Welcome!

CMS Authors: Mehdi Daoudi, Rishi Bhargava, Harry Trott, Xenia von Wedel, Carmen Gonzalez

Related Topics: CMS, Microservices Expo

CMS: Blog Feed Post

ERP Software Customization: The Ultimate Sin of Enterprise Software?

Customization is one of the most controversial topics surrounding ERP software

ERP Journal on Ulitzer

Customization is one of the most controversial topics surrounding ERP software.  A majority of our clients have every intention of leveraging vanilla, off-the-shelf software during their software selection process.  However, as project teams get into the details of the software during the implementation cycle, requests to make one or more customizations to the software are inevitable.

According to our 2008 ERP Report, only 23% of organizations implement vanilla ERP software with little to no customization.  The remainder of organizations in our study customized their software, with 34% indicating that they heavily customized their software.  According to our same research, large companies with over $500 million in annual revenue are even more likely to customize their software, as are companies in the aerospace, defense, and government industry verticals.

In addition, an organization’s propensity to customize software seems to be at least partially driven by the specific ERP solution being implemented.

The reason for the controversy around customization is threefold,  First, it increases the complexity and risk of an implementation, while at the same time making it potentially more difficult to upgrade software in the future.  Second, it in some ways undermines the best practices built into the software, which software vendors often spend significant R&D developing.  Thirdly and finally, customization is often a symptom of bigger problems, including a solution’s mismatch with a company’s requirements or a lack of project controls during implementation.

So what to do?  Here are three tips to help manage customization of ERP software implementations.

Three Tips to Help Manage Customization in ERP Software Implementations

  1. Understand the difference between software customization and ERP package configuration. Configuration is the normal set-up of the software, such as parameters, fields, and workflows.  These changes are a normal part of any implementation and do not require changes to the source code.  Customization, on the other hand, requires changes to the source code and also requires a higher level of technical sophistication.  Often times, business requirements and objectives can be met via configuration and set-up instead of customization.
  2. Ensure clear, company-wide definition of business requirements. One of the primary drivers of customization is lack of direction regarding business requirements.  If business requirements are not well-defined, it is more likely that a project team will bastardize the software to meet requirements as they are defined.  In addition, clearly defined business requirements will ensure you choose the right enterprise solution during your ERP software selection process.
  3. Establish solid ERP project controls. Without strong project controls and project governance, a project team is more likely to customize every item on the users’ wish list without prioritizing, rationalizing, or identifying potential solutions within the core functionality of the system.  The executive steering committee and project manager need to clearly define criteria for potential customizations, including conducting a cost-benefit analysis of the customization to ensure that you are only customizing where is provides the company with a unique competitive advantage and where there is so viable workaround within the system.

Every company is unique and no single ERP solution is going to meet 100% of a company’s requirements.  However, keeping these three tips in mind and finding the right ERP software with the best functional fit will ensure that your customization needs are minimized.

Read the original blog entry...

More Stories By Eric Kimberling

Founder and president of Panorama Consulting Group. Founded in 2005 and headquartered in Denver, Colorado, Panorama Consulting Group is a niche consulting firm specializing in the enterprise resource planning (ERP) market for mid-sized companies across the globe. Independent of affiliation, Panorama helps firms evaluate and select ERP software, manages the implementation of the software, and facilitates all related organizational changes to assure that each of its clients realize the full business benefits of their ERP implementation. We minimize ERP risk, accelerate implementation progress, and increase the success and value of your ERP initiatives.

IoT & Smart Cities Stories
Nicolas Fierro is CEO of MIMIR Blockchain Solutions. He is a programmer, technologist, and operations dev who has worked with Ethereum and blockchain since 2014. His knowledge in blockchain dates to when he performed dev ops services to the Ethereum Foundation as one the privileged few developers to work with the original core team in Switzerland.
In his general session at 19th Cloud Expo, Manish Dixit, VP of Product and Engineering at Dice, discussed how Dice leverages data insights and tools to help both tech professionals and recruiters better understand how skills relate to each other and which skills are in high demand using interactive visualizations and salary indicator tools to maximize earning potential. Manish Dixit is VP of Product and Engineering at Dice. As the leader of the Product, Engineering and Data Sciences team at D...
Dynatrace is an application performance management software company with products for the information technology departments and digital business owners of medium and large businesses. Building the Future of Monitoring with Artificial Intelligence. Today we can collect lots and lots of performance data. We build beautiful dashboards and even have fancy query languages to access and transform the data. Still performance data is a secret language only a couple of people understand. The more busine...
Bill Schmarzo, author of "Big Data: Understanding How Data Powers Big Business" and "Big Data MBA: Driving Business Strategies with Data Science," is responsible for setting the strategy and defining the Big Data service offerings and capabilities for EMC Global Services Big Data Practice. As the CTO for the Big Data Practice, he is responsible for working with organizations to help them identify where and how to start their big data journeys. He's written several white papers, is an avid blogge...
René Bostic is the Technical VP of the IBM Cloud Unit in North America. Enjoying her career with IBM during the modern millennial technological era, she is an expert in cloud computing, DevOps and emerging cloud technologies such as Blockchain. Her strengths and core competencies include a proven record of accomplishments in consensus building at all levels to assess, plan, and implement enterprise and cloud computing solutions. René is a member of the Society of Women Engineers (SWE) and a m...
Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life settlement products to hedge funds and investment banks. After, he co-founded a revenue cycle management company where he learned about Bitcoin and eventually Ethereal. Andrew's role at ConsenSys Enterprise is a mul...
Whenever a new technology hits the high points of hype, everyone starts talking about it like it will solve all their business problems. Blockchain is one of those technologies. According to Gartner's latest report on the hype cycle of emerging technologies, blockchain has just passed the peak of their hype cycle curve. If you read the news articles about it, one would think it has taken over the technology world. No disruptive technology is without its challenges and potential impediments t...
If a machine can invent, does this mean the end of the patent system as we know it? The patent system, both in the US and Europe, allows companies to protect their inventions and helps foster innovation. However, Artificial Intelligence (AI) could be set to disrupt the patent system as we know it. This talk will examine how AI may change the patent landscape in the years to come. Furthermore, ways in which companies can best protect their AI related inventions will be examined from both a US and...
Bill Schmarzo, Tech Chair of "Big Data | Analytics" of upcoming CloudEXPO | DXWorldEXPO New York (November 12-13, 2018, New York City) today announced the outline and schedule of the track. "The track has been designed in experience/degree order," said Schmarzo. "So, that folks who attend the entire track can leave the conference with some of the skills necessary to get their work done when they get back to their offices. It actually ties back to some work that I'm doing at the University of San...
When talking IoT we often focus on the devices, the sensors, the hardware itself. The new smart appliances, the new smart or self-driving cars (which are amalgamations of many ‘things'). When we are looking at the world of IoT, we should take a step back, look at the big picture. What value are these devices providing. IoT is not about the devices, its about the data consumed and generated. The devices are tools, mechanisms, conduits. This paper discusses the considerations when dealing with the...