How can you customize your ERP without interfering with future upgrades?

There are many ways that modern Cloud ERP like #S4HANA allows customization while helping keep the Core clean which enables seamless upgrades. Clean code (building extensions using in-app or side by side), Clean data (keeping only the data you need) and Clean process (using best practices as much as possible while driving the process via process mining tools) all help with clean core which in turn keep your customizations standard in modern cloud ERP

Well, for me, we need to explore two things here: 1. What is the future cost of your customizations? Adding customizations will add cost in future maintenance. This may seem difficult to quantify, but it's not just upgrades which become troublesome with customizations. The added maintenance cost of the customization can spiral out of control very quickly. 2. What is the re-engineering opportunity being missed? Most ERPs now offer "best practices", which whilst not always the gold standard they claim to be, can offer standard processes which you can align your business processes to.

There is always cost associated with any kind of customization that we do in our ERP landscape over long term. Be it additional R&M cost and additional efforts during Upgrades...While evaluating the need for customization, we should always keep in mind following aspects: 1. Is this customization must for Minimum Viable Product State or End State? Are there any other alternatives than going for customization? 2. Is my current user experience levels being degraded without this customization? Is this degradation acceptable and can be taken care by Change Management? 3. What is the long term cost associated with this customization and what's the value to be realized associated? Basically do Cost to Value analysis.

In my experience tight project schedules often lead to quick fixes. Teams rush into customization because there isn't enough time to deeply understand the business needs or explore available standard solutions or process reengineering options. The project team's limited time and budget often restrict in-depth analysis and discussion of business requirements. This leads to fast solutions like customizing standard code or creating custom solutions. While short-term budget constraints and timelines might push for immediate customizations, a more comprehensive approach in the early stages can significantly reduce risks and ensure smoother, more successful long-term system operations. In fact, it will save more money in the long term.

In my experience - customisation of ERP can be one of the most contentious - and costly - areas affecting an ERP implementation. It is one of the key causes of ‘cost blow-outs’ on ERP projects - and a key failure point in the projects / programmes that I have been brought in to recover. Clients often start out with strong intentions of implementing as close to ‘Out Of The Box’ (or ‘vanilla’) ERP as possible. However, during the project, business push-back on this - i.e. having to change / compromise too many existing business processes becomes a harsh reality. The combination of vendor desire to keep proposed implementation costs to a minimum, which initially aligns to the clients desire for ‘OOTB’, quickly unravels the project….

Selecting the appropriate customization method is crucial for integrating tailored features seamlessly into your ERP system. Prioritize configuration options whenever possible, and if deeper modifications are necessary, use extension points or API interfaces provided by the ERP vendor. This approach minimizes the risk of conflicts during future upgrades, ensuring system stability while meeting specific business needs.

From my experience there is no right customization method, only less problematic from cost maintenance and future technical debt inheritance. What matters is, will the customization cost outweigh the business value that will bring to the business process in terms of saving time=money.

Effective customization requires careful use case assessment and tool selection. Start with data model customization: if standard fields don't suffice, cautiously add custom fields, avoiding model changes. For workflows, build custom workflows externally when standard rules don't meet needs, integrating with ERP via APIs and events. In UI customization, simple branding elements like logos should be configured directly. For extensive UI changes and added controls, build the UI outside the ERP using its standard APIs and make sure all the custom UI Application are accesible through a unified launchpad platform for seamless user experience. This approach ensures upgrade stability, assuming the APIs remain unchanged post-upgrade.

Effective ERP customization requires a thorough understanding of business needs & ERP capabilities. Rushed projects often result in inadequate solutions. To avoid interference with future upgrades: 1. Invest time in understanding exact business requirements, engaging all key ERP users to fully grasp core business needs. 2. Prioritize understanding ERP capabilities before introducing third-party solutions. Often, a work-around can be found using existing ERP features. To sum it all up, better measure twice and cut once, than measure once and cut twice. In conclusion, thorough business process scoping may seem time-consuming initially but pays off by delivering a viable, future-proof solution that will integrate well with future upgrades..

I like to think about changing the standard coding in the way I imagine surgeons see their procedure: get as much data before deciding on the approach, try non invasive procedures first and if it needs to be invasive try to keep the impact at minimum. Surgical erp changes.

When developing any custom component, it’s critical to focus on how you build, ensuring adherence to best practices. For API usage in ERP, be informed about potential deprecation and prepare for necessary updates in future releases to prevent downtime. Establishing a robust CI/CD pipeline with workflow management is essential for quality control and deployment strategy. Include performance testing, user experience feedback, and improvement planning in your strategy. Integrating a monitoring and observability platform is crucial for the overall solution. Additionally, implement diverse security strategies to safeguard against vulnerabilities in the system.

Adhering to best practices and guidelines is essential for successful ERP customization. Prioritize modular customizations, avoid direct changes to core code, thoroughly document modifications, and leverage configuration options. Conduct rigorous testing, stay informed about vendor updates, and engage professional services if needed. Regularly review and update customizations, and implement robust backup and version control. By following these practices, you can strike a balance between customization and system stability, ensuring a smooth and effective ERP implementation.

