Critical Success Factors in ERP Implementation Success: A Literature Review and Model Development

Critical Success Factors in ERP Implementation Success: A Literature Review and Model DevelopmentBy: Tammy BahmanziariSeptember 15, 2004Critical Success Factors in ERP Implementation Success: A Literature Review and Model DevelopmentAbstract

This paper reviews the recent empirical research in ERP (Enterprise Resource Planning) implementation. The purpose of this paper is to develop a parsimonious model of ERP implementation success by identifying and categorizing the critical success factors (CSFs) that have been empirically tested in the literature. This research results in the proposal of a parsimonious model of CSFs in ERP implementation. The paper is supported with tables and appendices to ease familiarization of the reader with the subject matter and to serve as a reference for future research. The paper includes an annotated bibliography of the research reviewed in the development of this paper.

Keywords: Enterprise Resource Planning, ERP, ERP implementation success, critical success factors, CSFs, accounting information systems

Critical Success Factors in ERP Implementation Success

IntroductionCritical success factors (CSFs) in the implementation of ERP systems have been a topic of concern for practitioners and academic researchers in the last few years. Although a number of studies have been published that identify these factors, it is important to summarize and synthesize the current state of the literature in order to create a parsimonious model of CSFs in ERP implementation success. This paper is an attempt to create such a model. Scholars in the accounting information systems area advocate the involvement of the accounting personnel in the systems analysis and design of new accounting information systems. One often cited reason for this imperative is the ability of the accountant to integrate controls into the accounting system from the development stage. The accountant has a vested interest in the successful implementation of the accounting system. This is also true in the implementation of ERP systems. This paper is motivated by the need of accountants to understand the factors critical to the successful implementation of the ERP systems and the measures used to identify success. The remainder of this paper discusses the benefits of ERP, the categories of CSFs, the measures used to define implementation success and model development.

Evidence of the benefits of ERP to the organization

Several of the studies discussed in this paper purport benefits to organizations from the implementation of ERP systems. The trade and academic literature concerning ERP is filled with reports of the success and failure of ERP implementations. However, despite the apparent risk of failure, and the accompanying financial risk, companies have turned consistently to ERP systems to gain advantages perceived in its use. Obviously, these companies have identified various reasons for the implementation that fit, hopefully, with long-term strategic goals of the company.

The measurement of the benefits of the ERP implementation in most studies is dependent upon the perceptions of the management, users, consultants, and others in the organization. A table showing the dependent variables used in the research studies included in this paper is provided in Table 1.. Three studies identified in this research used constructs to measure the success of the implementation and benefits to the firm that did not depend on the perception of stakeholders within the organization. These constructs were market price (Hayes et al 2001), firm performance (Hunton et al. 2003) and financial analysts earnings predictions (Hunton et al. 2002).

Hayes et al. (2001) investigated how the capital markets responded to firms announcements of ERP implementation. The purpose of this study was to determine if, empirically, the ERP was expected to add value to the organization. This was the first study to undertake this type of empirical testing of the value to the organization of ERP. The research found that the market did react significantly and positively overall to the announcement of the ERP implementation for the sample firms. For small/unhealthy firms, however, the reaction on the market return was negatively. The authors explained that the cost of the ERP implementation was probably considered prohibitive for unhealthy firms such that they would have a difficult time recovering due to their poor health.

Hunton et al. (2003) examined the longitudinal impact of ERP adoption on firm performance. The authors proposed that the long-term financial performance of companies that did not adopt ERP would be lower than the financial performance of those companies that adopt ERP. Financial performance was measured using four numbers: return on assets, return on sales, asset turnover and return on investment. Using regression analysis, the results indicated that the ERP adopting firms had slightly better performance than nonadopters. The authors found a positive relationship between firm performance and firm size and financial health.

Hunton et al. (2002) investigated the extent to which investors believe that ERP systems enhance firm value by examining changes in financial analysts earnings predictions before and after they receive an announcement that a firm plans to implement and ERP system. Two contextual factors, firm size and firm health are proposed to moderate the relationship between announcement of the implementation plans and the analysts earnings predictions. The experimental results show that ERP adoption announcements have a significant positive effect on earnings predictions. Therefore, the authors conclude that the analysts perceived that the ERP system will reap positive benefits to the company.

These studies highlight the benefits of an ERP implementation to the market. The benefits are dependent upon the successful implementation of the software. The following section of the paper discusses the critical success factors that have been identified through empirical academic studies in the literature. These factors are arranged in a final model that can be used to help guide future research in this area. (See Appendix A)

Critical success factors

Several studies identified as empirical analysis of the ERP implementation process are summarized and analyzed in this paper. The main purpose of this paper is to create a model of the factors affected the successful implementation of ERP that have been empirically tested in the academic literature. The resulting model, presented in Appendix A, does not include all the factors used in the reviewed literature but does include a majority of them. The factors tested in these studies have been organized into categories based on common characteristics. These categories are the environment (cultural and structural aspects), ERP software characteristics, firm characteristics, implementation team characteristics, characteristics of top management, the implementation process and characteristics of end-users. A summary of the categories and the specific factors under each category along with the studies in which this factor is tested empirically are included in Table 1. For more specific information on a particular study, Appendix B includes an annotated bibliography and Table 2 summarizes the results of the tests of CSFs used in each study in the literature review alphabetically and outlines the specific success measures used. Each of these CSF categories is discussed below along with the empirical findings.

Cultural aspects of the environment

The factors that are present in the environment are of two types: cultural and structural. The cultural aspects, discussed here, encompass those factors that are unique to corporate culture. The structural aspects of the environment, discussed in the next section, are those that are concerned with factors in the environment not logically tied to corporate culture but more indicative of the specific industry of the firm or market conditions.

The critical success factors (CSFs) included under environment/cultural aspects are cultural importance on training and systems, resistance to change, cultural readiness, open and honest communication, expectations and social commitment. The cultural importance placed on training and the importance of systems in empowering the organization was included as CSFs in a study reported by Krumbholz et al. (2000). This study identified these CSFs and others in a study of the effect of differing national culture and corporate culture on the successful implementation of ERP.

Resistance to change is an important CSF for an ERP implementation. Several studies have identified this factor as influential in organizational success in ERP implementation. (Duplaga and Astani, 2003; Hong and Kim, 2002; and Palaniswamy, 2002) Resistance to change is the natural inertia inherent in organizations. In Duplaga and Astani (2003), 30 percent of the respondents to the survey questions responded that they felt that resistance to change was a major problem in their implementation effort. Hong and Kim (2002) used resistance to change, called organizational resistance in their study, as a moderator between organizational fit and ERP implementation success. They defined organizational resistance as resulting from resistance due to job changes and uncertainty of the new system. Hong and Kim (2002) found that resistance to change, among others, was one of the main impediments to ERP implementation success.

Open and honest communication was a significant CSF in two studies. (Nah et al., 2003; and Sarker and Lee, 2003) Often, openness and honest communication occurs in corporate cultures where trust between management and employees is strong. Sarker and Lee (2003) identified open and honest communication as social enablers that influence successful ERP implementation. They defined it as open and honest communications at all levels of the management and users and all phases of the project.

Another cultural environmental factor identified in the literature refers to unrealistic expectations and tendency to endure escalation of commitment. (Sumner, 2000) The presence of unrealistic expectations and the tendency to escalation of commitment is indicative of the inability to recognize and solve problems. (Sumner, 2000) Clearly, ERP implementations will lead to various problems in the course of implementation and the inability to recognize and fix those problems is a major impediment to success.

Structural aspects of the environment

Structural aspects were identified in several studies. In some industries, competitive pressure is an important factor in motivating firms to implement ERP systems. (Bradford and Florin, 2003) This factor is important in keeping organizations motivated during the implementation process and thus is an important factor in success.

The lack of IT personnel, business experts and/or employee turnover within the organization was CSFs identified in several studies. (Aladwani, 2002; Duplaga and Astani, 2003; Markus et al., 2000; Palaniswamy, 2002; Robey et al., 2002; and Sumner, 2000) These three factors indicate general labor market tightness in these areas and are representative of a special concern in some environments. Without proper personnel, the ERP implementation is difficult to accomplish.

