Research issues on the use of ERPS in interorganizational relationships

Abstract

The use of enterprise resource planning systems (ERPS) is a critical component of a firm's strategy for the proper management and control of inter-organizational relationships. This research note utilizes recent research findings that bear on the effectiveness of the implementation and use of ERPS in business organizations and extends these findings in the inter-organizational context. The major purpose of this essay is to present theoretical bases on which future research could justify theoretical models and present theoretically-sound arguments for the examination of the use of ERPS in the management and control of inter-organizational relationships. The implications of a number of theories are examined, including: (a) the theory of co-opetition from organizational strategy, as it relates to the necessity for carrying out simultaneous activities in inter-organizational cooperation and competition, (b) the economic theory of complementarity, as it emphasizes interactions in different elements of organizational design and explains how different elements of organizational strategy and management process relate to one another, and (c) the real options theory from finance as it relates to the degree of managerial flexibility in making infrastructure investment decisions. Each of these theories offers important implications for the examination of use of ERPS in inter-organizational relationships. This essay develops a number of research propositions in order to motivate research in this area. Future research not only could benefit from these theoretical bases but also could make contributions for the extension of these theories in the use of ERPS for the management and control of inter-organizational relationships.