In my opinion, customization is inevitable for customers to be competitive in their respective industries. Therefore, what is more important would be to have a tool which can identify all the effected codes, APIs etc as a result of the vupgrade. This would ensure a faster implementation since developers do not have to find each issue occurred due to customization.

Customizations are often requested because the new/upgraded ERP process isn’t familiar to the end user base. People, by nature, are comfortable with what they know & understand. The best implementations allow time to understand the business reason behind the request & also provide clear, specific training on the new process before entertaining a customization request. I tend to live by the saying “Just because we can, doesn’t mean we should”. Customizations come at a cost on many levels, so take the time to be thoughtful about decisions to introduce uniqueness into your ERP.

-In my experience in implementations so far, the following are the objectives that are supposed to be understood ahead of time:- 1. Requirements for the implementation 2. Fits vs gaps 3. Bifurcation of gaps into Reports, Interfaces, Conversions, Enhancements and Forms 4. Mostly, reports, interfaces, conversions and forms do not hinder with future upgrades. So there’s a need to do a deep dive analysis on enhancement requirements. 5. During the Enhancement analysis, it needs to be understood which enhancement is a business logic vs technical logic. 6. For business logic, there must be a decision that project leadership must make and this should specify where the business logic should be. For ex. Non-SAP systems with low code capability.

In my view, 1) we should stick to standard ERP features for customizing the requirement as much as possible. 2)Use standard fields given by the ERP application as much as possible if any enhancements required. 3)Better to have the future version release visibility and understand the impact in case going for upgrade.

To ensure smooth ERP upgrades, it's crucial to manage complex custom code. During implementation, robust governance and a strategic approach to handle customizations are essential. Pay close attention to release notes, especially regarding how they might impact external customization points which are being used in different extension solution built outside of the ERP. If there are changes, adapt these in your extension solutions, and conduct thorough testing in a separate environment before proceeding with the upgrade.This will help prevent any disruptions post-upgrade. The same level of attention is necessary for APIs used in integrations with all satellite systems.

Effective planning and preparation are key to successfully managing future upgrades. Stay informed about the vendor's upgrade paths and release schedules. Document all customizations, ensuring thorough documentation of code changes and dependencies. Test your customizations rigorously in a sandbox environment to identify and address any potential issues. Engage with the ERP vendor's community and support channels to stay updated on best practices and potential challenges. Maintain a robust backup and version control system to facilitate easy rollback if needed. By planning ahead and being well-prepared, you can ensure that future upgrades are executed smoothly, minimizing disruptions and preserving the integrity of your ERP system.

Market-leading ERPs (and in the cloud) such as 365 Dynamics (Fincance & SCM), already have their entire architecture based on extensions (or even create new objects), without interfering with the standard code. This is the best way to ensure you don't have any headaches with future Updates. Another way, keep your code very focused on new objects, and keep, even in extension, your customs completely independent. And always rely on versioning tools, such as DEVOPS, for example

The current practice of ERP upgrades sees vendors releasing new versions of ERP systems many times a year. To stay up with this highly quickened pace, businesses must reconsider their approach to ERP systems. The less modifications, the better, because deviation from the given core functionality increases the amount of effort required when upgrading. To keep up with the changes, rapid user acceptance testing accompanied by test automation is nearly a must.

Let's talk about "Clean Core". In the Cloud ERP world upgrades and updates come regularly, just like in phone apps. SAP S/4HANA Cloud Public Edition, for example, provides two releases a year and monthly updates. This puts the focus on the value of staying current and adopting the latest innovations without impacting operations. To enable this the key is to Stay Standard, meaning "adopting SAP Best Practices while integrating and extending the solution". Integrations will be accomplished through SAP BTP, outside of the Cloud ERP. Extensions will be created either inside the stack (In-App, LCNC), or outside (Developer and Side-by-Side), in all cases keeping the Core clean and therefore preventing any impact on innovations adoption.

An ERP system should be customized or not, or to what extent should be customized is the dilemma we go through in every ERP implementation. It’s important to realize that ERP systems may not give users best convenience, instead will give scalability, process standardization opportunity and give stronger controls. The more you customize, you will loose the core benefits of ERP system and it will become a custom solution which will eventually create a huge technology debt for the organization. So, before embarking on an ERP journey, it’s better to evaluate whether the organization wants adopt a standard system or wants the system to adopt your processes and if later is the answer, standard ERP is not the right option.

No matter how clean you go, prepare for major business disruptions after go live. Compromises will be done and not all of your dream requirements put forward during blueprint will make it to go live. You will be squeezed in your timeline and budget. Most important is the hypercare phase. Make sure your team is ready to support anything that can go wrong in operations. Prepare the business for a tough transition. And incremental investments after go live. Do not underestimate anything, everything can go wrong and will most likely do. Have fun with your project! ??

IFS, one of the major ERP solutions, is well-prepared and well-designed for this industrial challenge. IFS Cloud, with an evergreen target, ensures continuous updates for all customers. The platform stands out by enabling users to customize their ERP seamlessly without compromising future upgrades. Its layered architecture allows for robust customization, avoiding compatibility issues in subsequent versions. Personalization options, with minimal development requirements, offer users flexibility. Additionally, IFS provides an outstanding workflow solution for creating custom flows without coding.

If anyone tells you that you can upgrade SAP without worrying about customisations, they would be lying to you. Thank you ??