In 1990, Gartner Group first used the acronym ERP as an extension of material requirements planning (MRP), later manufacturing resource planning and computer-integrated manufacturing. Without replacing these terms, ERP came to represent a larger whole that reflects the evolution of application integration beyond manufacturing.
Not all ERP packages developed from a manufacturing core. ERP Vendors variously began with accounting, maintenance, and human resources. By the mid–1990s ERP systems addressed all core enterprise functions. Governments and non–profit organizations also began to use ERP systems.
Expansion: ERP systems experienced rapid growth in the 1990s, because the year 2000 problem and introduction of the euro disrupted legacy systems. Many companies took the opportunity to replace their old systems with ERP.
ERP systems initially focused on automating back office functions that did not directly affect customers and the general public. Front office functions, such as customer relationship management (CRM), dealt directly with customers, or e–business systems such as e–commerce, e–government, e–telecom, and e–finance—or supplier relationship management (SRM) became integrated later, when the Internet simplified communicating with external parties.
"ERP II" was coined in 2000 in an article by Gartner Publications entitled “ERP Is Dead”- Long Live ERP II. It describes web–based software that provides real–time access to ERP systems to employees and partners (such as suppliers and customers). The ERP II role expands traditional ERP resource optimization and transaction processing. Rather than just manage buying, selling, etc.—ERP II leverages information in the resources under its management to help the enterprise collaborate with other enterprises. ERP II is more flexible than the first generation ERP. Rather than confine ERP system capabilities within the organization, it goes beyond the corporate walls to interact with other systems. Enterprise application suite is an alternate name for such systems.
Developers now make more effort to integrate mobile devices with the ERP system. ERP vendors are extending ERP to these devices, along with other business applications. Technical stakes of modern ERP concern integration—hardware, applications, networking, supply chains. ERP now covers more functions and roles—including decision making, stakeholders' relationships, standardization, transparency, globalization, etc.