Abstract
Today, great potential is envisaged for ERP systems in small and medium-sized enterprises (SMEs), and software vendors have been repackaging their ERP systems for SMEs with a recent focus on cloud-based systems. While cloud ERP offers the best solution for SMEs without the overheads of the huge investment and management costs that are associated with traditional ERP systems, the SME sector faces many challenges in their adoption. Traditional ERP studies have predominantly focused on large organizations, and gaps in the literature indicate that both vendor and consumer perspectives require more understanding with new technology offerings for SMEs. This paper describes some of the common challenges, such as cost effectiveness, alignment between software and business processes, customized governance and training, which form the major SME constraints for ERP system adoption. Due to the dynamic nature of SME businesses, best practice guidelines for an SME’s ERP implementation could be arrived at through closer investigation of its business requirements in order to avoid misfits. This forms the main objective of the study. We identify key success factors of ERP implementation in an Australian SME as a case study. These target success factors are then compared to the actual outcomes achieved. Factors such as business process alignment with the ERP system, meeting customer and stakeholder needs and reducing recurring and maintenance costs were key to the success of ERP implementation for the Australian SME. In particular, the IT and business strategy alignment with a customer focus and flexible reporting features of ERP systems has resulted in business agility.
Highlights
Integrated, streamlined, responsive and agile are the key words used to define what organizations must be developed into, in order to stay profitable, in particular for the sustainability of small and medium-sized enterprises (SMEs) in today’s global and competitive environment that businesses face [1,2,3,4,5]
While there is a rise in awareness about enterprise resource planning (ERP) systems and their benefits, their adoption is slow among SMEs
An integrated ERP system is required to possess characteristics and conditions for achieving user information satisfaction, better system usage, flexibility, scalability and full benefits that would drive its implementation among SMEs
Summary
Integrated, streamlined, responsive and agile are the key words used to define what organizations must be developed into, in order to stay profitable, in particular for the sustainability of SMEs in today’s global and competitive environment that businesses face [1,2,3,4,5]. While ERP vendors perceive ERP opportunities in SMEs, there are several implementation constraints and success factors that are based on each SME’s business context. In order to gain an in-depth and first-hand understanding of the ERP implementation problem in SMEs, the constraints reported in the literature need to be explored, and the actual ERP implementation process adopted by an SME is to be studied in the present local and global context, so that useful adoption lessons could be learnt from other similar SMEs [3,4,6]. The aim of the paper is to identify from the literature the constraints and factors affecting the adoption and implementation of ERP systems in SMEs that are similar to the Australian context. This study includes identifying the common challenges and barriers faced by the SMEs and current strategies adopted by ERP vendors that have resulted in arriving at specific process-based guidelines for successful ERP implementation in the Australian SME. We describe the best practice steps adopted by the SME, including various success factors identified and the actual outcomes achieved
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