Opportunity of Free Open Source ERP System as a Competitive Advantage for Small and Medium Enterprise

Dionysia Kowanda1, Muhammad Firdaus2, Rowland Bismark Fernando Pasaribu3

1,2,3Department of Economics, University of Gunadarma, Jakarta, Indonesia,,



In today’s world, IT is a source of differentiation from competitors. The tendency is to produce more, with the least possible cost and be reactive to the need to continue to change and the requirements of internal and external customers. That is why flexibility, adaptability and cost-cutting is the main reason that drives more and more companies to adopt Open-Source Enterprise Resource Planning (ERP). The main objective of this study was to investigate whether the Open Source ERP system can meet the needs of large organizations and SMEs. The study also attempts to answer the question whether Open-Source ERP vendors offer adequate levels of support to their clients. First, an explanation of research background and the motivation behind it. Then, the research hypothesis is presented. Last, discussion about Open Source concepts, history and advantages of Open Source ERP system. In order to verify research hypothesis, a comprehensive literature review focus on ERP selection criteria of large organizations and SMEs. This review resulted in a number of dimensions that served to build evaluation model. Another component of the evaluation is a “feature” offered from different ERP systems. This model became the principle when evaluating a selected Open Source ERP system. Three Open Source ERP system were chosen being evaluated, namely OpenERP, EpenBravo and Adempiere. Here are answers to the research hypothesis: we can say that the selected of Open Source ERP system offers an adequate level of support to their clients. In addition, they are suitable for SMEs as they can answer all the needs of most SMEs. However, the Open Source ERP which elected has limitation in large organizations: such limitations can be summarized regarding their scalability because there are still doubts the ability of these systems to handle large volumes of users or requests, and their ability to be improved as the cluster model. Other limitations that have an impact on large organizations are the lack of support for the international accounting rules which essential for public business organizations.

Keywords—Small and medium enterprise, competitive advantage, business applications, information technology



The 1st UICRIC 2015 Opportunity of Free Open Source ERP System As a Competitive Advantage for SME’s

%d bloggers like this: