ERP Customization Issues Explained
ERP customization can be a controversial topic. Some people will see it as an obstacle that must be overcome and avoid it, yet there are others, who see ERP customization as an opportunity; as a way to build on and enhance the identity of your brand and separate yourself from your competition. ERP customization issues are common and manageable side effect of taking a large leap in technological capability and efficiency. Over the course of this article, I will try to explain to you exactly what I mean by this and how you can see the opportunity in something that presents itself in the form of a problem.
1.Customizing Your ERP is Virtually Inevitable
Unless you have some sort of crystal ball or are in touch with future versions of you, there is really no way to avoid customizing your ERP at least in some small way. ERP developers design modules to handle common business processes at the time, but common business processes do not always remain popular and “best practices” are always evolving. So it’s extremely likely that any given ERP of right now will have many difference features from the ERP of 5 years from now, using this logic, you may not want to wait for the ERP to update so you can take advantage of the current best practices in your industry.
Another thing that you can’t predict is what your business will be doing in the future. The world of enterprise is volatile and unpredictable, and there will be times when your business will have to adapt, change course, scale-down, scale-up, or even explore a new industry. All of these changes could mean new ways of doing business, and these processes probably weren’t considered when you first picked out and implemented your ERP.
The numbers do not lie! In Panorama’s 2016 ERP report, they found that only 10% of businesses using an ERP have done ZERO customization. With numbers like this, it’s safe to bet that your business will probably have to deal with customization some point in time. And if you find that you are in that lucky 10% that needs no customization and have no ERP customization issues, don’t break out the champagne just yet, you may be missing something. But, I will get into this a bit later.
2. ERP Customization Issues Can Bury You
Customizing your ERP can come with some nasty side effects. So whenever the topic does come up it’s in your best interest to 1. perform a gap analysis to be sure you need the customization and 2. make sure you understand exactly what you’re getting into. As I mentioned in a past article, ERP implementations have a high failure rate and an even higher rate of projects that are finished over budget, past expected deadlines, and performing below customer expectations. A large reason for this is because of customizations that need to be implemented before “go live.” Over-customization can easily stall, or worse case scenario, completely sink an implementation project before it gets off the ground.
It is imperative that you understand that ERP customization will always add to the scope and complexity of a project along with additional costs for maintenance and training down the road. Don’t let this scare you away from customization, though, there are a number of very solid reasons to customize your ERP. Its a matter of understanding the
3. ERP Customization Can Be the Best Investment You Ever Make
When implementing your ERP there will come a time when you have to decide what’s going to change. Either your business is going to have to change to fit the mold of the ERP or the ERP is going to change to fit your unique business. Let me tell you now, there is a lot the pressure here. Getting this decision right can mean the difference in long, headache-filled nights working with third-party developers to keep your ERP from crashing and beating your quarterly earning projections by a mile.
To get this decision right you must understand what it is about your business that gives it a unique advantage over the competition and customize the ERP in a way that enhances these features. Doing this will ensure that the program is adding directly to your competitive advantage and helping a successful business become an even better version of itself. This is the opportunity I was talking about in the introduction, this is your chance to see what some people see as an obstacle and turn it into a strong competitive advantage. This is also why having zero ERP customization is a cause for concern. If the vanilla version of an ERP can satisfy all of your business needs, either your business is in no way unique or you adapted too much to the ERP during implementation, both scenarios should give you reason to reconsider the relationship you have with your ERP and how you think about ERP customization issues.
You should also understand, though, that you must still pick your customization battles to avoid over-complication and unnecessary costs. If your unique way of handling a process doesn’t contribute to your unique solutions or products as a business then it may be wiser to adapt to the “best practices” outlined by the ERP. Finding the right compromise between changing the ERP and changing the business will be critical to your success with any ERP system.
4. You Should Purchase Your ERP with Customization in Mind
If you’ve read this article up to now then this last point should be a no-brainer to you. When you are going through the process of choosing an ERP you should expect to do some sort of customization for reasons I have outlined above. However, not all ERP’s are created eqaul with regards to customization and some ERP customization issues are more common for certain platforms. So we created this checklist you can use to identify an ERP that will be flexible enough to meet your most unique needs and not bury you with excessive development and maintenance costs.
- The ERP has well-documented APIs that enable you to modify all business logic.
- Customization code can be written in standard languages using common development tools. Otherwise, you will have to spend a lot of time, effort, and money finding developers that know the proprietary language of your ERP system.
- The ERP has a software development kit or a method to easily upload or import custom development.
- Customizations are managed separately from core logic, so upgrades and updates do not break customizations.
- Customizations occur at any time and are not dependent on software releases.
An ERP with these qualities will be much cheaper to customize and maintain, I would still caution you not to go overboard, though. ERP customizations are not to be taken lightly no matter what ERP you are working with.
I hope this article does not scare you away from ERP customization but instead prepares you to be the kind of person that sees ERP customization as an opportunity and motivates you to use customization in a way that enhances the unique features that make your business successful. If you have any questions please leave them in the comment section below, and if you liked the article please subscribe for more! And as always, thank you for reading.
2016 ERP Report, Panorama Consulting, http://panorama-consulting.com/resource-center/2016-erp-report/
Kanchymalay, K., Krishnan, R., Arif, F., Amiruddin, S., Salam, S., & Hashim, U. R. (2013). The extent of ERP customization towards user satisfaction in daily operation for manufacturing companies. Journal of Computers, 8(7), 1788.
Parthasarathy, S., & Sharma, S. (2014). Determining ERP customization choices using nominal group technique and analytical hierarchy process. Computers in Industry, 65(6), 1009.
Zach, O. and Munkvold, B.E. (2012), “Identifying reasons for ERP system customization in SMEs: a multiple case study”, Journal of Enterprise Information Management, Vol. 25 No. 5, pp. 462-478.
Jeremy McCourt is an content producer in the enterprise software industry that focuses on NetSuite and related cloud-based software solutions.
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