Guide to Enterprise Resource Planning (ERP) Software Development

If you’re reading this article, you likely want to find out how to build an ERP system from scratch or install an already existing one in your enterprise. In this article, we review those questions, offering key insights into the core characteristics of ERP.

We begin with the nature of ERP software and its key benefits for aspects like supply chain management. Then, we transition to the core ways to create an ERP system in your business and some questions related to this choice, such as the average price of ERP development.

What Does ERP Development Stand For?

ERP development stands for the creation of tools aimed at Enterprise Resource Planning. What does Enterprise Resource Planning typically entail? It’s a combination of multiple company-related tasks like inventory management and Customer Relationship Management. An ERP is used to plan every resource available to a company. The list includes its core fixed assets, customers, employees, and finances. ERP development involves the creation of all those components to develop a full-scale system for controlling an entire enterprise. This development can take the form of proprietary software creation or, for example, custom software development. In short, the opportunities for the relevant decision-makers are diverse in the presented case. 

Why Do You Need ERP System Development?

A common question we get is why would one need an ERP system in the first place? In our opinion, it’s a perfect platform for project management. Here are more specific reasons to use systems of this kind:

Automation

The majority of business processes are time-consuming. For example, collecting performance information on employees is a complex task that may require an entire full-time position in an HR department. In this light, you should actively consider how to build an ERP system to remove the reliance on this type of workforce. ERPs allow modern companies to automate most processes related to HR or maintenance reminders. Consequently, they can dedicate their workforce to newer tasks requiring higher creativity from the managers. Automation is not a path to unemployment: it’s a path to higher work complexity and creativity.

Data-oriented decision-making

Another important aspect one can expect from any custom ERP solution is undoubtedly its capability to improve data-oriented decision-making. What do we mean in this regard? Modern ERPs collect tremendous amounts of data on various aspects of work-related performance. For instance, custom solutions may gather information on worker concentration time (if trackers are installed) or the long-term trends in company finances. 

The core benefit of software for the manufacturing industry is that it can collect more information than humans due to automation. All that is necessary afterward is for humans to process this data. In fact, even processing isn’t always vital: many ERP systems have in-built AI modules capable of transforming various small data sets into full-scale Big Data. This Big Data, in turn, can be used to make decisions oriented around information rather than some approximate models or intuitive judgments.

Customer data security

A major reason to consider ERPs is also the security of customer data. What do we mean by that? Data stored outside an ERP (in a Word file, for instance) is likely to be highly vulnerable to external attacks. Even if some parts of the data storage system are potent, the sporadic maintenance of information is highly likely to end up in the major gaps within the existing defenses. Consequently, custom ERP development exists to solve this problem once and for all. ERP systems are noteworthy for their ability to store all core business information. As a result, it’s easier to protect this information with the world’s most powerful frameworks. In the end, one needs to cover the relevant data with a singular approach to protection instead of using several frameworks. Thus, ERP software development is a strong way to save funds when it comes to data protection.

Improving interaction between coworkers

Modern Enterprise Resource Planning is noteworthy for its capability to improve the interactions between coworkers. Typically, interaction between coworkers occurs through email communication and, at best, platforms like Slack. The reason for this is simple: different departments use different tools for their main activities. In this light, the interoperability aspect becomes very difficult to control. Hence, Custom ERP Software Development is here to solve this problem. An ERP is a platform covering the activities of an entire firm. It involves almost every possible aspect of its actions, meaning that various departments can easily share information with each other within such systems. This is vital because this approach prevents situations in which there’s no opportunity to provide data between different departments. ERPs greatly speed up the interaction between workers and, thus, make it possible to enhance communication between diverging parts of a firm. 

Compliance with regulations

Modern business is full of regulations that create different demands for operational efficiency. The problem for businesses that don’t use ERPs lies in the fact that they usually don’t have a singular set of apps. As a result, the likelihood of going against some standards rises to a great extent. To avoid the presented challenge, you should use an enterprise resource planning system. Since such a system combines all user information in one place, it’s an outstanding tool for improved security. Moreover, it’s easier to comply with other regulations in these systems. After all, the core data is unified in a singular location, and, thus, it’s easy to cover the information with a unified protocol. The singular nature of ERPs is among their greatest advantages: those platforms are noteworthy for their capability to maximize security and regulatory compliance through a centralized approach to management. 

