1

Comparative study of Open Source ERP Systems

By

07030244018

Ravindra Nath Sharma

SDM – 07-09

Symbiosis Centre for Information Technology

(A constituent member of SIU Established under section 3 of the UGC Act 1956 vide notification no. F.9-12/2001-U.3 of the Government of India)

2

Acknowledgement

Apart from the efforts of me, the success of this project depends largely on the encouragement and guidelines of many others. I take this opportunity to express my gratitude to the people who have been instrumental in the successful completion of this project.

I want to thank Mr SVK Bharathi (faculty and my guide for this R&D project) for giving me the opportunity of working on my R&D project under his guidance and for enhancing my ambit of knowledge to a greater altitude. I can’t say thank you enough for his tremendous support and help in spite of his busy schedule. I feel motivated and encouraged every time I attended his meeting. I thank him for patiently attending my queries between his busy schedules .Without his encouragement and guidance this project would not have materialized. I would like to show my greatest appreciation to the CTO Mr. Shyam Sharma Business Head and Chief Technology Officer (CTO) compugenius

I am deeply indebted to my Director Ms. Shaila Kagal whose inspiring suggestions and encouragement helped me in executing the project.

I would also like to thank my colleague Mr. Mahesh Panchal for giving me time to time reviews and their valuable thoughts.

Especially, I would like to give my special thanks to God and my Family whose love enabled me to complete this work.

3

Index Chapter 1: Introduction

1.2 Objectives....................................................................................5

1.3 Scope...........................................................................................6

1.4 Methodology..................................................................................7

Chapter 2 Review of literature

2.1Open Source ERP.............................................................................................8 2.2 Popularity of Open Source ERP.......................................................................10

2.3Difference between open source ERP and commercial ERP............................11

2.4 Points to be kept in mind while choosing the appropriate ERP platform.........12

2.5Parameters for choosing dot net and j2ee for ERP applications........................14

2.5Parameters for choosing dot net and j2ee for ERP applications...............15

Chapter-3: Analysis of Problem under Research

3.1Evaluation Criteria for Open Source ERP............................................16

3.2Open Source ERP Product and Price...................................................18

3.3.1open bravo .........................................................................................20

3.3.2Compiere.............................................................................................23

3.3.3Tiny ERP..............................................................................................24

Comparision of features of three popular open source products.................25

4

Chapter 4

4.1Findings..........................................................................................29

4.2Recommendations..........................................................................30

4.3Conclusion ......................................................................................31

References………………………………………………………32

Appendix…………………………………………………………33

 

5

Comparative study of Open Source ERP Systems FPR

Chapter 1: Introduction

Summary of Abstract: Companies availing ERP services always face the hassle of paying a large sum of money for license fees. This did not stop with the implementation process alone. They continued in many areas like modification and deployment. However open source ERP helped to remove this drawback. So more and more companies going for open source ERP the need of the hour is to define the evaluation criterion or the factors that should be kept in mind while choosing open source ERP by companies .the research will be based on the comparative study of the two most popular open source ERP packages into consideration with their parameters on which they are selected by the companies. We will also analyse the need of open source ERP in SME sector especially .why open source is becoming popular in this segment of industry. First study Open source ERP systems by collecting data through Internet. It includes study of various white paper, News, Articles, Blogs, Success stories, Case, forums & site, additionally I’ll go through books & reference material Afterword it’s mandatory to study and compare Open source ERP systems / Technologies / framework .Then Analyze the companies who has adopted Open source ERP systems, It includes findings like, which Open source ERP systems are best suited for companies along with its pitfalls.

1.2 Objectives:

The objective of the research is to

1. Find out some of the issues concerning Open Source ERP for S.M.E'S by taking two prevalent open source ERP packages into consideration

2. Evaluation Criteria for Open Source ERP.

3. Compare the two open source ERP packages on the basis of evaluation criterion

6

1.3 Scope:

Open source ERP systems are often targeted to enterprises whose requirements are not covered by standard software. Similar circumstances apply to organizations that need continuous adaption of the software to changing processes and needs. In this work the suitability of current open source ERP systems for these enterprises will be examined. Starting from the question which opportunities a company has to support its processes with IT, the advantages of flexible systems are elaborated. Besides the focus on flexibility, Open source specific criteria for support, continuity and maturity are worked out. Then selected open source ERP projects are reviewed and classified according to these criteria. Need: Different vendor claim that it is hard to adopt the open source ERP. But from developers perspectives it’s not that much hard also to customize that.

1.4 Methodology:

This research is carried out by study, Analyze, cases on open source ERP , & Getting data from primary resources (Developers, forum, Groups) First I’ll study Open source ERP systems by collecting data through Internet. It includes study of various white papers, News, Articles, and Blogs, Success stories, Case, forums & site; additionally I’ll go through books & reference material

Afterword it’s mandatory to study and compare Open source ERP systems / Technologies / framework. Then Analyze the companies who has adopted Open source ERP systems, It includes findings like, which Open source ERP systems are best suited for companies. Along with its pitfalls. Working in the same direction.

The research will proceed in the following way as shown in the diagram

7

Research results: The study of open source ERP & The problem solutions while adopting open source ERP along with comparisons with other packages. It is finalized by preparing brief report. Finally study comes to end by Suggestions, improvements, & conclusion.

8

Chapter 2

2. Review of literature: 1Methods to Implement an ERP System

2.1Open Source ERP:

The companies can download the software programs at free of cost and use them. The good news is that the source code is also available in many a times.

Some of the features of Open Source ERP are as follows:

2.1.1. Cutting down the costs This is the first and foremost advantage of ERP. Companies really find it taxing to pay the additional cess whenever a renewal is made to existing license system. Since they invest a large amount in the initial stage they find difficulty in paying again and again. All these have been completely done away with by the intervention of open source ERP. All that the company has to do is to download the software and make use of it.

