Antecedents of ERP assimilation and its impact on ERP value: A TOE-based model and empirical test

Abstract

Drawing on the technology-organization-environment (TOE) framework and prior IT assimilation literature, we develop and test an integrated model of ERP assimilation and value in Chinese firms. We also contrast the strength of the antecedents of ERP assimilation and value across different ownership types. Our empirical results using a survey data showed that relative advantage, complexity, compatibility, top management support, organization fit, financial commitment and competitive pressure are significant predictors for ERP assimilation. We also found that the linkage from ERP assimilation to ERP value is very significant. In addition, the strength of the antecedents of ERP assimilation and value varies dramatically across different firm ownership types. Our study confirms that traditional diffusion of innovation attributes, top management support and competitive pressure are significant during the whole ERP life cycle. Our findings also emphasize and validate the importance of ERP assimilation in improving firm performance, and provide evidence for the continued debate on ERP payoff and information technology productivity paradox. In sum, these findings provide insights into how ERP assimilation and ERP value are influenced by contextual elements, and how the impacts may vary across different ownership types.