decision makers, decision, management, magazine, books, articles, research, business

decision makers, decision, management, magazine, books, articles, research, business

Issue No: 07/04/1

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Previous Issue: Is Modeling "good" for me?

Canned solutions are readymade solutions available off the shelf in the market. These solutions get refined with each implementation and take care of a large number of operational nuances. Whereas, customized solutions are tailor made for the problem at hand. One needs to pay for the features and flexibility required rather than the standard features built in by the standard solution supplier.

Some of the salient features of these solutions are:

Standard Solution Customized Solution
Confidence in solution High Moderate to Low
Proof of concept Not Required Preferred
Initial cost High Low to Moderate
Implementation cost High Low
Suitable to your needs 50-70% Above 90%
Flexibility Low High
Application For recording transactions For Planning purposes

Canned solutions are less flexible in comparison to customized solutions. At the same time they are based upon some of the best practices followed in the industry. On the other hand Decision Support Systems based upon mathematical modeling that need to incorporate company specific constraints into the system, are Custom built.

Both type of solutions have their own advantages and disadvantages. Generally for all execution systems (transactional systems) standard solutions are a better bet. Whereas, for planning customized solutions at a reasonable price find more acceptance from the clients. ERP systems like SAP, JDE, Oracle also have the planning components. However, due to the complexity in planning and the amount of flexibility required, client pays for features that actually are not required. And, client specific constraints are difficult to build into a standard solution.

The complete solution from technology supplier may include "canned" solution or other solution that was customized for another company, which may or may not be very similar to your company. These applications may meet some of your specific needs but will definitely require additional costly customizations, integrations, and possibly proprietary hardware, software, networking equipment, or interfaces. Furthermore, there will usually be annual upgrade costs and required support contract fees. Unfortunately, your suggestions for improvements, requests for enhancements, requirements for corrections to errors and other "bugs", and requirements for your growth and expansion are usually only "slated" for consideration in the next expensive "release" -- which can be six months to a year or more -- and may or may not be part of that release, depending on what other users of the same system have requested, or how "marketable" your suggestions will be to future users.

In case of customized solution, technology provider works directly with the client team and takes into account company specific objectives, priorities, current systems, constraints and other details.

Finally, the choice between Canned solution and Customized solution depends upon the application area. For transactional systems, standard solutions make more sense and for planning solutions based upon mathematical algorithms, customized solutions are more suited.

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