ERP Solutions

The Pros and Cons of an Open Source ERP Solution

In this world you never get something for nothing.  It’s true, while open source ERP (Enterprise Resource Planning) solutions are free, you will still have to pay for installation or implementation, employee training, support services, and so on.  With the economy basically “in the toilet”, it’s important to save your pennies and shop deals.  However, a deal isn’t a deal if it doesn’t work for you.  Open source ERP solutions won’t work for every organization.   However, it may be the “end all be all” for some.

Popularity in open source ERP solutions is growing and in 2008 there were somewhere around 174,000 open source products on the market.  One reason for the growth in open source solutions is due to the fact that the internet now has the capability to handle proper security.  Another reason for this growth is the recession, which is supposed to be over but we all continue to feel it.  Lastly, another big reason for this growth is the cost of an open source ERP solution.  Like I said, you never get something for nothing but with open source solutions you don’t have to pay huge up-front licensing fees.  After all, software license fees are about ten to fifteen percent of the total cost of an Enterprise Resource Planning system.   We are also seeing a growth is open source ERP solutions because the small to mid-size business market is growing.  During recessions small and mid-sized businesses typically fair better than large organizations.  Open Source ERP solutions are a great alternative to on-site solutions for small and mid-sized businesses.

Larger organizations aren’t jumping on the open source band wagon just yet.  Perhaps these large organizations doubt the power of the open source ERP solution, which would be very peculiar as one can customize the heck out of an open source ERP solution thanks to the free compiled and un-compiled code.  Perhaps these large organizations just want to wait and see if these solutions blow up in the faces of the small and mid-sized businesses.  Or, perhaps these large organizations have invested so many millions of dollars on an on-site ERP solution that it just doesn’t make sense to adopt an open source ERP solution.  Whatever the case, you can’t bet that we’ll see open source ERP solutions grow in number and large organizations will adopting them in the future.  It just makes cents (and dollars)!

Written by :

kristine H