9

However this issue has drawn lot of controversies recently. Some companies feel that open source is not promising enough to meet the application deliverables. The others find it convenient to make the necessary payments for the service rendered. This debate continues endlessly in one end while in the other end the fact remains that ERP open source has made it possible for S.M.E.'s to enter the market owing to the cheap cost.

Companies don't prefer to go for open source applications due to cost alone. They choose it if and only they are convinced that it will help them keeping their IT infrastructure and requirements in mind.

2.1.2. Lesser dependence on the vendor Open Source ERP application not only brings down the costs but also reduces the dependence on vendor. In fact this in itself is another form of saving. The companies have to approach the vendor for each and every petty issue. But it is not so after the intrusion of open source ERP. Open source gives everything readymade right from source code. This also implies saving of time. The company need not wait till the vendor comes to sort out the issue. Neither do they have to train the employees in a fully fledged manner.

Some complexities

Open Source is not completely free from limitations. There are some issues which the company has to think twice before going for open source ERP application. Firstly the accountability is solely on the part of the company as the vendor has little prominence in this whole. Secondly the company there is many legal issues associated with open source ERP. Even though it is acclaimed as free software that does away with the criteria of licenses there are many implied conditions which has to be dealt carefully. The interpretations of the conditions are still unclear. The clarity has been increasing only after successive lawsuits. Thirdly Open source has been found unsuitable especially for conventional applications that require the fulfilment of preset criteria. In addition companies have their own inhibition that discourages one to go for open source ERP

2.2 Popularity of Open Source ERP:

It is a well known fact that open source ERP has done away with the concept of license fees. However that does not become the only reason for the growing popularity of open source ERP applications. Some more reasons contribute to open source ERP popularity. Some of the reasons are as follows:

10

2.2.1 Bringing down the costs and doing away with Vendor's Dependence The amount of money invested in ERP deserves no special mention. It is no exaggeration to say that ERP occupies a significant place in the budget of the company. In this context open source ERP has helped in reducing the amount spent not only by way of offering source code and software programs at free of cost but also by easing the procedures. Since the codes are readily available the chances of mistakes are considerably reduced even if they are not nil. This has become possible due to open source ERP technicalities.

The ERP vendor need not be called every time because the source code acts as a guide to the company. His services may be used only when there is absolute necessity. Moreover the company can carry modifications on its own just by clarifying with the ERP vendor. Normally they stay in the company till the process of migration especially if the company is new and lacks a proactive approach to ERP. This stage was often considered to be a troublesome one since there could be more clashes between the vendor and the company regarding the process. The intensity of these clashes could be than during the initial restructuring stage because the vendor will press for more changes now given that ERP has been experimented and the exact gaps and loopholes have been identified.

2.5.2 Flexibility Open source ERP is more flexible that a partial ERP application. A partial ERP application is selected for the particular function/functions. But when it comes to ERP the codes can be selected based on the requirements. This is an advantageous feature made possible by open source ERP technicalities. The remaining codes can be ignored. It is also to be noted that this feature will be absent if the company chooses a proprietary technology. This does not necessarily mean diminish of open source ERP popularity.

2.5.3 Easy to understand and use: A unique feature of Open Source ERP technology is that it can handle the functions without any complexities. This is by and large the reason for small companies to choose Open Source ERP for their operations. Open Source ERP finds itself unacceptable in large companies that adopt difficult process though not in all cases. Open Source erp technicalities are also suited for member concerns from the same industry. The common databases of these concerns have helped a lot. For e.g. the hospitals sharing the information about patients will find this service extremely useful during cases of emergency more so when a doctor takes care of a particular patient and he has no clue about his history, though there are lots of arguments for intrusion into one's privacy and sharing of confidential details.

11

2.5.4Training and security The training part of open source ERP is negligible. In fact no amount of formal training is required to run an Open Source ERP application. Some orientations on how it all works wills do. The user can learn the rest. He gets to learn unlearn and relearn during the course of working. When it comes to security open source ERP is less risky when it comes to bringing things under public domain.

2.3Difference between open source ERP and commercial ERP

Enterprise resource planning is available in two states. One of them is referred as commercial while the other is called open source ERP. .commercial and open source ERP have lots of differences.

Some of the differences are as follows:

2.3.1Pricing Commercial ERP is an expensive package and suitable only for bigger corporations. The prices do vary significantly but according to the size of the company and volume of business. In any cases they have been found to be extremely costly irrespective of the quantum in which they are purchased. These packages are not subject to flexibility and moulding. Their usage modalities are rarely liberal and cause troubles when they are modified. Hence the deployments also turn out to be costly and inconvenient due to the procedures involved, in the future. Another major allegation against the package is that they consist of lot of hidden costs. The greatest advantage of Open source ERP application is that it is available at free of cost. This is a motivating factor to companies that shun the idea of ERP for the sake of price tags. Even the licenses are available along with the source code. This essentially makes sure that the procedures for training are very easy. In the case of commercial ERP vendors don't disclose the prices initially for it would make any sane person to refuse the order. He is later blamed for inflating the costs. This feature is unknown in open source ERP as everything is free e.

2.3. Flexibility This important feature was found absent in commercial ERP. It was a difficult task to make them suit the working pattern. Instead of modifying those in wake of the inherent difficulties companies had no other choice but to change their way of business. This was often a debacle even though it was argued that the best ERP were designed for the best business practices.

2.3.1 Duration, Dependence and Results The time allotted for implementing open source ERP is very less when compared with commercial ERP than open source. The innumerable number of complexions in commercial ERP calls for longer time span. It consumes a lot of time not only during implementation but in every stage of ERP process due to the nature of work involved.

