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ERP - Make Or Buy ?

Benefit From Gray Arrow Kaytek IT - ERP Consulting Perspectives






Down Arrow ERP - Make Versus Buy Decision

Should an organization make it's own ERP software or buy a ready made ERP System from the Market ?



First, the ERP - Make (Homegrown) Versus Buy (Commercial Off The Shelf or COTS) Decision essentially has to be a Time and Cost Risk Return Analysis of the two choices.

The issue in most ERP Software Requirements is no longer of Development but that of Discovery.

Even if an organization feels that they have certain unique requirements that






nobody else in the world has thought off or developed, perhaps, they need to search further.

Somebody in some part of the world (out of the hundreds of ERP companies and thousands of ERP Developers out there ) perhaps must have already automated your so called unique custom ERP requirements.

No point in reinventing the ERP Software wheel or any Software wheel for that matter. It is a waste of your precious resources and diversion from your main business focus.

What you want has perhaps been thought out, developed, tested before.

You only need to discover the same.

There are multiple technology components and layers in an ERP solution.

In case you want to be a wheel manufacturer, you need not redevelop from scratch.

You can Pick and Choose from different technologies and product options available geographically.

Also, you can perhaps look at Open source ERP solutions as an option.

Fortunately, with Open Source solutions, geographical location is not much of a liability except in the case of critical and emergency support requirements.

Your geographic location need not be a liability for Open Source software solutions. In fact, it does not matter at all, since you can always download software applications from wherever, test them out and then decide for yourself.

If your company is not focussed on the ERP software development business, however hard you may try, or as many



people as you may choose to employ ,your ERP efforts will never be able to match the skillsets, resources, technology, etc of specialised ERP software companies.

As the CEO of an IT company (I think, SUN) said " The smartest people in the world do not and will NEVER work for you."

So, decide for yourself which business you want to be in - Software or Non-Software.

Once, you have decided that software manufacture is not your cup of tea, please get out of it.

There are tons and tons of non software core competency companies who thought that software was all about only hiring PC's and programmers.

Software is an extremely tricky business. In the US, one software company died everyday for the last decade.

Instead, there are literally dozens of ERP vendors who would want your business on your terms and conditions.

Talk to them. Negotiate Hard !!

Also, update your knowledge. The better educated you are, the greater probability of a successful ERP project.



Gray Arrow Email Us : Can we help with your ERP Make Or Buy Decision ?




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Last Updated on 6th February 2009.
Posted on 5th July 2004.

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