Characteristics of the software

The characteristics of the software are important to successful implementation. Companies must be careful to compare the capabilities of the software package under consideration for adoption to the specific needs of the company. While there are a handful of software vendors that populate the top sellers in the ERP system sales (e.g. SAP, Peoplesoft, and J.D. Edwards), there are a plethora of vendors available. Differences in these different software products can have major effects on the successful implementation of the ERP.

Complexity of the software was a major concern in several studies. (Adam and ODoherty, 2000; Bradford and Florin, 2003; Francalanci, 2001; Parr and Shanks, 2003; Ribbers and Schoo, 2002; Robey et al., 2002; and Sumner, 2000) The complexity of the ERP software inhibits the ability of the users and implementers to understand and incorporate the software into the business processes of the organization. Also, the higher the complexity of the software, the more time and hence, expense of the implementation. Therefore, complexity of the software may have a negative relationship with successful ERP implementation.

Especially with regard to international implementations of ERP software, the ability of the software to comply with local legislation is an important CSF for success. (Krumbholz et al., 2003) Newell et al. (2003) found that the focus of the software, efficiency or flexibility, influenced how the organization dealt with possible changes to business processes, and thusly, successful implementation. Finally, the suitability of the operating assumptions and business rules with respect to the company and industry in question is an important consideration in the gauging successful ERP implementation. (Krumbholz et al., 2000; Lee and Lee, 2000; Nah et al., 2003; and Umble et al., 2003)

Characteristics of the firmSince the characteristics of the users, implementation team, and management is discussed later in this paper, only one other characteristic of the firm was identified as a CSF in the literature reviewed. Firm size was identified by several researchers as a CSF for ERP implementation success. (Bradford and Florin, 2003; Duplaga and Astani, 2003; Mabert et al., 2003b; Mabert et al., 2000) Bradford and Florin (2003) used firm size as a control variable. This is usually done with a characteristic or independent variable with a significant effect on the dependent variable but not a variable of interest in the study under analysis. They did not find it a significant factor. Bradford and Florin (2003) For Duplaga and Astani (2003), firm size proved to moderate the relationship between various independent variables and ERP implementation success. Only Mabert et al. (2003b) and Mabert et al. (2000) used firm size as an independent variable and found it to be significant influence on a variety of success variables.

Implementation team characteristics

Several studies have studied the use of experienced consultants in successful implementation processes. (Adam and ODoherty, 2000; robbery et al., 2002; Haines and Goodhue, 2003; and Markus et al, 2000) Consultants are important in bringing both knowledge and experience in implementation. These are two important implementation success factors often lacking in firms implementing ERP systems. Some of the studies mentioned that not all consultants were experienced and thus it is important to distinguish between experienced and inexperienced consultants. Some executives responded to questions with the comment that the consultants learned as much from the company as the company learned from them. However, it would generally be the consultants job to help the company and therefore, experience is valued.

Gefen and Ridings (2002) looked at whether implementation team responsiveness to user needs was a significant CSF. Logically, they found that responsiveness lead to increased perception by users of the system being correctly configured and satisfaction with the system. (Gefen and Ridings, 2002) The ability of the implementation team to plan and make decisions was an important factor. (Mabert et al., 2003a; Nah et al., 2003) This empowerment of the implementation team helps to increase their responsiveness to impediments to the implementation process.

The composition of the team can add significantly to the probability of successful implementation. (Aladwani, 2002; Nah et al., 2003; Parr and Shanks, 2000; Sarker and Lee, 2003; and Umble et al., 2003) The right mix of IT experts, business experts and consultants can increase the probability of success. Finally, two studies investigated the role of the project champion in the implementation process. (Nah et al, 2003; and Parr and Shanks, 2000) The project champion is instrumental in ensuring that the project is pushed through obstacles and trying points in the installation process. The project champion can be on the implementation team or a member of management who is behind the project. Often, the project champion has identified significant benefits of the ERP project.

Role and characteristics of top managementThe establishment of clear objectives and goals for the ERP project is important in successful implementation. (Adam and ODoherty, 2000; Aladwani, 2002; Duplaga and Astani, 2003; Nah et al., 2003; Parr and Shanks, 2000; Sumner, 2000; Umble et al., 2003) According to the old adage, you cant get anywhere unless you know where you are going. So it is that the clear objectives and goals are important to move all parties in the same direction. The goals and objectives, set by top management, are related to another factor, top management support, involvement and participation. This factor is often included in models of ERP implementation success. (Aladwani, 2002; Bradford and Florin, 2003; Duplaga and Astani, 2003; Jarvenpaa and Ives, 1991; Nah et al., 2003; Palaniswamy, 2002; Parr and Shanks, 2000; Sarker and Lee, 2003; and Umble et al.) Jarvenpaa and Ives (1991) found that both involvement and participation were significant. Executive participation referred to the CEOs activities or substantive personal interventions in the management of IT. Executive involvement reflects the degree of importance placed on information technology by the CEO. Interestingly, top management executives age and functional background was found significant to ERP implementation success. (Jarvenpaa and Ives, 1991)

Characteristics of the implementation process

One of the major conflicts in ERP implementation is the choices that have to be made between business process engineering vs. software modification. Due to the off-the-shelf nature of ERP software, and the lack of uniformity across business processes, even within industries, this conflict leads to differing degrees of each for each ERP implementation. Business process engineering refers to the changes made to the firms operating procedures in order to conform to the business rules of the software. In those cases where this is undesirable or impossible, software modifications must be made. Each has its own unique problems associated with it. Business process engineering is difficult where resistance to change is present. Software modifications lead to upgrading problems when new releases of the software are issued. Several studies included one or more of these factors in their analysis. (Hong and Kim, 2002; Markus et al., 2000; Motwani et al., 2002; Nah et al., 2003; Palaniswamy, 2002; Parr and Shanks, 2000; Robey et al.; Umble et al., 2003)

Training and education of users, customers and suppliers is an important part of adoption and satisfaction of the ERP system. (Duplaga and Astani, 2003; Markus et al., 2000; Palaniswamy, 2002; Robey et al., 2002; and Umble et al., 2003) Inadequate training was mentioned as a disabling factor in several studies. Data quality and accuracy from the system was included by Markus et al. (2000) and Umble et al. (2003). Adequate testing of the system before the cut-over was a factor in studies by Markus et al (2000) and Nah et al. (2003). Adequate time to complete the implementation, in order to avoid going live before the system is ready was identified in studies by Adam and ODoherty (2000), Bradford and Florin (2003) and Parr and Shanks (2000). And finally, although it may seem to be obvious, ability to evaluate the project progress is an important consideration. (Markus et al., 2000; Nah et al., 2003; and Umble et al. 2003)

End-users characteristicsFinally, characteristics of end-users have been identified in some studies as predictors of ERP implementation success as measured by adoption, use and satisfaction with the ERP system. End-user attitudes toward the ERP system were found to influence successful implementation. (Abdinnour-Helm et al., 2003; Krumbholz et al., 2000; and Sumner, 2000) User involvement in the ERP implementation process was studied by Abdinnour-Helm et al. (2003) and Sumner (2000). Abdinnour-Helm et al. (2003) found that employees with the lowest job tenure and those in professional positions were more likely to be satisfied with the ERP system.

Quest for the dependent variable

Before the model of ERP Implementation success can be discussed, it is important to distinguish which factors represent ERP implementation success. Most of the case studies in the reviewed literature used the term ERP implementation success to describe a situation in which the software was installed and up and running. No differing degrees of success were differentiated due to the fact that the emphasis of the research was the identification of CSFs. However, several of the studies identify possible factors that can be used to conceptualize and/or quantify ERP implementation success. These factors include expectations of added value, user acceptance and satisfaction, efficiency and effectiveness, organizational performance, systems use and service quality. See Table 2 for details of these factors.