12

When it comes to the question of relying on the vendor the open source ERP vendor enjoys a considerable edge than the commercial ERP. Since open source is a (self) built in process companies rely less on vendors and takes care of needs by themselves. The productivity is also high in open source ERP systems and the failure rates are very low.

2.3.2Training Lots of training is required for using commercial ERP. It calls for lots of investments in terms of time and money. There are lots of controversies regarding them. If they don't give the necessary impetus the results will be poor. Similarly the companies are largely debating the validity of training sessions designed and handled exclusively by the ERP vendor.

On the other hand Open Source ERP does not require much training. The source code is more than a training manual. The results are also bound to be effective because the user gets to learn through the process of self teaching. The company need not spend much on training and makes a minimal utilization of the resources. This is another way of reducing the level of dependence on the ERP vendor.

2.3.3 Security Commercial ERP systems are less secure when compared with open source erp applications. They are by and large prone to the traps and pitfalls of hackers (no matter however tight is the segregation of the components).Even though open source ERP makes everything transparent and available in the public domain it bring into the notice of user whenever something goes wrong.

2.3.4 Conclusion The differences between commercial and open source ERP applications show the Edge enjoyed by open source ERP players. However the fact remains that they are not recognized well in the market for fear of failure as customers are still prepared to pay for results. They can go a long way only if the awareness is high (which is encouraging in the current scenario).

13

2.4 Points to be kept in mind while choosing the appropriate ERP platform:

The company has to exercise lot of care in choosing ERP platforms. Companies normally tend to go for a platform that is akin to the current work scenario. This will help in easily working with the existing systems rather than going for a new one. However there are other factors to be considered in this regard.

Some of them are as follows:

2.4.1. Prior experience with ERP The company should check if the platforms in question have already been experimented successfully in an ERP environment. The more they have been tried and tested the greater is their credibility. This helps to increase the comfort zone psychologically and technically because of the feeling that the platform has demonstrated competence in ERP.

2.4.2. Networking facilities The organization should consider the channels used for disseminating information and its relevance with the platform in choice. By and large the features should not be subject to any amount of rigidity. The platform should basically allow fee flow and exchange of data between the networks and be applicable to work in the latest atmosphere.

2.4.3. Proper designs ERP applications are often more than complex and taxing. Thing will become worse if the preferred ERP platforms are also of the same stature. Therefore the designing part of the platform will be able to speak for itself only if they are done unequivocally. The designs should be in such a manner that they can be used freely either in integrated or distributed applications.

2.4.4. Effective outputs The ERP platforms should contribute valuably to the output. The system should work well and be able to balance the flaws that arise during procedures. All platforms are bound to face struggle while working in the introduction stage. This problem is an unavoidable one especially in the introduction stage. The preferred ERP platforms should resist the errors that come during the procedures, even though they may be due to some functional component and not directly connected with the platform.

2.4.5. Sustainability The company needs to be assured that they can implement this platform for a considerable longer time. The ERP platform will be retained only if they are satisfied that it justifies the costs incurred. The preferred ERP platform should have the capacity of being tuned well within the company's environment.

14

2.4.6. Assortment of related levers The company has to not only check the comfort level of the platform with the main applications but also with the supporting levers. Since they go in hand during the process it becomes important to give them the due attention. This is important in ensuring that there are no hassles in when the entire operations are set in motion.

Conclusion

These general characters need not necessarily suit every company. They can be taken as parameters for assessment but to take them as deciding factors will not suffice. The company should as well take all the relevant internal and external factors in to account to decide on this matter before choosing ERP platforms.

2.5Parameters for choosing dot net and j2ee for ERP applications:

The battle for supremacy for ERP platforms choice goes uninterrupted others.

It is a critical decision for the companies. Similarly the fates of these two companies are also unpredictable as they keep constantly improving their functions and scope.Some parameters taken into account by the companies are as follows:

2.5.1Working pattern There are two factors that generally constitute the working pattern. Firstly it denotes the platforms and applications put into use. Secondly it denotes the systems advocated by the company to keep abreast of the market trends. Any company will aim at obtaining a platform that can satisfy both these conditions. The monetary factor, financial strength of the company besides the budgetary policies have a strong hold in deciding these two factors. The man-hours allotted by the company are also taken into account in this context. Companies generally have a tendency to go for ERP dot net for Windows platform. On the other hand they choose ERPj2ee if the platform happens to be windows.

2.5.2 On the basis of strength The term strength is to be analyzed in two connotations. Firstly the company has to see the validity of using applications with reference to the current level of operations and those anticipated in the future. There is a particular reason for laying overstress in the future component. Since change has become an incredible element in organizational behaviour provisions have to be always made keeping the future in mind.

Dot net can be used comfortably if the number of people working in the systems is around 90.They can be used even beyond that stage but the comfort level will decrease. It is advisable to go for j2ee when the overheads exceed 290and more. For E.G. if the number of persons is 90during the time of implementation but the company thinks of an alternative to go for 290 or

15

more in the next six months the company can either wait till then if the expansion is not confirmed and then decide on the platform. On the other hand if the expansion is very likely the company can straight away go for ERP j2ee applications. Otherwise they can go for ERP dot net. ERP platforms choice is crucial in this aspect.

2.5.3 Cost of the platforms The company needs to find this out initially and match it with their budgets and requirements. Frankly speaking both applications are highly expensive. However the companies company needs to evaluate the price in terms of the facilities offered by the platforms. Some platforms will have default facilities which might be of no use to the company. On the other hand other platforms will have those facilities as an option.

In addition the company needs to decide if it is going to develop from the existing systems or invest on a new one altogether. The money payable as salary or professional fees to the consultants and specialists employed on project basis is another factor. The general connotation is that J2ee developers are at least 5% more costly than dot net developers.J2ee continues to top prices in all areas including setting up and procurement charges.

