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Benefits of Open Source ERP to Small and Medium Businesses

open source erp softwareOpen Source Technology was once supposed to be only for techies and nerds. Slowly, it has proven itself and moved to center stage and become mainstream platform with a major market share.

Considering its robust platform, many developers have come up with beautiful web based solutions including ERP. ERP on open source platform is not really new. It has been around for some years now. However, looking at its acceptability, one of the open source ERP Software has also received venture funds recently. It proves that ERP on Open Source is a viable business solution not only for the industry users but also for investors.

What makes Open source tick?

  • Huge technically well qualified community
  • Very definition – Open to change from users
  • Free – all Open Source components are either free or nearly free
  • Maintenance is today available from third party vendors, though at a cost
  • Free regular upgrades
  • Backing by mighty software vendors like Google, Facebook etc.

Thus, any software developed on Open Source proves to be less costly to implement, though not free as many people imagine. Only negative is that there are no standards, or in other words, there are too many standards. But, with proliferation of vendors in this field, it is possible to work around given standards, say Suse Linux from Novell or Red Hat etc.

All this has made it possible to develop large complex applications like ERP on open source. With some years of experience on Open source based ERPs and alternative revenue models that have emerged, it is possible for a user to opt for an open source ERP. Outside India there are many such ERPs today in the market. In India too, ESS has taken the lead by releasing an ERP based on LAMP stack.

How does an Open Source ERP make sense to small & medium sized companies?

  1. User does not have to worry about license cost of third party components like O/S, Database etc. nor does the user have to worry about AMC for these products. Third party vendors do provide AMC for LAMP based products also, but user has an option. If he/she is technically savvy, he/she may chose to maintain the system by self. If however, user is not tech-savvy one may chose to go with a vendor for regular support.
  2. With support of large community of developers Open Source comes with features that are much more user friendly many times than what people imagine.
  3. Because of the quality of developers, generally the softwares are lighter to work on and maintain.
  4. With technology base of Open Source, products built on this platform are more suited for Cloud computing structure than other heavy weight products in the market.
  5. It is light weight as compared to other available proprietary technologies, thus consume lesser hardware and network resources.
  6. With Cloud computing coming up as the next wave, ERPs built on LAMP stack have natural advantage in exploiting this technology.

Thus, it makes eminent sense for SME users to look at alternatives available on Open Source for heavy applications like ERP software.

About the Author

Ratan Sharda is Chief Consultant with ESS. He has a rich industry experience of over 33 years, of which 21 years have been in IT. His domain since last 15 years has been ERP. He brings along with this his years of rich experience in textile manufacturing and marketing, dairy, packaging, publishing and printing. He is a postgraduate in Economics from Mumbai University , having graduated from St. Xaviers College.