The purpose for the use of different dependent variables can be surmised to be dependent upon the reasons for the implementation. If the purpose of the implementation is to increase efficiency and effectiveness, then a measure of the degree to which the implementation has achieved these goals is a valid measure of success. Since many factors can influence the decision to implement an ERP system, then the dependent variables selection can be considered unique to the individual firm. Therefore, the empirical researcher may find it difficult to determine the measure of success most appropriate for the study. While the inherent deficiencies are noted, for the purposes of this literature review, ERP implementation success will be used as the dependent variable.

Model Development

These factors extracted from the literature and categorized in a logical manner serve as the basis for the research model for this paper. Since the purpose of this paper is model building, the conclusion of the paper is Appendix A. This model should be tested empirically to determine soundness and revise the model as necessary. One major deficiency of this model is the lack of attention to two factors: untested potential predictors of success and possible multicollinearity of the CSFs. However, testing of the model should be able to address these issues.

ConclusionThis research has attempted to understand the empirical research in ERP implementation success and the empirically identified CSFs in this stream of research. Many studies that discuss ERP implementation conceptually were basically ignored in this research. The result of this research is a model based on empirical research that is appropriate for testing.

CategoryCritical Success/Failure FactorsAuthors (year)

Environment : CulturalCultural importance placed on training, cultural importance of systems empowering the organizationKrumbholz et al. (2000)

Resistance to changeDuplaga and Astani (2003), Hong and Kim (2002) and Palaniswamy (2002)

Cultural readinessMotwani et al. (2002)

Open and honest communicationNah et al. (2003) and Sarker and Lee (2003)

Unrealistic expectations and social commitment (escalation of commitment)Sumner (2000)

Environment: StructuralCompetitive pressureBradford and Florin (2003)

Lack of IT personnel, business experts and or employee turnoverAladwani (2002), Duplaga and Astani (2003), Markus et al. (2000), Palaniswamy (2002), Robey et al (2002), and Sumner (2000)

Organizational fitHong and Kim (2002) and Sumner (2000)

SoftwareComplexity of the softwareAdam and ODoherty (2000), Bradford and Florin (2003), Francalanci (2001), Parr and Shanks (2003), Ribbers and Schoo (2002), Robey et al. (2002) and Sumner (2000)

Ability to comply with local legislationKrumbholz et al. (2000)

Focus of the softwareNewell et al. (2003)

Suitability of operating assumptions and business rules, choosing the right softwareKrumbholz et al. (2000), Lee and Lee (2000), Nah et al (2003) and Umble et al. (2003)

FirmSize of the firmBradford and Florin (2003), Duplaga and Astani (2003), Mabert et al. (2003b) and Mabert et al (2000)

Implementation Team CharacteristicsInclusion of experienced consultants Adam and ODoherty (2000), Robey et al. (2002), Haines and Goodhue (2003) and Markus et al. (2000)

Implementation team responsivenessGefen and Ridings (2002)

Planning and decision makingMabert et al. (2003a) and Nah et al. (2003)

Project championNah et al. (2003) and Parr and Shanks (2000)

Team compositionAladwani (2002), Nah et al. (2003), Parr and Shanks (2000), Sarker and Lee (2003) and Umble et al. (2003)

Top Management Clear objectives and goalsAdam and ODoherty (2000), Aladwani (2002), Duplaga and Astani (2003), Nah et al. (2003), Sumner (2000), Umble et al. (2003) and Parr and Shanks (2000)

Support, involvement and participation by top managementAladwani (2002), Bradford and Florin (2003), Duplaga and Astani (2003), Jarvenpaa and Ives (1991), Nah et al. (2003), Palaniswamy (2002), Parr and Shanks (2000), Sarker and Lee (2003) and Umble et al. (2003)

Executives age and functional backgroundJarvenpaa and Ives (1991)

Implementation ProcessImplementation approach (piecemeal or all at once)Brown and Vessey (1998), Markus et al. (2000), Parr and Shanks (2000), Robey et al. (2002) and Umble et al. (2003)

Business process reengineering vs. software modificationMarkus et al. (2000), Motwani et al. (2002), Nah et al. (2003), Palaniswamy (2002), Parr and Shanks (2000), Robey et al. (2002), Umble et al. (2003), and Hong and Kim (2002)

Training and EducationDuplaga and Astani (2003), Markus et al. (2000), Palaniswamy (2002), Robey et al. (2002) and Umble et al. (2003)

Data quality and accuracyMarkus et al. (2000) and Umble et al. (2003)

Evaluation of project progressMarkus et al. (2000), Nah et al. (2003) and Umble et al. (2003)

Adequate testing of systemMarkus et al. (2000) and Nah et al. (2003)

Timing of implementationAdam and ODoherty (2000), Bradford and Florin (2003), and Parr and Shanks (2000)

End-usersEnd-users attitudes toward the ERP systemAbdinnour-Helm et al. (2003), Krumbholz et al. (2000) and Sumner (2000)

User involvementAbdinnour-Helm et al (2003) and Sumner (2000)

Job Tenure and TypeAbdinnour-Helm et al. (2003)

Author(s)Critical Success FactorsSignificant?Dependent Variables

Abdinnour-Helm et al.(2003)level of employee involvement with the early implementation process: four levels of cornerstone, team builders, organizational mapping and non-involvementNot significantThe expected capabilities of the ERP system

job tenureSignificantThe expected value of the ERP system

job typeSignificantAcceptance of the ERP system

Timing of the ERP implementation

Adam and O'Doherty (2000)durationSignificantAdoption by the staff

complexitySignificantstaff found the software beneficial

clear managerial objectivesSignificantDegree to which managers took ownership of the ERP system

work in collaboration with an experienced implementerSignificant

Aladwani (2002)technology characteristics : support technologies for production, coordination and organizationSignificanteffectiveness

project characteristics: project team sizeSignificantefficiency

people characteristics: expertise of the staffSignificantsatisfaction

organizational characteristics: support from top managementSignificantadded business value to organization

process characteristics: problem solving competency Significant

task characteristics: clear goalsSignificant

Bradford and Florin (2003)Innovative characteristics: technical capability, perceived complexity and business process reengineeringSignificantorganizational performance

organizational characteristics: top management support, training, and consensus with organizational objectivesSignificantuser satisfaction (became a moderator)

environmental characteristics: competitive pressureSignificant

control variables: time needed to implementationSignificant

control variables: firm sizeNot significant

Brown and Vessey (1998)Organizational characteristicsNot significant Implementation approach

Package capabilities soughtSignificant

Scope of the projectNot significant

DeLone and McLean (2003)Systems use

service quality

information quality

system quality

use

user satisfaction

net benefits

Duplaga and Astani (2003)lack of ERP training and educationSignificantERP implementation success

lack of in-house expertise in ERPSignificant

lack of data accuracy Significant

lack of companywide support and involvementSignificant

lack of clear goals for ERP effortSignificant

resistance to change Significant

firm size was moderating variableSignificant

Francalanci (2001)size of the projectSignificantimplementation effort

complexitySignificant

Gefen and Ridings (2002)implementation team responsivenessSignificantuser assessment of correctness of the configuration

Significantuser willingness to adopt the system

Hayes et al. (2001)announcement of ERP implementationSignificantfirms market return

Haines and Goodhue (2003)level of implementer knowledge and skillsSignificantERP success

consultant involvementSignificant

Hong and Kim (2002)organizational fitSignificantERP implementation success: degree of deviation from fproject goal in terns of expected cost, time, system performance and benefits

Moderators: ERP adaptation, process adaptation and organizational resistance.Significant

Hunton et al. (2002)announcement of an ERP implementationSignificantfinancial analysts' earnings forecasts

Moderators: firm size and firm healthSignificant

Jarvenpaa and Ives (1991)Executive involvementSignificantprogressive use of IT

Executive participation Significant

executive ageSignificant

functional backgroundSignificant

Organizational conditionsSignificant

Krumbholz et al. (2000)importance of trainingSignificantERP implementation success

employee job satisfactionSignificant

importance of systems empowering the organizationSignificant

inability of the software to meet specific needs of the employeesSignificant

ability to comply with local legislationSignificant

unsuitable operating assumptionsSignificant

Lee and Lee (2000)Business rules in ERP packagesSignificantERP implementation problems

Mabert et al. (2003a)planning effortsSignificantUnder budget and "on-time" implementations

implementation decisionsSignificant

implementation managementSignificant

Mabert et al (2003b)organization sizesignificantReason for the implementation

amount of ERP functionality employed

implementation method

type of benefits enjoyed

cost to implement

Implementation time.

