Enterprise Resource Planning Value Research Articles

The S curve: A dynamic view of in ERP evaluation

Previous Enterprise Resource Planning (ERP) evaluation methods using closed-form solutions have ignored the unique characteristics of ERP’s life cycle. We propose a lifecycle model based on simulation and stochastic processes to capture and evaluate ERP’s value, including additional key factors. Our results show that accounting for the life cycle, ERP value differs from traditional wisdom and supports decision making from various factors and scopes, considering ERP’s implementation’s unique characteristics.

An interpretive study on the role of top managers in enterprise resource planning (ERP) business value creation

This paper contributes to the growing body of literature on enterprise resource planning (ERP) business value by investigating organizational ERP development in view of the active involvement, vision, and direction of top management teams (TMTs). A top-down approach to ERP adoption and implementation was adopted with sociomaterial and social construction assumptions about the mechanisms that generate ERP business value. A single ERP case study was analyzed in an industrial setting by interpretive means, thus providing theoretically based, detailed and interesting insights. Our research suggests that ERP benefits emerge during the TMT’s encounters with the ERP system through pragmatic action and situated improvisations. Our findings suggest that ERP adoption is strongly influenced by TMT characteristics and social processes, while complementary process-change needs are perceived by the executive participation during implementation. We also suggest that when the ERP system goes live, a synergistic relationship termed TMT-IT imbrication will create the technological infrastructure perceived as ERP value. At this postimplementation stage, various TMT characteristics and processes are proposed that greatly influence top managers’ patterns of imbrication behavior. Several propositions are developed and summarized in a framework to enhance the current understanding of managerial agency in achieving business benefits from ERP systems. The paper concludes with implications for top managers and future research directions.

Differences in ERP Value between Iberian Manufacturing and Services SMEs

Enterprise Resource Planning (ERP) system literature reports little research on the specificities of an industry analysis. Based on a theoretical model we assess ERP Value between Manufacturing and Services industries in Small and Medium Enterprises (SMEs) across the Iberian region (Portugal and Spain). The empirical test was conducted through structural equation modeling, using data from 261 firms. Results show that Firm size, Analytics and Collaboration contribute to ERP Value in those industries, with Analytics being more important for the Services industry.

Using TOE and RBV Theories to Define a Theoretical Model to Assess ERP Value Across Iberian MANUFACTURING and Services SMEs

Enterprise Resource Planning (ERP) system literature reports few studies with a focus on specificities of an industry analysis. Based on the Technology-Organizational-Environment (TOE) framework and the Resource-Based View (RBV) theory, we present a theoretically developed research model aiming at measuring and examining determinants of ERP use and value and their impact in the Iberian region (Portugal and Spain) across Manufacturing and Services industries in Small and Medium Enterprises (SMEs). The research model suggests ten hypotheses that will be tested and analysed with data from a questionnaire among firms that have adopted ERP systems in their organization. Due to the nature of the research model the data analysis will be supported by Partial Least Squares (PLS). Our aim with this research project is to provide new knowledge into which determinants contribute to ERP use and ERP value in Iberian Manufacturing and Services SMEs.

Using resource-based view theory to assess the value of ERP commercial-packages in SMEs

This study explores the enterprise resource planning (ERP) variations in value on small and medium enterprises (SMEs) across four commercial-packages (Microsoft NAV, SAP All-in-one, ORACLE JDE, and SAGE X3). Grounded on the resource-based view (RBV) theory of the firm, we assess a research model linking three determinants; ERP use, collaboration, and analytics to explain the ERP value in three effects (individual productivity, management control, and customer satisfaction). Using a survey data set of 883 firms across European SMEs we test the theoretical model through structural equation modelling. This study provides empirical evidence on how European SMEs find value from the top four commercial-packaged ERPs. Whereas for Dynamics and ORACLE the most important factor is analytics system capability, for SAP and SAGE it is greater collaboration system capability. Furthermore, for SAP and ORACLE greater ERP use is perceived as an important factor, but not for Dynamics and SAGE. In addition, the study finds that both collaboration and analytics capabilities are the greatest differentiators to ERP value, which is consistent with the RBV. The finding provide guidance to business implementation strategies and to software development. The limitations and future work of the study are noted.

