One of the most crucial parts about determining what ERP (Enterprise Resource Planning) system is right for you is the flexibility of the software to fit your business processes. Two terms often used in this context are configurable and customizable ERP software. While they might sound similar, they refer to two very different approaches to adapting ERP software to your company’s needs.

Understanding the distinction between configurable and customizable ERP systems can help you make an informed decision and ensure that your ERP investment aligns with both your current and future business requirements.

What Is Configurable ERP Software?

Configurable ERP software is designed with flexibility built into its core. It allows users to change or adjust certain features, settings, and processes to match specific business requirements without altering the underlying code. These adjustments are typically made through settings, templates, or modules within the software that can be turned on, off, or adjusted to suit the user’s needs.

For example, a configurable ERP system might allow you to choose how financial reports are displayed, set specific approval workflows for procurement, or define user permissions – all without requiring technical development.

Key characteristics of configurable ERP software:

• No coding: Configuration changes can be made by non-technical users or system administrators using the software’s built-in tools.
• Defined parameters: The system offers different options for cookie-cutter business processes within a structured framework.
• Faster implementation: Since no custom code is involved, the configuration process is generally faster, leading to quicker deployment.

Examples of configurable options in ERP systems:

• Customizable dashboards and reporting templates.
• Setting up multi-currency options or tax rules for different regions.
• Creating different approval workflows based on user roles or departments.
• Defining pricing rules, discounts, or promotional offers.

What Is Customizable ERP Software?

Customizable ERP software, on the other hand, goes beyond configuration by allowing businesses to modify the underlying code to meet specific business needs. Customization involves altering or adding new features that aren’t available within the system’s out-of-the-box settings.

Customization can be necessary for businesses with unique processes that aren’t supported by a configurable ERP system. For instance, if your business has proprietary workflows, specific regulatory requirements, or specialized industry needs, you will likely require customization to ensure that the software aligns with your operations.

Key characteristics of customizable ERP software:

• Coding required: Customization often requires technical expertise, either from your in-house IT team or from an external ERP developer.
• Tailored to your specific needs: Customization allows for unique and specific functionality to be built into the system that is not available in the standard configuration.
• Longer implementation time: Since customizations involve coding and testing, the implementation process takes longer compared to an out-of-the-box option.

Examples of customizations in ERP systems:

• Developing a custom reporting module that tracks specific industry-related metrics.
• Creating a tailored workflow that automates processes unique to your business model.
• Building an integration with a niche third-party software that isn’t supported by default.
• Developing new features or modules that aren’t included in the standard ERP package.

Which One Is Right for Your Business?

Choosing between configurable and customizable ERP software depends on several factors, including your industry, the complexity of your operations, and how unique your business processes are. Here’s a breakdown of when each option might be the better fit:

When to Choose a Configurable ERP System:

• Standard business processes: If your business follows relatively standard processes, a configurable ERP system with pre-built workflows and modules may fill your needs.
• Faster implementation: If you need to implement an ERP solution quickly, configuration is the way to go.
• Lower cost and complexity: Configurable ERP solutions are generally less expensive because you won’t have to spend resources on development or ongoing support for custom code.

When to Choose a Customizable ERP System:

• Unique processes: If your business has unique or complex processes that go beyond what is typically offered by out-of-the-box solutions, customization is often necessary. This is common in specialized industries like manufacturing, healthcare, or government entities, where specific workflows and compliance needs may not be supported by standard ERP features.
• Scalability and differentiation: Custom ERP solutions can provide a competitive edge by aligning the software exactly with your business model, allowing for scalability as your business grows.
• Specialized reporting or integrations: If you require custom reporting capabilities or need to integrate the ERP system with niche software solutions not supported by default, customization is the way to achieve these goals.
• Industry-specific compliance: For highly regulated industries with stringent compliance requirements, customizing the ERP system to meet those needs can be essential.

What About a Hybrid Approach?

Many modern ERP systems offer a combination of configurability and customization. This hybrid approach allows businesses to use standard configurations for some of their needs while customizing specific areas that are critical to their unique processes. This balance can provide what a lot of businesses need – flexibility to adapt.

AccountMate’s Customization Stories

When choosing an ERP software, you should consider how your business will grow in the coming years. Do you have a straight-forward business that can incorporate an “out-of-the-box” software, or does your business have more considerations and future goals that will likely need a custom solution? It’s also essential to work with an ERP vendor that offers strong customer support and can help guide you. AccountMate specializes in creating customized solutions for businesses who need more than the out-of-the-box software’s can provide.

Here are some examples of customized solutions:

1. Manufacturer of Test Equipment for the Paper Industry

• Problem: Workers forgot or lost the “Certificate of Analysis” required when shipping products.
• Customization: Created an input screen for entering the necessary data and automated the system to print the correct certificate when each serialized product is shipped.

2. Water Filtration System Service Provider

• Problem: Employees were regularly not invoicing filters during maintenance services.
• Customization: Configured the system to trigger frequent cycle counts for high-turnover items, which helped the company identify inventory discrepancies and reduce lost invoices.

3. Medical Device Manufacturer/Distributor

• Problem: The company serves international clients, and shipping documents and invoices needed to be in multiple languages.
• Customization: Modified the ERP system to automatically print shipping documents and invoices in the language of the customer, supporting over a dozen languages.

4. Seed Corn Distributor

• Problem: Seed corn is packaged by kernel count rather than weight, and shipping pallets have weight restrictions.
• Customization: Changed the picking list to optimize loading by specifying which bags and how many to pack, ensuring that no pallet exceeded the 2,000-pound weight limit.

5. Produce Distributor

• Problem: Carton quantities for cantaloupes vary based on fruit size, leading to discrepancies between purchase orders and actual deliveries.
• Customization: Modified the ERP system to reconcile carton counts, unit counts, cost per unit, and other attributes for variable items like cantaloupes, ensuring accurate inventory management.

6. Alligator Hide Supplier

• Problem: Alligator hides are categorized by multiple attributes, making inventory tracking and order fulfillment complex.
• Customization: Developed a system to serialize and track alligator hides by 14 measurements, top or belly cut, and a grading system. The sales order process includes these attributes, and the picking list recommends which hides meet or exceed customer specifications, with preference for the oldest items. The system also tracks which specific serialized hide was picked and shipped.

Considerations for Future Growth

Understanding the difference between configurable and customizable ERP software is key to choosing the right solution for your business. Configurable ERP systems offer flexibility within a standard framework, allowing for faster implementation and easier maintenance. Customizable ERP systems allow for deeper tailoring to meet unique needs but often come with longer timelines.

The choice ultimately depends on the complexity of your operations and your business’s long-term goals. Regardless of the path you choose, making an informed decision will ensure that your ERP system supports your business as it grows and evolves.

To get started with AccountMate, you need to work closely with an experienced ERP consultant and vendor who can guide you through the selection and implementation process, ensuring that your ERP system aligns with your business’s immediate needs and long-term vision. Are you considering a new ERP system? Contact our experts! We have local solution providers who can help you navigate the process. Contact us now or call 707-774-7537 to talk to someone about your specific needs.