A study on key failure factors for introducing enterprise resource planning

Abstract

ERP (enterprise resource planning) is a management information system that optimizes distribution of enterprise resources and helps a business to integrate all its resources for fast and effective application to improve its operational performance and enhance its competitiveness. Consequently, a failure evaluation model for introducing ERP, together with the factors and reasons for failures are presented in this research, acting as a reference for businesses when planning and making important decisions on ERP. This study uses the DMAIC of the 6-Sigma approach and a failure evaluation model for introducing ERP that involves expert opinions, a questionnaire, V-shaped performance evaluation matrix (PEM), statistical methods, QFD & FMEA (quality function deployment & failure mode and effects analysis) methods, and QFD & AHP (quality function deployment & analytic hierarchy process) methods to find 6 key success factors and 8 key strategies for introducing ERP. The results of empirical application indicate that internal employee complaints were reduced, supply efficiency of chain suppliers was increased, and customer complaints about quality were decreased. Therefore, the approach presented in this paper is truly effective for business. It is hoped that these key factors can serve as references for other enterprises when introducing ERP.