I’ve often found myself on an implementation wondering if this specific customization I’m working on the right way to meet the requirement or if we should have taken the third-party app route instead. This is a difficult question to answer, and almost philosophical in nature. How do you determine which approach is the best? This question has an answer in hindsight but when making this decision in the early days of the project and considering both approaches, they both have their pros and cons. Frankly in my opinion the success of the project is more closely tied to the people involved in the project and less with picking one of these options. However, with that being said this decision can make it incrementally harder or easier to implement an ERP which in the end may make all the difference.
In my experience when NetSuite doesn’t meet all of the requirements out of the box for an enterprise level customer, there’s most likely third-party apps leveraged to meet the gap, similar to a best of breed approach. What this typically looks like, if you imagine a technical architecture diagram is NetSuite sitting in the middle encapsulating all finance and general ledger functions and third party apps covering various other functions like procurement, CRM, tax, AP, expense management, banking, with an integration tool to tie it all together. Although It might be rare to see every function use a specific third-party app typically the more enterprise a customer is the more third-party apps would be used. The main advantages gained from this approach are greater access to specific functionality through the add-on’s, more choice from the breadth of third-party apps available, and the flexibility of implementing these add on modules in subsequent go live phases. Looking at the other side of the coin, the largest challenge with this type of approach is managing the integrations. How difficult the integrations are to manage depend on a few other factors such as the flow of data, the frequency of integration, the number of touch points and what the true system of record is. NetSuite tries to overcome these challenges by having an ecosystem of SuiteApps and built for NetSuite connectors. However, I imagine a future for NetSuite where instead of picking different third-party apps to plug in and play NetSuite just incorporates all these dedicated and focused features directly in the app. In other words, NetSuite would be utilized as a customized single platform.
I think the biggest advantage obtained with a single customized ERP over a best of breed is that integrations don’t have to be maintained. Theoretically if everything is on the same platform every record update is pushed from the client to the same database instead of having to move from the client to one database through a middleware to another database. With best of breed approach, trouble can arise with integration fallout, systems falling out of sync, and increased processing overhead since records are kept in multiple systems. Of course, these potential headaches need to be weighed against headaches that can come out of customizing NetSuite. The most common one is the additional processing time caused by having a script or workflow run. Early in my career I remember getting an explanation as to why this slow down happens, and if anything could be done to remedy it. Essentially the scripts and workflows that are created in each instance sit on a layer above the database which increases the processing time, but if somehow these customizations could run on a lower level closer to the database then the processing time could be sped up. In essence I think this is the strategy that NetSuite tries to employ, new features are tried and tested through these customizations that sit on top of the application and eventually they’re brought into the core application speeding up the processing times. As more features and functions are added to the core application, as well as its technology infrastructure expanded, I think in the near term we’ll see NetSuite used more commonly as a single customized platform even for enterprise level customers.
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