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Unit 11: ERP-II

11.4 an introduction into open source erp technologies notes

Open Source Technologies have made the job of ERP easier. It has helped the consumer in many
ways other than cost. Lots of companies are increasingly using them.
Some of the features are as follows:
1. Influence of the Cost Factor: It is interesting to know the Price tag of Open Source ERP
technologies. It is literally available at free of cost. All that the user has to do is to download
the software and install it. An unbelievable fact is that even the source code comes freely.
This in itself has encouraged lots of companies to go for ERP, as they are not burdened with
investments. Of late companies don’t necessarily go for ERP because their attitude towards
spending on ERP has undergone a sea change in the sense they don’t mind to pay as long
as they think ERP is worth the costs. Open Source accounting ERP and open source ERP
payment are famous solutions.

2. Influence on the Operational Expenses: Open Source ERP technologies largely influence
operational expenses. The company is relieved from paying the extra sum for facilities
provided in moving to a new system. Similarly the company need not incur additional
expenditures for renewal and purchase of licenses as and when some components are added
in the framework. This gradually reduces the monetary outlay that has to be otherwise
incurred for every update. Open Source accounting ERP has helped to simplify the financial
practices. Open source ERP payment has helped in facilitating easy disbursement of cash.
3. Absence of Vendors help: Unlike the usual ERP applications it is not possible to avail the
services of a vendor as the company handles everything independently. This has many
dimensions. Firstly the company enjoys a sole liability. Secondly a simple error when not
rectified (or the in-house personnel does not know to) could prove to be a costly affair for
the company. Above all the company gets to learn from mistakes and without any external
assistance.
4. Litigations: Open source ERP has resulted in many lawsuit and incidental claims. There is
still ambiguity in the copying aspects. The question of infringement and indemnification
remains unanswered as seen from the previous cases.
5. Unsuitable for all Applications: Open source has a limit when it comes to the places where
they can be put to use. They don’t find applicability in all areas especially for conventional
practices. It is not appropriate to introduce open source in those areas without changing the
way the systems work. Infact it could be a risky option to do it. This drawback discourages
many functions from being Open source friendly.

Who should go for it?

A company can go for open source if is satisfied that its business modalities will be addressed.
The point to be considered is will open source ERP cater to the particular business needs of
the company. This decision is detrimental in making the companies chose open source ERP.
Companies that are more dependent on external factors can resort to open source ERP technologies
than those relying on internal factors.

Task “If companies feel that coordination and enterprise communication are their
only problems they don’t have any other alternative but to go for ERP, provided they want
to make profits and remove the existing setbacks.” Suggest

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