Puzzled what an ERP software is all about? An ERP(Enterprise Resource Planning) is a cluster of software modules that manages the overall operation of your business. Each of these software modules focuses on a specific business area such as Manufacturing, healthcare, human resources, and much more.
Custom ERP Software Development vs Generic ERP Solution: Which one to Choose?
With ERP, you can streamline your business process, improve customer service, keep up with competitors, and most importantly ́ “Save Money”.
So, without further ado, let’s get started and interrogate the possible solutions for your business.
Choosing the Right ERP Software for Your Enterprise
While adopting ERP software, you can choose between two types of systems viz: Generic or Off-the-shelf ERP software and Custom ERP software.
Generic ERP Software:
These are ready-made ERP Softwares that are developed from an extensive analysis of potential user groups (other organizations) other than yours. You can procure generic ERP Softwares from tier 1 companies such as SAP, Microsoft, Oracle, and many others. These ERP solutions can be extremely beneficial for large enterprises as they provide them with loads of modules and even a bit of customization.
Custom ERP Software:
These are exclusively tailor-made based on the experience of your enterprise. If you are into developing a custom ERP solution for your enterprise, you can direct your software development vendor to build the ERP system that complies with your specific business requirements. If you’re unsure about developing a custom ERP solution for your enterprise and you want it at a cheaper price tag, think about outsourcing your project to Asian countries. Many software development companies in India provide affordable ERP solutions that are tailor-made for your business at an affordable rate without compromising the quality.
Generic ERP Software vs Custom ERP Software: Comparison
|Generic ERP software||Custom ERP Software|
|Features and Functionality||They provide the same solution no matter the industry.||They are capable of delivering unique functionalities that are specific to multiple industries.|
|Domain Knowledge||They won’t clearly have the domain or industry knowledge of how to function within a given domain.||They are developed by carefully analyzing the requirements of your business.|
|Implementation Cost||The initial purchase and integration costs will be on the higher side. Apart from that you also have to shell out large amounts of money for support, annual subscriptions, adding extra features.||Since it requires more development time and extensive testing, you need to spend a significant portion of your corporate budget for its development.|
|Scalability||You can use a generic ERP software solution right away after purchase.||Custom-made ERP software requires a significant amount of development time. It takes from months to even a year to build a fully functional ERP solution.|
|Upgrade||Generic ERP solutions provide only limited upgrades.||You won’t have to spend an extra dime when it comes to upgrades.|
If you want to set up an ERP for business, you can either procure an ERP software or you can build a custom ERP that is tailored for your business needs.
With loads of off-the-shelf ERPs out there, Is it worth it to have a custom ERP for your business? Let’s find out in this blog post.
Why Do You Need an ERP System?
Most of the enterprises out there rely on standalone tools such as spreadsheets for managing their multiple business processes. But this won’t be an effective way of management since managing different applications can get less efficient and time-consuming.
Adding an ERP to your enterprise can change the way your employees work. Many enterprises migrate their workloads to ERP solutions because they are confused with the efficiency of their current models.
Let’s take a closer look at the advantages that you could probably get by implementing an ERP system.
1. Drives Your Enterprise More Closely Towards Industry 4.0
Nowadays, a growing number of enterprises are leveraging ERP to achieve business process automation. Automating core business processes can drive your company closer to industry 4.0. Moreover, ERP systems allow your enterprise to efficiently manage critical tasks.
This will reduce your overall overhead and operating cost. Automating the business process will eliminate the need for repetitive and error-prone backend jobs. Thus, Automation plays an important role in augmenting your business process.
2. Fosters Communication
ERP solutions can intensify internal communication within your organization as it can efficiently integrate multiple departments such as Procurement, Inventory, Production, Warehousing, Administration, hr, marketing, sales, and finance.
Also, real-time communication within the departments allows you to make faster decisions.
3. Hassle-free accounting process
Adopting an ERP system will make your accounting a hassle-free process. Your ERP can automatically process transactions and can even generate financial reports and audits.
Why Do You Need a Custom ERP Software for Your Enterprise?
1. Custom ERP Solutions Are Cost-Effective:
If you are running a startup or medium-sized business, you should probably build a Custom ERP software rather than choosing a generic ERP system.
Implementing an off-shelf ERP software can drain your corporate budget. Besides that, you’ll have to pay even for features that you don’t require.
2. You Can Customize it According to Your Business Needs:
Having an ERP solution that is custom-built for your company will definitely have an edge when compared with off-shelf ERP Softwares.
With a custom ERP solution, there will be greater agility to meet the increasing demands of your business. However, the upfront investment for setting up a custom ERP will be on the higher side.
3. Generic ERP Softwares Doesn’t Include Specific Modules:
Not all companies have similar operations, many enterprises require highly specific modules to be implemented.
For instance, a module that fetches purchase request information from the database to the system can be a good example of this. With custom ERP software, you can counter this issue in an effective manner.
4. Custom ERP Solutions Are Highly Scalable:
Since you can integrate more modules into custom ERP software, it is considered a highly scalable option for your business.
Having the flexibility to reconfigure your ERP software could be highly beneficial for your business, especially your expansion phase.
As custom ERP software is architectured to meet the demands of your enterprise, it will undoubtedly deliver you with increased revenue and solid user experience.
How to Choose the Right ERP for Your Organization?
With so many ERP solutions out there, choosing the right ERP for your organization can be a daunting task.
So what is the right way to implement an ERP solution that suits your organization?
Here we list down two of the important steps to help you choose the right ERP for your organization:
1. Choose an ERP that Suits Your Infrastructure
It’s important to choose an ERP architecture that can effortlessly integrate with your current infrastructure.
So choose an ERP that aligns with your enterprise’s backend management infrastructure.
2. Evaluate the Financial Risks that Are Associated with Buying an ERP:
Don’t get fooled by the cheap marketing tricks of ERP software product companies. Their sole aim is to purchase their software, in order to achieve that they try to soften the risk and costs that are directly linked with purchasing their product. Before buying an ERP software, feel free to ask your vendor about the hidden costs that are associated with purchasing their software which includes its maintenance, hardware upgrades, setup cost, etc.
Not all companies have similar operations, many enterprises require highly specific modules to be implemented. For instance, a module that fetches purchase request information from the database to the system can be a good example of this. With custom ERP software, you can counter this issue effectively.
Adopting an ERP solution will be quite challenging, especially for startups and medium-sized businesses. Both generic and custom ERP solutions have their strong and weak spots, so you
Must carefully analyze the pros and cons of both methods to ensure that your investments will pay off in the long run.
The enhanced security, scalability, regulatory compliance and comprehensive features of custom ERP solutions make it an excellent choice for small to medium-sized businesses.
Thanks for making it to the end ;)
If you are a business owner of a growing startup or medium-sized company, then developing custom ERP software will be the best strategy since they are more adaptable to your changing business needs.
If your company lacks an in house team skilled in developing custom ERP software, you can hire a software development company that offers custom ERP development at a reasonable price tag. Many software development companies in India even provide a demo Version of ERP based on your requirements, prior to the development.
We hope this piece will help you to make informed decisions to evaluate the Systems you actually need.