Why Are ERP Systems Worth Their Cost? That Is,how Do

question 48

Essay

Why are ERP systems worth their cost? That is,how do companies justify ERP investments?

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Definitions:

Present Values

The current worth of a sum of money to be received or paid in the future, discounted at a specific interest rate.

Net Present Value

A calculation that determines the current value of a series of future cash flows, discounting them by a specified rate to evaluate investments or projects.

Present Value

The present value of a future amount of money or series of cash flows, based on a particular rate of return.

Future Cash Inflows

Projected cash earnings from investments, operations, or financial instruments over a specified future period.