How Implementing Enterprise Recourse Planning System Can Be Found Beneficial by Businesses - Essay Example

Phase 11: Project Proposal and Planning 2.1 Target Audience In the development of any research study the core focus is on the study deliverables. As such, the obtained deliverables should have a direct practical and theoretical impact in the market. If such practical and theoretical impacts are absent, then a research study rationale declines, making it unviable (Woodward 43). To this end, the rationality of the evaluation of ERP systems benefits on ADNOC can be established through its intended target audience. The first target audience for the study is the ADNOC Company. Although a leader in the oil and gas industry, global oil market changes and dynamist require increased operational efficiency to increase profitability margins. As such, through the study outcomes, the organisations will establish areas of value creation supported by ERP systems, as those that can benefit from the system use into the future. A second target audience is the entire manufacturing industry in the UAE and entire MENA region. In this regard, through the obtained study findings, the organisations will be able to benchmark their ERP systems effectiveness. As such, if the systems benefits are less that illustrated potential in the analysis, then timely corrective measures will be guided accordingly. This will ensure that the organisations ERP systems operate to their optimum levels into the future. 2.2 Methodology of Research 2.2.1 Method Used In conducting a research study, the data collection approach used is hedged on a number of factors. Key among the factors includes the type of data required. In this regard for the ERP systems benefits for ADNOC Company analysis, specific data was required form the venture employees. As such, this implies that the study would require primary data. As Woodward (21) noted, primary data can be collected through a number of ways including surveys, questionnaires, interviews, and observations respectively. The study used the questionnaire data collection method. The selection of questionnaires was based on the anonymity of the respondents. Through this avenue, the employees could offer sensitive and objective reviews on the ERP systems use in the venture without the fear of victimisation. The research study will distribute 200 questionnaires, offered through a non-probability convenience sampling approach. As such, it is only the willing and easily accessible employees who will be incorporated as a part of the study respondents’ base. 2.2.2 Research Analysis Methodology Employed Once a research data is obtained, the next step is analysis. This includes the evaluation, review, interpretation and presentation of obtained data findings. The type of data collected as well as the research study deliverable components influence the analysis method used. For the study evaluating the benefits of ERP systems application on DNOC, the quantitative data analysis method was selected. Wetcher-Hendricks (15) argued the quantitative data analysis approach allows for the use of statistical analysis method, using statistical analysis measures such as the inferential and descriptive statistics. The use of scientifically proven analysis methods increases research study findings objectivity (Wetcher-Hendricks 21). In this regard, the researchers’ role is reduced to interpreting the obtained findings, reducing the potential risk of the researcher bias, a trend mostly common in qualitative analysis methods. 2.3 Literature Review 2.3.1 Introduction This literature review is a critical analysis of the existing literature on ERP and technology in general application in organisations. In this regard, the literature review analysis is hedged on the understanding that there are past theories, models and studies that have been conducted on this topic. As such, it relies on these past literature elements to develop a concise study framework for its data analysis. Moreover, it is hedged on a review of these literature aspects that the study develops its niche through a literature gap establishment. In order to facilitate review clarity and understanding, the section is classified into various sub-sections. The first section offers a background analysis of IT application in organisations theories, a foundation that forms the study analysis pillars. The evaluation of these theories is expected to form a basis of justification and rationale for the application of ERP systems by the ADNOC Company. Moreover, it analyses the key areas where ICT and ERP systems are applied in an organisation. On the same line of argument, it reviews the factors influencing technology application in a venture. At the heart of the reviews is an analysis of the organisational areas that benefit from IT systems application. This is the foundation of the study as the review will involve evaluating the ADNOC Company different functional areas benefit as anticipated. Finally, the literature review explores the challenges facing ICT application in organizations. These are the potential challenges that could lead to poor and less than expected performance for ADNOC ERP systems, making their evaluation critical. 2.3.2 Theories on IT application in organisations In order to understand the process of ICT application in organisations, this literature review develops a critical understanding of the ICT theories. An understanding of the theories shapes the understanding of the benefits of the diverse ICT systems. The Social Construction of Technology Theory (SCTT) It is one of the key technology descriptive theories. On one hand, the descriptive theories are the ones that explain the emergence of technology application in organisations as well as its relation and connection to the human factors such as employees in an organisation. The SCTT theory is hedged on the argument that the existing human elements impact on technology application in an organisation. In this case, the theory holds that although a shared type of technology could be applied in different organisations, the impacts, benefits and challenges faced are bound to be different (Bijker et al, 46). This is because; different organisations have diverse human factors that are bound to impact an organisation differently. The social construction of technology theory has four main elements namely the interpretive flexibility, relevant social