Self developed ERP: Opportunities and Challenges Coexist

In today's digital age, enterprise resource planning (ERP) systems are crucial for efficient operation and management of enterprises. In recent years, large state-owned enterprises such as CGN and China Mobile have planned to independently develop ERP systems, which has attracted widespread attention and discussion in the industry.

1、 Background and Motivation

The trend of domestic software replacing European and American software, and self-developed software replacing commercial software has become increasingly evident in recent years. Large state-owned enterprises choosing to develop their own ERP systems may be driven by considerations of information security. In the complex and ever-changing international situation, relying on European and American software may pose potential security risks. On the other hand, self-developed ERP systems can also help enhance a company's core competitiveness. Through independent research and development, enterprises can better meet their specific business needs, achieve personalized customization, and improve operational efficiency.

In addition, some companies may develop their own ERP systems out of political achievements or commercial strategic considerations. For state-owned enterprises, successfully developing their own ERP systems can showcase their technological strength and innovation capabilities, and win more policy support and resources for the enterprise. At the same time, self-developed ERP systems may also be commercialized in the future, bringing new economic growth points to enterprises.

2、 Challenge and Doubt

However, self-developed ERP is not always smooth sailing. Taking Huawei MetaERP as an example, although its launch caused a sharp drop in the stock prices of Kingdee and UFIDA, there have been no obvious successful commercialization cases to date. Self developed ERP faces many challenges.

Firstly, the high difficulty of secondary development is an important issue. ERP systems need to be closely integrated with various business processes and requirements of different enterprises, which vary greatly. Therefore, self-developed ERP systems often require extensive secondary development in practical applications to meet the personalized needs of enterprises. This not only requires a significant investment of time and manpower costs, but also places high demands on the technical level of the R&D team.

Secondly, the process from research and development to commercialization is lengthy. The self-developed ERP system requires multiple stages including requirement analysis, design, development, testing, and deployment, each of which requires a significant amount of time and resources. Moreover, in the process of commercialization, it is necessary to carry out market promotion, customer training, after-sales service and other work, which also increases the difficulty and cycle of commercialization.

In addition, relying solely on internal resources often makes it difficult to support the development and maintenance of self-developed ERP systems. ERP system is a complex software system that involves multiple technical fields such as databases, software development, network security, etc. The internal technical team of the enterprise may have deficiencies in certain areas and need to rely on external technical strength and resources. At the same time, the development and maintenance of self-developed ERP systems also require a significant amount of capital investment, which may be a heavy burden for some enterprises.

3、 Industry impact

More and more companies are joining the ranks of self-developed, which has had a profound impact on the software industry.

On the one hand, it may lead to overcapacity and intensified internal competition in the software industry. With more and more enterprises developing their own ERP systems, ERP software suppliers in the market will face greater competitive pressure. In order to compete for market share, software suppliers may lower prices and improve service quality, leading to a decline in industry profits. Meanwhile, some small software suppliers may be eliminated due to their inability to compete with large enterprises, further exacerbating the industry's internal competition.

On the other hand, there may be a polarization between the state-owned enterprise ecosystem and the small business ecosystem. Large state-owned enterprises, with their own technological strength and resource advantages, can successfully develop their own ERP systems and form a relatively closed ecosystem internally. However, small businesses often have to rely on external software suppliers due to a lack of technical and financial support. This may lead to a widening gap between the ecosystem of state-owned enterprises and small businesses, limiting overall innovation in the industry.

However, self-developed ERP is not entirely without benefits. For the software industry, self-developed ERP can promote technological innovation and progress. In the process of developing their own ERP system, enterprises will continuously explore new technologies and methods to promote the technological development of the software industry. At the same time, self-developed ERP can also cultivate more technical talents for the software industry and improve the overall technical level of the industry.

4、 Conclusion

In summary, the self-developed ERP system presents both opportunities and challenges. Large state-owned enterprises choosing to develop their own ERP systems may not only enhance their core competitiveness, but also face challenges such as high difficulty in secondary development and a lengthy process from research and development to commercialization. At the same time, more and more companies joining the self research ranks will have a profound impact on the software industry. In the future, the software industry needs to find a balance between self-developed ERP and commercial software to jointly promote the healthy development of the industry.