Based on past researches Enterprise resource planning (ERP) systems defined as an integrate business processes and information technologies into a synchronized suite of procedures, applications and metrics. ERPs are expected to enhance all of the corporate performance due to redesigned or rebuild business processes, integrated business functions, accelerated reporting cycles and expanded information capabilities (O’Leary 2000). On other hand Enterprise Resource Planning (ERP) system is business or financial management software, which used to manage and integrate business functions in the organization.
Therefore it’s consists of, finance, Human Resource, sales, material management, control and production planning. An example for those who provides these solutions is SAP in Germany and Oracle. But many organizations now are restricted their operation to companies who have the same ERP. Many organizational effects of ERP systems have been widely addressed in the popular literature. However, there is a littlie of empirical research examining the impact of ERP system on firm performance. Recently, calls for empirical researches into the effects of ERP system on firm value have viewed in the literature (Lee, 2000).
In the past, an increasing number of firms that’s impacted by information technology as a form of computerized transaction processing and electronic telecommunications. For competitive reasons, companies have to change the line and then computerized system that’s called enterprise resource planning systems (ERPs). An ERP system has a combined database that integrated together by links all systems in all departments of the company as a whole consist for example capital budgeting together with financial accounting, etc. ERP systems, by linking all sub-systems through a data warehouse, enable a company to manage its operations overall.