group, closure and stabilisation, and wider context respectively (Tomei, 11). Based on these elements, the social construction, beliefs and understanding of the involved human force has a direct impact on the perceived benefits of an IT system application in the market. The theory analysis although focused on IT systems correlates directly with the organisational behaviour theory. McShane, SOlekalns and Travaglione (83) stated that the organisational behaviour theory holds that there exists an interaction between the human and technical elements in an organisation. Thus, this is the basis at which different organisations, although serving in the same industry, have diverse policies in the market. An illustration on the role of social culture and beliefs on technology application in a learning institution concept. The review by Eden and Christopher (2014) established that the perceived social relevance of different technologies as illustrated in the figure below impacted on their adoption rate and perceived benefits in the long run period. In this case, the social needs of the students influenced their preferred technology application. For instance, most prefer the online learning approach over the traditional learning systems. Consequently, this influenced the recommendation for online and free web contents provision. If the same question was posed to the graduate part time learners under a different age group and social set up, the results could have been different. Figure 3: Integrating Technologies onto Courses Source: Eden and Christopher, 2014 The impact of social construct aspects on technology application could be illustrated through the review by Mathews (2015). On its part, rather than focusing on the students, the study focused on organsiational managers and their perceived technology that could be of benefit and befitting to their operations. Consequently, as illustrated in the figure below, it established that their main preference was cloud computing ad storage as it would fit into their movement needs as they can work from any strategic location in the market. Figure 4: Executives preferred Technologies Source: Mathews, 2015 However, Charmaz (34) criticised this model. The authors argued that the use of the descriptive model restricted the IT application benefits perception to the human factor elements. As such, although this is viable, it is also imperative to understand that in the modern society and business contexts, a majority of the IT systems operate autonomously devoid of human contributions. Nevertheless, although this critique is valid, its argument scope does not include the ERP system. This is because the inputs and output data for the ERP system is influenced by employees as well as the management respectively. Hence, the study applies the SCTT theory as part of its adopted model in the analysis process. Based on the descriptive theory analysis, this literature review establishes a number of issues. First, it establishes that the existing employees’ culture and beliefs influence their perception of the benefits of an applied technology. Therefore, in analysing the illustrated benefits of ERP systems for ADNOC, the analysis will seek to establish if the unique corporate culture among the employees has an overall effect on their response. Secondly, the analysis establishes that diversity in employees’ perception and beliefs influence their opinion on technology benefits. As such, although evaluating the majority opinions on ERP systems benefits for ADNOC Company, the analysis will also focus on the minority opinion. This is because such minority opinions could represent the opinions of employee with a diverse perception. This increases overall perception, as they could possible accept and appreciate technology benefits that the other employees could underrate. Technology Acceptance Model (TAM) The second evaluated information technology model is the TAM model. This theory offers a critical analysis of how users come to accept and agree to sue a given technology in the organisation Pei et al (537). The theory is based on the understanding that there are a wide range of factors that influence users to accepting a technology application. The acceptance level has a direct impact and relationship to their perceived benefits of a technology application. The theory elements can be summarised in figure 1 below (Pei et al 537). Figure 1: The TAM Model Analysis Source: (Pei et al 537). The TAM model indicates that in the application and acceptance of a technology, the users are influenced by the perceived usefulness and the perceived ease of use of the technologies. On one hand, the perceived usefulness of a technology is the extent to which the users expect the use of the applied technology to improve their operational efficiency as well as improve their overall productivity. Hence, an acceptable technology is one that improves the overall performance quality and productivity of the users. On the other hand, the perceived ease of use is the extent to which skills and expertise is required to operate and work with a given technology application. As such, to a majority of the technology users, acceptable technology is one that is easy to use and requires minimal additional skills (Su, Tsai and Hsu 529). Based on this theory analysis, a number of aspects come to the fore. One, users will regard as technology as beneficial if it is easy to use. Secondly, users regard a technology as beneficial if its increases theory quality and productivity elements. Hence, this analysis guided the questionnaire development process. As such, among the ERP technology benefits applied were the aspects of ease of use as well as usefulness perception among the employees and organisational systems stakeholders at large. However, the application of this analysis is cognisant of Giovanis, Binioris and Polychronopoulos (26) critique of the theory. On their part, the authors argued that although an ideal tool for the technology users, the model is limited to the direct users only. As such, it excludes the potential gains to the third parties such as the company shareholders and customers although the technology could be hard to use for the employees. Therefore, this means that merely focusing on the use of this model would limit the study scope. The study expected to analyse the benefits of ERP systems not only to the ADNOC Company employees, but also to