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Is developing an in-house ERP system expensive?

This is a question that has been asked repeatedly because there is a misconception that an in-house developed ERP system will be not only less expensive but also more reliable.

In fact the reality is something else. First of all, in-house development can be much more costly than it appears. Managing your own development team with their salaries and other perks, the downtime in user departments during all phases of development, and the opportunity cost of not putting developers on other worthy projects that would propel your business forward. The time it requires to extract meaningful data for executive analysis out of your database must also be included as a cost consideration.

Then comes the maintenance part. The maintenance of ERP system is time-intensive, slow, and fraught with undocumented functions. And remember the the cost of downtime when outages occur. The complexity of today's computing environments only magnifies the difficulties and expense of implementing and maintaining an ERP system. Therefore it is better companies should avoid any plan to develop an ERP solution in-house that can bring only troubles and no benefit.