A Study on ERP Adoption in SMEs for Improving Operational Performance and ROI

Abstract

This research paper addresses the adoption of Enterprise Resource Planning (ERP) and examine their effect on organizational performance and Return-on-Investment (ROI) in Small and Medium Enterprises (SMEs). In this two-part paper, the first part identifies and measures tangible and intangible benefits of ERP. The second part identifies and explains certain financial indicators on ERP investments. The research involved a variety of methods including semi structured interviews, participative observation and review of documents & case studies related to ERP implementations in SME, ROI on ERP, ERP product brochures and few existing case studies related to this research. This paper provides empirical insights to the performance improvements in the process and financial perspectives. The paper explained the perception of SMEs on the tangible, intangible benefits of ERP implementation and its linkage to ROI and provides practical insights into the benefits and ROI from ERP investments to SMEs which are planning to or have implemented ERP.