ABOUT SERVICES

ERP RESOURCE CENTER 360° ERP BLOG

GOVERNMENT CONTACT

ERP Systems: Build vs. Buy

Home / Consulting Services

Since many of us are natural problem-solvers, it may often be

tempting to identify and create our own solutions when we
encounter a new demand in our business. Can our problem be
resolved by using a macro? Should we ask our technology team
to create a new software application for this specific issue? Can
we alter our existing ERP system for a temporary resolution?

As the development of ERP solutions continues to advance,

many organizations struggle with the practicality of building
their own software applications to meet evolving business
requirements. Following are some pros and cons to this
approach that organizations should consider before giving in to
the temptation:

Pros of Building

Control – organization has internal support for future fixes

and enhancements
Unique Fit – applications are custom-developed for specific
business needs
Lower Immediate Costs – applications are created on an as-
needed basis

Cons of Building

Outdated Software – applications need to be flexible to meet

new changes in technology
Long Development Time – internal staffing limitations may
place the project at a low priority resulting in long periods of
development, configuration and testing.
Limited Training and Support – lack of specialized training to
transition employees to the new ERP system components or
related business process changes
Risks – turnover in software developer team, disjointed data
and reporting, and challenges with integrating different
applications

Despite the potential challenges of custom-building

applications, purchasing ERP software can often be just as – or
more – intimidating. The decision to buy software from an ERP
vendor or VAR typically raises concerns around compatibility as
well as implementation cost and duration. Below are some pros
and cons of buying ERP software:

Pros of Buying

Software Sophistication – extensive research and

development, industry-specific solutions and fewer
complications or “bugs”
Stable Knowledge Base – many experts on the software who
can provide long-term training and support
 Continuous Improvement – flexible and adaptable to
integrate with new technology and software applications as
well as an ability to adopt future enhancements
Streamlined Functionality – collective data analysis and
reporting

Cons of Buying

Higher Upfront Cost – ERP system acquisition typically results

in more upfront money out of pocket than in-house
development
Less Control – software vendor holds the rights to the code
so implementing organizations are dependent on external
technical support

If buying ERP software seems to be most appropriate to meet

the needs of your business, many resources exist to help you
and your organization decide which software is most
compatible. Consider engaging the services of a third-party ERP
consultant such as Panorama to ensure due diligence during
the process in order to maximize benefits and success.

Written by Christine Thai, Associate Business Analyst at

Panorama Consulting Solutions.

About the author

Panorama Consulting Solutions

Related posts
 Benefits of The Right
ERP for a ERP
Firm that has Consultants
never Will Improve
Implemented Your ERP
ERP Software Project
April 6, 2018 March 23, 2018

Standardization Key Drivers of

vs. Flexibility: Your ERP
How This Implementation
Decision Drives Time, Cost and
Your Digital Risk
Transformation March 6, 2018

March 9, 2018

Why People Are Five ERP

the Most Software
Important Part Trends to
of Your ERP Watch in the
Implementation Healthcare
March 2, 2018 Industry
January 22,

2018

2 Comments

Doug September 16, 2013 at 12:12 pm Reply

Hadden

The build vs buy debate is particularly

vociferous in the public sector. There are
some markets where general ERP
solutions require so much customization
that they resemble custom projects.
Of course, there are often vertically-
specific solutions for these markets.

Some additional cons for building

include:
– Quality Assurance: single custom
projects do not have the “customer base”
hitting all software features and
uncovering bugs, particularly under
stress
– Feature Management: custom projects
do not have the advantage of many
similar organizations pushing for more
advanced features that could be valuable

– Configurable vs Hard Coding: software

engineers design to specifications
meaning that it is very difficult in a single
project to know what is likely to be
changed in the future

Some cons for buying:

– Lack of leverage with the manufacturer
meaning that you need to provide the
customizations

-Systems integrator looking to maximize

long-term revenue by recommending
unneeded customizations

SATYA September 19, 2013 at 1:03 am Reply

NARAYAN MAHESHWARI

Cons of Bespoke solutions :

1. Lake of foresight while gathering
requirements.
Solftware built to meet immediate
 needs. It is most of the time found
myopic.
2. Not attending to required
validations/Internal controls. It is
exposed to huge control risks.
3. Lack of benefit of leading/best
practices across industry/geograpgies

For functions where processes are more

or less standaridise it is always better to
for Standard applications.

Leave Comment

Your email address will not be published. Required fields are marked *

Comment

clear form
Name* Email*
Submit
Recent
Articles

5 Ways to
Prepare for
Transformational
Change
August 13, 2018

SAP vs.
Oracle vs.
Microsoft
Dynamics:
6 ERP
Evaluation
Criteria
August 6,
2018

A CIO’s
Guide to
Digital
Government
July 30, 2018
Advice for
Global
Organizations
Pursuing
Digital
Transformation
July 23, 2018

Who Should be
on Your Digital
Transformation
Project Team?
July 16, 2018

Global
Chamber
Denver
Hosts
Consular
Corps of
Colorado
at Buell
Mansion
July 9,
2018

360
ERP
Blog
(609)

Change
Management
(306)

ERP
Implementation
(503)
ERP Project
Management
(86)

ERP
Software
(408)

ERP
Systems
(166)

Aerospace
(5)

Chemical
Products
(1)

Construction
(3)

Consumer
Packages
Goods
(1)

Consumer
Services
(1)

Contract
Manufacturing
(1)

Defense
(5)

Engineering
(3)

Financial
Management
Software
(63)

Food
and
Beverage
Software
(14)

Government
Software
(14)

Healthcare
IT
(29)

Hospitality
and
Entertainment
(5)

Human
Resources
Software
(33)

Industrial
Products
(5)

Inventory
Management
Systems
(37)

Life
Sciences
Software
(3)

Manufacturing
(17)
Manufacturing
Software
(147)

Oil
and
Gas
(4)

Order
Management
Software
(10)

Paper
and
Packaging
(1)

Plastics
(1)

POS
Software
(11)

Retail
(10)

Small
Business
Software
(5)

Supply Chain
Management
Software
(40)

Utilities
and
Energy
Software
(10)
Warehouse
Management
(2)

Wholesale
Distribution
(3)
Contact Us ERP Industry Recent Articles Latest on
News Twitter
Panorama 5 Ways to
Consulting Expanded Prepare for How do you begin
Solutions Oracle Transformationaldigital
5975 S. Quebec Accelerator Change transformation?
Street, Gives August 13, 2018 Join us August 23 to
Suite 207 Texas find out.
SAP vs.
Greenwood Village, Startups a https://t.co/6dis1n1a4T
Oracle vs.
CO 80111 Boost 5 hours ago
Microsoft
+1 (720) 515-1377 June 25,
Dynamics: Equip your team
info@panorama- 2018
6 ERP with the tools to
consulting.com
With the Evaluation transform your
Intelligent Criteria people, processes
Enterprise, August 6, and technology.
SAP 2018 Our next training is
Creates “A September 2…
A CIO’s
Completely https://t.co/bHEbHRruqb
Guide to
Different 3 days ago
Digital
Kind of
Government
Flexibility”
July 30, 2018
June 18,
2018

Why Cloud
Customer
Success is
New Top
Priority for
Salesforce,
Microsoft,
Workday,
SAP and
Oracle
June 11,
2018

© 2018 Panorama Consulting Solutions LLC Privacy Policy | Terms of Use | DMCA Policy | Anti-Spam Policy