Factors Affecting ERP in US and Arab Gulf States Emphasis On SAP

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THE
FACTORS
THAT
ENTERPRISE
INTERNATIONAL
COMPANIES
AFFECT
RESOURCE
ARAB
WITH
THE
PLANNING
GULF
STATES
SPECIAL
Of
Partial
of
ON
UNITED
SAP
STATES
SOFTWARE
Submitted
Fulfillment
the R e q u i r e m e n t s
Doctor
OF
(E R P ) IN T H E
AND
EMPHASIS
A Dissertation
In
IMPLEMENTATION
for
Industrial
the
Degree
Techno logy-
Approved :
Dr.
Mohammed
D r . Ali
F.
Fahmy,
Kashef ,
Dr.
Recayi
Pecen,
Dr.
Sue
Joslyn,
A.
Dr. S h a r o n
Member
Saud
University
E.
Chair
-Chair
Committee
Committee
Smaldino,
Member
Member
Committee
Al-Sehali
of
Northern
December
Iowa
2000
UMI Number: 9992042
UMI
UMI Microform 9992042
Copyright 2001 by Bell & Howell Information and Learning Company.
All rights reserved. This microform edition is protected against
unauthorized copying under Title 17, United States Code.
Bell & Howell Information and Learning Company

300 North Zeeb Road
P.O. Box 1346
Ann Arbor, Ml 481 06 -1 34 6
Copyright
SAUD
AL-SEHALI
December
All
by
Right
2000
Reserved
THE
FACTORS
THAT
ENTERPRISE
INTERNATIONAL
COMPANIES
AFFECT
RESOURCE
ARAB
WITH
An A b s t r a c t
IMPLEMENTATION
PLANNING
GULF
SPECIAL
THE
STATES
of
(E R P ) IN T H E
AND
EMPHASIS
OF
UNITED
ON
SAP
STATES
SOFTWARE
a Dissertation
Submi tted
In
Of
Partial
Fulfillment
the R e q u i r e m e n t s
Doctor
of
for
Industrial
the
Degree
Technology
Approved:
Dr.
Mohammed
D jgf. J o h n W.
P f a . n of t h e
Saud
University
F.
FahmyT
Chair
SomerviTl
'
Graduate College
Al-Sehali
of
Northern
December
Iowa
2000
ABSTRACT
The p r i m a r y p u r p o s e
investigate
and
implementation
in
companies
S tat e s ,
A random
in
determine
of
in
using
had
SAP
from
Arab
Of
the A r a b
sample
the
an
150
Gulf
of
a return
rate
44.7%.
(SPSS)
67
Statistical
was
tests were
used
to
as
an
and
of
the
system using
120
the
the
the
data.
to
analyze
variables.
measures
included
t-test,
the U n i t e d
were
level
and
the
returned,
sciences
of
percentage
chi-square
companies
Statistical
Frequencies
and
SAP
Social
significance.
compute
States
30 w e r e
from
(.05)
companies
United
questionnaires
for
(ERP)
the U n i t e d
150
ERP
and
the
example.
in
Package
at
to
affecting
and
analyze
conducted
States
selected
States
A total
was
resource planning
respondents,
States.
The
study
factors
Gulf
was
States
of
the
software
implemented
software.
t his
enterprise
the
the A r a b G u l f
that
of
were
used
Statistical
test,
and M a n n -
W h i t n e y U tests.
The
critical
was
the
respondents
success
reported
factor
top m a n a g e m e n t
for
that
the ERP
support
and
the m a j o r
implementation
involvement.
They
were
managed.
most
dissatisfied
Most
of
implementation
There
companies
was
were
differences
in
statistically
regard
make
respondents
between
of
the w a y
change
believed
t he
was
ERP
successful.
no
found
implementation
did not
the
about
to
an
Arab
the
ERP
significant
Gulf
factors
system.
any
difference
in
the
respondents
and
U.S.
tha t
The
the
affect
company
critical
the
size
success
factors.
Most
of
functional
implement
schedule
usually
reasons
the
and
ERP
estimated
estimates.
that
they
The
already
main motivation
Although
time
that
for
accurately,
the
implementation
thi s
was
less
of
the
respondents
implemented
an
ERP
system
specific
majority
Preparatory
of
approach
system
steps
to
were
true
for
indicated
address
problems.
implemented
complete
