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While the software mentioned earlier (Quickbooks, Microsoft Accounting, Peachtree, AccPac, and
Exact Systems) are indeed ERP offerings in that all modules are integrated and business processes are
coded into the software, most business professionals think of large, integrated packages from
companies like SAP, Oracle, and Infor when they hear the term ERP. These large packages integrate
not only the accounting functions, but also the manufacturing, warehousing, sales, marketing, and
distribution functions. Most ERP systems also interface with Web applications to enable e-commerce
transactions.
ERP software implements what its vendor feels are best practices for business processes. Prior to
ERP software, software was developed to fit the business processes of an individual firm or industry.
Since that approach does not offer economies of scale, ERP vendors determine the most efficient steps
for carrying out a particular business process and code those steps into their software. Organizations
can choose either to modify their own business processes to match the best practices that are delivered
in the software or to spend a great deal of time and money to customize the software to match their
own business processes. A benefit of accepting so-called best practices is compliance with federal
requirements such as Sarbanes-Oxley or International Financial Reporting Standards.
These packages have spawned an entire industry of consulting companies to assist large companies
in implementing ERP software, a process that may take several years to complete. As in any software
implementation, one must always factor into the timetable the process‟s cost and the distraction it
causes the organization. In today‟s lean business environment, people have little extra time for new
tasks. Implementing a major new system or, for that matter, any system requires a major time and
effort commitment.
Information Technology in Banking and Financial Services
Information technology is mission critical for the banking and financial services industry. So it‟s no
surprise that it is also the leading industry in its use of information technology. The industry has
become a transaction processing industry that is information dependent. Very little real money is ever
touched. Rather, all transactions, from stock purchases to the direct deposit of workers‟ checks, are
processed electronically. Information technology has paved the way for innovations like the electronic
trading systems used by NASDAQ and the New York Stock Exchange.
The financial services industry is also the leading industry to adopt new uses of information
technology. Paperless check exchange, voice authentication, and secure messaging between banks are
just a few of the innovative uses they have adopted.
Competitive advantage for banks has gone from having ATMs on every corner to having online
banking features accessible on the Web. Customers can check balances, transfer funds, pay bills, and
look at current credit card activity.
E-Commerce