1. History of ERP
Some components of this lecture is based on: Watson, E. & Schneider, H. (2000) “Using ERP Systems in Education”. Communications of the AIS. 1(9).

2. Evolution of ERP Systems
ERP systems have evolved over the past 30 years.
ERP systems grew out of MRP II systems.
Thus to understand the history of ERP systems, we must review MRP and MRP II systems.

3. MRP Systems
Material Requirements Planning (MRP) is a computerized inventory control and production planning system for generating purchase orders and work orders of materials, components, and sub assemblies.

4. Components of a MRP System
MRP is a CBIS designed to handle the ordering and scheduling of dependent demand inventories.
Major components of a MRP system:
Bill of materials - composition of the finished product.
Master schedule - how much of the finished product is desired and when.
Inventory records file - the amount of inventory on hand or ordered.

5. Components of a MRP System
Example of a MRP system.

6. MRP II Systems
Manufacturing Resource Planning (MRP II) is an expansion of MRP, originating during the early 1980s.
MRP II helps to plan all the resources necessary for manufacturing; including financial analysis, feedback loops, and marketing plans.

7. MRP II Systems
MRP II is simply an expansion of the scope of MRP to include other functional areas in the planning process.
These other functional areas are usually marketing and finance.
Example of a MRP II system.

8. ERP and MRP II Systems
The major differences between ERP and MRP II systems are:
Use of a GUI.
Relational Database.
4GL.
Client/server architecture.
Open-systems portability.
Much more integrated than MRP II.

9. ERP and MRP II Systems
Some definitions of ERP systems reference MRP II systems.
ERP is an updated manufacturing resource planning system (MRP II) with relational database management, GUI, and client/ server architecture.

10. ERP and MRP II Systems
Diagram of the relationship between MRP, MRP II, and ERP systems.
ERP systems are still growing. They are now considered a strategic business solution.

11. Recent ERP Trends
ERP systems are now linking groups and applications external to the organization.
We are now linking ERP systems with web and E-commerce applications, b-to-b, b-to-c, and b-to-s.
ERP systems are now beginning to use web browsers as the GUI.