Adoption Factors and Implementation Strategies of on-Premise and Cloud Based ERP Systems by SMEs in Thailand

Abstract

Abstract Over the past years, Thai small and medium enterprises (SME) had to deal with changing economic situations and had to adapt to new technological evolutions, representing new challenges as well as new opportunities for doing business. With the forthcoming ASEAN Economic Community 2015, Thai SMEs will face an increase in competition and, as a possible solution, may have to adopt new information systems to remain competitive. The objectives of this study are (1) to identify the factors facilitating or hindering the adoption of cloud-based enterprise resource planning (ERP) systems by Thai SMEs and to (2) provide an analysis of the adoption and the implementation strategies. The research is based on a qualitative exploratory approach, relying on semistructured interviews with IT experts, IT managers and business owners to collect data, and on the template analysis method to analyze the data. Respondents have identified trust, cost control and the security of financial data as the most important factors for the adoption and selection of on-premise and cloud-based ERP systems. The adoption rate of cloud-based solutions appears to be low and local ERP providers face the challenge to discover the reasons why business owners do not adopt their solutions. First generation business owners prepare the transition to the next generation and want to better organize and structure how their businesses operates, but their own confidence in the technology still limit the adoption pace and the decision process. SMEs' strategies usually consist in a step-by-step implementation, consolidating the changes and readjusting the goals in case of setbacks, minimizing the consequences. ERP providers' strategies focus on new offerings with enhanced features and slowly integrate change management and extended support. Keywords: ERP, Cloud Computing, Small and Medium Enterprise (SME), Mobile App, Open Source, Organizational Innovation Adoption model.