Scalability

ERP tools are geared directly towards working with large companies. For example, Oracle ERP can take on thousands of employees and a tremendous number of clients, boosting customer service and promoting better business standards. These features are vital if you expect your business to scale. The problem with, for instance, pen and paper systems is that they can become overwhelming once numerous individuals are involved. It’s impossible to automate processes in them, and, as a result, they become highly inefficient with time. For instance, one can’t create custom profiles for all clients with the pen-and-paper method. Modern electronic frameworks like ERPs solve this issue once and for all. They allow various firms to automate the majority of the document work and, thus, make it easy to greatly increase in size regardless of the scope of a particular firm. In our opinion, scalability is one of the main reasons why many firms are willing to learn how to build ERP software. 

Improving customer and employee experience

In the end, all the presented benefits of custom ERP development are crucial for improving the customer and employee experience. How exactly do these platforms achieve their goal? Firstly, they create a centralized location for all customer and employee information, which makes it simple to quickly react to various data requests from different actors. Secondly, an essential reason to invest in custom ERP software development comes in the form of data analytics. Those systems are the only tools on the market capable of analyzing diverging customer and employee requests in the first place. Consequently, they can make high-value evaluations of the requirements set by different groups.

What are some examples of ERPs enhancing customer and employee experience? Imagine that you host a video platform. An ERP system can help analyze which video types are the most interesting to the viewers and, thus, boost their monetization to create more incentives for further investments. Similarly, an ERP is highly useful for manufacturing firms. Tools that exist on the market are noteworthy for their capability to, for instance, track the selling history of a particular ware. In practice, this means you can clearly understand whether one product is successful or not. This is vital because hidden costs sometimes obscure the true situation with various wares from us.

Existing ERP System Frameworks

In our opinion, there are two main types of ERP systems you should consider. On the one hand, cloud systems for ERP exist. They work from any location with the Internet and allow deploying your business in a wide range of situations. These systems are highly vital because, to a great extent, they enable many types of work arrangements. For instance, modern cloud ERPs allow one to promote distance work in their business model. Processing capacities of those platforms are also greater in the majority of cases. They’re capable of analyzing tremendous amounts of data and producing high-quality decision-making inferences. At the same time, those models are less secure than on-premise ones. The constant need for Internet connection creates major risks for businesses using such ERPs.

On-premise ERPs, in turn, tend to be more secure. It’s possible to completely withdraw them from the Internet and, thus, guarantee maximal confidentiality for your business. At the same time, you need to spend much more funds than in other cases to adequately launch apps using this model. For example, it may be necessary to invest in costly server processors such as Xeon or Threadripper lines. Hence, those frameworks tend to be slower and require advanced management knowledge from the core staff in your firm. Ultimately, the choice of this or that model depends on your needs. Confidentiality may be essential for one project and greater speed for another.

Key Must-Have Features of an ERP

In our opinion, the following features offer the greatest benefits for businesses. Therefore, while working with an ERP, you should primarily pay attention to the following features:

• Module integration that interconnects the core aspects such as finance, accounting, inventory, supply chain, manufacturing, and human resources.
• Data access and reporting capabilities that provide a complete picture of the organization’s activities and accomplishments.
• Automation features that help streamline workflows and optimize tedious processes like business intelligence collection.
• A central database that keeps data consistent across the organization.
• Scalability features that help accommodate the growing needs of your business and its future growth opportunities.
• Strong security features that protect the core user data and ensure complete compliance with main industry regulations.
• Interfaces that are customizable and can be applied to a wide range of business situations.
• Mobile accessibility features that help streamline the business development process and access it from any location.
• Integration capabilities that enable ERP platforms to integrate with other important business projects and, consequently, maximize efficiency for the relevant stakeholders.
• Comprehensive reporting and analytics tools that are used to support data-driven decision-making and business intelligence.

