ERP Glossary
Definitions of common ERP, Odoo, ERPNext, and business management terms
A to Z of ERP Terms
New to ERP? This glossary explains the most common terms you will encounter when implementing Odoo, ERPNext, or any enterprise resource planning system.
A
API (Application Programming Interface)
A set of rules that allows different software applications to communicate. Odoo provides REST and XML-RPC APIs to integrate with third-party tools.
AR Aging
Accounts Receivable Aging report shows unpaid customer invoices grouped by how long they have been outstanding (e.g., 0-30 days, 30-60 days).
B
BOM (Bill of Materials)
A structured list of raw materials, components, and quantities needed to manufacture a product. Multi-level BOMs include sub-assemblies.
B2B (Business to Business)
Transactions between businesses, as opposed to B2C (business to consumer). B2B sales cycles are typically longer and involve more decision makers.
C
CRM (Customer Relationship Management)
Software for managing interactions with current and potential customers. Odoo CRM tracks leads, opportunities, and customer history.
CMMS (Computerized Maintenance Management System)
Software for managing equipment maintenance, work orders, and asset lifecycles. Available as part of Odoo Manufacturing.
D
DocType (ERPNext)
The fundamental building block of ERPNext. Each business object like Customer, Invoice, or Item is a DocType with its own fields and behaviors.
E
ERP (Enterprise Resource Planning)
Software that integrates core business processes like finance, HR, sales, inventory, and manufacturing into one unified system.
EDI (Electronic Data Interchange)
Standard format for exchanging business documents (purchase orders, invoices) electronically between trading partners.
F
FIFO (First-In, First-Out)
Inventory valuation method where the oldest stock is assumed to be sold first. Important for accounting and inventory cost calculations.
Frappe Framework
The open-source Python web framework that powers ERPNext. Used for building custom DocTypes and business applications.
G
GL (General Ledger)
The master accounting record containing all financial transactions categorized by accounts. Foundation of all financial statements.
GAAP (Generally Accepted Accounting Principles)
Standard accounting rules used in the USA. Odoo Accounting supports US GAAP compliance.
H
HR (Human Resources)
The function and software managing employees, payroll, attendance, leave, and performance. Odoo HR covers all aspects.
I
Inventory Turnover
The number of times inventory is sold and replaced over a period. Higher turnover usually indicates efficient inventory management.
K
Kanban
Visual workflow management method using cards on a board. Odoo uses Kanban views extensively for sales, projects, and CRM.
KPI (Key Performance Indicator)
Measurable values showing how effectively a business is achieving objectives. Odoo dashboards display KPIs in real-time.
L
Lead Time
The time between order placement and delivery. Critical for inventory planning and customer satisfaction.
LIFO (Last-In, First-Out)
Inventory valuation method where newest stock is assumed to be sold first. Less common than FIFO and not allowed under IFRS.
M
MRP (Material Requirements Planning)
Production planning system that calculates raw material needs based on demand forecasts and inventory levels.
MRR (Monthly Recurring Revenue)
Predictable monthly revenue from subscriptions. Key metric for SaaS and subscription businesses.
Multi-Currency
The ability to record transactions in multiple currencies with automatic exchange rate conversion. Essential for international business.
O
Odoo
Open-source business management software with 50+ integrated modules. Available in Community (free) and Enterprise editions.
OEE (Overall Equipment Effectiveness)
Manufacturing metric measuring availability, performance, and quality of equipment. Odoo MRP tracks OEE automatically.
On-Premise
Software deployed on your own servers rather than the cloud. Used for data sovereignty and compliance requirements.
P
POS (Point of Sale)
System used at the point of customer transaction. Odoo POS works for retail and restaurants with offline capability.
PO (Purchase Order)
Document sent to a supplier to authorize purchase of goods or services. Tracked in Odoo Purchase module.
PLM (Product Lifecycle Management)
Managing a product from inception through engineering, manufacturing, service, and disposal. Built into Odoo Manufacturing.
Q
QC (Quality Control)
Inspection processes to ensure products meet quality standards. Odoo Quality provides checkpoint workflows.
Quote-to-Cash
The end-to-end process from creating a quote to receiving payment. Odoo automates the entire cycle.
R
RFQ (Request for Quotation)
Document sent to suppliers asking for prices and terms. Odoo Purchase manages RFQs and compares supplier responses.
ROI (Return on Investment)
Profit gained relative to cost. Typical Odoo ERP implementations show ROI within 12-24 months.
S
SaaS (Software as a Service)
Cloud-based software delivery model. Odoo Online and Odoo.sh are SaaS offerings.
SKU (Stock Keeping Unit)
Unique identifier for each distinct product. Essential for inventory management and tracking.
SLA (Service Level Agreement)
Contract defining expected service performance levels. Rubicon offers Bronze, Silver, and Gold SLAs.
T
TCO (Total Cost of Ownership)
Complete cost of ERP including licenses, implementation, training, hosting, and support over its lifetime.
U
UAT (User Acceptance Testing)
Final testing phase where end users verify the system works as expected before go-live.
V
VAT (Value Added Tax)
Consumption tax used in UAE (5%), UK (20%), and many other countries. Odoo automates VAT calculations and reporting.
W
WMS (Warehouse Management System)
Software for managing warehouse operations including receiving, putaway, picking, packing, and shipping.
Work Order
Instruction to manufacture a product or perform maintenance. Includes BOM, routing, and assigned resources.
X
XML-RPC
Remote procedure call protocol Odoo uses for external API integration alongside REST APIs.
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