16

Chapter-3: Analysis of Problem under Research

3.1Evaluation Criteria for Open Source ERP

3.1.1. Customization Complexity

No matter how comprehensive an ERP solution is, customizing the software is inevitable. Open source ERP solutions are particularly easy to customize, since the source code is freely available. Also, these solutions are written in popular, widely used computer languages such as PHP and Java. It is also important to evaluate how easily customized code is migrated during software upgrades.

3.1.2. Functionality

All ERP packages are expected to support core business process. For example, creating customer, vendor and products master records, maintaining customer orders and sending invoices are integral parts of ERP systems. Besides core processes, ERP solutions vary widely. One ERP solution might be very good at managing manufacturing operations, while another one will have a robust accounting module. It is vital to identify the unique strength of each open source ERP solution and decide which one fits your business requirements best.

3.1.3. User Experience

Although many older ERP solutions do not pride themselves in their user experience, modern technologies make it much easier to build pleasant user interfaces, making it easy for users finding information and connecting it to the business process they are managing in the ERP information system. User interfaces should be clean, clear, intuitive, offer context-based help, enabling users to be as efficient as possible in their daily tasks.

3.1.4. Development Activity

Unfortunately, many open source projects do not last many years. That is true, of course, for non open-source software as well-smaller software companies are bought and products are discontinued, software vendors go bankrupt and support and maintenance companies discontinue operations. The good news is, since the products are open source, the source code is available and you can continue developing the product to fit your specific needs even if the official development of the project stopped. However, in any given open source project, developers activity might vary over time, effecting rate of bug fixes and new features development. It’s important to consider the development activity in the months prior to the time the decision about the open source ERP solution is made.

17

3.1.5. Knowledge

A key success factor in any kind of information system implementation is knowledge around the product. Too often, great software products are not successful because there are not enough professionals who know how to implement the product. That is especially true for ERP implementations - the complexity of the project and the varying requirements from one project to another requires strong knowledge of the ERP software being implemented. New open source ERP solutions do not always have enough experienced consultants that can help customers bring out the highest possible Return On Investment.

3.1.6. Production-readiness

We use the term production readiness as a placeholder for a set of requirements that has nothing to do with functionality, but are of equal importance to any business software -performance, ability to scale to large numbers of records, high availability options, and recovery procedures in case of system or database crash, security features, user management and access control. These are often the factors that differentiate mature open source ERP solutions from others. Production readiness is commonly overlooked, especially by small and medium companies, since the volume of transactions and data stored in the ERP system is relatively small. Hopefully, an ERP system will help the business grow to a point where this issues will rise - suddenly, creating a new customer orders or displaying an inventory report takes 10 seconds instead of 1 second, system availability is not 100% or the system shuts down because the database is full. You must consider early on future growth rates, allowed downtimes, cost of lost data etc.

3.1.7. Integration

Every ERP project requires integration. The open source ERP solution you will use will need to communicate with other software systems - mail servers, spreadsheets, your vendors’ ordering system, your shipping companies’ software. In commercial ERP solutions, the integration is handled by middleware - usually a huge bundle of software components that manage that integration. An open source ERP can never provide that level of integration support. What it can do is use standards which are supported by other software vendors to enable painless integration. For example, using XML files to import and export data such as customer and product records is the de-facto standard in data exchange. Exposing functionality as web services and being able to consume web services from other systems is also becoming increasingly popular.

3.1.8. Migration

The first step of most ERP projects is migration. For large ERP implementations, that step can take months if not years. For smaller companies implementing open source ERP solutions, the amount and complexity of data to migrate from older systems to the new ERP system is much smaller. Still, a poor migration can bring an ERP project to failure. Open source ERP solutions should provide a flexible migration component, allowing import of data from multiple sources(text files,csv,excel files, database files),a validation layer, acting as a gatekeeper, stopping low quality data from entering the new system and an exception reporting tool.

18

3.1.9. T.C.O

Open source is free. Well, not always. Almost all open source products are free to download and use, but some some are not. Also, most are free to download and use-you will still need to customize the software and require some consulting services. There is a long debate between supporters of open source software and commercial software vendors over the question “How much does free, open source software, actually costs”. You can be sure of one thing - you will save a lot of money on licensing the software itself, money you can invest in customization, consulting, support and maintenance.

3.1.10. Community

The open source movement is all about community. A group of people working night and day, spanning multiple time zones, writing large amounts of great code, without being paid! It sounds crazy, but it’s true. All successful open source projects have one thing in common - a thriving, diverse community, supplying everything required to support wide adoption of software-not only development but also documentation, bug reporting and support forums. The larger the community, the higher chances of success for an open source project. Although there are some other criteria you might want to consider, the list above is a must in your checklist of evaluation criteria for open source ERP solutions.

Issues concerning Open source ERP in SME'S

Open Source applications are tools that has made it possible for S.M.E.'s to realize their ERP dreams. It refers to the software programs that can be copied and reproduced

Without even paying the license fees. This has done away with the hassles faced by the companies. However there are some restrictions and the question of proprietary or non-proprietary technology comes to the picture in determining the judicious use.

Some of the issues concerning Open Source ERP for S.M.E'S are as follows:

ERP'S intervention in S.M.E.'S ERP was enjoying a large segment among big players. The subsequent applications only increased its scope. There was no looking back especially when the industries suffered from dearth of connectivity and communication. ERP has turned out to be the apt solution to meet the fast-moving channels in the corporate sector. However as stressed earlier it was not possible to cater to all the sectors.

Proprietary and Non proprietary technologies

The two major types of Open source are classified as Open source with Proprietary technologies and Open source applications with non proprietary technologies. There are many nuances of

19

open source ERP .These technologies determine the extent of usage and scope of open source applications.

Proprietary technology prohibits the copying of the software except for some conditions. Thus proprietary technology poses some restrictions to the users’ .On the other hand non-proprietary technology is devoid of the restrictions. This neither imposes many precincts like that of the former.

