Respond to the following: Many experienced ERP implementers will say there are two rules you should follow when implementing these systems:
1. Do not customise your ERP.
2. See Rule 1.
Why do you think this is? What are the risks of customisation? What does a need to customise say about the willingness or an organisation to effect BPR?
There has been a long debate going on regarding whether an ERP system should be customized or not. There are experts who are with or against customization. Before jumping into the customization it is important to realize why customization is needed? Despite following the best practices in business, ERP customization can become inevitable because:
- Successful organizations have their competitive advantages which differentiate them from other organizations.
- Some ERP functions are badly aligned to business requirement
- People are used to flexible technologies (Kimberling 2012)
However, customizing ERP software can have some ugly effect when it is not done in controlled way. If any organization considers customizing then they must be aware of following risks:
- Customizing a single functionality of an ERP might have a following effect to other functionalities which might only be identified later, after the system is live. One thing leads to another, and the system can get tangled.
- Customizing can stretch the date of going-live, which can affect the company in different way.
- If a company is not taking help from original vendor for customization then it can upset the vendor, which might lead in withdrawing of support.
- Even if the vendor is still supporting, the new upgrades provided by vendor may now not be applicable after customization. This will only lock the company in old system.
- If a company customizes on its own with the help of an in-house expert, the company should be aware that the knowledge of that customization goes out with that person. Thus, making it harder to pin down the complexity in that very customization. (Vjeko 2009)
Yet, there can be difference in ERP solution and actual business process which is commonly referred as gap. One of the solutions in reducing this gap is to business process reengineer the business process to suit ERP package. This means changing the established workflow in the company and to tune it line with the workflow given in ERP ware (Subramoniam, S, Tounsi, M, Krishnankutty, KV 2009). However, there should be a good balance of realigning business process and customizing ERP in order to best suit the organizational need.
Kimberling, E 2012, Case For and Against ERP Customization, Viewed 4th August 2013, http://www.backbonemag.com/Backblog/case-for-and-against-erp-customization.aspx
Subramoniam, S, Tounsi, M, Krishnankutty, KV 2009, ‘The role of BPR in the implementation of ERP systems’, Ergonomics, Business Process Management Journal, Vol. 15, no. 5, pp.653 – 668.
Vjeko 2009, Top 7 reasons why to avoid (much) customization, Viewed 4th August 2013, http://vjeko.com/blog/top-7-reasons-why-to-avoid-much-customization
Examine assessment item 2. The purpose of this assignment is to provide a report responding to a case study. Provide a rough skeleton (dot point form if you wish) of the content and structure of the main body of your report. You should make clear what the problem is and also outline what the options are.
The rough skeleton of the content and structure of the main body of the report is provided below:
- Summary of the report outlining the purpose, outcome and recommendations.
- Objective, key ideas and the structure of the report.
- Significance of ERP implementation
- Issues and Problems of ERP system.
- Analysis of critical factors.
- Pros and cons of existing system.
- Pros and cons of legacy system.
- Recommendation and Illustration.
- Summarise the findings of analysis and present recommendation.
- List down all the references in Harvard style in alphabetical order.