to
time
Most
all-in-one
the
the
system.
training
cost
certain
were
indicated
the
an
for
respondents
ERP
ERP
who
system have
have
chosen
software
selection
roll-out-at-once
strategy.
included
establishing
an
and
a project
team with
a strong
resources
to
the
The major
system
the
is
to
leader
of
The
and
computer
major
an
ERP
system
disadvantage
across
is
the
of
the
cost.
Recommendations
study
include
having
system
itself
to
provides
transition
training
job
and
ERP
on
clear
of
ERP
to
ERP
the
is
based
objectives
about
implementing
a uniform
organization.
high
budget
implementation.
advantage
have
and allocating
serve
reassurance
in
and
the
results
understanding
the
company
ensuring
adequate
for
that
of
the
as w e l l
the
employee
employee
concerned
security.
as
i i
For m y
brother
SUNDAH
ACKNOWLEDGEMENTS
I would
express
my
like
take
gratitude
dissertation
for Dr.
to
to
Fahmy,
committee,
for
while
dissertation
this
author
other
also
his
his
Dr.
Ali
Pecen,
Sue
Joslyn,
their
professional
support,
was
and
remember
will
tha t
Kashef,
and
never
being
my
are
technical
written.
the
personal
forgotten.
The
to
this
Dr.
the
for
assistance,
dissertation
interest
The
Recayi
Smaldino
advice,
while
advice
advisory
Sharon
technical
reserved
dissertation
appreciation
in
Dr.
to
my
(co-advisor),
and
Their
be
of
and
sincere
encouragement,
being written.
support
was
of
thanks
chairman
professors
committee.
Dr.
Special
professional
express
respectable
opportunity
the m e m b e r s
committee.
Mohammed
th is
and
author will
forever.
iv
TABLE
OF
CONTENTS
PAGE
LIST
OF
T A B L E S .............................................. x
LIST
OF
F I G U R E S ......................................... x i i i
CHAPTER
I.
I N T R O D U C T I O N ................................
Statement
of
P r o b l e m ...............................
Statement
of
P u r p o s e ...............................
Significance
of
the
S t u d y .......................... 6
L i m i t a t i o n s ...........................................
A s s u m p t i o n ............................................
Research
Q u e s t i o n s ................................. 10
Definition
of
Organization
CHAPTER
ERP
II.
and
ERP
of
the
LITERATURE
Its
History
in
11
S t u d y ......................... 15
R E V I E W .......................
16
H i s t o r y ................................. 16
Timeline
ERP
T e r m s ...............................
of
in
of
U n i t e d S t a t e s ........... 17
E R P ................................18
the A r a b
A Description
the
Gulf
S t a t e s ................ 20
E R P ................................24
Characteristics
Integrated
and
C o m p o n e n t s ..........
24
s y s t e m ...................... 24
Client/Server
S y s t e m .................. 25
PAGE
Enterprise-wide
D a t a b a s e ........... 27
A p p l i c a t i o n s / M o d u l e s .................
31
Industry-Specific
A p p l i c a t i o n s ....
31
W hat Do M a n u f a c t u r e r s
E x p e c t E R P to D o ? ...........................
32
How
33
What
Do
ERP
Does
Systems
D o ? ..................
34
S y s t e m .................
34
E a s i e r A c c e s s to
R e l i a b l e I n f o r m a t i o n .................
34
E l i m i n a t i o n of R e d u n d a n t
D a t a a n d O p e r a t i o n s ..................
35
Reduction
36
Benefits
ERP
W o r k ? ..................
of
Really
an
ERP
of
Cycle
T i m e s ...........
I n c r eased Efficiency, Hence

