“Technology” today is the backbone of any growing organization. As a result, the success of the organization can be measured by analyzing its technology infrastructure. As a matter of fact, technology used by an organization is becoming a source of differentiation from competitors. Most of the organizations today want to be proactive rather than reactive in order to meet the changing need of the hour. Looking at the other side of the same coin, the tendency to produce more minimizing the cost is also growing. Adapting open source technology can be one of the best and most feasible options in their arsenal.
An Enterprise Resource Planning (ERP) application forms the base for technology infrastructure in an organization and is the backbone of its IT strategy. Major portion of organization budget is sacked by these ERP apps. However, if companies are to adopt open source ERP systems, a lot can be saved.
Cost saving is one of the most important benefits an open source ERP brings to an organization compared to other proprietary ERPs. In the recent times, many new players have emerged who are offering such ERPs with capabilities and features similar to their established competitors/proprietaries in the market. Adoption of such systems in large enterprises is a very recent movement. However, small and medium business enterprises consider it as a strategic decision and it has become an integral part of their business plan.
The debate on whether open source software can suffice the needs of large enterprises is still going on. Often it is considered that open source ERP fails to offer various features and capabilities that a large enterprise demands for its operation. Getting the benefit of doubt, proprietary ERPs get the preference to run their business. But the problem with such proprietary ERP systems is that they are too expensive for any mid size enterprise to afford, very complex, vendor dependent and bloated with features. Further, their maintenance cost is too high and demands experts to handle it. But the biggest challenge is yet to come. The enterprise doesn’t have access to the source code of these proprietary ERP applications unlike the open source ERPs. Hence it becomes difficult to customize the ERP software considering the future demands of the business.
Until last decade, SMEs had to rely on various sales and accounting software’s to deal with their day-to-day routine work. Evolution of open source software is a boon to such organizations. It has matured to a level where SMEs can now trust this software and embrace it. It offers the following benefits to its users:
- These softwares are far more cheaper compared to other proprietary ERPs. Hence, SMEs can afford it.
- Easy to customize as enterprise has access to the source code.
- User friendly and easy to use as it has limited features that are custom built to meet specific requirements.
- Addition of various features in future is comparatively easier.
Looking at the market trends, it won’t be wrong to say that the fear for open source ERP is slowly dissipating. Adopting an ERP is completely dependent on the enterprise’s needs and budget. By far, such open source software seems to be the best fit for SMEs.