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What is the connection between ERP and e-business?

E-business stands for 'electronic business', which involves communications and doing business electronically through the Internet. E-business is defined as the use of electronically enabled communication networks that allow business enterprises to transmit and receive information.

It can significantly improve business performance by strengthening the linkages in the value chain between businesses (B2B) and consumers (B2C). Besides increasing efficiency in selling, marketing and purchasing, e-Business achieves effectiveness through improved customer service, reduced costs and streamlined business processes. Furthermore, e-Business creates a strategic, customer-focused business environment for shared business improvements, mutual benefits and joint rewards.

Companies use the Internet to implement customer relationship management (CRM) and supply chain management (SCM) capabilities, which enabled them to link their operations seamlessly with customers and suppliers.

For example, a beverage manufacturer with 40% growth and Rs. 700 crore in annual sales revenue sells its products through 150 distributors nationwide as well as general stores and cafes in the country. By using ERP system and e-Business platform, the salespersons can track sales and promotions through the Internet and are provided assistance and suggestions to enhance their performance. The sales persons and distributors have access to commission reports and they can track and adjust sales orders. Through consolidating its financial, compensation, sales and depletion data into a single report, the organization prevents out-of-stock and partial shipments. The increased need for more labour force to handle customer service issues in the past was also eradicated by integrating ERP system with e-Business.