Examine ERP post-implementation stages of use and value: Empirical evidence from Portuguese SMEs

There is a great interest among researchers and practitioners in accounting information systems (AIS) value. This is particularly important in cases of systems such as enterprise resource planning (ERP). This paper empirically measures and analyses the determinants of ERP use and value in a single framework, as well as provides empirical evidence from Portuguese small and medium enterprises (SMEs). Drawing upon theories on the process and contexts of information technology (IT) we postulate nine hypotheses. Used the technology–organization–environment (TOE) framework to hypothesize how compatibility, complexity, efficiency, best-practices, training, and competitive pressure explain ERP use. Based on the resource-based view (RBV) theory we hypothesize how ERP use, collaboration and analytics explain ERP value, and its potential contribution for the nature of management control and accounting information systems on Portuguese SMEs. Through structural equation modeling, a data set of 134 web-surveyed firms is used to test the hypotheses. Our empirical analysis leads to six main findings: 1) compatibility, complexity, best-practices, and efficiency are more important determinants for ERP use as well as training and competitive pressure, suggesting that technological, organizational and environmental characteristics are the main drivers of ERP use among Portuguese SMEs. 2) Similarly, collaboration and analytics are more important for ERP value upon use, suggesting that system capability characteristics are the main drivers of ERP value. 3) ERP value benefits from system enhancements to firms' business processes in the post-implementation phases. 4) For Portuguese SMEs the mostly valued metric attained through ERP is management control. 5) Impelled by legislation, Portuguese SMEs are using ERP as the accounting system for management, financial and tax accounting. 6) Portuguese SMEs invest more than 70% of their annual IT budget to ERP use. Together, these findings offer insights into how Portuguese SMEs use and extract value from ERP, and how enhancements positively impact the system's value. Unlike the typical focus on ERP adoption described in the literature, this research focuses on the post-implementation phase, linking actual use with value creation, adding an empirical study to the AIS literature.

Commodity or competitive advantage? Analysis of the ERP value paradox

A true e-business enabled firm needs the support from a well-tuned enterprise resource planning (ERP) system for providing real time data. However, many companies complain that after their huge investments in ERP systems, they found the ERP systems do not bring them new orders, new profits, or competitive advantage as ERP vendors claim. Academic studies also found mixed results regarding ERP’s payoff. In line with resource based view (RBV), the study proposes an integrated model to shed light on the ERP value paradox. We try to answer “With what organizational resources and by building what firm specific capabilities, the investment in ERP systems may bring firms competitive advantage”. Using a sample of 150 ERP and e-business adopters in the US, we found that (1) organizational resources such as managerial skills and organizational change management play a more important role than IT resources (ERP, e-Business technologies) in generating business integration capability. (2) However, neither IT resources nor organizational resources directly provide firms with competitive advantage. Instead, business integration capability built from the two resources plays a mediating role through which business achieves competitive advantage.

Differential Effects on ERP Post-Adoption Stages across Scandinavian and Iberian SMEs

Enterprise resource planning (ERP) post-adoption stages (use and value) and small and medium enterprises (SME) are of high interest among both academics and practitioners. Grounded in the diffusion of innovation theory to explain ERP use and resource-based view theory to explain ERP value the authors postulate that use is an important link to value. The authors propose and test a model using a unique dataset of 883 SMEs from Scandinavia and Iberia. Whereas for both regions, competitive pressure, efficiency, and best-practices are important factors to use ERP, analytics and collaboration are important factors for ERP value. Whereas complexity and training are not relevant for ERP use among Scandinavian SMEs, they are facilitators for Iberian firms. This is an empirical theoretically grounded research studying ERP use and value among SMEs across two distinct European regions, thus adding an international dimension to the IS literature, as well moving beyond dichotomous “adoption versus non-adoption”.