its other stakeholders, hence, the analysis was not limited to the use of the TAM model. Diffusion of Innovation (DOI) Although not initially developed as technology specific theory, the DOI theory is applicable in the information technology spheres. The theory, as illustrated in the figure 2 below is classified into five main categories, namely the innovators, early adopters, early majority, late majority, and laggards respectively (Kaminski, 4). Figure 2: Diffusion of Innovation Theory Source: Kaminski, 4 The theory holds that in the application of technology, there are different forms of application and adaptability in the organisation. In this case, different organisations accept and apply technology at different levels and speed. As such, the first category is the innovators who develop new technologies as well as improving the existing technology to a customised level for the ventures. They are followed by the early adopters and early majority respectively. A critical analysis on this theory, as Yun (972) argued, serves as a continuation of the TAM model. As such, through the DOI model, one is able establish the effectiveness and speed through which an organisation applies a technology. The level of adoption and time of entry speaks volumes on its rationale. In this case, the stage at which an organisation adopts technology highly determines the enjoyed benefits. Conceptual Framework Based on the above analysis, the literature review established that it is imperative to evaluate the stage at which ADNOC Company applied the ERP systems technology. By establishing the application stage, the analysis will be able to zero in on the maximum potential benefits it could have obtained. As such, the performance for the venture ERP system will not be evaluated based on the other level of adoption, but on its specific level. This ensures that the analysis is practical and specific to the ADNOC Company. Based on the above theories reviews, it is apparent that each of the technology theories has its strengths and weaknesses. As such, the analysis will apply a combination of the theories. First, in order to evaluate the benefits of the ERP systems on employees, the TAM model elements on ease of use and usefulness will be applied. Moreover, in order to incorporate the diversity of employee views the analysis applies the SCTT model to ensure that the specific employee beliefs and characteristics impact on their technology perception on ease of use and usefulness are not and accounted for, to reduce potential selected study sample bias. Finally, as a means of evaluating the maximum number of benefits the ADNOC Company would have gained from the systems application, the analysis will use the DOI model to establish the level and speed of ERP adoption and possible benefits. From the established application models, the analysis formulates this framework Figure 3: Research Conceptual Framework Source: Summarised by the Analysis 2.3.3 Areas of ICT Application Systems This review section offers a critical overview of the areas through which ICT systems can be applied ain an organisation. The section seeks to explore the various areas at which organisations can seek to enhance their operations through support ICT systems. The evaluated application areas include the marketing, operations, customer, and supplier management areas respectively. IT Use in Marketing The application of ICT in the marketing functions can be illustrated through a series of empirical reviews and case studies. First, a number of case study organizations have come to the offer illustrating how ventures can benefit through applying marketing. One such example is the Apple Company, market leader in the technology and electronic industry. The apple company, as Hischier et al (225) argued, has applied ICT systems in its marketing. As such, rather than using the traditional mass media marketing, it has employed the use of technology approaches such as internet search engine marketing and online sales shops. The use of these technology approaches in marketing has been attributed to the rising market competiveness and sustainability by the Apple Company. Additional examples for the analysis include empirical studies developed on the topic. For instance, Sugarhood (82) stated that through the use of IT systems organisations were able to reduce their overall marketing costs. In this case, the review established that through the elimination of human labour, that has a high cost implication, enables the ventures to reduce the overall marketing costs. Additionally, Davenport (21) noted that besides reducing on operational costs, the use of ICT marketing systems enhances increased marketing quality. As such, through this approach the marketing organisations increase marketing reliability and reach to an increased consumer base. However, although a majority of the study reviews indicates the merits and gains of ICT application, others have disputed the application of this approach in marketing. In their review, Escobar-Rodríguez and Carvajal-Trujillo (75) stated that the use of ICT systems in marketing should not be adopted as the only alternative. As such, they argued that the use of ICT should not be an alternative for human workforce use, but be applied as a supporting avenue to supplement the human force used in the function. Production and Operations Function The second area of ICT application is in production and operations functions. In this case, a number of organisations such as Coca-Cola have automated their operations. As such, through the use of ICT systems, Coca-cola has successfully reduced its overall, operational costs. In a study focused on the Coca-Coca Company, Razzaq, Li and Zhang (292), in an evaluation of the company practise in China, established that the venture has successfully applied ICT systems in its production and operational systems. As such, the review indicated that this has reduced the overall operation cots, by creating operational effectiveness and increased coordination practices. Additional illustrations could be indicated through studies developed by Talib, Siddiqui and Khanam (35) and Cordella and Tempini (284) respectively. On one hand, Cordella and Tempini (284) established that the use of ICT systems in organisations was a major boast and contributor in enhancing the input-output transformational model. The model is hedged on the balancing of organisational inputs