Intercompany reconciliation is often a time-consuming task, particularly for evolving companies. Effective intercompany relationship management is key to ensuring the reconciliation process runs as smoothly as possible. Solutions designed for this management can help.
When it comes to these solutions, one of the biggest debates is between developed and configured. Is it better to choose a developed solution that’s been customized specifically for your business needs or a configured solution, like Virtual Trader? We’ll take a look at the pros and cons.
Before we start, let’s quickly cover what customization and configuration actually mean.
A customization is when a software or feature of a software has been custom coded. A configuration is when you use a software’s native tools to change how that software works. Although these two definitions sound remarkably similar, there’s one major difference. With a customization, if the software vendor releases an upgrade, you’ll have to adjust the coding but with a configuration, you won’t because you used native tools.
Now that that’s been covered, it’s time to discuss the pros and cons of customized and configured software.
Pros of a Developed/Customized Solution
You Have Total Product Control
When you’re able to customize your solution, it means you have total product control. You’re able to design the solution to suit your business’ precise needs.
Businesses that work in niche industries can often struggle to find solutions that completely meet their requirements. In these cases, customization might be the best solution.
Cons of a Developed/Customized Solution
It’s Time-Consuming and Expensive to Build
One of the most significant drawbacks of having a customized solution is that it's extremely time-consuming.
When you’re customizing, you’ll need developers who specialize in coding the type of solution you require. They also need to be experts on your business so they can code precisely to your needs.
After creating the solution, they’ll need to run tests to ensure that it works properly. And then there’s the need for regulatory compliance. Unlike configured solutions, there’s no guarantee that customizations will comply with regulatory standards.
It’s a Complicated, Lengthy Process if the Solution Needs Updating
Creating a customized solution is a lengthy process, but if your solution ever needs updating, this can cause further complications.
For example, if the software developer releases a newer version or security patches, or your business evolves - you’ll need to update all of your customizations. If you don’t, it’s likely your solution will cease to work properly or at all.
Updating your customization is often a complicated and time-consuming task. For starters, you’d need to keep up-to-date with the original software developer, such as Oracle EBS, or regulations. When they update, you’ll have to change your solution accordingly.
Then, your solution developers would need to go back and re-analyze the custom coding, looking to see what part needs changing. After changing the coding, they’d have to run a series of tests to check that the software still works and performs the tasks that you need it to while complying with regulations.
It’s Expensive to Upgrade or Patch
As well as being complicated and time-consuming to update your solution, it’s also expensive.
While it might seem worthwhile to have a solution that caters precisely to your business needs, bear in mind the process your developers will have to go through if they need to update or patch the solution. And as businesses and their industries are constantly evolving, this might need to happen more often than you anticipated.
There’s Little to No Support
Because you’re the one who created the solution, there’s little to no support if you encounter problems, such as your customization not working properly. It can be difficult if you ever need to troubleshoot.
Pros of Configurations - like Virtual Trader
There’s Automatic Updating
With customized solutions, you’re solely responsible for investigating the impact of software upgrades and implementing the necessary changes. If you have a configured solution, like Virtual Trader, there’s no need for that.
Virtual Trader’s software product is independent of the version of Oracle EBS with which it’s operating, so if Oracle EBS changes, VT will automatically adapt. There’s no need to go back and change the coding yourself, which improves efficiency by saving time and money.
The Solution Will Grow with Your Company
Industries and markets are constantly changing, which causes companies to evolve. This has a knock-on effect on intercompany relationships and the balance between legislations, tax planning, business expansion and acquisitions. For this reason, it’s important that your software grows alongside your company. The more effortless this growth is, the more efficient it is for you.
Virtual Trader accommodates for this vital factor with its Business Rules feature. Rather than customizing your solution from scratch, companies only need to edit the Business Rules. They can choose rules to suit their own needs and VT will adapt the solution accordingly.
This is a major advantage as it means configurations like VT will easily grow with your company. In contrast, customizations often have the solution embedded in the code as they’re produced for short term expediency. This, ironically, makes them inflexible even though customizing should allow you to design a solution that perfectly adapts to your needs.
There’s Whole Life Support
Virtual Trader offers whole life support through a renewable annual contract, so troubleshooting is much easier. In contrast, with customized solutions, the responsibility for support rests entirely with the company who custom coded it.
It Offers Huge Breadth of Scope
Virtual Trader is a mature product of almost 20 years. In that time, VT has grown to offer huge breadth of scope in relation to managing intercompany relationships. Its functional development has been directly driven by client needs, meaning that its client-centric nature represents a comprehensive intercompany solution.
It’s difficult to find a developed or customized solution that will match up with this breadth of scope.
Interested in Learning More about Virtual Trader and How it Stands Up Against Other Solutions?
When it comes to intercompany relationship management, Virtual Trader and a developed/customized solution aren’t the only two options you can choose. Our guide to intercompany management softwares compares four of the most popular options: outsourcing a team vs inhouse team vs Oracle AGIS vs Virtual Trader. Download it below.