Step-by-Step Guide for Creating an ERP

Now that we understand what features are necessary for an ERP, it’s time to look at the core theme of this article: how to build a custom ERP? Here are the core steps that are, in our opinion, essential for the process of custom ERP development:

Step 1. Outline the goals and requirements of your company

The first step to consider in the creation of custom ERP software is to focus on outlining the goals and requirements of your company. In this regard, you should highlight which processes need intervention from an ERP system. It’s not always logical to install systems of this kind in your business. For instance, they’re suboptimal in situations where you already have some high-quality software installed in your firm. What do we mean by that? If you already have an interconnected system of inventory management and HR software, for example, an ERP may be an unnecessary addition to your existing capabilities. Similarly, if you don’t face a high level of organizational complexity, there may be no major need for such transformations in the first place. As a result, we recommend custom ERP software development only in those situations where the long-term benefits of adopting this technology are genuinely significant.

Step 2. Choose what type of ERP you want

A second aspect to consider is the type of ERP you may want to install in your company. We’ve already mentioned that the ERP types are subdivided into two groups: on-premise and cloud. A cloud-based approach may be perfect for a development team that works in several countries at once. It’s an outstanding model for all types of distance work. In turn, an on-premise approach may be more advantageous for confidential software development services. What approach to choose depends on the organizational requirements of your business. Higher processing power needs, for example, may create a greater demand for cloud approaches. It’s crucial to choose wisely, in the end, because many ERP models are costly. For instance, we know that cloud ERP solutions typically can require well over 3 million dollars for organizations that have more than 1000 workers.  

Step 3. Create a user-friendly UI/UX design

A major factor in the success of ERP software is a user-friendly UI/UX design. Why is this the case? ERPs encompass entire firms: they involve hundreds, if not thousands, of workers. Thus, we encounter a major human resource management challenge here: the relevant software should be accessible to every person included in the business processes. To work this way, your software must have a user-friendly interface that’s accessible to everyone. The only way to achieve such an interface is to start with a proper design in mind from the onset. How can one do this? Primarily, by creating a set of prototypes for your enterprise resource planning software and then testing them on real employees to see if they react positively to this or that business idea. 

Step 4. Develop the product and review it

Once you have outlined the why and how of your product, it’s time to implement it in real life. In this regard, the existing theory shows that ERP development greatly depends on two core aspects. On the one hand, you should make a major investment in choosing the right development platform. In this respect, two frameworks exist on the market. You can go for Agile methodology or mix it with older approaches like Waterfall. The first option is great when you aren’t budget-constrained and are ready to experiment. In the second case, more constraints are present, making development more streamlined and reliant on the developers.

You should also actively think about the tech stack of your project. Today, many development solutions are present on the market. You can choose between CPU-optimized platforms like C++ and more scalable solutions like Node.js. Different programming and scripting languages create different capabilities for your apps. In this respect, you should, above all, actively consider the future needs of your business. A focus on processing may require something CPU-intensive. In turn, a concentration on scale can benefit from JavaScript technologies.

Step 5. Ensure third-party integration

Multiple third-party solutions are highly popular among various businesses. For example, the manufacturing sector concentrates on SAP Business and Microsoft Dynamics 365. In turn, financial companies focus on other types of solutions. One factor is clear here: every sector has its own set of apps that are highly popular and become a major part of user roles distribution. You should clearly define what solutions are essential for your type of ERP software. Then, it’s necessary to transform your ERP software development to conform to the needs of the users regarding these app types. What should one do here? Above all, review the common file types in those sectors and make data from them transferable to your platform. This approach may be essential both for working together with those solutions and, for instance, for transferring data between them.

Step 6. Collect and analyze user feedback

Upon launching your app, it’s time to collect and analyze user feedback for the relevant software systems. At this stage, you should analyze what your customers say and then introduce positive changes based on their core wishes concerning your system. User feedback is typically what distinguishes a potent solution from a weaker one. Many people like apps that involve active maintenance. Development only begins with the transition to release. Upgrading is among the most important manual processes in software development.

Step 7. Support and maintain your ERP

The final stage is to actively support your ERP. In this respect, you must do everything to carefully maintain the app and ensure that it’s in a good technological state. Apart from iterations based on user feedback, you must also concentrate on the improvements regarding overall ERP development quality. Remove bugs and ensure that your app features minimal technical problems. After all, issues with a financial module, for instance, can have a highly negative impact in case of some errors.

How Much Does It Cost to Build Your ERP?