Mabert et al. (2000)firm sizesignificantextent of packaged ERP system use

motivation to pursue an ERP system

implementation experience

benefits obtained through implementation

Markus et al (2000)phase of the project: project phase, shakedown phase, and onward and upwardsignificantERP implementation success

software modifications to the ERP packagesignificant

system integrationsignificant

consultantssignificant

turnover of project personnelsignificant

implementation approachsignificant

project scopesignificant

end-user trainingsignificant

inadequate testingsignificant

data quality problemssignificant

reporting needssignificant

business process reengineeringsignificant

ability to gage progresssignificant

lack of IT personnelsignificant

upgrading problemssignificant

Nah et al (2003)appropriate business and information technology legacy systemERP implementation success

business plan and vision

business process reengineering

Change management culture and programsignificant

communication

ERP teamwork and compositionsignificant

monitoring and evaluation of performance

project championsignificant

project managementsignificant

software development

testing and troubleshooting

top management supportsignificant

Newell et al. (2003)focus of the software (efficiency and flexibility)significantComplementarity between KM and ERP systems

Parr and Shanks (2000)management supportsignificantERP implementation success at each phase of the project

full-time business expertssignificant

empowered decision makerssignificant

deliverable and realistic datessignificant

project championsignificant

vanilla ERP (little customization)significant

smaller scope projectssignificant

clear definition of scope and goalssignificant

right balance on the implementation team of expertssignificant

perseverance and determination with a commitment to changesignificant

Moderators: scope and complexity of the projectsignificant

Palaniswamy (2002)employee turnoversignificantERP implementation success

resistance to changesignificant

over run of estimated budgetsignificant

increased work load in implementation processsignificant

business reengineeringsignificant

user resistance significant

lack of top management supportsignificant

training significant

Ribbers and Schoo (2002)Complexity of the software implementation : variety, variability and integrationsignificantERP implementation success

Robey et al. (2002)knowledge demandssignificantERP implementation success

business expertssignificant

size and complexity of the softwaresignificant

business process reengineeringsignificant

consultantssignificant

traningsignificant

approach to implementationsignificant

Sarker and Lee (2003)strong and committed leadershipsignificantERP implementation success

open and honest communication

balanced and empowered ERP implementation team

Sumner (2000)Organizational fit: resource insufficiency, extent of changessignificantERP implementation success

Skill mix: lack of knowledge and technical expertisesignificant

Management structure and strategy: lack of agreement on project foals and lack of senior management involvementsignificant

Software systems design: misunderstanding requirements and changes in requirements, lack of an effective methodology, poor estimation and failure to perform the activities needed. significant

User involvement and training: lack of user commitment and ineffective communications with users and conflicts between user departmentssignificant

Technological planning refers to lack of adequate technologysignificant

strained technical capabilities and failure of technology to meet specifications and technical complexity.significant

Project management: unrealistic schedules and budgets, people and personality failures, lack of effort, antagonistic attitudes and people clashessignificant

Social commitment: inability to recognize problems, and a tendency to keep pouring resources into a failed project and unrealistic expectationssignificant

Motwani et al. (2002)Change environment: cultural readiness, learning capacity, relationship balancing, IT leveragability and knowledge capability and strategic initiativessignificantERP implementation success

Change management involves effectively balancing forces in favor of a change over forces of resistance. significant

Process management is defined as a set of concepts and practices aimed at better stewardship of business processes. significant

Umble et al. (2003)Clear compelling visionsignificantDegree to which the implementation met predefined goals

strong leadership, commitment and participation by top managementsignificant

project management significant

reengineering of key business processessignificant

implementation team compositionsignificant

data accuracysignificant

education and trainingsignificant

carefully selected performance measuressignificant

tie compensation to successful implementationsignificant

multi-site issuessignificant

cut-over strategysignificant

selection of the software productsignificant

implementation approach or strategysignificant

Abdinnour-Helm, S., Lengnick-Hall, M. L., and C. A. Lengnick-Hall. 2003. Pre-implementation attitudes and organizational readiness for implementing an Enterprise Resource Planning system. European Journal of Operation Research, 146:2, 258-273.

This paper examines the role of employee attitudes in ERP implementation effectiveness in order to provide a better understanding of the people side of ERP implementation. Employee attitudes toward ERP systems and how these systems are introduced into organizations can either hinder or facilitate implementation success, despite the rational approach to change an organization may take. Employee attitudes toward ERP systems are dynamic, changing over time as employees experience the ERP system more directly.

This paper introduces the idea of the socially constructed components of technology. The objective components include the design and input characteristics and its functionality. The socially constructed component of technology includes the meanings people attach to the technology, which affects how they feel about the technology and how they behave.

The study looks at the level of employee involvement with the early implementation process, job tenure, and job type on shaping attitudes toward an ERP system in the pre-implementation stage. Employees with greater involvement early have greater exposure to the software and greater positive attitudes toward the technology. Involvement was defined as four levels: Cornerstone, Team builder, organization mapping and non-involvement. Cornerstones were leaders in the implementation process. Team builders were second highest and they are assigned the role of practical application of change management. Organizational mapping was the third level and included employees that only attended meetings that mapped the processes that were affected by the ERP.

Employees with lower levels of job tenure will react more positively to the new ERP systems in the early stages than those with higher levels of tenure. Employees with managerial or professional roles in the organization will have more positive attitudes than employees in supervisor, production worker and other job types. The dependent variable in the study consists of four parts: the expected capabilities of the ERP system, the expected value of the ERP system, acceptance of the ERP system and the timing of the ERP implementation.

A survey was conducted with a large manufacturing organization in the Midwest. The data was analyzed using MANOVA. The overall MANOVA was significant and three of the individual were: capacity, value and acceptance. Level of involvement in pre-implementation training with the consultants appeared to have little influence on attitudes toward ERP. Contrary to expectations, exposure to the ERP system and greater levels of involvement in its implementation did not seem to dramatically change the attitudes of employees. Employees with less tenure were more sanguine about the potential capabilities and the potential value of the new ERP system than employees with 11 or more years tenure. Either a higher level in the organization hierarchy and/or a professional/engineering position may favorably shape employees appreciation of the potential benefits of ERP.

Organizational demography appears to be an important factor determining attitudes toward ERP implementation and its ultimate effectiveness. Second, an exceptionally quick implementation approach may not provide the time necessary for employees to learn about the system and appreciate its potential value. Third, following a rational approach to ERP implementation as advocated by consultants and others will not necessarily overcome sources of organizational resistance to change. The rational approach (explain its benefits and people with value it) may not have the best consequences. Adam, F. and P. ODoherty. 2000. Lessons from enterprise resource planning implementations in Ireland towards smaller and shorter ERP projects. Journal of Information Technology, 15, 305-316.

The purpose of the article was to empirically investigate the experiences of businesses implementing ERP in Ireland over a 3 year period. Due to the enormous about of press in the trade journals about the inherent risks of ERP implementations, the authors sought to investigate the experiences of implementers and determine if their experiences mirror the expectations that are currently discussed in the media.

The authors focused on the profiles and sizes of the organizations implementing ERP and on the key parameters in their relationship with their suppliers of ERP software. The organizations studied covered different industries and degrees of expertise with IT. Approximately 64 percent were classified as small to medium enterprises (SMEs). The selection process was simply to study the implementations of one particular package of one distributor. This was necessary because, in Ireland, only one distributor exists.

