Organization's Successful Implementation of ERP System - Term Paper Example

Organization Successful Implementation of ERP System 1st Author 1st author's affiliation 1st E-mail 2nd Author 2nd author's affiliation 2nd E-mail 3rd Author 3rd author's affiliation 3rd E-mail ABSTRACT Enterprise Resource Planning (ERP) is renowned as imperative investment tool that position an organization to attain a significant competitive advantage in revenue and organizational growth. To ascertain successful implementation of ERP, the study engages into literature reviews and engages respondents from organizations renowned for successful implementation of ERP, purposefully to identify how ERP can successfully be implemented. The respondent feedbacks will play a pivotal role in ensuring future success in ERP initiative. Essentially, the report will play a major role in ensuring that organizations attain the desired goals after successful implementation of ERP. A 7 point Likert scale is employed to ascertain aspects that are greatly alluded towards the successful completion of ERP projects. Keywords: ERP-Enterprise Resource Planning. Likert Scale contributed to the understanding of the opinions and the perceptions geared towards successful implementation of ERP. 1. Introduction In contemporary business market, tougher competition is spearheading the urgency to effectively optimize resources, improve organization profitability, and keep customers satisfied. As such, organizations are increasingly employing the Enterprise Resource Planning (ERP) purposefully to improve on organization operations and provide faster consumer response. According to Vessey, ERP is basically a system that designs organization data structure that integrates the business procedurals and function (Vessey, 2000). ERP system is highly renowned as a strategic tool that fosters organization quicker decision making process, improved management of functions and costs, and develop standard organization dissemination of information (Wu, 2017). Additionally, ERP system is perceived to be an attractive solution for large organizations in getting rid of organization challenges whereby the organization leadership open a single platform and smoothly attain general information across all the business function (Emad, 2015). However, finding from Harvard Business School reveals that ERP systems implementation across organizations are not successful due to workforce resistance towards organizational change, cost overruns, inadequate skills, and the underperformance of the benefits accruing from the ERP system (Cotteleer, 2003). Due to the large investments that the ERP systems entail and its potential benefits across the organization, it is important to identify factors that fosters the ERP complete implementation. 2. Purpose of the paper The core purpose of this paper is to conduct a review of the organizational industry and academic literature pertaining the ERP results and identify the efficient and effective approaches regarding successful implementation of the ERP System across the organization. By doing so, organizations will be able to judge and allocate their resources effectively purposefully to realize success of the ERP implementation. 3. METHODOLOGY/APPROACH Basically, the paper explores aspects that basically influence the complete implementation of the ERP structure across organizations. The sample entailed the 6 respondents thus from two companies which are the VSM Group and Scania, two consultant organization thus Sogeti and the SYSteam. Lastly, the research involved two vendors, thus the Oracle and the SAP vendors. The involved respondents were expected to respond on the research main questions. Basically, the respondents are to respond on varied factors that foster successful implementation of the ERP. The survey was conducted by the use of the 22 KSF by employing a7 point Likert scale. By employing use of 7 point Likert scale, the findings will be based on the opinion and the perceptions of the participants related to the single latent variable of the research. The 7 point Likert scale rates the factors that ae least perceived to be of importance towards realization of ERP success completion (value = 1) as the most relevant to ERP completion. Under the 22 KSFs, the rank was from the largest to the lowest whereby the mean of (1-less than 3) is perceived to be lowest while between (3-5) is rated as moderate while more than (5-7) is considered to be high. As per the table 1 rank representation, it is important to note that the findings are as per the perception of the respondents and not as per the indicator of the ERP literature. 4. Findings Based on the respondent’s feedbacks, the highest KFS was the organization top management support which was at a mean of =6.31, followed by user training on software at a mean of =6.07, and the clear responsibility and roles which was at a mean of= 6.00. Contrarily to the highest KFS, the lowest aspects perceived to foster the success of ERP implementation were the organization partnership with vendors at a mean of= 4.39, the client’s resources at a mean of=4.55, and the use of the consultants at a mean of=4.84. The below table showcases the mean and the standard deviations of the lists of KSFs ERP successful factors Rank Mean Organization top support 1 6.31 User involvement 2 6.07 Clear responsibilities and roles 3 6.00 Change management 4 5.97 Implementation goals 5 5.87 Good planning 6 5.82 Training 7 5.80 Budgeting 8 5.77 Testing 9 5.60 Consultants resources 10 4.84 Architecture choices 11 4.54 Partnership with vendors 12 4.39 4.1 Responses from Participants 1.1.1 Organization Top Support According to VSM Group, organization top support plays a pivotal role towards ensuring successful implementation of the EPR. VSM Group advocates that the implementation plan of the EPR need to be communicated from the top to down to show the concern of organization in realizing the successful implementation of ERP. For Scania organization, the organization top management fosters successful implementation of ERP because of the authority and support from the top level by enabling people to understand their roles that are aligned to implemented software. As such, workers will definitely understand their roles and responsibilities. Lastly, the Oracle company advocated that the top organizational leadership plays a pivotal role in ensuring that ERP project is positioned as top organizational priority project. As such, the organization need to engage competent and suitable team members that will fosters complete implementation of the ERP. 1.1.2 User Involvement The VSM Group advocate that employees play a major role in realizing successful completion of ERP infrastructure by simply understanding the urgency of the system across the organization. Additionally, the Group argued that EPR success implementation is attained when the organization motivate the users by giving legit examples of the benefits and successful stories of the ERP across the organization. 