Key Difference: ERP Customization vs ERP Configuration

What is ERP Software System and What does It Mean for Enterprises?

ERP stands for enterprise resource planning and is a kind of software created and used to manage a variety of day-to-day business operations. For instance, accounting, project management, supply chain management, risk management, and so on, in a company.

ERP systems are specifically designed to be flexible, assisting businesses in meeting the business objectives they are aimed at. Each organization is different from others; hence ERP systems are also different depending on the organization they are built for. In many organizations, they modernize their legacy ERP system with new features, tech stacks and functionalities.

Did you know the revenue in ERP is all set to reach US$49.30bn in 2023?

Anyone can build an ERP system as per their business needs, and you’ll have many choices, including configuration and customization, depending on your needs. In this article, we will explore the differences between customization and configuration for ERP. Let’s explore!

Understanding ERP Configuration

ERP configuration is the process that consists of making changes in an ERP based on specific requirements in an organization without altering or modifying the source code. The configuration contains adjusting multiple settings, including time zones, language, industry-specific business processes and workflows, financial reports, currencies, data analytics and business intelligence, and so on.

The configuration settings are pre-built within an ERP system and are a part of the source code. As per their need, a company can tweak the settings and configure the system to cater to their specific needs.

Pros And Cons of ERP Configuration

Going through the paragraphs mentioned above, you’re more likely to know what’s ERP and ERP configuration, with some examples. As you know, it’s time we knew some of the pros and cons of ERP configuration.

Understanding ERP Customization

Unlike configuration, ERP customization consists of modifying the ERP app on a macro scale to make the system as worthwhile as it meets the organization’s specific requirements. ERP customization involves making modifications in modules/functionalities as per the needs, apart from what the standard version provides. Moreover, integration with third-party or internal apps to improve performance and provide an end-to-end automation solution is also part of customization.

The ERP customization process consists of working at the source code level, hence, involves comprehensive planning. The process contains understanding the project requirements in detail, planning, development, testing intensively, implementation, and eventually, training and bug fixes. The procedure can take an elephantine amount of time and expense depending on the project scope, changes required, and the enterprise size.

ERP Customization Pros and Cons

When an ERP system is customized per your business, it brings more benefits to the table. When customized accurately, an ERP has all the features and functionalities to cater to your specific business needs resulting in delivering the outcome that fits into your expectations. However, there’s nothing with only pros, the ERP customization also has some cons. For your information’s sake, we mentioned not only the advantages of ERP customization but also the disadvantages that you need to consider.

When To Choose ERP Configuration & ERP Customization

A configuration involves changing features and setups to change the behavior of the system you make use of. Customization, on the other hand, alters the features and functionality to fit into the business requirements. Configuration is done to the setup part with a slight change, whereas the customization requires coding as well. Moreover, customization may take more time and cost compared to configuration. When choosing between customization vs. configuration services, there’s no pre-defined parameter, but you need to consider a variety of factors to come to a conclusion and select what’s right for you. Mentioned below are some of the factors that can make a difference.

Balancing Configuration And Customization

There’s a multitude of factors based on which organizations can opt to choose for ERP configuration and customization. Companies need to gauge their business size, industry vertical, existing business process, allocated budget, and so on, and then choose the one that suits their needs the most. For example, ERP configuration suits small and medium expertise, whereas ERP customization is better for large organizations with specific requirements.

Despite ERP configuration being simpler and beneficial, organizations still need ERP customization to meet their business requirements. The majority of organizations look to combine ERP customization and configuration to squeeze the most out of the process.

To squeeze better outcomes, an organization requires a robust ERP software to yield the expected result. However, you need to choose if you need standard ERP system or custom ERP development to make the most out of your development needs. Excellent ERP developers understand your requirements, work dedicatedly, and deliver results satisfactory to you.

Conclusion

There’s no predetermined answer on whether to choose ERP configuration or ERP customization for your ERP system implementation, as it mostly depends on your company, its present business requirements, and many other factors. Perform a proper assessment of what your company requires, also consider your budget, and then go with ERP customization or ERP configuration that fit your need.

Codzgarage is the most reputed ERP Software Development Services provider to help you bag the best system for your enterprises. Contact us if you need consultation or customization and configuration or everything in between.