Data was collected through semi-structured interviews with key actors who had been involved with the selection and implementation of the software in the client organizations. A questionnaire was used in order to ensure that all relevant issue were dealt with, but interviewees were left to volunteer whatever information they felt was important given the goals of the study. The empirical data collected about each site and each implementation were reviewed with the staff members in the software distributor office to ensure accuracy of the data. Analysis of the findings and conclusions about the research were undertaken in collaboration between the academic researcher and the most senior project leader of the software distributor, in order to give equal importance to the opinions of all parties involved and remove the possibility of bias in the interpretation of the results.

To determine if the projects were successful, the authors looked at whether the ERP system had been widely adopted by the staff in the organization and whether the staff was convinced of the benefits brought by the software. Also, the degree to which managers had taken ownership of the ERP system was another key aspect of the study.

This study indicates that duration and complexity of large ERP projects as portrayed in the literature may be due as much to the complexity of the organizations where they are implemented as to the complexity inherent in ERP systems. However, ERP implementations remain large IS projects, but they can be quicker if the organization is pursuing clear managerial objects and if they work in collaboration with an experienced implementer. A number of the successful implementations occurred in companies with little to no IS expertise onsite. These findings indicate that the application service provider (ASP) route may not be the only solution for SMEs.

Aladwani, A. M. 2002. An integrated performance model of information systems projects. Journal of Management Information Systems, 19:1, 185-210.

The purpose of this study is to validate an integrated, theoretically driven performance model of information systems (IS) project performance. IS project performance is influenced by six dimensions which are the independent variables in the theoretical model of the paper. These six dimensions are technology characteristics, project characteristics, task characteristics, people characteristics, organizational characteristics, and process characteristics.

Technology characteristics are conceptualized as support technologies with three components: production, coordination, and organizational dimensions. Production technology refers to the activities that relate to representing information requirements, activities that relate to analyzing information flows and data relationships, and activities that relate to transforming these views into program codes. Coordination technologies are those that enable control and cooperative functionalities. Organizational technologies reflect support and infrastructure functionalities. Project characteristic is represented by the project team size. Given a particular task, the larger the project tem size, the greater the abilities or resources available to the work group. Also, research suggests that problem solving ability in groups is facilitated by team size. The task at hand should have clear goals as a characteristic to increase IS project performance. Clear goals, a task characteristic, can improve the ability of project members in problem solving tasks. People characteristics refer to the expertise of the staff. Past research suggests that experience and knowledge and the resultant familiarity with the problem faced can be an important determinant of IS project outcomes. Organizational characteristics such as management advocacy refer to the willingness of management to provide the required resources and authority for project success. Process characteristics refer to the problem solving competency of the project workers.

The dependent variable in the model, IS project performance is measured in terms of the task, psychological and organizational outcomes of IS projects. Task outcomes are effectiveness and efficiency. Psychological outcomes are defined as satisfaction. Organizational outcomes are the added value to the business operations that are affected by the IS project.

Data was collected via a survey from 84 IS project leaders. The data was analyzed using path analysis is a regression-based technique widely used for studying the direct and indirect effects in models encompassing mediating variables. Clear goals, staff expertise, and project team size are significant predictors of problem solving. Problem solving, use of support technologies, and management advocacy have significant direct effects on task outcomes of IS projects. Problem solving and clear goals have a significant direct effect on psychological outcomes of IS projects. Problem solving and management advocacy have significant direct effects on organizational outcomes of IS projects.

The major contribution of this study is that it empirically tests a multidimensional view of IS project performance. This study also confirms that an IS project has to have a number of important characteristics to function effectively. The most important to overall IS project success is problem solving ability of the team members.

Bradford, M. and J. Florin. 2003. Examining the role of innovation diffusion factors on the implementation success of enterprise resource planning systems. International Journal of Accounting Information Systems, 4, 205-225.

The purpose of this study is to create and build a model of ERP implementation success. The prior research has concentrated on case studies and the authors attempt to build a model that can be empirically tested. Two related literature streams, Diffusion of Innovation (DOI) and Information Systems Success (IS) are used to build a theoretical basis for successful implementation of ERP.

The model shows that Innovative characteristics, organizational characteristics and environmental characteristics are the independent variables in the study and ERP implementation success is the dependent variable. Innovative characteristics are composed of technical compatibility, perceived complexity and business process reengineering. Technical compatibility refers to an innovations compatibility with existing and retained systems, including hardware and software. Complexity is the degree to which a certain innovation is difficult to understand and use. Business process reengineering is the process by which the ERP implementer changes their business processes to conform to the package.

Organizational characteristics are composed of top management support, training, and consensus with organizational objectives. Top management support is the active involvement, vision, and direction of high-level executives needed to drive the impetus to implement ERP. Organizational objectives consensus refers to consensus among managers about the objectives of the ERP implementation, and how these objectives will be monitored and measured, will lead to higher user satisfaction. Training refers to the training of users about the effects of mistakes that introduce errors into the system.

The environmental characteristic included in the study was competitive pressure. An ERP system is a capability that provides the infrastructure to manage information and coordinate activities within the firm to develop more efficient operations and to take advantage of new opportunities. Therefore, higher competitive pressure is similar to subjective norm for individuals.

The dependent variable, implementation success is measured in two ways, organizational performance and user satisfaction. Two control variables were used in the study, elapsed time (the number of months since implementation of the ERP package) and firm size. The data was collected by way of a survey of key informants of the SAP user group. The responding firms span a wide range of industries, firm sizes, and experience with ERP.

The model was tested using stepwise linear regression models to test the relationship of the seven independent variables with each of the two success measures. For perceived organizational performance, time elapsed since the implementation, consensus with managerial objectives and competitive pressure were significant predictors. For user satisfaction, complexity, training, competitive pressure and support from top management were significant. Post Hoc analysis showed that user satisfaction moderated the relationship between the independent variables and organizational performance.

Brown, C. and I. Vessey. 1998. ERP implementation approaches: Toward a contingency framework. Nineteenth International Conference on Information Systems, 411-416.

This paper is designed to increase our knowledge about actual ERP implementation practices. The research question is: What ERP implementation variables appear to be critical to successful implementations and what contingency factors are associated with these key ERP implementation choices? The case study methodology was utilized with a theoretical sampling approach.

The dependent variable in the model is the implementation approach. The approach to implementation differs along five dimensions: the amount of management support, composition and leadership of the project team, attention to change management, usage of 3rd-party consultants, and management of complexity.

The independent variables are organizational characteristics, ERP Package Capabilities sought, the actual package chosen and the scope of the project. It is theorized by the authors that these factors will influence the implementation approach.

The selection of the case study sites was based on a theoretical sampling method. For this study, six companies will be paired on key variables in an attempt to elucidate theoretically-useful findings with a small set of case studies. For each case study, on-site interviews with IS and non-IS stakeholders and other participants will be conducted. Semi structured interview guides, based on the theoretical framework, have been developed.

The results showed that the ERP package capabilities, whether meant to support the value-chain activities or support activities, did indeed influence the implementation approach of the subjects.

DeLone, W. H. and E. R. McLean. 2003. The DeLone and McLean model of information systems success: A ten-year update. Journal of Management Information Systems, 19:4, 9-30.

In this paper they discuss many of the important IS success research contributions of the last decade, focusing on the research efforts that apply, validate, challenge and propose enhancements to the original model of the authors. The focus of the paper is on the constructs used to measure IS success.

Systems use can be one measure of IS success. However, the authors warn that this use should be informed and effective use of the system. They argue that the choice of success variable is often a function of the objective of the study and the organizational context of the study. They propose adding service quality as a success factor. Other success factors include information quality, system quality, use, user satisfaction and net benefits. Net benefits include both individual and organizational impacts. This paper also proposes a set of ecommerce success metrics.

Duplaga, E. A. and M. Astani. 2003. Implementing ERP in manufacturing. Information Systems Management, 20:3, 68-75.

This study focuses on recognizing the problems encountered by organizations in implementing ERP systems. They conducted face-to-face interviews with persons at 30 manufacturing firms in the Upper Midwest of the US. In each organization, the person interviewed was directly responsible for overseeing the ERP implementation project. The majority of the individuals interviewed were from the IS area. Each interviewee was asked to respond to the same set of questions, which included both open and closed forms.