1.1.3 Clear responsibilities and Roles SAP company argued that a clear division needs to accompany the ERP implementation based on who is responsible for the project and whose role is to do the implementation. this implied that clear state of responsibilities and roles would foster successful implementation of the ERP. The company further states that lack of clear responsibilities and roles will otherwise delay or stop the ERP implementation simply because nobody will take charge of it especially when challenges arise. 1.1.4 Change Management Oracle response argued that successful implementation of the ERP is not only about computer elements such as collecting and reviewing organization information, but is much of strategizing new systems across the organization. As such, the company argued that both the management and employees need to firstly accept change of their way of working to realize successful implementation of ERP. The top management and the bottom operators need to be informed of the deep real change ERP package will bring and need to accept the change. 1.1.5 Implementation Goals Oracle company argued that during the pre-sale activity, the seller and the client need to have an implementation goals that the software can fulfill and be beneficial for the company. As such, the company advocates that a seller and the client needs to have a good agreement before the project commences which poses room for alternatives especially if ERP scope implementation changes. This will pose room for successful implementation of ERP simply because the implementation goals are not rigid but flexible. 1.1.6 Good Planning VSM Group company advocates that successful implementation of the ERP entails well-analyzed plan that is embedded with good communication. Additionally, the organization advocated that the ERP implementation plan need to be process-oriented rather than functional oriented simply because ERP systems is all about the process change. 1.1.7 Training The organizational training on ERP implementation need to cover different levels from the top to the bottom of the inside of the company. The project leaders need to be trained on how to run project 100% while the project members need to be trained on how to be devoted towards the project. Such trainings play pivotal role towards the realization of ERP implementation success. 1.1.8 Budgeting According to Sogeti Sverige organization, budgeting plays an important role in supporting the activities associated with ERP implementation and in selection of the right software. Sogeti consultants argued that successful realization of ERP implementation is attained by first having enough budget to ensure quality software is purchased and quality customization of the software that will ensure organization meets the demands of the customers hence maximize profit of their source. 1.1.9 Testing All the involved respondents implied that testing needs to be done in steps and conducted in parallel of the ERP implementation. Essentially, respondents argued that testing needs to be conducted as early as possible so that the users familiarize and recognize the functionality of the ERP system. This further enhances the reduction of the large scale-use; hence organizations can adjust the units once the problems have been identified thus fostering the successful implementation of ERP. 1.1.10 Consultants Resources Respondents argued that the assigned consultant units need to have imperative skills and competencies that spearheads smooth implementation of ERP within organizations. Under the case study of Oracle company, the presentation and the pre-sales of the ERP were conducted with experienced and competent consultants in Oracle while the implementation phase was conducted by a freshman will led to challenges of ERP implementation. As such, Oracle argues that companies need to ensure all consultants are qualified hence a stepping stone to realize successful implementation of ERP. 1.1.11 Client’s Resources The involved respondents implied that successful implementation of ERP is attained by organization having capable human resource to engage with project teams inclusive of consultants and vendors. As such, organizations need to be equipped with technical facilities such as computer and internet which are of huge benefit in realizing the successful implementation of ERP packages. Respondents further argued that lack of such resources expose the organization to the failure of implementing ERP. 1.1.12 Partnership with Vendors The chosen respondents argued that by organization partnering with the vendors, the vendors assist the organizations to remove any barriers within the organization and the level of management so that ERP can be implemented successfully. Essentially, the organization renowned vendors for being helpful in constructing organization blueprint from the top level to the bottom level of management, and the type of the software and hardware that fosters successful realization of the organization EPR implementation management. 5. Originality/VALUE The research basically contributes to the imperative approaches in successful implementation of ERP based on the organizational perspectives, business perspectives, and technological perspectives. Under the organizational perspectives, the implementers will understand that ERP is an actor participating in the interaction across the organization which fosters organization change. This is because the ERP model represent another discourse, centrally to the one existing in the organization. Under the business perspective, the research informs that successfully implementing the ERP system will enable the organization to understand the complexities within business environment based on information technology/information systems. Lastly, the research contributes in the body of technological perspectives to better understand the complexities in ERP implementation. Such challenges are to be eradicated through standard architecture, infrastructure, configuration, and customization. 6. keywords 1.1.13 ERP Enterprise Resource Planning. 1.1.14 Likert Scale contributed to the understanding of the opinions and the perceptions geared towards successful implementation of ERP. 7. Current State Name Year Topic/Title Data Collection Research Underway Adel. M. Aladwani 2011 Change Management Strategies for Successful ERP Implementation The report employed qualitative secondary data collection. The data generally focused on ERP implementation strategies, marketing strategies, sources of user resistance, and change management. Proposes for future actual ERP model adoption for testing its success based on theoretical specifications enlisted by the respondents in this research paper. 8. Category Information Technology Business. 9. REFERENCES Cotteleer, M. (2003). Enterprise Resource Planning: Technology Note. Harvard Business School Publishing, no. 9-699-020, pp. 1-8. Emad, A. (2015). Critical Success Factors for ERP Implemtation: The Case of Jordan. International Arab Journal of e-Technology, vol. 4, no. 1, p. 1. Vessey, I (2010). ERP Implementation Approaches: Towards Contingency Framework, Proccedings of the 20th International, Conference on Information Systems, pp. 411-416. Wu, J. (2017). Critical Success Factors for ERP System Implementation, p. 740. Retrieved from http://ai2-s2-pdfs.s3.amazonaws.com/888a/33275b78c9d009dc3f7f982bfd58d9de4a17.pdf. Read More