--- title: ERP Components: Core Parts to Enterprise Resource Planning --- # ERP Components: Core Parts to Enterprise Resource Planning Last Reviewed: March 16, 2026 9 min read [20 comments](https://www.selecthub.com/enterprise-resource-planning/6-main-erp-components/#comments) [ ![Khaleel Hayes](https://www.selecthub.com/wp-content/uploads/2020/07/Khaleel-96x96.jpg) ](https://www.selecthub.com/author/khaleel-hayes/) [Written by Khaleel Hayes](https://www.selecthub.com/author/khaleel-hayes/) Technical Content Writer [ ![Hunter Lowe](https://www.selecthub.com/wp-content/uploads/2023/11/cropped-Hunter-Headshot-96x96.jpg) ](https://www.selecthub.com/author/hunter-lowe/) [Edited by Hunter Lowe](https://www.selecthub.com/author/hunter-lowe/) Content Editor Table of Contents * [What Is ERP Software?](#What%5FIs%5FERP%5FSoftware "What Is ERP Software?") * [Common ERP Components](#Common%5FERP%5FComponents "Common ERP Components") * [1\. Human Resources](#1%5FHuman%5FResources "1. Human Resources") * [2\. Customer Relationship Management (CRM)](#2%5FCustomer%5FRelationship%5FManagement%5FCRM "2. Customer Relationship Management (CRM)") * [3\. Business Intelligence (BI)](#3%5FBusiness%5FIntelligence%5FBI "3. Business Intelligence (BI)") * [4\. Supply Chain Management (SCM)](#4%5FSupply%5FChain%5FManagement%5FSCM "4. Supply Chain Management (SCM)") * [5\. Inventory Management](#5%5FInventory%5FManagement "5. Inventory Management") * [6\. Accounting/Financial Management](#6%5FAccountingFinancial%5FManagement "6. Accounting/Financial Management") * [Secondary Components](#Secondary%5FComponents "Secondary Components") * [Primary Benefits](#Primary%5FBenefits "Primary Benefits") * [Do Your Research](#Do%5FYour%5FResearch "Do Your Research") [ERP software](https://www.selecthub.com/erp-software/) has numerous features and add-ons available from vendor to vendor. However, don’t put the cart before the horse by looking at add-ons before selecting the main ERP components that you need in your software. You wouldn’t go to a car dealership and start asking about customized rims before looking at mileage and safety ratings. The same thinking applies to ERP systems. [Get our ERP Software Requirements Template](https://pmo.selecthub.com/erp-requirements-template-site-vers/) ![Top ERP Components]() Ultimately, ERP software is very modular, and you can usually pick and choose which features you want to have present in your solution. We’ve created this list of six of the most commonly desired features to help you formulate an idea of some of the functions you might be interested in having. But first… ## What Is ERP Software? ERP software is a solution that centralizes and connects various business processes in one place. It’s beneficial because it’s a hub for real-time and historical data across business departments and functions. This centralization reduces time spent manually pulling data to send to business partners. Automating processes simplifies business workflows, saves time, boosts revenue and enhances productivity. There are hundreds of ERP vendors on the market, but each choice offers different solutions and functionality. There are some standard components of an ERP system that you may wish to have in your system, but there will likely be some add-ons or modules that streamline your specific day-to-day tasks. ![ERP Software Definition]() Before looking for software, you should create a list of challenging tasks for your business that need simplification. An ERP solution could help. You should also look at the main components of ERP to see if any of the commonly included tools would be beneficial to your business. Each module has capabilities that vary depending on the vendor, but you should expect vendors to provide at least a handful of the main components available out of the box. ## Common ERP Components The most common components of ERP are as follows: ### 1\. [Human Resources](https://www.selecthub.com/category/hris/) Managing your employees is typically the highest priority and a prominent component of ERP. Without them, you don’t have a company. The HR ERP module in your software solution should handle employee management tasks such as onboarding, offboarding, timekeeping and benefits administration. [Payroll software](https://www.selecthub.com/payroll-software/) is the most crucial feature in core ERP components. Manually submitting payroll and issuing direct deposits is inefficient and not cost-effective. An HR component automates payments, including tax deductions. Hourly