Learn IT Fundamentals with Teacher Pochi

Package Software

Key points

  • Package software means adopting a business package (an off-the-shelf business system) and customizing it with add-on development as needed.
  • Unlike SaaS, it's often deployed into an environment dedicated to your own company, giving you more room to customize.
  • In exchange, the burden of deployment and maintenance tends to be larger than with SaaS.

What is package software?

A package is a software product that bundles together standard functionality for a specific business domain — accounting, HR, inventory management, production management, and so on. Products known as ERP (Enterprise Resource Planning) systems are one type of package.

Rather than building from zero, you start from workflows that are already commonly used across the industry, and adjust from there to fit your own company.

How package software works

Packages let you tailor the standard functionality to your company's unique workflows through what's called "add-on development" — additional programming layered on top.

Business package
(standard features)
Tailored to your
company's needs
Customized via
add-on development
Deployed on your own
servers / dedicated environment

Teacher Pochi's hintIt's like buying an existing house and renovating it. The frame and basic floor plan are already fixed, but you can adjust the interior and fixtures to suit your taste.

How it differs from SaaS

Package software and SaaS both start from an existing foundation, but they differ a great deal in how they're deployed and how freely you can customize them.

☁️ SaaS Shared by everyone Limited customization Maintenance left to the vendor
📦 Package Dedicated to your company Flexible via add-ons Deployment & maintenance on your side

Well-known examples of package software

There are a wide range of package products for different business domains.

  • SAP, Oracle NetSuite (ERP and core business operations)
  • Sage, Intuit QuickBooks Enterprise (accounting)
  • HR and payroll packages (HR / payroll processing)
  • Sales management packages (order processing / inventory management)

Pros and cons

Built-in business know-howIndustry-standard workflows are already baked in.
Easy to customizeAdd-on development can accommodate your company's unique requirements.
High deployment costLicensing fees plus add-on development costs add up.
Maintenance burdenYour company has to handle version upgrades and maintain the add-on portions.

Practical pitfalls to watch for

Skipping a fit-and-gap analysisDeploying without first mapping the gaps between standard features and your actual workflows leads to add-on development ballooning out of control.
Compatibility across version upgradesWhen the core package is upgraded, add-on customizations can break, creating ongoing costs just to keep up.
Consider adapting your workflow to the standard features tooThe more customization you add, the heavier the maintenance burden gets. Adjusting your own processes to fit the package's standard functionality ("fit to standard") is worth considering as an alternative.

Summary

Package software builds on top of business package software with add-on development, giving you greater customizability than SaaS — along with the burden of deploying and maintaining your own servers.

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