From dynamic capabilities to ERP enabled business improvements: The mediating effect of the implementation project

This study explores whether an Enterprise Resource Planning (ERP) implementation project mediates the relationship between dynamic pre-adoption capabilities and ERP-enabled business improvements. The results from our field survey of large ERP adopters in Austria suggest that the effects of the two out of three selected dynamic capabilities are dependent on the properties of the underlying organizational transformation project. While external information acquisition and IT governance capabilities are fully mediated by the performance of the ERP implementation project, decision making only directly impacts business capabilities. These results further our understanding about the role of the implementation project for ERP value creation and the different natures of capability relationships. We call for more research on co-presence conditions related to dynamic capabilities and IT transformation project performance.

ERP use and value: Portuguese and Spanish SMEs

PurposeConsistent with the diffusion of innovation (DOI) model and resource‐based view (RBV) theory, the purpose of this paper is to develop a research model for measuring enterprise resource planning (ERP) post‐adoption and its consequence on small and medium enterprise (SME) performance.Design/methodology/approachThe model links six determinants based on DOI to explain “ERP use” and three on RBV to explain the “ERP value”, on which nine hypotheses are postulated. Testing was conducted through structural equation modelling, utilizing data from 558 web‐surveyed firms in Portugal and Spain.FindingsFull sample analysis finds that competitive pressure, training, best‐practices, compatibility, and efficiency are important antecedents of “ERP use”. Together with usage, collaboration and analytics capabilities contribute to “ERP value”. Cross‐country analysis reveals that complexity is an important inhibitor for “ERP use” in Portuguese firms whereas it is a facilitator for Spanish firms. In addition, while for Portuguese firms, compatibility and efficiency are significant, they are not for Spanish firms. For “ERP value”, while use and collaboration are more important for Portuguese firms, analytics is more important for Spanish.Research limitations/implicationsThe paper provides insight into how SMEs use and value ERP; however, the authors cannot speak empirically on the issue of whether value is sustained, or on maturity stages, or on the impact of different industries.Originality/valueThe paper describes the first empirical research study on Iberian SMEs, thus adding a cross‐country dimension to the innovation diffusion literature. Unlike the typical focus on ERP adoption found in the literature, this paper focuses on post‐adoption stages, linking usage with value.

Determinants that Influence ERP Use and Value: Cross-Country Evidence on Scandinavian and Iberian SMEs

Enterprise resource planning (ERP) use and ERP value are of high interest among both academia's as well as practitioners. Despite different views of gained value from implemented ERP, there are some studies focusing in larger companies, however, few studies report on challenges experienced by Small and Medium sized Enterprises (SMEs). Based on diffusion of innovation (DOI) literature and resource-based view (RBV) theory, we explore the reasons for ERP post-adoption through a research model. From a large scale web-survey, a partial least squares (PLS) was conducted to empirically assess nine hypotheses. Findings are that best-practices and competitive pressure influence most ERP use and, analytics and collaboration influence ERP value. Indicating, that ERPs are not only been used as a transaction processing system but also as front-end applications in SMEs. This is the first study that explores differences and similarities across Scandinavian and Iberian SMEs in regards to ERP use and ‘ERP value’.

Pre-implementation attitudes and organizational readiness for implementing an Enterprise Resource Planning system

Implementing an Enterprise Resource Planning (ERP) system is expensive and time consuming. A substantial cost is associated with pre-implementation involvement and training designed to encourage acceptance and effective implementation of the system. The results of this study indicate that, contrary to conventional wisdom, extensive organizational investments in shaping pre-implementation attitudes do not always achieve the desired effects. Despite extensive time, money and effort, length of time with the firm and position had a greater impact on attitudes toward ERP capabilities, value, acceptance and timing than high levels of pre-implementation involvement.