Open Source ERP Grows Up

For Enterprise Resource Planning (ERP) software to be accepted by IT, it
needs to be very stable and reliable — after all, in a very literal sense,
ERP software runs businesses.

After eight years of development and over a million downloads, the open source Compiere ERP has proven that it fits the bill for many.

Next week, Compiere is set to release a major update to its namesake ERP software as well as a reorganization of its commercial support offerings. All told, the effort amounts to a new push from the open source vendor to capture a bigger slice of the multi-billion dollar ERP market.

“Our mission is all about making ERP easier to evaluate and extend while making it available at a fraction of propriety offerings,” Compiere CEO Don Klaiss told “We do that by leveraging the disruptive economics of open source. Unlike other open source projects, we’re a real company with investors, management and support processes that are similar to large enterprise software vendors.”

Compiere version 3.0 will include over 150 updates. The most visible new feature is a new architecture that provides ERP capabilities through a Web interface.

“The new Web architecture is a key point as it does enable greater usability and lower cost of deployment and maintenance, because you don’t need to manage software on each desktop,” Klaiss said.

Version 3 also includes expanded returns management capabilities, such as facilities for RMA (Return Materials Authorization,) as well as a number of new financial reporting templates.

Currently, Compiere is available in four different support configurations: extended, standard, self-service and open source editions. Starting Dec. 4th, that also will change, with Compiere reducing its offerings to just three editions: Professional, Standard and Community (open source) editions.

Klaiss commented that the new versions should simplify Compiere’s offerings and make it less complex for enterprises to choose. The three versions differ in the amount of support they include for enterprise buyers.

The Compiere project began back in 1999, led by former Oracle and SAP
personnel. In 2006, Compiere raised $6 million in venture capital and started to expand its channel and support offerings.

When the Compiere project first started, it had no open source competition. Today, it competes with at least two other open source project. One of those, OpenBravo, is actually a fork of the Compiere project itself.

Klaiss said OpenBravo forked off the Compiere code base in 2002. Since then, they have evolved their product separately. An OpenBravo spokesperson was not immediately available for comment.

Another open source ERP contender is Xtuple, with its PostBooks offering.

“I think our multi-platform, rich GUI is also a strong differentiator,” xTuple President and CEO Ned Lilly told “we hear lots of unhappiness with the existing Compiere UIs. Maybe with this new version, that could change. But I think functionally speaking, we’ve still the most feature-rich open source ERP with PostBooks.”

Compiere’s Klaiss, however, isn’t focused on open source competition. Instead, he has his sights set on the big proprietary vendors like Oracle and SAP. Competing against the proprietary vendors, Klaiss said he doesn’t see many barriers to adoption.

In terms of time and cost, he said, Compiere ranks well below any of the propriety solutions, while Compiere’s ecosystem of partners can add extensions that
help meet specific needs.

He also said the fact that Compiere is open source no longer negatively impacts adoption.

“A couple years ago, in larger companies, there was a real reluctance to bring
open source in due to concerns about intellectual property issues and the
level of support,” Klaiss said.

Since then, those issues have presented less of a problem for Compiere, with its reputation and background as a professionally managed company offering full testing and support capabilities.

“We address the concern about support because we are a commercial company, and we also address licensing concerns since we own all the code ourselves,” Klaiss said. “So we are uniquely able to provide a private license as well as an open source license, and that is comforting for some of the big companies that are squeamish about using open source software.”

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