R e d u c i n g C o s t s ........................ 36
E a s i l y A d a p t a b l e in a
Changing Business E n v i r o n m e n t
37
Y2K
E n a b l e d ............................
38
E n a b l e d ...........................
39
Euro
Factors A f f e c t i n g
I m p l e m e n t a t i o n of
the
E R P ............................ 39
Speed and Difficulty

of I m p l e m e n t a t i o n ........................... 40
S e l e c t i o n of t h e W r o n g
E R P S o f t w a r e ................................. 42
Commitment
to
a Single
V e n d o r ........... 43
v i
PAGE
Too
Many
Cost
of
F e a t u r e s ........................... 44
an
ERP
S y s t e m ...................... 44
E x p e c t a t i o n s ..................
Unrealistic
46
L a c k of A t t e n t i o n to the
I n f r a s t r u c t u r e P l a n n i n g ................... 48
Centralized
Lack
of
D e c i s i o n - M a k i n g .............. 50
a S t r a t e g y .......................... 50
Insufficient
Undue
ERP
e x p e r i e n c e .............. 50
H a s t e ................................... 51
How
to
Survive
ERP
in
the
an
Market
Today's
ERP
P l a c e .......................... 54
Market
SAP
I m p l e m e n t a t i o n ......... 52
L e a d e r s ..................... 55
A G ................................... 56
Oracle
C o r p ............................ 57
J .D . E d w a r d s ........................... 5 8
P e o p l e S o f t ..............................59
Baan
Future
of
C o ..................................60
E R P ................................ 61
S u m m a r y ...............................................63
CHAPTER
III.
Overview
METHODS
of
Population
the
and
AND
P R O C E D U R E S ................. 65
S t u d y ............................ 65
S a m p l e ............................
66
PAGE
I n s t r u m e n t a t i o n ....................................
Validation
of
the
67
I n s t r u m e n t ..................... 69
Data
C o l l e c t i o n ......................................70
Data
A n a l y s i s ........................................ 71
CHAPTER
IV.
RESULTS
OF
THE
S T U D Y ...................... 72
General Characteristics
of the R e s p o n d e n t s .................................. 74
The
Location
Income
of
Position
of
C o m p a n i e s ............. 74
C o m p a n i e s ..................... 74
the
of
the
the
Classification
R e s p o n d e n t s ................75
of
the
C o m p a n i e s .......... 76
Current Implementation
S t a t u s of E R P in C o m p a n i e s ................. 77
ERP
Modules
I m p l e m e n t e d ..................... 78
Statistical Analyses Related

to the R e s e a r c h Q u e s t i o n s .........................79
Research
Question
1 ........................
The Critic al Success Factors

for E R P I m p l e m e n t a t i o n P r o j e c t s . . .
79
79
Criti cal Su cc e s s Factors Not

I m p l e m e n t e d S a t i s f a c t o r i l y ...........80
Success
of
I m p l e m e n t a t i o n ............ 82
Most Important Elements Affecting

the E R P I m p l e m e n t a t i o n ................82
PAGE
Effects
Is s u e s
of
Attention
on
IT
85
E f f e c t of t h e I m p l e m e n t a t i o n of
Client/Server System and
E R P o n t h e I T ........................... 85
M e e d for C o m p u t e r P r o f i c i e n c y
A m o n g E m p l o y e e s ......................... 86
Increased
Employee
T u r n o v e r ......... 87
ERP I m p l e m e n t a t i o n and
E m p l o y e e L a y o f f s ......................
87
C o s t of I m p l e m e n t a t i o n as
P e r c e n t a g e of A n n u a l R e v e n u e ........ 88
Research
Question
2 .........................
89
C r i t i c a l S u c c e s s F a c t o r s for
E R P I m p l e m e n t a t i o n P r o j e c t s ......... 89
Critical Success Factors not
I m p l e m e n t e d S a t i s f a c t o r i l y ...........91
Most Important Elements Affecting
t h e E R P I m p l e m e n t a t i o n ...............92
Research
3 .........................
93
C r i t i c a l S u c c e s s F a c t o r s not
I m p l e m e n t e d S a t i s f a c t o r i l y ........
93
C r i t i c a l S u c c e s s F a c t o r s for E R P
I m p l e m e n t a t i o n P r o j e c t s ............
93
Research
Question
Question
Reasons
for
4 .........................
Implementing
96
E R P ........ 96
Typical Decision-Making Process

