Historically speaking, ERP or Enterprise Resource Planning has evolved from manufacturing resource planning- which in turn developed from material resource planning. But with the intervention of web-enabled and open-source technologies, the functioning of ERP has today assumed added utility and prominence.

The latest advancement in ERP software has been termed as ERP II. With this background we seek to analyze the direction in which ERP is destined to progress, or to determine whether or not the use of ERP will diminish in the future.

ERP has undoubtedly become an important business application for a variety of industries. It has almost become a necessity for all organizations, irrespective of the type of business manufacturing or service they are engaged in. If these firms feel that coordination and enterprise communication are their only problems they don't have any other alternative but to go for ERP, provided they want to make profits and remove any existing setbacks.

In fact it may be safe to say that ERP can help a number of firms in their monetary and non-monetary aspects if they are keen in utilizing it to the maximum, and take the necessary steps to overcome any setbacks. However ERP needs a lot of improvement in order to be a more effective application. It would be great if one can bring an ERP system that is free of the drawbacks from the existing ones. The latest changes involving open source and web enabled technologies have increased the effectiveness of ERP applications. ERP II applications are being designed to make the maximum use of the Internet so that the user can access data from any part of the world just by a click of the mouse. This has further solidified the future of ERP, so that it will be some time before the concept and its applications reach a saturation point.

Due to its cost and implementation aspects, ERP used to be formerly restricted to Fortune 500 companies only in terms of affordability. This restriction limited sale opportunities and put the small and medium industries at a large disadvantage, as they were not able to make use of any ERP application to get the available benefits. However this drawback has now been removed through the intervention of open source facilities. The use of outsourcing has helped in removing the difficulties faced by small and medium enterprises.

Hence a large potential for ERP still exists in the market for small and medium enterprises. Today’s ERP II vendors can target this market effectively. However both the vendor and the companies in this segment must keep in mind that there is a lot of competition in this sector and one is not likely to succeed unless he provides the best product at an affordable price.

ERP II software has now thrown open opportunities for many companies to trade with foreign counterparts in the name of outsourcing, implementation and deployment of the existing ones. It has contributed a lot to the economy and has promoted a lot of employment and educational opportunities. Thus the future of ERP has an undisputed demand not only at the national level but also at a global level. If this technology can be improvised to the desired extent that it becomes easy to create and maintain tailor made programs and applications, the future of ERP will be all that more robust. Indeed ERP II software has been characterized by need based applications, reduced implementation time, less costs to buy and the use of open source, web based and wireless applications. It looks like ERP is here to stay.