 

In 1980‟s-90‟s MRP II transform into ERP. By overcoming shortcomings of MRP II and integrating new technologies.

Evolution of ERP System.


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