Firms were categorized by the number of employees to help determine if company size has any impact on the results. The reasons for the ERP implementation were different for small and large companies. The top five reasons were to improve control of information resources, overcome inefficiencies of legacy systems, integrate functional areas information systems, support supply-chain management and support advanced planning and scheduling systems.

The interviewees were asked to rate several problems identified in the literature as impediments to ERP implementation success as to how much of a problem they were in their implementation process. The responses differed depending on company size as they did with the reasons for ERP implementation. Lack of ERP training and education was the top rated problem for both large and small firms. The second highest rated problem was lack of in-house expertise in ERP. This was followed by lack of data accuracy and lack of companywide support and involvement. Small and medium companies rated lack of clear goals for ERP effort among the top five problems. Large companies considered lack of top management commitment and support. In the open-ended questions, one additional problem was identified: 30 percent of the respondents felt that resistance to change was a major problem in their implementation effort.

The next set of questions dealt with success of the implementation. The large firms defined success in terms of completing the project on time and within budget, without disruptions to normal business and with user acceptance of the implemented system. Small and medium firms related success to achieving a short duration of implementation. They also felt that ERP systems that were on-time and within budget, maintained data integrity and system works well as important factors to measuring success.

Francalanci, C. 2001. Predicting the implementation effort of ERP projects: Empirical evidence on SAP/R3. Journal of Information Technology, 16, 33-48.

The objective of this paper is theoretical discussion and empirical testing of predicting ERP implementation costs. The size and complexity dimensions of a project were the general drivers of the implementation effort. The size of the ERP project was measured as the number of modules and sub modules that are implemented and the implementation effort measured as the human time devoted to implementation activities. Other contextual factors were expected to affect the implementation process such as organizational size, total number of users, and the per-module no. of users.

The data was collected from eight consulting companies on a total of 43 SAP implementation projects. A questionnaire was prepared for collecting both the quantitative data on SAP projects and qualitative descriptions for helping in interpretation of the findings. Multivariate linear regression was used to evaluate the data. Overall, the models were statistically significant, thus indicating that the technical size and organizational complexity of projects are relevant drivers of implementation effort. This empirical evidence affects success because if effort is reduced then the chances for likelihood will be increased.

Gefen, D. and C. M. Ridings. 2002. Implementation team responsiveness and user evaluation of customer relationship management: A quasi-experimental design study of social exchange theory. Journal of Management Information Systems, 19:1, 47-69.

The purpose of the study is to determine whether responsiveness to user requests in real-world settings is a plausible cause of increased favorable user assessments of the correctness of the configuration and, through these assessments, user willingness to adopt the system.

SET (Social Exchange Theory) views interpersonal interactions from a cost-benefit perspective. People will engage in exchanges when they view that the rewards from the exchange will outweigh the costs of the exchange. The authors use this theory to explain that the responsiveness of the implementation team leads the user to believe that the team has cooperative intentions and this will lead to a finding by the user of configuration correctness and user approval of the ERP module.

The data was collected onsite at the implementation of a CRM in a large telecommunications company. The experimental instrument (surveys) was distributed to users who had already interacted with the implementation team. The data was analyzed using factor analysis and stepwise linear regression.

The results of the study showed that perceived responsiveness of the implementation team increased cooperative intentions as perceived by the user. Also, cooperative intentions lead to perceptions of configuration correctness and user approval as hypothesized.

Hayes, D. C., Hunton, J. E. and J. L. Reck. 2001. Market Reaction to ERP implementation announcements. Journal of Information Systems, 15:1, 3-18.

The objective of this research is to examine how the capital market response when a firm announces that it plans to implement an enterprise resource planning (ERP) system. This study was the first to examine the extent to which ERP systems are deemed to add market value to business organizations. Since the benefits of an ERP implementation are difficult to quantify, and the cost of such implementation is often staggering, an empirical investigation into the effect an adoption on the stock price helps to quantify the market reaction.

The dependent variable in the study is the firms market return. The main independent variable in the study is the announcement of an ERP implementation. Several moderating factors were also tested. Firm size and financial health of the firm were tested as moderators of the cause effect relationship. Small healthy firms and large unhealthy firms were expected to generate more positive market returns than small unhealthy firms who were expected to be unable to shoulder the financial strain of the implementation. Also, the size of the ERP vendor was considered a moderating factor. Specifically, large vendors such as SAP and Peoplesoft were expected to create a larger positive market return than small vendors (all others).

The data was collected from firms having announced an ERP implementation in the eight years from 1990 to 1998. After adjustments, 91 firms were included in the final sample. Regression was used to identify abnormal returns for the sample firms during the time in which the announcement to implement the ERP was made. The sample was divided into small and large using the median assets as the dividing mark. Financially healthy firms were those with Z-scores greater than 2.99.

The market did react significantly and positively overall to the announcement of the ERP implementation for the sample firms. The market reacted most positively to announcements by small/healthy firms and negatively to announcements by small/unhealthy firms. There was less of a difference between the large unhealthy and large healthy firms. The size of the ERP vendor was significantly associated with market reaction to ERP announcements.

Haines, M. N. and D. L. Goodhue. 2003. Implementation partner involvement and knowledge transfer in the context of ERP implementations. International Journal of Human-Computer Interaction, 16:1, 23-38.

The two major questions addressed by this study are1) How does the amount of involvement of consultants impact the project outcome? And 2) How does the knowledge held by the organization implementing an ERP system impact the project outcome?

The dependent variable in the study is ERP Success. The independent variables were the level of implementer knowledge and skills and consultant involvement. The data for the study were collected from 18 interviews with 12 different organizations in the U.S. and Europe. The interviews were semi-structured and most questions had an open-ended nature. The factors associated with ERP success identified through the interviews were associated with the independent variables of implementer knowledge and skills and consultant involvement.

Adverse selection refers to the misrepresentation of ability of the agent. Several of the firms stated that the consultants learned a lot from us and thus did not have the skills that they represented that they had. Moral hazard refers to the fact that goal discrepancies may result in actions on the part of the consultant (agent) that are not in the best interests of the implementer (principal). Due to these problems with the consultants behavior, two factors were found to be relevant. The first actor is the ability of the implementer to control the consultants behavior and the second was the consultant involvement. Several of the managers also mentioned knowledge transfer as an important factor for the success of the implementation. Training was an important part of this factor.

In this simple case study, it is shown that the level of in-house knowledge and ability will influence both the level of consultant involvement as well as the ability of the implementer to monitor the consultants behavior. This study, grounded in agency theory, helps to identify some important evidence for which factors are important to control for successful implementation.

Hong, K. and Y. Kim. 2002. The critical success factors for ERP implementation: An organizational fit perspective. Information & Management, 40:1, 25-40.

In this study, the authors define the concept of organizational fit of ERP and empirically examine its impact on ERP implementation success along with the moderating roles of ERP implementation contingency variables such as ERP adaptation, process adaptation, and organizational resistance. The independent variable in this study is organizational fit. The authors define organizational fit as the congruence between the original artifact of ERP and its organizational context. The dependent variable is ERP implementation success. Implementation of an innovation is a dynamic process of adaptation. Two alternative approaches to implementation of ERP are the adaptation of the package to the organizational needs and organizational adaptation to the package. Most ERP vendors recommend process adaptation by the organization and discourage adaptation of the software package. The dependent variable in the study was ERP implementation success which was defined as the degree of deviation from project goal in terms of expected cost, time, system performance and benefits.

Three moderating variables are defined in the study. ERP adaptation level refers to the amount of adaptation of the ERP software code that is made to adapt the ERP to organizational needs. Process adaptation is the level of business process reengineering undertaken in the implementation. Organizational resistance results from resistance due to job changes and uncertainty of the new system.

A survey was used to collect data from firms that had implemented ERP. In-depth interviews with various ERP project managers were conducted to examine the external validity of the research model. Correlation analysis was used for testing the base relationship between organizational fit of ERP and ERP implementation success. ERP adaptation did moderate the relationship between organizational fit and ERP implementation success. Process adaptation did also moderate the relationship between organizational fit and ERP implementation success. Organizational resistance was not significant.