Open source and S.M.E.'S There is a considerable advantage in using Open source applications in S.M.E.'S. Small and medium industries cannot afford to install large applications. This is not only because of cost but also due to other practical difficulties. There are many more nuances of open source ERP.

In this context it becomes wiser to use open source applications that can serve the dual purpose of reducing (or not even paying) the license fees. Open source applications can help the companies to reduce the technicalities by offering comprehensive solutions on need basis that is the company can decide to make a copy of only those functions required by it. The company need not necessarily take a note or install all the functions of software. On the contrary they can choose only those applications required for their daily routine.

This happens to be a main advantage for an S.M.E. When compared with bigger companies. They have to invariably select all the functions from software irrespective of the fact whether they are useful or not. Their operations are extensive and hence they may only need more than what is available in a particular software. On the other hand the autonomy of choice is available with S.M.E's. Moreover even if bigger companies copy the entire software verbatim the idle functions may cause extra storage process and may even disturb the process. These limitations don't find a place in S.M.E'S.

20

Open Source ERP Product and Prices

1. Openbravo

Openbravo provides a single paid edition (’Openbravo Network’). Prices are 5,000€ for the first 5 users and then 500€ per user, per year. They currently offer a promotion price of 10,000€ for unlimited users, which is a really good deal if you plan to run more than 20 or so users.

2. Compiere

Compiere has been offering commercial editions of their ERP product for a long time now. They offer both Standard and Professional editions. The Standard edition goes for 25$/User/Month and the professional for 50$/User/Month.

3. XTuple

xTuple offers 3 editions - Postbook, a free, open source edition, Standard Edition and OpenMFG, the latter 2 being enhanced, commercial ERP versions based on Postbooks.

For Postbooks, the open source edition, xTuple offers varying prices for support and services, depending on the number of users. For 5-19 users, for example, the price is 500$/User/Year, going all the way down to 100$/User/Year for 200+ users.

4. OpenERP (Former TinyERP)

OpenERP does not offer different ‘editions’ of its software, but they do offer different support packages. Average price is 100€ per hour.

OpenERP Support Plans

OpenERP is also offering a SaaS ERP (ERP on Demand). They are currently the only open source ERP vendor to offer that. They have a very flexible pricing scheme, allowing you to choose which modules you want to use and pay for. Their SaaS ERP offering is sold for 140€ per user per month.

Development model of OPENBRAVO

Openbravo follows a development model that combines elements of agile programming with aspects of a traditional waterfall development process. When we receive feature requests, we do a quick initial assessment to roughly estimate the amount of effort required to implement the feature. We then add the feature to our queue of requests. At the beginning of a release, developer targets an appropriate set of features that he wants to build. This process balances three elements: how well understood a feature is community priorities and development capacity.

21

For each feature, he develops a functional specification and then break down the project into sub features. The release development cycle is broken into several iterations. At the beginning of each iteration, He decide which sub feature to build next and we assess whether the whole project is still on track to complete in time for the release.

Development environment:

Openbravo is developed in Java, SQL and PL/SQL. Most of developers work on a Linux machine with a database, PostgreSQL or Oracle, the Java Development Kit, Apache Ant and Tomcat installed. Java coding and debugging is done in Eclipse. The source control system is SVN

Scripting languages

Openbravo does not directly use any scripting language. Our user interface implements AJAX using the DOJO library. We work closely with the DOJO project and occasionally we make changes to the DOJO JavaScript code, but, at the end, our product embeds a standard version of DOJO.

Largest customer base (sector wise)

Open Bravo has mainly mid size enterprise customers in four key industries: manufacturing, distribution & logistics, professional services and media.

Target market

Open Bravo’s largest customers are mid-size enterprises (Over 100 employees).The target clients are small and mid-size enterprises (SMEs), say between 10 and several 100 employees who have the need for an integrated management system, but felt a standard solution was not for them. Open bravo is not focusing now on micro companies (SoHo) (with less than 5-10 employees), which usually can't afford an ERP or large corporations, which are completely served by major players like Oracle or SAP.

Recent customers

One of newest customers is a company focused on the sales of food products and logistics to professional clients like hotels, restaurants, and the like. Active from three locations, it belongs to a large Spanish retail chain with around US$8 billion (AU$8.87 billion) in revenues. Another new customer is a Spanish consulting company focused on implementing open-source software solutions and outsourcing to final customers with more than 200 employees and Euro 20 million (AU$31.6 million) in revenues. And there is also a media company that focuses on economic and market information about companies and industries in Spain that has recently started using Open bravo.

22

Future plans of Open bravo Actively building the distribution channel, with partners around the world

Fostering localization of Open bravo ERP to facilitate entry in new markets

Further developing the ERP solution to enhance functionalities

Introducing value-added products and services based on the ERP; focus on scalable products to facilitate rapid growth

Fostering dissemination by reinforcing communication efforts

Continuing to build the team with top-tier professionals

Opening limited number of offices in strategic locations around the world (as of 2008)

Compiere:

Compiere can demonstrate advantages and drawbacks of open source solutions from the point of view of a medium size company.

Architecture and technology of compiere: Compiere is 100 percent Java solution based on Oracle technologies and J2EE standards. The architecture is as for platform independent and in the last release of software the independent database layer was modified to support many databases: Sybase, Microsoft SQL, IBM DB2, Postgres. Compiere can run on many platforms: Linux, Windows, OS X, and Solaris. It means on the server and client side, too.

Client is completely created in Java and it communicates with the database by JDBC protocol, with the application server by RMI methods. The alternative HTML client could be use for smaller volume of processing and it has almost full functionality like a Java client. Advantageous use of this client is the case where the installation of fully featured client is not possible or suitable. For example customers could use part of the information system of client or is possible that remote connected employee can use this HTML option.