workers receive automatic payments thanks to [time-tracking software](https://www.selecthub.com/hris/time-and-attendance/time-tracking-software/) modules. One of the main benefits of an ERP solution is that it automates routine workflows to reduce human error and time, such as data entry, general ledger balancing and more. Using enterprise resource planning software with an integrated accounting system and human resources module lets you send automatic payments to employee bank accounts and manage compensation forms with less effort. ### 2\. [Customer Relationship Management (CRM)](https://www.selecthub.com/category/customer-relationship-management/) Managing your customers and leads is another crucial facet among the components of ERP. Without them, your business can’t survive. A [CRM tool](https://www.selecthub.com/crm-software/) stores and tracks generated customer and lead data, helping you develop helpful insights for sales and marketing improvements. One primary CRM use is tracking customer buying habits. With this information, you can see which products lack sales and the best timeframes for upselling. Additionally, you can use this module to track conversation history with leads to know which sales personnel spoke to clients, when they talked and what they discussed. This data reduces redundancy and customer irritation for more successful profits. With [eCommerce software](https://www.selecthub.com/ecommerce-platforms/), you can integrate your CRM process to target ads accurately and preserve customer payment information. These features guarantee that customers have the most streamlined buying experience possible. This solution is just one example of how to benefit your customers. ### 3\. [Business Intelligence (BI)](https://www.selecthub.com/category/business-intelligence/) BI has quickly become a standard component of ERP systems. BI collects data and performs analysis to provide actionable insights about business processes. As businesses rely more heavily on data-based decisions, standalone [BI software](https://www.selecthub.com/business-intelligence-tools/) becomes indispensable. ![Tableau Dashboard]() An example of Tableau. A good reporting feature is vital in BI and enables you to make sense of the analyzed data. Some reports come in the form of numbers and tables. However, many prefer visual documents because they allow you to spot trends at a glance. Verify that whatever data format is best for your company is available in your ERP’s reporting capabilities. When you use an integrated solution, actionable insights allow you to make informed business decisions across departments and processes. One huge pain point in companies that have yet to implement an ERP system is that the department silos information. Therefore, it is easier to see a complete view of data and how various business aspects affect profitability and customer retention. [Compare Top ERP Software Leaders](https://pmo.selecthub.com/top-erp-software-site-vers/) ### 4\. [Supply Chain Management (SCM)](https://www.selecthub.com/category/supply-chain-management/) Creating an effective supply chain is never easy, especially when you don’t have the best tools to oversee your operation. Ensuring that your core ERP components have SCM capabilities is crucial to staying competitive in this arena. Your [SCM applications](https://www.selecthub.com/supply-chain-management-software/) should optimize [distribution](https://www.selecthub.com/category/distribution/) and [manufacturing](https://www.selecthub.com/category/manufacturing/) processes to create a more efficient supply chain by collecting real-time data. [Real-time data](https://www.actian.com/blog/are-real-time-analytics-in-supply-chain-management-important/) allows you to find and fix issues as they happen instead of after. It also makes predictive analytics possible to help with demand planning. Real-time data can help you create an accurate and up-to-the-minute production plan to meet and exceed demand. The SCM component of enterprise resource planning can also assist in boosting profitability by measuring factors such as which inventory items are commonly purchased together and then using that information to optimize the best placement for items on the warehouse floor. SCM coupled with CRM can help keep customers updated on the status of their purchase within the distribution process and estimate a delivery date. ### 5\. [Inventory Management](https://www.selecthub.com/category/inventory-management/) Monitoring inventory is vital among components