What is Open Source ERP?
A question that immediately contains two terms that are not equally familiar to many people. In an earlier blog I already wrote what an ERP system is.
But open source? What does that mean? And what is its relationship with ERP? An Open Source ERP system has a fundamentally different approach than traditional ERP systems. In this article I will try to clarify what Open Source ERP is.
What is Open Source?
The definition of Open Source is described by the ‘Open Source Initiative’. If you want to read the complete English definition, follow this link. On Wikipedia they have made a clear translation, which I repeat below.
Under the Open Source Definition, licenses must meet ten conditions to be considered open source licenses.
Below is an unofficial, shortened, free translation of the license.
The license may not prohibit anyone from giving away or selling the software free of charge.
The source code must be supplied with the software or be freely available.
Distribution of derivative works and modified versions of the software must be permitted.
Licenses may require that modifications be distributed only as patches.
The license may not discriminate against users (groups).
The license may not discriminate against the environment in which the software is used.
The rights attached to the program must apply to everyone to whom the program is distributed.
The rights attached to the program must not depend on software distributions of which the software is a part.
The license may not require that other software distributed together with the software falls under the same license.
None of the provisions of the license may refer to a specific technology or interface style.
How does Open Source work?
The power of Open Source is obvious: the source code is open and available to everyone.
This provides the unique opportunity to work on the product with people all over the world. Systems have been set up to keep the programming of the software on track.
So how does that work? Actually, it is not that difficult. Put simply, it works as follows:
Someone starts developing a software product and puts their code in a public place on the internet so that it becomes accessible to others. These are version control systems, for example GitHub.
Someone who is interested in ‘joining in’ makes a copy of the source code. This is called ‘forking’ the software.
A modification is made in the copy and it is submitted to the original.
The version control system reviews the differences and the initiator of the software product can approve this modification for inclusion in the standard version.
In practice, all modifications are reviewed by multiple people and assessed for correctness. There are also various automated test systems that test the modifications against predefined test scenarios. The control is managed very strictly to ensure the quality of the product.
In this way, it is possible to activate and bring together people worldwide to work on the product. This is called the community and, because of the large number of people and the amount of knowledge, it is a very important part of open source software.
With Open Source ERP, the community contributes to the main product, but they are also able to develop specific software based on the ERP product. This may be so specific that you could call it customization, but it can also be very good extensions to the existing ERP system, often called Apps or modules. These are offered both free of charge and paid.
Are there Open Source licenses?
Open Source and a license? Yes, licenses also apply to Open Source. This license describes exactly what you may and may not do with the source code and the product. You can find a complete overview of the different licenses here.
The licenses describe the freedoms and rights you have when you use, modify, and redistribute the software.
Fully Open Source or Hybrid
There are ERP systems that are fully Open Source. The producers of this software are often foundations and are not profit-driven. There are also commercially driven Open Source producers, and they often struggle to generate sufficient income from services on the software product alone.
With much open source software, and Odoo as well, you see that the supplier splits the software into an open source version (also called the community or open core version), which is often free, and a closed version (often called the Enterprise version) for which payment is required.
What is the business model for Open Source?
How do the makers of open source software make money? We have already mentioned several times that some companies also do not make money from Open Source. A number of revenue models include:
Product support
Consultancy and advice
Implementation
Migration services
Enterprise versions
Developing extra 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 depends entirely on the producer of the software whether it is free or not. But often there is a free version that you can use freely. However, if you use the software professionally, it is wise to engage someone who can provide the necessary support.
What is Vendor Lock-in?
Perhaps the most important reason to choose an Open Source ERP system is the freedom to choose who you work with. People say you have no ‘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 who understands the software.
Would you choose Open Source ERP software?
