In 1997 more than 20,000 firms worldwide paid $10 billion to enterprise resource planning (ERP) vendors [1]. With a growth rate of 37 percent per year, total ERP Company revenue is expected to top $52 billion by 2002 [2]. ERP is expected to continue to be one of the largest, fastest-growing and most influential players in the applications software industry well into the new millennium.
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When we come to the Indian scenario, the increasingly sophisticated and competitive economy is faced with life in the global fast lane. In order to keep up with the first world Joneses, numerous industries are implementing or considering ERP practices. How these sophisticated solutions are applied in India may well determine the country's course after the clock turns 2000.
India's GNP is now the fifth largest in the world. The transition to an open economy has thrust India squarely into the information age, an age that is forcing the country to cope with a deluge of new information relationships. At the same time, India must attempt to bolster its competitiveness in the global marketplace - an imperative that requires industry to have a greater sophistication in dealing with materials, men, and machines. With all of these demands, it is no wonder that ERP had hit India like a tidal wave.
Integrated ERP solutions optimize resource utilization by providing up-to-the-minute information on demand for quick decision making. Industries that successfully implement ERP can enjoy an overall cost reduction for business, an increase in per capita productivity, quick response times, lower inventory levels, and better customer orientation, all of which lead to higher customer satisfaction.
India's economic ascent, in conjunction with the country's increasing exposure to intense global competition, has fueled the need for the implementation of ERP; of course, certain operational, financial, and psychological resources are required to satisfy these needs.