The application server contents business logics and it is still implemented in open source J2EE application server JBoss. Other J2EE servers are planned.

23

Architecture of compiere

The Structure of the whole system is implemented with huge independence of particular objects. Application logic is strictly separated from the presentation layer and is described in so called “Rule engine”. The originally closely connected processes are separated from one another and processed by asynchronous way and the system checks the finishing of all processed branches. Only the main task influences the work of user. Subsidiary faulty processes do not block of user. The user and the administrator are alerted by system as for faults, but the system can continue processing. This concept is called “Fail-safe transaction”.

Implementation and maintenance cost of compiere: Compiere is distributed under Mozilla license (MPL 1.1). It allows the user to use it for himself, his partners, and clients. The application can be modified and these changes are allowed to be sold without any duty towards the open source community. Some license conditions of distribution must be observed (for example using of object name, adding license text to sources, etc).

But Compiere also includes next hidden costs. One of them is still big dependence on commercial database Oracle. Although Compiere supports Oracle Express, this variant is not sufficient for real installation. Compiere offers migrating tools included in annual fee. Without these tools client can hardly follow the actual version. Due to used technologies the application of Compiere requires a system specialists for Oracle and partly also for application server.

24

In spite of the fact that Compiere specialists say, that the system implementation takes just a few days, we can hardly agree, because the system is so complex that its implementation is not possible without deep knowledge of logics and functionality. In any case the client must become aware that it is not just the simple system installation but the company own processes must be compared with preset once in application very thoroughly and their modification, parameterization, adaptation for concrete user must be taken in account.

Business model and application functionality: The case of Compiere, when the application framework is the integral part of system and the whole application is developed by this framework. The user can add whole modules with minimal risk of application destabilisation in standard way and user profits of standard user’s environment and standard security model and standard databases.

The concept of so called application dictionary assures quick changes and fluent run of application. Accounting server and workflow server are at disposal for the user and they provide planning and processing, as for accounting record and warehousing transaction or processing of customer’s requirement, mail reaction, alerts or document printing. Client works with the system by means of personalised environment.

User’s environment is generated on the basis of rules and therefore the application is stabile and consistent. Time-demanding user’s inputs are replaced by the defaults and by selections from once entered data.

User can reorganise input form, change fonts, field names or hide unimportant data or add specific helps. He can also add new fields validation criteria. User’s access to data and processes are controlled by elaborated security model.

Compiere product includes processes in unified application more than the set of traditional independent ERP modules. Thanks to supported CRM features Compiere is flexible enough to be used for various businesses.

Tiny ERP:

The user interface of TinyERP is comfortable and well designed. Lots of charts and graphics types are available. It is targeted to micro, small and medium enterprises having up to 150 employees in the sectors trade, distribution and service. The modules available are accounting (inspired by Sage 100), CRM, sales& purchases (delivery, purchase, sales management, point of sale), human resources, marketing, MRP (manufacturing resource planning), MRPII, inventory control, project management. Additionally, there are some special purpose modules and a interface to ecommerce application Modules can be installed partly in TinyERP.

25

Customization Forms, reports and workflow development are supported without the requirement of programming. Forms and workflow are customizable with XML files. Tiny ERP is customizable via the client in Administrator mode. A brief tutorial for developing new modules is available. The code is very compact and has a tight memory footprint. For low level code customization a forum thread explains some of the functionality.

Internationalization The translation of languages lies mostly on the server side and to a small part on the client side. It provides a translation mechanism for the content of form fields showing list values. Server side translations are available in Spanish, Hungarian, French, German, Romanian, Italian, Portuguese, Chinese, Czech, Albanian and Dutch. Some of these translations are not for the current version of TinyERP or are not complete. Without client side translation the GUI is in mixed language. TinyERP supports multiple accounting schemes. Schemes for Belgium and France can be delivered.

Architecture TinyERP uses a self-developed proprietary server. All logic and data stems from the server. The client is based on the multi-platform GTk+38 toolkit and provides a “fat” client like rich GUI.

Documentation A Wiki is used for collaborative documentation authoring. The installation (38Pages), user (141 pages) and administration (31 pages) manual are free. A user tutorial (77 pages) is sold. A brief public introduction to module development is available online. The technical concepts and architecture are not documented. Partners have access to additional resources.

Project structure TinyERP is run by the Belgium company tiny sprl39 which employs five developers. It is mostly used in French-speaking countries. Besides the many French partners there are also partners in Argentina, Canada, Spain, and Switzerland. The founders themselves sell services too. Most contributions concern translation and bug fixing. Partners also do module development.

Transparency New features are published in the “New Releases” forum when released. Polls on new wanted features are also conducted there. A detailed change log is published in the download section. There is no public roadmap available. Access to the concurrent code versioning system is available only for partners.

26

Comparision of features of three popular open source products

Features compiere open bravo Adempiereorder management yes yes yesinventory management yes yes yes personnel management yes yes yesaccounting management yes yes yesbusiness partner management yes yes yescustomer relatioship management yes yes yessales and marketing management yes yes yesprojrct management yes yes yesservice management yes yes yeswork flow design yes yes yesdatabase support oracle XE yes yes yesdatabase support PL SQL yes yesapplication directory yes yesjava hot map debug yes yesjava client yes yesweb client yes yes yesfiest public release Nov‐01 Apr‐06 Oct‐06open source OSI approval yes yes yes

27

Chapter 4

Findings:

From the study and research conducted by me I came to find out that open source is becoming popular and the various layers in the market are providing the service but to compare all on the given decided parameters is really difficult as one is good at reporting and the other is easy to install and easy to adapt changes .so from the company point of view this should be strategy for the best use of open source ERP. The five critical steps in developing strategy for companies in implementing open source ERP:

Step one: Is ERP for you?

