Advantages and disadvantages of enterprise systems
Almost every business customises their ERP because off-the-shelf they never fully cover their needs.
Nowadays most companies are customising their ERP software. At least 37% of this companies customise between 26% to 50% of their ERP system.
Advantages and disadvantages of erp system are often related with the way you implement the system in your company and that's tightly related with the way you take on erp customization.
What is an erp disadvantage should be always related to the size of the company, in first place. If you have more than 20 employees it's hard to go by without and ERP. Implementing ERP in a scalable approach with a controllable budget, specially focusing on the structural basis of the company it's always a path to success.
Everything today is customised
As we all know, today everything is customised, from our personal social media page to consumer products. Its a fucral feauture that companies look for when searching for an ERP software to suit them, not only to make sure that their system is prepared for their evolution but also due to the Era of technologies we live in where everything is being updated and innovated and Closed-Source softwares are getting out of demand.
As mentioned, the market is expanding faster than ever and competition also grows with it. Companies must guarantee their competitive advantage at all cost, off-the-shelf solutions assume you don't have one. To assure such advantage your ERP can't be easily copied otherwise anyone could replicate the competite advantage of your business.
At first, no one wants to customise
As good as it might sound, most business apps are ready to use, however you might have to add manual preceadures around it or change your methods to fit the software. This is where software customisation comes in.
Usually customers don't want any customisation, they want a system without any changes to the code and not significant adjustment even though configuration and personalisations are always needed.
During the implementation of a new ERP, businesses recognise one or two things that doesn't work quite right making them ask for minor changes to the software, which usually leads to a lot more changes.The 2018 ERP REPORT shows the low number of businesses without customisation.
To get a better competitive advantage an ERP software needs to be customised from it's key business functions or support capabilities to be added.
Companies that commercialize ERP software aren't willing to customise it. They don't want to change the way that they do things.
Sometimes resistance to change results in over-customization of the system. It's important to consider how the changes align with the business and IT strategies.
The state of ERP customisation
All organisations go through some kind of customisation, here are the reasons for it:
- Complexity of processes or transactions
- Supporting competitive advantage
- Size of the Organisation
Most business prefer off-the-shelf ERP, but as the implementation goes by the urge for customisations rises. The 2018 ERP Report shows tha only 11% of companies using ERP didn't have any customisation, while 70% had some customisation (11 to 25% of code modified) and 37% had significant customisation (26 to 50% of code modified) done.
The majority of the participant are large organisations, with 85% representing businesses of $50M worth or more.
Customisation varies with company size. Larger companies customise more to keep their competitive advantages. Smaller companies leverage “out of the box” functionalities and best practises.
Customisation or Configuration?
There’s a difference between software customization and configuration. Configuration is the normal set-up of the software (fields, workflows, parameters). These changes are part of an installation and don’t need changes to the code. Sometimes, objectives can be met with configuration instead of customisation.
Customisation needs changes in the code. It also needs a higher level of technical knowledge. To make a customisation to software, you need to change its code. New code is added to the system to allow new functionalities in the ERP. You can ask for new capabilities or to remove features you don’t need.
What do you need to do to have a successful customisation?
You need clear business requirements. If they’re not well defined, customisation will not help you achieve your goals. Your business requirements will help you choose the right ERP system as well.
A cost-benefit analysis of the customisation ensures you’re only changing parts of the ERP that will give you unique competitive advantages. A successful ERP project has your requirements listed according to priority. The project managers look at what can be done within the core functionality of the system and where customisation is needed.
Every company is different. Each has their own needs and requirements. No ERP is going to cover all your requirements. So, you need to find the right ERP software that will minimise customisations.
Advantages and Disadvantages of ERP customisation
Protection of competitive advantages
Customised to your processes and workflows
Perfect fit for the company and user
Upgrades are more complex, risky and expensive
Can weaken ERP built-in best practices
From the main container, you can change the background to highlight features.
Mismatch with business needs
Helps with changes to business processes
Quick employee acceptance
Minimise confusion by removing unwanted features
Lack of project controls
The downside of customisation
Some companies have their system completely customised. Upgrades and maintenance are expensive and very risky. So, they start looking for another software.
Sometimes, customisations don’t work because they’re a symptom of management issues. Not the problem. The company and its resistance to adopt new business processes and software functionalities are. The business may need to take their investment to organisational management changes.
Most of the time, customised code isn’t supported in system upgrades. During upgrades, it needs to be tested and reviewed.
Open source ERPs are the best solution for customisation
Customising ERP software isn’t very expensive. If the software is open source, this is especially true. It allows you to keep your processes and remove features you don’t need. Open source software makes the whole process a lot easier.
Odoo is made for customisation. With the open code, it’s easy to modify the system without damaging it. Odoo is easily adapted to different industries and business requirements.
An active community of developers is always creating something new. The modules and plug-ins can be added without disturbing the system. There are thousands of modules that you can pick to add to your business. All you need to do is install it.
We are here to help you with your Odoo customisation. Take a look at our process.
You will find your spot in the customisation or no customisation camps. You’ll find where your business fits. It depends on how unique your company is, business processes or how open to change it is. And keep in mind the disadvantages of ERP customisation. Find your balance.