ERP systems are primarily used by organizations to do automation of their business operations. As logical as it sounds, enterprise resource planning software solutions deal with resources management. Given the ERP, all the income data is stored in a unified database, so everybody within a certain company, regardless of what department they belong in, is allowed to work with that information. So, everyone has access to what they need having it organized, analyzed, and ready for reporting. Besides, ERP as software can take the shape of both a web-based system and a mobile application with the whole set of features appropriately aligned.
Each ERP software must be tailor-made to be able to efficiently address specific areas of performance that a company wants to have improved. These areas can be the following:
- Salesforce automation and marketing
- Human resource management
- Finances management
- Project management
- Compliance monitoring
- Business intelligence
- Synchronized and automated reporting
Besides, ERP software has to facilitate interaction between these areas. What all solutions will have in common is that all components of a system, so-called modules that correspond to separate areas of performance, have to be loosely joined, which will enable their integration with other systems already used by a company. Therefore, the process of developing custom ERP software will involve using modules or building new ones.
What to do: build vs buy an ERP system?
This is the question that a business owner or another decision-maker in a company should decide upon when considering ERP systems. The “build vs buy” decision is a tough one when it comes to the company’s software needs. Choosing in favor of building, you face another question of how to develop web-based ERP software, but while opting for buying, you have to make it clear, what that software should look like.
Buying an off-the-shelf ERP solution will most probably cost you less and this is a great advantage over the tailor-made option. The lack of customization is, however, the reverse side of buying the software. Sooner or later, this disadvantage starts overweighing the cost benefits, especially as the company is growing.
So, eventually, it can become inevitable that the company starts building its proprietary software to be able to scale effectively. But you should remember that a course of events like this is only favorable when this custom software is bound to give you a competitive advantage over your competitors in the market and your business is expanding so that the expenditures on the costly software will be covered due to a larger client base resulting in a larger return on investment.
Disadvantages of building custom ERP software:
- Cost – customized solutions are naturally more expensive.
- Time lag – long periods of time are needed on development, configuration, and testing.
- The limited number of needs are addressed.
- The functionality of ready-made solutions is nearly impossible to modify.
- Incompatibility – chances are it will be challenging to get an off-the-shelf ERP software to communicate with other programs in an attempt to complete certain tasks.
Advantages of developing custom ERP software:
- Costs can also be customized depending on how advanced the solution must be.
- You decide what specialized needs will be addressed.
- Integration with a wide set of third-party programs.
- Increased productivity – custom software designed for you will support you in the most efficient way.
- Once you find a great team to build your ERP solution, they can align your business needs with the current state of the market by building an array of tools and systems for you thus helping you to avoid becoming obsolete.
Enterprise resource planning software examples
If you do decide to go for a ready-made ERP solution, there are some well-known examples thereof that you should weigh in the first place.
NetSuite. It is a cloud ERP acquired by Oracle, the widely known corporation, renowned for its splendid cloud apps and services. Cloud computing is now almost synonymous with data security, flexibility, and accessibility. And when we talk about ERP software in the context of cloud computing, we mean a software-as-a-service delivery model. NetSuite was one of the originators of cloud ERP. Since then, it has been gradually gaining strength. Moreover, with NetSuite, you may rest assured that you are always up to date using the latest version — your cloud ERP solution is being upgraded regularly by its provider.
SAP ERP. It is a business software developed by SAP SE. This ERP solution is focused on areas like financial and asset accounting, material and quality management, production planning, HR, controlling, sales and distribution. SAP ERP targets both large enterprises and small/midsize companies. Unlike NetSuite, SAP’s software can either be deployed on-premise or run as a cloud-based solution. SAP SE is a big provider of ERP solutions, so you have a choice in what way to handle things. There’s also SAP S/4HANA, an intelligent alternative that helps users run their businesses in a more advanced way in the cloud or on-premise.
Dynamics ERP. It is five-fold Microsoft’s enterprise resource planning solution that is represented by Dynamics AX, GP, NAV, SL, and C5. All five products have been purchased by Microsoft at some points in time. They highlight different areas of performance, so your choice should be based on what area you need to optimize and where you want to have them hosted: on local servers or in the cloud. Collectively, they are labeled Dynamics 365.
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ERP system development process
So, if you feel convinced enough to start the development of custom ERP software, now you need to know what steps to take in order to create the product capable of meeting all or at least most of your business needs.
1. Define the goals
One cannot embrace the unembraceable. It is nearly impossible to get everything in one solution straight away even if it is customized. So, first, you must define the vision and scope of work to be undertaken in order to develop your future ERP solution and you should think over your software development in advance. At this step, we outline expectations and discuss the ways in which the goals set can be achieved.
Then, it’s time to come up with a prototype ERP system. The system is prototypical in itself — it is a frame that becomes meaningful after the modules are designed and added. After things are filtered, the needs of various departments are accommodated and prioritized, you and the development team have to picture what the system will look like. This visualization can be done in several ways. You can create wireframes to get an idea of what the UI will look like or you can go for clickable prototypes so that the conversation between a development team and stakeholders could be more productive.
- Hosting. ERP solution can be hosted on local servers or you can take advantage of a cloud host. As we’ve mentioned before, cloud computing is gaining popularity now due to its numerous advantages, one of which is security. On the other hand, local servers require substantial investments in hardware and salaries for employers who will maintain it. As a result, many companies opt for the cloud.
- Databases. A great bulk of important business information is stored in a database. This data is tied to a packaged ERP business application or system and needs to be stored for future reference or analysis. It is advised that NoSQL non-relational databases should be used for enterprise resource planning systems since they are easily scalable, flexible, and quick to set up.
- Integration of ERP modules with legacy apps. Usually, there are apps that an enterprise already uses. When the brand-new ERP software shimmers in the distance, those apps must be integrated with that solution and merged smoothly into a single IT infrastructure.
- UX/ UI design development. Now, you literally should keep going by the wireframes or prototypes that were created at the previous step. Yet, we’ll talk more specifically about ERP software design.
To consider an implementation of the project successful, every aspect of an ERP solution must be tested. Testing ERP systems manually, it will take too much time to complete one round of it, so it will be more difficult to ensure 100% quality. Instead, it’s suggested that companies design their own automated testing frameworks, set up as the whole testing infrastructure.