of ERP solutions because it’s highly collaborative. It works with the SCM component while dipping its toes in other processes, such as warehouse management and sales. [Inventory management systems](https://www.selecthub.com/inventory-management/inventory-management-software-top-features-requirements/)‘ main features include managing order fulfillment and maintaining a warehouse’s stocking functions. Best-in-class inventory management is essential to core ERP components, including tracking features that can reduce manual inventory control. These features may possess revision level tracking, multi-level serial number tracking and multiple units of measure per product ID or [SKU](https://www.shopify.com/encyclopedia/stock-keeping-unit-sku). This component is especially beneficial to manufacturers or companies with distribution centers because it assists in the profitability and functionality of inventory processes. An integrated solution could update your company website to say that an item is out of stock to avoid making orders for unavailable on-hand items. ### 6\. [Accounting](https://www.selecthub.com/category/enterprise-resource-planning/accounting/)/Financial Management The final main component of ERP is accounting, aka financial management. Because every business process involves money flow, whether paying your employees or paying to ship goods, this tool works with other ERP system components. [Accounting tools](https://www.selecthub.com/accounting-software/) analyze and track financial data, including accounts receivable, [accounts payable](https://www.investopedia.com/terms/a/accountspayable.asp), budgets and costs. Financial data analyses can reveal trends in your spending, helping you better understand calculated profits and discover where you can reduce costs. You also obtain predictions to project future revenue. Profitability is the driving force of all businesses, making it fundamental among components of ERP systems. These platforms maximize revenue by integrating sales, customer relations and distribution practices. The software ultimately increases productivity and frees employee time to work on non-automated tasks. [Compare Top ERP Software Leaders](https://pmo.selecthub.com/top-erp-software-site-vers/) ## Secondary Components Multiple ERP [features and add-ons](https://www.selecthub.com/enterprise-resource-planning/key-erp-functional-requirements/) exist to target more specific business needs. Here are some extra modules that you might consider adding to your solution. * **Risk Management:** Predict and reduce business risks seamlessly. This tool may also suggest [business continuity plans (BCPs)](https://www.kyndryl.com/us/en/learn/plan) for emergencies and unplanned situations. * **[Marketing Resource Management (MRM)](https://www.wrike.com/marketing-guide/marketing-resource-management/):** MRM aligns people, processes and technology to support and enhance marketing efforts. * **Sales Order Management:** Sales-order management can assist your company in managing sales orders through their entire lifecycle, from sales order generating to billing/invoicing. * **Advanced Planning System:** This tool uses data to track production costs for manufactured goods. It might also optimize the allocation of raw materials and capacity to balance consumer demand with the warehouse space available. * **Event Management:** This solution allows the end-user to run events and hospitality programs from start to finish. ## Primary Benefits [ERP software benefits](https://www.selecthub.com/enterprise-resource-planning/erp-advantages-and-disadvantages/) are vast and depend on specific tools and modules. However, there are some basic bottom-line pros that you can achieve upon ERP implementation. Some of them are listed below: ![Benefits of ERP Components]() * **Boost Profitability:** ERP software can help grow revenue in many ways. For example, your contract management tool may measure the profitability of a sales contract based on the estimated level of effort and resources. Forecasting tools are common and can help develop valuable insights into future activity. * **Reduce Wasted Time:** Thanks to automation, you can reduce the time your employees spend on projects, including manually inputting receipts for expense information or data to make a visualization. * **Leverage Manpower on Different Projects:** Automating business processes will also help free up employees’ time to work on high-priority tasks, leading to a productivity surge. * **Streamline Workflows:** The