Hunton, J. E., Lippincott, B. and J. L. Reck. 2003. Enterprise resource planning systems: Comparing firm performance of adopters and nonadopters. International Journal of Accounting Information Systems, 4:3, 165-184.

This study examined the longitudinal impact of ERP adoption on firm performance. The authors proposed that long-term financial performance of non-adopters will be lower than adopters. The financial measures used were return on assets, return on sales and asset turnover and return on investment. For large firms, the authors propose that there will be a significant negative association between firm health and performance. For small firms, the authors propose that there will be a significant positive association between firm health and performance.

Regression analysis was used to analyze the data collected through compustat. The results indicated that, on average, ERP adopting firms were slightly larger than non-ERP firms when measured by assets to sales. Overall, ERP adopters had slightly better performance than nonadopters. The results show a positive relationship between firm performance and firm size and financial health. As the firm size and financial health increased, there was a decrease in firm performance.

Hunton, J. E., McEwen, R. A. and B. Wier. 2002. The reaction of financial analysts to Enterprise Resource Planning (ERP) implementation plans. Journal of Information Systems, 16:1, 31-40.

This study investigate the extent to which investors believe that enterprise resource planning (ERP) systems enhance firm value by examining changes in financial analysts earnings predictions before and after they receive an announcement that a firm plans to implement an ERP system. The authors posit that the announcement of an ERP implementation will have a significant positive effect on financial analysts earnings forecasts. Two contextual factors, firm size and firm health are proposed to moderate the relationships between announcement and analysts earnings predictions. This experimental study used a computerized case study. The participants in the 2 X 2 experiment were sell-side analysts working for a large financial services firm. The treatment conditions were small vs. large and healthy vs. unhealthy. The dependent variable was the difference between the pre vs. post announcement earnings forecasts.

The experimental results show that ERP adoption announcements have a significant positive effect on earnings predictions. The findings found a moderate interaction between firm size and financial health and earnings predictions.

Jarvenpaa, S. L. and B. Ives. 1991. Executive involvement and participation in the management of information technology. MIS Quarterly, 15:2, 205-227.

Executive support is often said to be important in the success of IT management. The focus of this research is the Chief executive officer (CEO) and his or her role in IT management. They test alternative models of IT use are presented and tested. Executive participation is used to refer to the CEOs activities or substantive personal interventions in the management of IT. Executive involvement reflects the degree of importance placed on information technology by the CEO. Organizational conditions refer to the industrys relative potential for progressive use of IT.

Three models were tested in the study. One model had an independent variable of executive participation with a dependent variable of progressive use of IT. Progressive use of IT is related to the strategic use of IT and the degree to which IT figures in for the mission of the company. The second model had an independent variable of executive involvement and dependent variable of progressive use of IT. The third model had executive participation, organizational conditions and executive background as independent variables and executive involvement as the intervening variable and progressive use of IT as the dependent variable.

The sample consisted of 83 firms from four industries. Surveys of CEOs and information systems managers and data from chairmens annual letters to the stockholders resulted in the data analyzed in the study. The correlations suggest that executive involvement, executive participation, executive age, and functional background are significantly associated with progressive use of IT within the firm. Executive involvement is correlated with executive participation and organizational conditions, and weakly associated with an executives functional background. Executive participation is associated with a CEOs age and tenure in a company.

Krumbholz, M., Galliers, J., Coulianos, N. and N. A. M. Maiden. 2000. Implementing enterprise resource planning packages in different corporate and national cultures. Journal of Information Technology, 15:4, 267-279.

ERP packages are implemented in companies with different corporate and national cultures and there is growing evidence that failure to adapt ERP package to fit these cultures leads to projects which are expensive and overdue. This paper describes research which synthesizes social science theories of culture in order to be able to model and predict the impact of culture on ERP package implementation.

Knowledge meta-schema for modeling the surface and deeper manifestations of culture and predictions of ERP implementation problems based on national culture differences.

Data was collected by interviews with stakeholder. The questions were derived from reports of major problems with ERP implementations and previous studies of cultural impacts of ERP implementations. Short questionnaires and interviews were used to elicit information that confirmed the data from the interviews.

Cultural values were modeled in schemas as they were identified in the interviews. The identified cultural values extracted as influences on ERP implementation success were the importance placed on training, employee job satisfaction, the importance of systems empowering the organization, inability of the software to meet specific needs of the employees, ability to comply with local legislation, and unsuitable operating assumptions.

Kumar, V., Maheshwari, B. and U. Kumar. 2002. Enterprise resource planning systems adoption process: A survey of Canadian organizations. International Journal of Production Research, 40:3, 509-523.

This research explores the key considerations and successful strategies in an ERP adoption process such as adoption motivations, initiation, key players, justification, risks and criteria for selection of product vendor, project manager and implementation partners. The key underlying idea of ERP is using information technology to achieve a capability to plan and integrate enterprise-wide resources. ERP adoption or implementation involves a complex mix of both technological innovation and organizational change management. This paper focuses on empirically exploring the typical activities and issue in the ERP adoption process including adoption initiation, business case development, initial project plans and communication to the organization.

Data was collected from 19 Canadian organizations that have adopted ERP or are evaluating the adoption of an ERP system. Data were collected by interviewing ERP project managers or managers responsible for ERP in their organizations and administering a questionnaire.

Adoption initiation was strongly influenced by the expected benefits of ERP adoption in the organization. The top three benefits identified were eliminating redundant data entry and accompanying errors, improving functionality of information systems and providing better order tracking and fulfillment. The decision to initiate the ERP adoption was determined by top management in 74 percent of the cases.

The next step in the process is the business case development. The activities included in this category are justification, identification of risks, mitigation of risk, evaluation and selection of product, selection of implementation partners, and selling the idea to the rest of the organization, selection of a leader (usually a project manager or an executive champion), and developing an initial plan. The top three justifications were integrated and better quality of information, Y2K readiness, and ease of management of a single system vs. several integrated systems. The top risks identified were cost escalation, availability and retention of skilled people, level of organizational change and user acceptance. To mitigate these risks, managers identified strategies used. These strategies included planning and professional assistance, focus on change management, accountability on management, and investment in human resources. To help the company with the implementation, several implementation partners were employed. Major partners selected were independent consultants, the ERP vendor and the hardware vendor.

Many criteria were identified in the data as important considerations for choosing a system. These considerations included functionality of the system, systems reliability, and fit with organization systems, available best practices in the system, cross module integration and vendor reputation. The top two considerations for the selection of a leader were the project management skills and functional experience of the person.

Lee, Z. and J. Lee. 2000. An ERP implementation case study from a knowledge transfer perspective. Journal of information Technology, 15:2, 281-288.

This article is part of a longitudinal study based on the ERP implementation at the University of Nebraska. This article will identify the types of knowledge transferred during an ERP implementation and the factors affecting this transfer. Two types of knowledge are identified, tacit or explicit. Explicit knowledge is knowledge is visible and expressible. Explicit knowledge is transferable in a formal systematic way. Tacit knowledge, on the other hand, is associated with individual experiences and is difficult to code. The authors divide implementation into two phases: implementation and integration. Implementation is defined as the degree to which the recipient unit follows the formal rules implied by the practice. Integration refers to the state in which the employees at the recipient unit attach symbolic meaning to the practice.

The main argument of the authors is that the business rules associated with processes of ERP conflict with existing organizational values causing implementation problems. This study was based on in-depth interviews, process analysis and documentation analysis. Analysis of the implementation by the authors came to three important contributions to our understanding of ERP implementations. The authors noted that ERP implementations differed significantly from other implementations of technology due to the influence on the organizations practices. The results from this study suggest that the ERP implementation process should be understood by distinguishing the implementation process from the integration process. Thirdly, this study adds to our understating of organizational capability for internalizing business processes in the light of an ERP implementation.

Mabert, V. A., Soni, A., and M. A. Venkataramanan. 2003. Enterprise resource planning: Managing the implementation process. European Journal of Operational Research, 146:2, 302-314.

