What is open-source ERP software?
A question that immediately contains two terms that are not equally well known to many people. I wrote in an earlier blog. What is an ERP system?
But open source? What does that mean? What is the relationship with ERP? An Open-Source ERP system has a fundamentally different approach than traditional ERP systems. In this article, I will clarify what Open-Source ERP is.
What is Open Source?
The definition of Open Source is described by the ‘Open-Source Initiative’. The definitions are:
Under the Open-Source Definition, licenses must meet ten conditions to be considered open-source licenses.
Below is an unofficial, abbreviated, free interpretation of the license.
The license may not prohibit anyone from giving or selling the software for free.
The source code must be included with the software or be freely available.
Distribution of derivative works and modified versions of the software must be allowed.
Licenses may require modifications to be distributed only as patches.
The license may not discriminate against users (groups).
The license must not discriminate against the operating environment of the software.
The rights associated with the program must extend to anyone to whom the program is distributed.
The rights associated with the program should not depend on software distributions of which the software is a part.
The license may not require any other software distributed with the software to be under the same license.
None of the terms of the license may apply to any particular technology or interface style
How does Open-Source work?
The power of Open Source is logical, the source code is open and available to everyone.
This gives the unique opportunity to work on the product with people all over the world. Systems have been set up for programming the software to ensure that this runs smoothly.
How does that work, then? Actually, this is not that difficult. Simply put, it goes like this;
Someone starts developing a software product and puts his code in a public place on the internet, so that others can access it. These are version control systems, such for example: GitHub.
Someone interested in “joining in” makes a copy of the source code. This is called forking the software.
An adjustment is made in the copy, and it is presented to the original.
The version control systems review the differences and the originator of the software product can approve this change for inclusion in the standard version.
In practice, all adjustments are viewed by several people and assessed for correctness. But all kinds of automated test systems are also present, which test the adjustments against preset test scenarios. Control is very tightly regulated to guarantee the quality of the product.
In this way, it is therefore possible to activate people worldwide and bring them together to work on the product. This is called the community and is a very important part of Open-Source Software due to the large number of people and knowledge.
With Open-Source ERP, the community contributes to the main product, but they can also develop specific software based on the ERP product. This may be so specific that you can call it customization, but it can also be very good extensions to the existing ERP System, often called Apps or modules. These are offered for free and paid.
Are there Open-Source licenses?
Open Source and a license? Yes, licenses also apply for Open Source. This license describes exactly what you can and cannot do with the source code and the product. A complete overview of the different licenses can be found here.
The licenses describe the freedoms and rights you have if you use, modify and further distribute the software.
Entirely Open Source or Hybrid
There are ERP Systems that are completely Open Source. The producers of this software are typically a foundation and there is no profit motive. There are also commercially driven Open-Source producers, and they regularly struggle to generate sufficient income on the service alone of the software product.
With a lot of open-source software and also Odoo you see that the supplier splits the software into an open-source version (also called community or open core version), which is often free, and a closed version (often called Enterprise version) for which you have to pay.
What is the business model for Open Source?
How do the makers of Open-Source software earn their money? We've already mentioned it many times that some companies don't make money from Open Source either. Several revenue models include;
Support for the product
Consultancy and advice
Implementation
Migration services
Enterprise versions
Development of additional modules
Management
Software as a service (SaaS)
Is Open-Source Free?
A frequently asked question is of course: “Is it free?”. Open Source and therefore also an Open-Source ERP system is not by definition free. It entirely depends on the producer of the software whether it is free or not. But frequently there is a free version that you can use freely. But if you use the software professionally, it is wise to call in someone who can provide the necessary support.
What is a Vendor Lock in?
Perhaps the most important reason to choose an Open-Source ERP system is the freedom to choose who you work with. They say you don't have a 'Vendor Lock-in', in other words, you are not dependent on your supplier. If you are not satisfied with the service you receive, you can ask someone else to take over the management of the software. After all, the source code is open and can therefore be managed by anyone with knowledge of the software.
Would you pick Open-Source ERP software?
What is an open-source ERP system?