all-in-one solution of an ERP is helpful because it’s a hub for data and processes across a business. This centralization makes it easier for employees across different departments to work together. They can also better understand different team workflows and objectives. [Get our ERP Software Requirements Template](https://pmo.selecthub.com/erp-requirements-template-site-vers/) ## Do Your Research Researching core ERP components is a lengthy and sometimes tedious process. But reading articles, conversing with different vendors, setting up demos and talking to colleagues, stakeholders and other end users ensure your ERP system is ready for the long haul and can endure company growth. For more ERP solutions and features, check out our in-depth [comparison guide](https://pmo.selecthub.com/top-erp-software-site-vers/). What other components of enterprise resource planning do you think should make the list? 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Contributions from Khaleel Hayes, and Hunter Lowe. ## About the Contributors The following team members helped research, create, and review this content. [ ](https://www.selecthub.com/author/khaleel-hayes/) Written by [Khaleel Hayes](https://www.selecthub.com/author/khaleel-hayes/) Technical Content Writer Khaleel Hayes is a Technical Content Writer for SelectHub, with over 4 years of experience crafting content for manufacturing, PLM, ERP and technology selection audiences. He's also a freelance writer in his spare time. His body of work includes poetry, short plays, feature articles and film reviews either self-published or in Denver publications. He graduated with a B.A. in Journalism and an English minor from Metropolitan State University of Denver in May 2018\. When not writing, he enjoys classic movies and music, tasty burgers, tasteful bookstores, and breathtaking art and photography. [See Full Bio](https://www.selecthub.com/author/khaleel-hayes/) [ ](https://www.selecthub.com/author/hunter-lowe/) Edited by [Hunter Lowe](https://www.selecthub.com/author/hunter-lowe/) Content Editor Hunter Lowe is a Content Editor, Writer and Market Analyst at SelectHub. His team covers categories that range from ERP and business intelligence to transportation and supply chain management. Hunter is an avid reader and Dungeons and Dragons addict who studied English and Creative Writing through college. In his free time, you'll likely find him devising new dungeons for his players to explore, checking out the latest video games, writing his next horror story or running around with his daughter. [See Full Bio](https://www.selecthub.com/author/hunter-lowe/) Khaleel HayesSAP vs. Oracle: Which ERP Software is the Winner in 2026? * ‹ * › ### Conversation (20) ![Avatar](https://secure.gravatar.com/avatar/281d3616cf761f3582c0d76c23517846?s=32&d=mm&r=g) Write a response [Cancel reply](https://www.selecthub.com/enterprise-resource-planning/6-main-erp-components/#respond) Your message Your name \* Your email \* Website Save my name, email, and website in this browser for the next time I comment. Δ * ![Avatar photo](https://secure.gravatar.com/avatar/07e7bd7ad5b51ebfb16e7eb06152ca70db219047bdc5db7c2b15a64024471dfe?s=96&d=mm&r=g) #### **Perry** \- March 26, 2023 Very informative. Thanks **[Reply](#comment-169895)** [![Avatar photo](https://www.selecthub.com/wp-content/uploads/2020/07/Khaleel-48x48.jpg)](https://www.selecthub.com/author/khaleel-hayes/) #### **Khaleel Hayes** \- March 27, 2023 Thanks for reading, Perry! **[Reply](#comment-170009)** * ![Avatar photo](https://secure.gravatar.com/avatar/6484b98fa704f2e8a5e993248bb77e3376786d0ffd9a6b82d317471836bc913c?s=96&d=mm&r=g) #### **Doug** \- March 5, 2023 Excellent source of information! Thanks for this article. **[Reply](#comment-165535)** [![Avatar photo](https://www.selecthub.com/wp-content/uploads/2020/07/Khaleel-48x48.jpg)](https://www.selecthub.com/author/khaleel-hayes/) #### **Khaleel Hayes** \- March 7, 2023 Thanks for reading, Doug! **[Reply](#comment-166408)** * ![Avatar photo](https://secure.gravatar.com/avatar/024741f467a7b36bfa6cab33e6d0555c73cc001b2a837f131e079c45035aceb4?s=96&d=mm&r=g) #### **Jackie Ralph** \- January 26, 2023 An excellent article. It helps the reader to gain a thorough insight as it relates to the Components of the ERP software and the benefits it will bring to your business **[Reply](#comment-159004)** [![Avatar photo](https://www.selecthub.com/wp-content/uploads/2020/07/Khaleel-48x48.jpg)](https://www.selecthub.com/author/khaleel-hayes/) #### **Khaleel