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ERP builds the "electronic nervous system" to links all units together and increases overall productivity.
In some cases, firms found that they could eliminate most inventories by shifting to faster but more expensive transportation alternatives (e.g. air cargo) that replenished supply just in time. Simply put, ERP allowed information to replace inventory.
The emergence of the Internet facilitated more and more information sharing between firms, extending the benefits of ERP from the value chain of an individual firm to the entire value system of firms and their suppliers and customers. ERP can be a vital component in controlling complex supply chains and in the fast developing world of e-business and B2B electronic exchanges...
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