The cost of building your own ERP depends on a tremendous number of factors. Firstly, you need to consider the speed of development for your solution. The faster you want to develop an app, the costlier its overall development process will be. Secondly, it’s essential to understand the scope of features. A cloud ERP with a mobile app will cost much more than a solution that focuses purely on inventory management. Thus, the overall cost of business tools greatly depends on the scope of your project. The largest ERPs can cost millions of dollars per year in terms of maintenance.

Key Tips for Implementing Your ERP

In our opinion, the following approaches are central if you’re willing to implement an ERP: 

• Outline the core goals and objectives of your implementation process.
• Receive full-scale management buy-in.
• Choose a clear project team with expertise in a range of business solutions.
• Conduct thorough requirements analysis to ensure real-time integration.
• Select an ERP system that is right for your goals.
• Develop a comprehensive implementation plan to guarantee a full scope of features.
• Engage end-users and provide training for your core goals.
• Manage data migration carefully to ensure a smooth transition from older systems to newer.
• Conduct a thorough evaluation and validation of the system.
• Develop a change management plan.
• Prepare a plan for post-implementation support.
• Track success.

What Are the Core Criteria for Choosing an ERP Development Company?

In our opinion, there are multiple key criteria for choosing an ERP software development company. Above all, you should actively look at the overall expertise of the business in software development. In this respect, we recommend focusing on companies with at least five years of experience in development. Another vital aspect is the overall knowledge of the software development process for ERP projects or tools that are close to ERPs. For instance, a company with inventory management expertise may be good at creating high-quality ERP solutions. Lastly, you should also be aware of the chosen tech stack. In this regard, review companies according to the needs of your business. Different tech stacks fit different development goals in the majority of cases.  

Keenethics Expertise

Keenethics has major expertise in developing products related to the manufacturing field and ERPs. Firstly, we’ve helped develop a strong supply chain solution, GetPart, which has many functions of a high-quality ERP due to its warehouse management capabilities. Secondly, our firm has also assisted with upgrading ToolSense, an inventory management solution that required major ERP development expertise due to its all-encompassing nature. Lastly, we’ve also assisted with developing some financial projects, such as BankerAdviser. This information means that we have sufficient expertise to create a financial module for an ERP software solution. Apart from the development expertise in terms of creating business management apps, we also know how to deliver a strong cloud-based ERP solution. Why? The reason is simple: we’ve developed multiple cloud-integrated apps.

Conclusion

To summarize, the presented information means that ERP development is a worthy investment for the majority of firms on the market. Yes, developing these solutions is very difficult as their key features are costly. However, they bring about major positive outcomes that can compensate for most expenditures in a short timeframe. Thus, we highly recommend our clients to think about ERP software development as it offers many strong positives despite the difficulties of software integration. The Keenethics team is here to assist you with creating such solutions, as it has strong expertise in various manufacturing fields.

FAQ

What technology do you recommend for ERP development?

In our opinion, the choice of technology depends on your customization requirements. C++, for instance, is great when you need high-quality calculations. At the same time, Node.js may be a perfect choice in cases when you require complete control over scalability.

What are the core reasons to develop ERP platforms from scratch?

ERP development from scratch is advantageous because it allows you to have full control over the features in development. The key problem of proprietary ERP platforms is that they focus on the general department structure. In reality, your approach to departments may differ greatly. Therefore, many proprietary features can turn out to be redundant. In this regard, ERP development solves this problem once and for all by allowing you to create a solution that fits your needs and not those of any other companies.

What benefits can an ERP solution offer?

Here are the core benefits ERP development aimed at delivering a full-scale software solution can offer for your business:

• Integration of business processes.

• The enhancement of data visibility and accessibility

• Enhancement of operational efficiency

• Improved inventory control

• Streamlined logistics management

• Better customer service

• Reduced errors and redundancies

• The enhancement of productivity

• Better decision-making with real-time information

• The adherence to industry regulations.

• Ability to expand and change

• Lower operational costs

• The competitive edge

What does an ERP system provide for manufacturing?

Modern ERP systems offer many benefits for manufacturing. In this respect, the involved platform type promotes better testing of wares and improved tracking for product success. Essentially, these platforms are sufficient for organizing the monitoring of achievements in an entire business.