{"id":2342,"date":"2020-03-02T19:32:10","date_gmt":"2020-03-02T19:32:10","guid":{"rendered":"https:\/\/solutionsreview.com\/enterprise-resource-planning\/?p=2342"},"modified":"2022-07-08T19:45:24","modified_gmt":"2022-07-08T19:45:24","slug":"how-to-manage-erp-customizations","status":"publish","type":"post","link":"https:\/\/solutionsreview.com\/enterprise-resource-planning\/how-to-manage-erp-customizations\/","title":{"rendered":"How to Manage ERP Customizations"},"content":{"rendered":"

\"How<\/p>\n

Enterprise Resource Planning system (ERP)<\/a> customizations have a much broader purview, and typically involve extensive software coding modifications to better fit the needs of the business. They\u2019re far more labor intensive, and the margin for error is virtually nonexistent. Once you start making changes to the system, its a slippery slope towards more. However, when managed and done correctly, customized ERP systems can benefit the organization as a whole. In this article, we’ll explore the advantages and disadvantages of customizing an ERP solution, and how to manage one.<\/span><\/p>\n
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How to Manage ERP Customization<\/h2>\n

A study by Panorama Consulting showed that 90% of ERP systems have at least minor customizations, while 36% have customizations that involve modifying over 50% of the code. Only 2% are completely customized or home grown. However, the landscape is clearly changing at an accelerated pace.<\/p>\n

Consider the Pros and Cons<\/h3>\n

As you continue to make changes to the ERP system, it becomes much more complex and costly. Plus, upgrades can become a worst nightmare to businesses who have a customized ERP. Since the code needs to be rewritten to support any modifications, upgrades become more and more difficult.<\/p>\n

Panorama Consulting found that over-customization a key reason why so many organizations decide to replace their existing ERP systems \u2013 not because there is something wrong with the system really, but because it has been customized beyond the point of recognition. Customization requires design, development, deployment, and testing work, which is all very time consuming and sometimes very risky. Over-customization is one of the leading attributes to ERP failures, so its only fair that businesses would lean towards out-of-the-box ERP systems to avoid such risks.<\/p>\n

However, the bright side of all this is that you will have an entire ERP systems designed specifically to meet the needs of your business. Customizing allows you to modify and add your organizations areas of competitive advantage. While most business leaders want to manage their implementations by simply using basic configuration, setup and personalization of the ERP software, an majority end up making fundamental changes to the source code.<\/p>\n

Document and Identify Best Practices<\/h3>\n

It’s a good practice to document any existing and current industry best practices you cannot give up or change. Make sure that the ERP software vendors you are interested in provide explanations to how their specific solutions would address each business requirement.<\/p>\n

Identifying the customizations that address business needs and provide demonstrated value is also important. Once an ERP customization is complete, ongoing source code management and documentation of customization-related activities are necessary to preserve the integrity of your ERP system.<\/p>\n

Remove Unnecessary Customizations<\/h3>\n

The more your business grows, so does its needs and objectives. What was once a necessary business process may no longer be relevant to where you’re at now. Apply this to your ERP system. If an existing ERP customization no longer increases value, what’s the point of keeping it? According to Zach Hale, Marketing Copywriter for Gartner, after identifying a dispensable customization, you can retire it in one of three ways:<\/p>\n