Why Open Source ERP Isn't Always Free ERP
Want a free ERP for your business? The code may be yours for nothing, but businesses should be realistic about meeting other expenses when it comes to implementing open-source ERP software
Posted by Killian McAleese, 21st April 2011
Open-source can be synonymous with all things free, especially when we think of the costs and constraints of vendor lock-in that proprietary software can mean for a small or medium-sized enterprise.
The open-source ideal in most of our minds is likely to be the simple 'click to download', out-of-the-box (OOTB) and go! dream of a free product ready for use.
At Open Plus we're passionate proponents of open-source retail software in business, but we're also keenly aware that 'free' as in free from cost is quite, if not wholly, unrealistic when it comes to choosing an ERP in an ecommerce or multi-channel retail, or indeed any other, business.
Make no mistake: initially in some cases open-source enterprise resource planning (ERP) software or its code is very easily and quickly acquired, and, in principle, free of cost.
Furthermore, as time has passed it's become clear that 'free' open-source alternatives to expensive proprietary solutions are more than reliable, robust and secure enough for an enterprise environment. Projects like Apache OFBiz and Opentaps ERP are now trusted industry standards.
But as many businesses have learned the hard way, software doesn't run itself.
So what happens once you've downloaded your free ERP? There isn't much more that can be done without time and expert knowledge, and these, unfortunately, are costly.
Implementation and Integration
With open-source ERP as much as any other proprietary ERP, a successful implementation which is sensitive to your business needs is key. Due to the shear variety out there, it is almost inevitably the case that customisation is involved in an implementation. An open-source ERP like OFBiz, for example, is after all created to be customised.
That means a free ERP initially but one which requires in-depth knowledge about the business and about the software; it means the technical ability to leverage the software to your specific needs.
While open-source ERP has the potential to integrate smoothly with other systems in a business, it also requires technical know-how.
Training
Once implemented, it's likely that you'll want a reasonable number of staff to be able to operate, interact with and to some extent understand your open-source ERP. This immediately implies training costs as well as ongoing running costs.
In some cases it requires new staff if your business doesn't have a sufficient number of existing team members or the resources to put into training them on the new system.
Support
The area of ongoing support and improvement is one of the most dynamic and exciting aspects of the open-source community, and an open-source ERP like OFBiz is a fantastic example of this.
Because the code itself is released, and is of course free of charge, developers all over the world have access to it and are given forums to ask questions, share fixes, suggest changes and improve the software at an almost exponential rate.
This culture is often highlighted as one of the strengths of open-source, and indeed it is, but the downside is that there is usually no formal contractual support provided with most open-source software packages.
In fact, even in the case of an open-source ERP as prominent as Apache OFBiz, the code release means that it is impossible to calculate precisely how many users even exist, let alone sign up to fully support them all.
Put it this way: if your system is down and you're losing business, can you afford to wait for community responses to your troubleshooting questions on an online forum?
And if a business doesn't have the staff expertise to stay up to date with all the latest code releases and fixes, it may need to pay for in-house or external support. If it does already have the staff, those staff members will have to be reassigned to supporting the system. One way or the other, personnel costs are incurred.
'Huge Deployment and Maintenance Costs'
But where, then, are the advantages to open-source ERP? Most would still agree that in spite of the costs incurred, expected or not, open source is still cheaper than proprietary software, which the OFBiz website proudly claims has “huge deployment and maintenance costs.”
But perhaps the most important advantages of open source to any business, especially high growth business, arr the flexibility, scalability and lack of vendor lock-in.
Get Help!
The costs and the logistical difficulties involved in implementing and running open-source ERP have been known for some time and as a result of this, much of the difficulty in leveraging open source can be passed on to a consultancy company which will take the burden off your hands for an integrated fee.
The open-source route is low-cost, reliable and flexible. But businesses should be prepared to pay for it if they expect it to work for them.
Open Plus Ltd and Open Source - Our Free Consulting Service
If you'd like to find out about how Open Plus Ltd leverages open-source software to help high growth businesses, just check out our home page here. You can also send a message straight to an open source expert through our contact page here. Get in touch - it costs you nothing to ask!
If you'd like to know more about how we leverage OFBiz, Magento and other open-source software packages, see our OFBiz page and our Open-Source IT Solutions page.
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