to its outputs. As such, through the use of ICT systems to coordinate operations and production process, organisation are able to enhance their transformational process, increasing their overall effectiveness. This review was further illustrated by a subsequent study by Talib, Siddiqui and Khanam (35). The study established the relationship between transformational and operations efficiency to organisational success. As such, the review evidenced that by applying ICT systems in operations, organisations are able to increase their operational effectiveness in the long run period. Thus, based on the above analysis, it is evident that organisations can apply ICT systems in a number of ways in their production and operational systems. Customer Service and Suppliers Management The additional areas that ICT systems can be applied and be beneficial is in customers services. In this case, customer services, as Goodman (44) described, it includes all the activities aimed at facilitating an organisational customer’s satisfaction and loyalty in the long run period. A study developed by Chiarini and Douglas (257) indicated that there existed a direct relationship between use of ICT in organisations and the level of customer service exhibited. As such, the study argued that organisations applying ICT depicted superior and better customer services over those that lacked the ICT systems. This can be explained through the Yeo, Thai and Roh (439), analysis on the Korean port services. The reviews stated that the use of ICT systems enhances efficiency and effectiveness’ of operations. As such, the key data such as customer purchase are easily obtained and analysed. Hence, specific customer needs are single out and addressed, enhancing the customisation of customer needs in the market. An additional study evaluating the relationship between suppliers’ management and ICT adoption reported on a similar scenario. As such, Trainor et al (206) stated that through the use of ICT systems organisations improved their supplier management quality, by profiling the specific supplier needs in the market Application in the study analysis Based on the analysis above, this study develops a number of inferences based on the review analysis. The review recognises that different firms of ICT application impact on the organisational systems. In this regard, the literature review argues that the existing organisational systems can be improved through ICT systems application. Hence, this lays the foundation for the evaluation of the ERP systems application. In this regard, one of the key evaluation aspects will be to explore organisational areas and aspects that the applied ADNOC Company ERP spans to with respect to the discussed areas above. 2.3.4 Factors influencing ICT application in organisations This literature review section explores the factors influencing the application of ICT systems in an organisation. The exploration of these elements is aimed at developing a logical literature based explanation for the stage and period at which the ADNOC Company has applied its ERP systems. In the analysis, the section is guided by Ramdani, Chevers and Williams’s argument. The argument stated that although there are various factors influencing ICT adoption in organisations, they can essentially be classified into the external and the internal factors respectively. Internal Influencing Factors The key internal resources impacting on ICT application include organisational resources and the strategic goals. The influence of organsiational resources could be analysed through the reviews developed by Ramdani, Chevers and Williams (739), Palacios-Marques, Soto-Acosta and Merigo (27) and Ju (293) respectively. On one hand, Ramdani, Chevers and Williams (739) developed a review on the role of organisational resources to ICT application. In particular, the study evaluated the financial capabilities in SME organisation impact on ICT application. As such, based on the DOI model, it argued that there was a direct relationship between the availability of finances in an organisation and the adoption of technology. In this regard, through the availability of financial resources, organisations tended to adopt technology early enough. In this case, a majority of the innovator organisations were the organisations with a large capital base and financial stability and as such could dedicate finances to ICT research and innovations. Moreover, a majority of those that had a high capital and financial base were early adopt and early majority. This is because; the organisations had enough to risk in the new technology ventures. This is in contrast to the less financial stable organisations. As Palacios-Marques, Soto-Acosta and Merigo (27) argued, organisations with a low capital base are less willing to invest in new technologies. This is due to the risk of failure and uncertainty of such technologies. Moreover, such organisations have less working capital. Hus, they cannot invest in technologies at the early stages as they often have to readjust their systems to sustain a sustainable working capital. Consequently, such organisations are often among the late majority and the laggards based on the DOI model discussed in this review. The second resource value in technology adoption was analysed by Ju (293). In this regard, the study was based on the resource based view model. As such, the RBV model argues that organisations resources are not limited to the tangible resources, but also on the intangible resources such as the workforce. In this regard, Wu and Chiu (29) argued that the availability of an organisational workforce is key in technology adoption. In this regard, the study established that organisations with a trained and experienced workforce tended to apply technology early enough unlike those that had less trained and less experienced employees. This is because it is the organisational workforce that participates directly in the implementation of the technology. The study arguments and findings can be analysed and explained through the TAM technology model aspects. In this case, as already discussed above, the TAM model basis the application and adoption of technology on the basis of the ease of use and the perceived usefulness. As such, it is correct to establish that the employees training and experience levels are bound to influence their perceived ease of use of an ICT system. This is because, those