Impact of Excessive ERP Customization on Business Efficiency

As we all know, every organization follows certain processes to ensure their excellence in growth and productivity. One important aspect in ERP implementation is using standard features. However, there are several areas where companies need to rely on customization in certain areas or modules, to ensure the smooth implementation of business processes in the ERP system. Nowadays, ERP customization is becoming increasingly important for many different reasons.

1. The company does not want to change existing business processes.

2. The area or module that the company is looking for is not available in the ERP software so we need to make adjustments.

In this post, we will discuss why we should avoid heavy customization in ERP systems. Simple customization or configuration of ERP with settings can be completed quickly but when it comes to complex customization in ERP systems there are various problems that arise, which are as follows:

Increased Time Period – Customizations in ERP solutions increase the project time period.

Project Price – When the project period increases, it will increase the overall cost of the project. There are certain situations where the customization costs are higher than the implementation costs due to many complexities. Think twice before you decide on the level of customization.

Increases Risk – Complex customizations increase the risk of failure because new customizations require a proper foundation to understand customer needs and if the solution does not match your needs due to low project control than a particular customization increases the risk of wasting money, time and resources.

Problems in Migration – When you develop customized areas or modules as per your business process requirements then Migrating a particular module to a new version can take too much time if there is an upgrade of standard features and migration can be done easily.

Apart from the above, companies face many other problems when they do heavy customization. Therefore, we recommend that complex customizations can be avoided to ensure that development costs are less and your organization or department does not have to wait a long time to use the system. If you examine all these points, the pain points of extreme customization in ERP, it lies with the organization and not with the vendor because whatever changes the organization requires, the ERP vendor can make based on their capabilities and experience.

Many companies today avoid heavy customization. However, because too many decision makers from each department requested small customizations in each function of the ERP solution, this problem made the overall customization onerous and lengthy.

Customization Improvisation Tips during ERP Software Development

1. Different Configuration and Customization

The two terms seem similar and are often confused by developers and by organizations. Remember that customization is not Configuration – Configuration in ERP software includes setting fields, parameters and workflows these are small changes, which do not require adjustments in the project source code or do not require adding new lines of code. Meanwhile, customization requires creating a new module from scratch by adding new lines of code which also falls into the new development category.

2. Business Needs Analysis

Ensure that the Business requirements analysis team has covered the customization areas properly and is properly understood by the Project management team and the technical team as sometimes low understanding or misunderstanding of certain areas can lead to failure.

3. Choose the Right Methodology

The methodology during implementation also plays a very important role. You can apply the waterfall method when you know the work is related to configuration and installation but when it comes to developing new modules, the vendor and the organization need to be communicated strongly so as to ensure adjustments happen in the right route.

4. Change is good but not as long as Customization

Always clearly define the customizations you are looking for and freeze them first, there are some cases where customizations even change during or after implementation which creates more problems than extreme customizations.

As we have said that all businesses, processes are unique. Have you ever thought about a single ERP that can easily adapt to your own needs? The simple answer is Odoo.

Also Read: Gunakan 6 Komponen ERP Ini Untuk Menggapai Kesuksesan Pada Bisnis Anda!

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