Most people discover ERP when their spreadsheets start creaking and teams can’t agree on the numbers. But ERP didn’t appear overnight. It’s the result of six decades of steady evolution, each step driven by a simple need: see the whole business clearly, then act faster together.
This is the story of how ERP grew from factory planning tools into today’s cloud platforms that connect finance, operations, customers, people, and supply chains in real time.
The origin of ERP lives on the factory floor. Early computers were rare and expensive, so manufacturers used them for their biggest headache: making sure the right materials were in the right place at the right time.
This was the era of MRP (Material Requirements Planning). MRP took the production plan, exploded it into bills of materials, and told planners what to buy and when. For the first time, purchasing, inventory, and production were synchronised by a single schedule rather than gut feel and clipboards.
As computing power grew, MRP expanded into MRP II (Manufacturing Resource Planning). It didn’t just plan materials; it looked at capacity—machines, people, and time. Finance started paying attention too, because better plans meant fewer stockouts, less excess inventory, and smoother cash flow.
What changed: businesses learned the value of a single plan that different teams could trust.
By the early 1990s, organisations wanted the same planning discipline across the whole enterprise. That’s when the term ERP, Enterprise Resource Planning, took hold.
The concept was simple but powerful: one system, one data model, many functions. Finance, inventory, purchasing, manufacturing, projects, and later HR and CRM, all ran on a shared foundation. When sales booked an order, production saw it. When inventory moved, finance didn’t wait for month-end to learn about it.
Client-server architectures made ERP more accessible. And the looming Y2K remediation wave pushed many companies to replace ageing systems with modern, integrated suites rather than patch dozens of separate tools.
What changed: the enterprise embraced a single source of truth, not just a single production plan.
The early 2000s brought the internet into the core of business systems. ERP vendors added web portals for suppliers and customers, electronic data interchange became normalised, and analytics matured from static reports to dashboards.
But ERPs were still largely installed on-premise. Upgrades were heavy, integrations were custom, and mobile access was limited. IT teams spent huge energy just keeping the lights on.
What changed: ERP began to reach beyond company walls, but ownership and maintenance remained in-house.
The 2010s were the cloud decade. Cloud ERP shifted from novelty to default. Access via a browser, subscription pricing, frequent updates, and elastic scale lowered the barrier for multi-site and remote teams.
At the same time, companies wanted the freedom to pick the best tool for each job without sacrificing control. The result was a composable approach: a strong ERP core for finance and operations, surrounded by specialised apps (e-commerce, WMS, field service, planning & budgeting) connected through modern APIs and iPaaS (integration platforms).
Two important ideas stabilised here:
Two-tier ERP: a global, corporate ERP for consolidation and compliance, with lighter, faster systems in divisions or subsidiaries for day-to-day fit.
Configuration over custom code: use standard capabilities and workflows first; extend only where it truly differentiates the business.
What changed: ERP became the platform, not the whole universe.
Today, ERP is as much about data and decisions as it is about transactions.
Real-time visibility: streaming updates, event-driven alerts, and mobile approvals shorten cycles from weeks to minutes.
Analytics & planning: embedded BI, data warehouses, and connected planning move from rear-view reporting to forward-looking scenarios.
Automation: robotic process automation (RPA), workflows, and low-code tools remove repetitive tasks and enforce controls.
AI/ML: forecasting demand, spotting anomalies, auto-coding expenses, suggesting next actions—AI is becoming a quiet co-pilot inside everyday ERP tasks.
Industry depth: vertical editions (manufacturing, construction, wholesale distribution, services, NFP, etc.) bring prebuilt processes, dashboards, and compliance.
Security, privacy, and sovereignty have matured alongside these capabilities, with role-based access, audit trails, encryption, and regional hosting options now table stakes.
What changed: ERP evolved into the digital nerve system - sensing, learning, and automating as the business moves.
From monoliths to platforms: Modern ERPs expose clean APIs and app marketplaces, so you can extend without breaking the core.
From projects to products: Continuous updates replace multi-year upgrades; value lands in smaller, frequent increments.
From IT-led to business-led: Citizen developers configure workflows; super-users own dashboards; IT governs standards and security.
This matters because it changes the economics: you can evolve the system as the business changes, without starting from scratch.
Start with outcomes. Technology follows strategy. Define the wins first (e.g., “30% fewer stockouts,” “10-day faster cash conversion”).
Design the data early. Common definitions (customer, SKU, project) prevent reporting chaos later.
Configure before you customise. Keep the core clean; extend at the edges.
Treat change as a workstream, not a workshop. Communicate, train, and support super-users long after go-live.
Measure and iterate. Lock in 90-day value sprints after launch; ERP is a product you continuously improve.
We see a few clear directions:
AI-native processes: approvals that triage themselves, forecasts that learn continuously, and assistants that prepare reconciliations and month-end packs.
Event-driven supply chains: IoT signals (machines, fleets, sensors) feeding ERP to predict issues before they hit customers.
Composable finance and operations: deeper specialisation at the edge, anchored by a strong, standardised core.
Trust, compliance, and resilience: built-in controls, sustainability reporting, and cyber resilience moving closer to the transaction.
The headline: ERP will feel less like software you “use” and more like invisible infrastructure that keeps the organisation aligned.
Understanding where ERP came from helps you decide what you need next:
If you’re patching together five tools and spending nights reconciling data, you’re living in the pre-ERP era—start by unifying the core.
If you’re already on a suite but struggling to move fast, you’re ready for the composable era - standardise the centre, specialise at the edges.
If your teams are drowning in manual checks, it’s time to automate and add AI where it reduces risk and gives time back.
At Verde Group, we help New Zealand organisations use ERP evolution to their advantage. We’ll map your outcomes, design a pragmatic roadmap (foundations → operations → insight), and guide a shortlist and pilot so you can adopt what’s proven, without taking on yesterday’s baggage.
Curious where you sit on the ERP timeline? Book a 30-minute ERP readiness chat. We’ll place you on the map and outline the next two or three moves that bring real value quickly.