The very first thing you should address is clear: Do you need an ERP system at all? The answer to this is not as obvious as one might think. Most organizations considering ERP have environments made up of disparate applications, each focused on fulfilling a particular set of business requirements. The advantage of that approach is that these applications are probably very well-suited for your specific business requirements. ERP systems are by their very nature more general tools. If you are wedded to the functionality of your current applications, you might be better served by sticking with them and updating them as required with new versions.

Step two: Define your requirements

From step one above, it's clear that you need to understand (and document!) the functionality you need from your application infrastructure. If you're a manufacturer, you need a system to track orders, materials, works in progress and inventory. If you're a distributor, works in progress probably won't matter, but having two-level pricing will.

Defining the functionality you require for your business is the second step in developing your ERP strategy. If you have unusual requirements (say, for example, you import live animals for pets and therefore need government certificates and need to ensure adequate food and space is available) those need to be defined so that you will be able to see which, if any, ERP products can support them. Don’t overlook your processes. Examine them to ensure they're efficient. As the cliché goes, automating a poor process only gets it done faster -- not better. Assessing your processes with a sceptical eye can help you understand whether you're doing some things only because of habit or even because your current applications force you to.

Step three: Select a partner

Very few organizations successfully install an ERP system on their own. ERP applications are typically very complex. It's also difficult to comprehend all the functionality they offer and understand how organisations requirements will map to the product's functionality.

28

Because of this, it makes sense to find a service provider that can help you with the process. While this step is placed third on our list, depending on organisation organization, it may make sense to address this earlier in your ERP search. Many companies engage a partner to help them understand their product requirements and whether it makes sense to move away from their current functionality-specific infrastructure.

Make sure organisation' are in tune with them in all ways -- technically, financially, and culturally. If organisation likes deliberate project planning, partnering with a service provider that focuses on all-night work sessions rather than boring processes is not a good match for organisation. Similarly, if organisations are moving to open source and your potential partner tries to steer organisation toward a proprietary platform, move to the next candidate on

Step four: Select a product

Based upon the requirements organisation’ have developed and the partner organisation’ have chosen, organisation should be able to select the ERP product that's right for organisation. Organisation may have more than one candidate to select from -- in that case, what should organisation do?

I will always recommend choosing a product that fits with organisation infrastructure and technical direction. If the product requires a commitment to a scripting language that is obscure or that organisation will never use for any other purpose, maybe it's not the right one for organisation.

Select a product that meets at least your must-have features list and appears to be moving in a direction to address your nice-to-have list. Don't get overly hung up on whether a product fulfils 5% more of your nice-to-have list.

Step five: Implement the system

To ensure that the transition to the new system goes smoothly from a technical perspective, a good project plan is critical. Setting up a test system to ensure that important data flows and interapplication integrations works properly is important. Developing a migration plan for moving from the current system(s) and transferring data to the new system should be part of the project plan.

The fact that the user base is nontechnical requires consideration as well. Technical personnel are often willing to live with product crashes and failures. In fact, they may actually enjoy the process of figuring out what went wrong.

End users are a different breed. They typically think of the software as something they use to do their real job, so they don't have much patience for problems. Because of this, extra communication during the project planning and implementation stages is a good idea. Be sure to build these tasks into your implementation plan.

Open source ERP: The bottom line

29

Open source ERP can be a great choice for your organization. Having a single application provide a range of functionality can make your business operate more efficiently and profitably.

Recommendations:

These are the recommendations based on the study made on opensoure ERP they does not belong to any individual and are made on my study and may vary from person to person

Open ERP - The Fastest Developing Open Source ERP.

For those who are focusing on ERP solutions, especially the small and medium companies, Open ERP is always a good choice in terms of risk and the cost of integration. OpenERP is the most powerful and flexible Open Source ERP. It deals with each kind of industry, from accountancy to stock management, or project management. It is rich with more than 250 modules. Open ERP covers and integrates most enterprise needs and processes such as Accounting, HR, Sales, CRM, Purchase, Stock, Production, Services management, Project management, Marketing campaign, Management by affairs, etc..It has got more than 250 open source modules apart from the Custom made modules. This ensures Open ERP a right product for any business vertical.

Openbravo - opening ERP's future Openbravo is a web-based, open source ERP business solution for small and medium sized companies that are released under the Openbravo Public License, based on the Mozilla Public License. The model for the program was originally based on the Compiere ERP program that is also open source, released under the GNU General Public License version 2. Openbravo features a web-based interface, where the user can view the entire status of a company, including production information, inventory, customer information, order tracking, and workflow information. It is possible to synchronize this information with other applications through the Java-based Openbravo API. Openbravo can also create and export reports and data to several formats, such as PDF and Microsoft Excel. As Openbravo is web based, it is possible to access the interface from anywhere that there is an Internet connection.

Compiere for CRM purpose:

I have recently evaluated and reviewed Compiere and wanted to outline some of my findings. I have limited this evaluation of Compiere to some key areas. For a more exhaustive outline of capabilities and features

Compiere’s solution capabilities span Enterprise Resource Planning (ERP) and Customer Relationship Management (CRM). These include the following capabilities:

Financial Management (Accounting)

30

Sales Order Management

Materials Management (Purchasing)

Warehouse Management

Customer Service (Support & Self-Service)

Role-Based User Interfaces

One of the things I liked most about Compiere is its flexibility to adapt to an organization and to the roles within an organization. Through years of observation, I have found that 80% of ERP users use about 20% of the features and functionality that are available to them. Dealing with the confusion this creates has always been a challenge when implementing some of the traditional ERP solutions. In Compiere, the ability to tailor a user’s online experience in terms of ‘look and feel’ is defined easily using roles. Roles are easily setup by an administrator, no development is required. The menus, windows, forms and fields that are available to the user are all determined by the user’s assigned role. When roles are established, they are specific to a group of user’s tasks and responsibilities ensuring that the users only see what is required to do their job. Despite a broad array of features and functionality Compiere makes it easy to provide a simple streamlined user interface to your users. This easily translates into reduced training and support costs. Amongst complex applications, I have not seen an easier way to do this - Compiere hit this one out of the park.

