A systems science approach to enterprise resources planning systems

The enterprise resources planning systems (ERP) have received considerable attention recently, not only in the management of manufacturing industry but also within the services industries and their financial management. The viable system model (VSM) is recursive and helps explaining the general production management model of the ERP system. The recursion level explains the development starting from warehouse management to material requirement planning (MRP), to manufactory requirement planning (MRPII), to ERP and to supply chain management (SCM). In each recursion level, the emergent concepts help explaining the discovery of the two categories of demand: independent demand and dependent demand, the feedback concept helps explaining the closed cycles in MRPII, the local, future and total environment concept helps explaining the interactions between the market and the production system and the law of requisite variety helps to manage complexity.