Why is heavy ERP customization losing demand?

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Before we dive into the ‘why’, it’s important to understand the essence of ERP customization. ERP solutions typically come with a standard suite of features, designed keeping in mind the general requirements of different industries. When an ERP solution is implemented, it usually requires some degree of customization to address the specific needs of individual businesses and organizations.

Customizations are deep changes that are made by modifying the source code of the platform. (For more details on the subject, read our post on the difference between configuration and customization.) These changes can alter an entire application or some parts of it. Customization can be carried out either during the initial ERP implementation or whenever a particular need arises. These modifications usually enhance the capabilities of an ERP application or add new features. ERP applications are generally customized by the vendors, based on a customer’s request, and charges are applied depending on the extent of customization. Basic customization (generally part of the purchase package) is carried out at the time of the implementation.

While customization in unlikely to become obsolete, many organizations are starting to avoid extensive customization because of the risks and costs associated. Here are three common reasons.

ERP customization is expensive.

When you go beyond basic customization, you do so at a cost and things can become expensive. Unless you have a very clear picture of the outcomes you’d like to support, and the processes you need to streamline to get there, customization can be like a trip down a rabbit hole.

ERP customization can make application updates complicated.

In the quest for more features and enhancements, some companies modify the source code of the software to such an extent that the application becomes unrecognizable. This can make it impossible for the vendor or the ERP developer to update the application. Often, in cases like this, if an update is carried out, some customization may stop working entirely or become ‘buggy’.

Too much ERP customization can hamper growth.

A common problem faced by companies who carry out heavy customization is that they lose track of all the changes made. This can cause problems when the time comes to implement operational changes. A customized ERP application is difficult to modify. This can slow down the implementation of new ideas and growth strategies.

ERP vendors invest a lot of time and money developing ERP solutions and keeping it relevant for entire industries with updated features. A properly implemented ERP solution is designed to function seamlessly. Whenever the source code is modified extensively, there is a risk of destabilizing the entire architecture. Many businesses have started to understand these implications and only enter into complex customization when that is the only option available to them. While customization is often the fastest way to add a unique capability to an existing application, the risks involved must be considered.

To learn more about ERP customization and how to carry it out safely and according to manufacturer guidelines, get in touch with PSI at info@psierp.com.

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