This paper empirically investigates whether there are key differences in the approaches by companies that management their implementations on-time and /or on/under-budget versus the firms that did not. The authors identified several factors that companies that had successful implementations had in common. They grouped these common characteristics by three categories: planning efforts, implementation decisions, and implementation management. Planning effort refers to all factors that have to be addressed in the planning stages before the start of the project. These include such variables as executive support and involvement in the planning of the project, the makeup of the implementation team, and addressing key technology issues. Implementation decisions refer to strategic options on how to conduct the implementation. These include such planning decisions as whether to implement using the Big-Bang approach or the phased-in approach, and the amount of software customization and reengineering to complete. The third critical area is implementation management itself, referring to all variables/actions during the implementation.

A survey was mailed to 270 firms randomly selected from those having implemented or in the process of implementing ERP systems. The data was analyzed using regression. The factors found to be significant were strong executive sponsorship, strong executive involvement, empowered ERP steering committee, developed clear education and training strategies, had technology/infrastructure in place, benchmarked implementation progress against clear milestones or performance metrics, allowed ERP committee to make key decisions, communicated regularly with all who would be impacted, trained all who would be using the system, kept suppliers/customers informed and made major modifications to system.

Although these factors were found to be significant, it was important to determine which were the most important for on-time implementations and/or under-budget implementations. A composite of planning variables, modifications to the system, communicated progress regularly and kept suppliers and customers informed were the most important factors for under-budget and on-time implementation success.

Mabert, V. A., Soni, A., M. A. Venkataramanan. 2003. The impact of organization size on enterprise resource planning (ERP) implementations in the US manufacturing sector. Omega, 31:3, 235-246.

The primary objective of this project is to study the impact of the organization size on ERP adoption and implementation. The independent variable in this study is the size of the company. The dependent variables are the reason for the implementation, amount of ERP functionality employed, customize ERP software, implementation method (module or big-bang), and type of benefits enjoyed. Differences based on company size were also found in cost to implement, the cost breakdowns by category, and the implementation time. Organizational size can be defined in two ways, by number of employees or by revenues. Revenues were used in this study.

Thirteen companies were used for a case study of the initial propositions. The information from the case studies was used to develop the survey questionnaire for the broader study of ERP practice and experiences. The survey and cover letter were mailed to a randomly selected sample of 5000 APICS members employed in manufacturing companies in the US. The overall response rate was 9.6 percent.

With respect to motivational factors, five factors differed with respect to whether the ERP adopter was a large or small firm. These factors were solve the Y2K problem (small), ease of upgrading systems (Large), simplify and standardize systems (large), gain strategic advantage (large), and link to global activities (large). Large firms were more likely to have phased-in the ERP system by module or phased-in by site, whereas small firms were more likely to have used the big-bang approach. Small firms were less likely to customize the packages. Small firms were more likely to adopt a single ERP package whereas large firms were more likely to choose a single ERP system but to add bolt-on systems where needed to add to the overall functionality of the system. The source of the cost to the firms of the implementation differed by the size of the company. Small firms found that software and hardware costs were significantly larger than the percentage of these costs to total cost for the large firms. Larger firms experienced significantly larger proportion of their costs in the implementation team. Consulting and training were the same for both large and small firms. Integration of business processes, availability of information and quality of information are the areas most positively impacted.

Mabert, V. A., Soni, A., M. A. Venkataramanan. 2000. Enterprise resource planning survey of U.S. manufacturing firms. Production and Inventory Management Journal, 41:2, 52-58.

The objective of the study was to determine the extent of packaged ERP system use in manufacturing firms, the motivation to pursue such an application, the implementation experience, and benefits obtained. The survey was developed and mailed to a randomly selected set of APICS members employed in the US. The data collected revealed a number of important facts for businesses.

First, the planned/ actual use of ERP systems is pervasive in the U.S. manufacturing sector, with both large and small firms adopting systems. ERP does not appear to be a passing fad, given the investment expended and the time required to implement. The move to a package3d ERP system represents a greater resource commitment for small firms, with larger enterprises taking advantage of economics of scale. There is a common core of functional modules for manufacturing firms that have been implemented most frequently, with some customization required. ERP system implementation benefits are concentrated more quickly providing high-quality information within the firm.

Markus, M. L., Axline, S., Petrie, D. and C. Tanis. 2000. Learning from adopters experiences with ERP: Problems encountered and success achieved. Journal of Information Technology, 15:4, 245-265.

This paper describes the results of a study of problems and outcomes in ERP projects and was conducted under the sponsorship of an ERP vendor. Two basic research questions are addressed: First, how successful are companies at different points in time in their ERP experiences, and how are different measures of success related? That is, can early success be followed by failure and vice versa? Second, what problems do ERP adopters encounter as they implement and deploy ERP, and how are these problems related to outcomes?

The dependent variable in this study is ERP implementation success. The authors define success dependent upon the phase of the ERP implementation and experience cycle. These three phases are the project phase, during which ERP software is configured and rolled out, the shakedown phase, during which the company makes the transition from go live to normal operations, and the onward and upward phase, during which the company captures the majority of the business benefits of the ERP system. The authors maintain that different measures of success are necessary at each phase of the project.

The data collection in this study combined several methods: (1) reviews of published and in-process research studies and teaching cases of ERP implementations, (2) in-depth case studies of the ERP experience in five ERP-adopting organizations, (3) interviews with 11 additional ERP-adopting organizations and (4) approximately 20 interviews with ERP implementation consultants and members of the ERP vendor company sponsoring this study.

For the project phase, the most challenging problems reported by our respondents involved software modifications, system integration, product and implementation consultants and turnover of project personnel. For the shakedown phase, several of the problems were leftovers from the project phase that were not recognized and addressed during that stage of the process. Among these are approaching the ERP implementations from an excessively functional perspective, inappropriately cutting project scope, cutting end-user training, inadequate testing, not first improving business processes and underestimating data quality problems and reporting needs. The most important problems observed in the onward and upward phase were unknown business results, disappointing business results, lack of IT personnel, and upgrading problems.

Motwani, J., Mirchandani, D., Madan, M. and A. Gunasekaran. 2002. Successful implementation of ERP projects: Evidence from two case studies. International Journal of Production Economics, 45:1, 83-96.

This paper addresses two research questions: (1) What factors facilitate or inhibit the success of ERP projects, and (2) What actions can be taken to bring troubled ERP projects under control? This paper attempts to answer these questions by examining the ERP implementation experiences of two companies one unsuccessful and the other successful. The major thesis of the authors is that there are several factors in the change environment and that environment influences the ERP Implementation management and then the ERP outcome.

The change environment is composed of cultural readiness, learning capacity, relationship balancing, IT leveragability and knowledge capability and strategic initiatives. Strategic initiatives (reasons for implementing the ERP) are often included in the corporate strategic plan are from senior management and are either reactive or proactive in nature. Learning capacity refers to the major goal of learning: to provide positive outcomes through effective adaptation to environmental changes and improved efficiency in the process of learning. Organizational culture facilitates or inhibits the integration of individual learning with organizational learning by influencing the organizations ability to learn, share information, and make decisions. The role of IT in the business process change project can promote success or failure, often because of the lack of attention to the human components of change. The ability to share information, facilitated by it, promotes knowledge capability, and enhances an organizations tendency to change. Relationship balancing refers to the ability to partner with outside suppliers and other stakeholders in and out of the organization to increase performance in change management.

ERP implementation management is composed of two parts: change management and process management. Change management involves effectively balancing forces in favor of a change over forces of resistance. Process management is defined as a set of concepts and practices aimed at better stewardship of business processes.

Data was collected through the analysis of two case studies. Data collection methods included studying archival data and conducting interviews at various levels of the organizations. Specific questions about characteristics of the firms and their environment were asked that were linked to operationalization of the constructs in the research model

The case study analysis reveal that an incremental, bureaucratic, strategy led cautious implementation process backed with cultural readiness, inter-organizational linkages (with the vendor), and careful change managemen