ERP System: Understanding the Difference Between Customization and Configuration

The terms configuration and customization often appear side-by-side when businesses begin exploring ERP solutions for their company. Though these terms might sound similar, their meanings in the context of software are different. Both describe a specific approach that can be taken to adapt ERP to a business’s unique processes.

Understanding the differences between them can help companies make the right ERP decisions, thus preventing unnecessary costs, implementation delays, or the use of incompatible systems that are bound to fail.

In today’s blog, ERPion – the ERP system Ontario businesses use and trust - will discuss the distinction between customization and configuration so stakeholders can choose wisely.

What Is ERP Configuration?

Configuring an ERP system involves adjusting the capabilities of the software using built-in tools and settings. This type of change does not involve rewriting or modifying the underlying code in any way.

Most ERP platforms feature configurations that users can tweak based on business functions. Configurable options include:

• Workflow settings 
• User roles and permissions 
• Dashboard layouts 
• Reporting structure 
• Approval processes

Implementing a configuration change is quick and cost-efficient. It is also much easier to maintain. However, there is a catch. While it allows businesses to alter the system to suit their processes, they can only do so within the predefined boundaries set by their ERP provider. This means flexibility might be compromised. That said, companies that follow standard procedures can gain operational efficiency with simple configuration modifications.

What Is ERP Customization

Customizable ERP is where flexibility begins. Taking modifications a step further, customizations involve altering or extending the software itself to cater to unique business functions that do not subscribe to the templates of generic ERP.

Examples of customizations include:

• Building new modules or features from scratch 
• Developing custom workflows that offer more default functionalities 
• Enabling deep integrations with custom systems 
• Implementing unique operational logic or complex pricing

Customization is the way to go for businesses that place flexibility and tailored modules high on their software must-haves list. However, it is important to know that a customizable ERP tends to be more expensive and may take longer to implement while requiring long-term support.    

Which One Does Your Business Need?

The choice between a customized ERP system and a purely configurable generic ERP platform should boil down to a business’s particular requirements. Ensuring business processes align with ERP functionality is the only way to find the perfect fit.

For example, companies that have fairly straightforward processes in place can get by with simple configurations for day-to-day operations.

However, businesses with complex operational realities, such as those involved in manufacturing, distribution, mining, construction, or other industrial services, need systems that offer them more flexibility while supporting their unique processes and functions.

That is where configuration is simply not enough, and using a customized ERP system becomes the need of the hour. The latter can prevent inefficiencies and manual workarounds while matching the distinct workflows of companies with complex requirements.

Wrapping Up – Securing Long-Term Business Growth With Customizable ERP

By understanding the difference between ERP customization and configuration, businesses can make an informed decision about which approach works best for them.

While configuration guarantees speed, simplicity, and cost-efficiency, its limited capabilities can slow down the growth of companies with complex operational requirements, forcing them to resort to manual workarounds.

On the other hand, customization offers the flexibility companies need to support unique operational processes in an efficient manner. Growing businesses, particularly in complex B2B environments, must use custom platforms that provide easy configurations to get the most out of their investment.

ERPion is Toronto’s most widely used and trusted customized ERP system that offers configurable modules at affordable pricing. Contact us to learn how ERPion can meet your company’s current needs at scale.

FAQs

Can an ERP system offer both customization and configuration?

Yes. ERPion is a custom platform that offers configurable modules that businesses can tweak to match their requirements.

Is customization always more expensive than configuration?

Generally speaking, yes. However, the ROI of a customizable ERP is greater as it completely eliminates inefficiencies and manual workarounds.

Can a configuration be changed after implementation?

Yes. Configuration settings can be changed to suit the current operational requirements of a business.