that are well trained will perceive it easy to use a new technology as compared to those who are less trained and experienced respectively. The second internal element influencing ICT application in organisations is the organisational strategic objectives. In this case, organsiational mission and vision statements guide their activities and operations respectively. Han and Chen (63) developed a study evaluating the correlation between the organisational mission and vision statements to the adoption of technology, a case study of museums. As such, the review established that if an organisation aimed at venturing into the market as a modern venture, then its chances of adopting new and emerging technologies were higher. As such, through the DOI model, organisations with a modern and innovative approach concept are among the innovators, early adopters and the early majority ventures. On the contrary, those that seek to retain a traditional operations approach through personalised customer human based services are bound to be among the laggards and the late adopters respectively. Moreover, the study argument could be analysed through a review of the SCTT model. As such, the model, as analysed above, stated that the existing human factors in an organisation impact on the nature and extent of technology application. As such, the vision and mission statement, that guides the employees’ perception and beliefs influence the nature and extent of technology application in such organisations. External Influencing Factors Besides the internal factors influencing an organisational technology application and adoption, there are equally a wide range of diversified external influencing factors. Key among the factors includes market competition and technology infrastructure. On one hand, Bartelsman, Hagsten and Polder (29) developed a review exploring how existing technology infrastructure in the market influenced the application of ICT systems in respective ventures. The focus was on the African and the European markets. In this context, the study aimed at evaluating if the adoption trends in these markets varied, and if so the key causes for such variances. In its analysis, the study concluded that the European based evaluated ventures had a higher ICT adoption rate that their African counterparts. In this regard, the review concluded that the extent and a level of technology infrastructure in Africa and Europe varied, explaining the variance. Indeed, the study argument could be evidenced through a review developed by the IMF (2008) on technology infrastructure such as internet connectivity spread globally. The analysis sought to establish the infrastructure and development gap impact on technology application across nations. As indicated in the figure below, the Africa, represented by the low income earning nations, ICT infrastructure is low and only growing into the future. Therefore, based on this critical analysis, it is apparent that the existing level of technology development in a market influences the application extent and rates. As such, organisations serving in well developed ICT infrastructure markets have a tendency to adopting fully automated ICT systems. This is in contrast to organisations serving in less developed ICT infrastructure markets, which often do not apply ICT systems. Figure 5: IT Infrastructure trend globally Source: IMF 2008 The second external element influencing ICT application in organisations is the existing market competition. As Ramdani, Chevers and Williams (739) noted, an organisational competition influences the strategic approaches and decisions undertaken by a venture in the market. This is mainly as a means of leveraging the competitors’ market advantage, as well as creating organisational unique market competitiveness over the existing competition. The study established that there was a correlation between competitors ICT application to increased ICT use. As such, organisations with ICT systems were perceived as gaining an increased market edge through increased customer service quality and responsiveness. Consequently, in a bid to leverage on such gained market competitiveness, the service industry players resulted to the benchmarking and eventual application of the ICT systems. Therefore, this review led to the conclusion that the need to leverage the competition threats leads to ICT application in ventures. On a similar noted, Bohari, Cheng and Fuad (9) evaluated how organisations in the manufacturing industry apply ICT systems as a means of countering market competition and to create a sustainable competitive edge. In this regard, the study established that ventures sought to develop a unique selling point through technology. As such, through early technology application, ventures were able to create quality and differentiated market features. As such, this enabled the organisations create a viable market competitive edge in the long run period. Literature Analysis Based on the above analysis, this literature review establishes that in the adoption and application of technology is hedged on a wide range of both the internal and he external factors respectively. As such, in the ERP systems application by ADNOC the analysis will consider if the specific internal and external factors have a role to play in the attainment or the lack of attaining the venture ERP system benefits. As such, this will ensure that the factor surrounding the ERP systems benefits at ADNOC re evaluated. As such, this will inform the study decision on the key benefits and potential benefits on ADNOC that can be generalised to other industry and global players, while as establishing the ones that cannot be generalised in the market. The analysis process will support the study in delivering on its key objectives of generalising the potential ERP systems application benefits to the entire MENA region oil and gas industry. 2.3.5 The Advantages of ICT systems application in Organisations (2400 words) Operations Excellence New Product Development Decision making Internal and External Stakeholders’ Relationships Competitive advantage Market Sustainability 2.3.6 Challenges Facing ICT application in Organisations (1000 words) Market ICT infrastructure Financial resources availability Employee resistance 2.3.7 Summary (200 words) References Bartelsman, Eric J., Eva Hagsten, and Michael Polder. 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