Adaptability

Compiere employs an innovative model-driven architecture that gives you unprecedented adaptability, speed of deployment and a lower cost of ownership. I personally think that Compiere is under-selling this particular capability. The Compiere ‘Application Dictionary’ is a library of business logic meta-data that can be updated or extended to allow an organization to adapt Compiere to fit the unique requirements of their business. The level and extent of the customization that can be accomplished using the ‘Application Dictionary’ would require significant development time and effort in any other application. Compiere allows this adaptability while maintaining easy upgradability. The time and expense this saves during initial implementation as well as during periodic upgrades contributes to the already lower cost of ownership when compared to traditional ERP solutions.

Warehouse Management

Recently released in Compiere 3.2, Compiere offers one of their best modules to date - WMS (Warehouse Management System). WMS expands an already solid Materials Management module with a broad range of brand new functionality that automates inbound, warehousing and outbound operations. This is ideal for organizations that are looking to cut costs, improve productivity, reduce warehouse space utilization or increase customer satisfaction.

31

At the centre of the WMS module is a highly flexible and configurable rules engine for setting up intelligent materials movement through all phases of warehouse management operations. This expansion of the Materials Management module is offered by Compiere for an additional fee per user or per warehouse. If an organization only requires basic inventory and materials management functionality, I recommend using the functionality included in the Materials Management module at no additional cost - it is solid and mature. However, for the mid-size to larger organizations in the distribution, retail or manufacturing industries where the warehouse operations are complex, there are numerous warehouses or the number of items and transactions are high - the advanced functionality provided by WMS is worth the additional cost. In situations where you may be looking to cut warehousing costs as it relates to warehouse moves and utilization - Compiere’s WMS solution is worth looking at as either an add-on to a larger Compiere implementation or as part of an integrated ERP solution.

Conclusion:

Open source ERP systems allow unique, adaptable processes that support a diversification strategy, where IT is a source for differentiation from competitors. The availability of the source code and its use as application development framework can lead to a higher degree of flexibility and allows a close functional fit of the system to business processes. Company-internal system knowledge allows continuous process improvement and quick reaction to changing requirements. The main reasons for choosing open source ERP systems are cost, flexibility, vendor independence and company-internal knowledge generation. The project structure of the selected ERP systems varies from company-driven to community-driven.

For the purpose of a coarse, subjective summary, some system properties are pointed out: SQL Ledger has accounting focus and is proved internationally. It is best used out-of-the-box or as accounting module in an integrated solution. The SQL Ledger fork LX Office should only be evaluated for the German speaking market. GNU Enterprise is not production ready and missing any reference customers. TinyERP is evolving fast, provides more ERP functionality than SQL Ledger and can be customized with add-on modules. ERP5 and Opentaps (OfBiz) have very flexible architectures. ERP5 is following a purely object oriented approach, whereas Opentaps/Ofbiz is more relational database centric. Compiere, the current market leader, is a mature system, providing many customization possibilities.

.

Further work needs to be done in the areas of functional features documentation and comparison. Some ERP systems still have to prove the flexibility concepts in practice with documented business cases.

32

References

[1] The Case for Open-Source ERP

http://www.channelinsider.com/c/a/Commentary/The-Case-for-OpenSource-ERP/

[2] Open source ERP grows up

http://www.infoworld.com/article/08/04/22/Open-source-ERP-grows-up_1.html

[3] Evaluation criterion for open source ERP systems

www.big.tuwien.ac.at/research/publications/diplomatheses/herzog.pdf

[4] Open Source ERP Resources For The Small-Medium Business

http://opensourceerpguru.com/2008/02/24/open-source-erp-resources-for-the-small-medium-business/

[5] Reasons for the popularity of Open Source ERP

http://www.erpwire.com/erp-articles/open-source-erp-popularity.htm

[4] The parameters considered by the company in choosing dot net and j2ee for ERP applications

http://www.erpwire.com/erp-articles/erp-dot-net-j2ee-and-companies.htm

[5] Differences between the available Open source ERP packages

http://www.humanflash.com/products/openbravo_product_comparison.html

[6] Features of compiere

http://www.compiere.se/products/capabilities/index.php

http://www.bsys.cz/clanekx-aj.pdf

[7]Pricing of various open source ERP packages

http://www.erpwire.com/erp-articles/open-source-erp-popularity.htm

[8] Features of openbravo

http://wiki.openbravo.com/wiki/Contributor%27s_Guide

33

Appendix A: Glossary All Terms can also be looked up at http://en.wikipedia.org/.

C Programming language, UNIX is developed in C

CGI Common Gateway Interface, a standard web server interface

CVS Concurrent Versioning System: A client/server system for the central management of concurrent changes of source files. In most open source projects the source code is CVS managed. Also see www.cvs.org. A newer approach for versioning is subversion, used by open source projects like GNU enterprise,

LX- Office and OfBiz. www.subversion.tigris.org

DATEV An interface to DATEV Software, used by many accountants, especially in Germany. DATEV itself is accountant cooperative providing software for accountants in Germany and Central Europe.

GNUe GNU Enterprise www.gnuenterprise.org

GPL GNU Public License, www.gnu.org/copyleft/gpl.html

GUI Graphical User Interface

HBCI Home Banking Computer Interface, is a bank independent online banking protocol used especially by German banks

HRMS Human Resources Management System, an ERP module for human resources

IDE Integrated Development Environment

Java A platform neutral programming language widely used for enterprise software development. http:\\java.sun.com

JBOSS An open source J2EE application server. http:\\www.jboss.org