Hayes** \- January 30, 2023 Thanks for reading and for the kind words, Jackie! **[Reply](#comment-159574)** * ![Avatar photo](https://secure.gravatar.com/avatar/3cd9ea0e4caa46616233c3bfefcdfd27dfec9c3b58e3d60b03d49c273b49851e?s=96&d=mm&r=g) #### **khushbu** \- November 28, 2022 Very detailed and an easy explanation. thanks **[Reply](#comment-152791)** [![Avatar photo](https://www.selecthub.com/wp-content/uploads/2020/07/Khaleel-48x48.jpg)](https://www.selecthub.com/author/khaleel-hayes/) #### **Khaleel Hayes** \- November 28, 2022 Thanks for reading, Khushbu! **[Reply](#comment-152803)** * ![Avatar photo](https://secure.gravatar.com/avatar/9c3e4f29c165f3200be3ee3d4dfd5558c3b7020fc7884e7764d72a259fdfa63a?s=96&d=mm&r=g) #### **Chimaizu Godwin** \- February 8, 2021 Nice 1, kudos to the writer(s) and publishers **[Reply](#comment-61175)** [![Avatar photo](https://www.selecthub.com/wp-content/uploads/2020/07/Khaleel-48x48.jpg)](https://www.selecthub.com/author/khaleel-hayes/) #### **Khaleel Hayes** \- March 1, 2021 Thanks for reading, Chimaizu! **[Reply](#comment-63357)** * ![Avatar photo](https://secure.gravatar.com/avatar/44abfbd413d4784f2d9f941992b57b2ad9dbef036c5c9ddb0d9763d028ecb5db?s=96&d=mm&r=g) #### **Amer** \- February 7, 2021 thanx for elaborating the glitchs too. **[Reply](#comment-61144)** [![Avatar photo](https://www.selecthub.com/wp-content/uploads/2020/07/Khaleel-48x48.jpg)](https://www.selecthub.com/author/khaleel-hayes/) #### **Khaleel Hayes** \- March 1, 2021 You’re very welcome, Amer. Thanks for reading! **[Reply](#comment-63366)** * ![Avatar photo](https://secure.gravatar.com/avatar/70a5fedc815a889142be415a6c798106b06ab23994215bad5cd58aa7b3846a52?s=96&d=mm&r=g) #### **Adnan Bashir** \- December 22, 2020 It’s really helpful for me, Lot of thanx Lindsey Jenkins **[Reply](#comment-57013)** [![Avatar photo](https://www.selecthub.com/wp-content/uploads/2020/07/Madeline-48x48.jpg)](https://www.selecthub.com/author/madeline-reinbolt/) #### **Madeline Reinbolt** \- January 25, 2021 We’re glad our article was helpful to you, Adnan! **[Reply](#comment-59904)** * ![Avatar photo](https://secure.gravatar.com/avatar/49659f4770d1a6efd70655de8bf8b8f8029b478f889331f523d2babe555eccc9?s=96&d=mm&r=g) #### **ELLY KIPLIMO ROP** \- September 12, 2020 Hi the information is very good and helpful about ERP **[Reply](#comment-47491)** [![Avatar photo](https://www.selecthub.com/wp-content/uploads/2020/07/Madeline-48x48.jpg)](https://www.selecthub.com/author/madeline-reinbolt/) #### **Madeline Reinbolt** \- October 12, 2020 Hi Elly, thanks for leaving us a comment! **[Reply](#comment-50438)** * ![Avatar photo](https://secure.gravatar.com/avatar/e465c7dd74787f7b2f8c0439982332f2f6e8e24f9d00979e1b04276d4adffbba?s=96&d=mm&r=g) #### **Caleb** \- July 14, 2020 Its a nice article to read for start up guys who want to learn more about ERP and its benefit’s. **[Reply](#comment-42295)** [![Avatar photo](https://www.selecthub.com/wp-content/uploads/2020/07/Madeline-48x48.jpg)](https://www.selecthub.com/author/madeline-reinbolt/) #### **Madeline Reinbolt** \- July 21, 2020 Thanks for the comment, Caleb! **[Reply](#comment-42658)** ![Avatar photo](https://secure.gravatar.com/avatar/971a631f49a27e064e75bd3b6b300fead446473a989fb3f7cd4a2505e6a8635a?s=96&d=mm&r=g) #### **Opar Joshua** \- October 4, 2021 Thanks alot. **[Reply](#comment-91336)** [![Avatar photo](https://www.selecthub.com/wp-content/uploads/2020/07/Khaleel-48x48.jpg)](https://www.selecthub.com/author/khaleel-hayes/) #### **Khaleel Hayes** \- October 6, 2021 Thanks for reading, Opar! **[Reply](#comment-91618)** **Tier 1:** Fully/moderately supported out-of-the-box allowing for quick and easy deployment. Fully or moderately supported out-of-the-box with industry-leading capabilities and is immediately available after installation without needing any add-ons, integrations, or custom development. **Tier 2:** Supported with workarounds or add-ons that may require additional costs. Not directly available in the software, but can be accomplished using other built-in features, workarounds, or add-ons/products from the vendor with or without any additional cost. **Tier 3:** Requires partner integrations or custom development that is often at an additional cost. Requires additional integrations, plugins, marketplace applications from a third-party vendor, or custom development using the APIs, libraries, extensions, and development framework supported by the software, with or without any additional cost. 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