T o w a r d I m p l e m e n t i n g E R P .............
96
ix
PAGE
Accuracy
of
E s t i m a t e s ................
97
S p e c i f i c P r o b l e m s as a F a c t o r in
I m p l e m e n t a t i o n D e c i s i o n ............. 100
S p e c i f i c P r o b l e m s for E R P
to A d d r e s s .............................. 100
Approach
to
ERP
S e l e c t i o n .......... 101
I m p l e m e n t a t i o n S t r a t e g y in
R e s p e c t to R o l l O u t .................. 102
Preparatory
Research
Steps
Question
Reasons
f or
T a k e n ............. 103
5 ......................... 103
Implementing
Typical Decision-Making
Toward Implementing ERP
ERP
....
Process
...........
103
104
A c c u r a c y of E s t i m a t i o n
b y T y p e .................................105
Research
Question
6 ........................
106
A d v a n t a g e s of I m p l e m e n t i n g
a n E R P S y s t e m .......................... 106
D i s a d v a n t a g e s of I m p l e m e n t i n g
a n E R P S y s t e m .......................... 107
CHAPTER
V.
SUMMARY, DISCUSION,
A N D R E C O M M E N D A T I O N S .......................
Summary
of
Conclusions
F i n d i n g s ............................... 109
and
D i s c u s s i o n ...................... Ill
R e c o m m e n d a t i o n s ...................................
Suggestions
109
fo r
Further
116
S t u d y .................. 118
PAGE
REFERENCES
.................................................. iÛ
Questionnaire
APPENDIX
A:
Appendix
B : Respondents
and Co v e r
L e t t e r ........ 127
C o m m e n t s ...................
143
x i
LIST
OF
TABLES
TABLE
PAGE
1.
Some
2.
Respondent
3.
Income
4.
Position
5.
Classification
6.
7.
8.
9.
Components
of
an ERP
S y s t e m .............. 28
P o p u l a t i o n ........................... 73
of the C o m p a n i e s
........................... 75
of the R e s p o n d e n t s
of
...................... 75
the Companies
............... 75
C u r r e n t I m p l e m e n t a t i o n S t a t u s of E R P in
C o m p a n i e s ........................................... 77
ERP M o d u l e s
They
H a v e I m p l e m e n t e d .............78
I m p l e m e n t a t i o n P r o j e c t s .......................
80
Critical Success Factors

N o t I m p l e m e n t e d S a t i s f a c t o r i l y ................. 81
10.
Success
of
I m p l e m e n t a t i o n ....................... 82
11.
M o s t I m p o r t a n t E l e m e n t s A f f e c t i n g the E R P
I m p l e m e n t a t i o n ....................................
84
12.
C o n c e n t r a t i n g on IT I s s u e s , at
the E x p e n s e of C o r e I s s u e s
C r i t i c a l to the B u s i n e s s ......................... 85
13.
Effect
on t he
14.
N e e d for C o m p u t e r P r o f i c i e n c y
A m o n g E m p l o y e e s .................................... 87
15.
I n c r e a s e d E mpl oy ee T u r n o v e r A f t er ERP
I m p l e m e n t a t i o n ...................................
16.
of C l i e n t / S e r v e r S y s t e m
IT D e p a r t m e n t .............................. 86
87
ERP I m p l e m e n t a t i o n a n d
a n E m p l o y e e L a y o f f s ............................... 88
TABLE
17.
PAGE
T o t a l C o s t of I m p l e m e n t a t i o n as
P e r c e n t a g e of A n n u a l R e v e n u e .................
89
18.
I m p l e m e n t a t i o n P r o j e c t s .......................... 90
19.
Critical Success Factors

not Implemented Satisfactorily
20.
..............
91
M o s t I m p o r t a n t E l e m e n t s A f f e c t i n g the E R P
I m p l e m e n t a t i o n ....................................
92
21.
C r i t i c a l Success F act or s not

I m p l e m e n t e d S a t i s f a c t o r i l y ...................... 94
22.
I m p l e m e n t a t i o n P r o j e c t s ......................... 95
23.
24.
Reasons
for
A c c u r a c y of
26.
A c c u r a c y of
Estimation
Estimate
by
by
Specific Problems
29.
A p p r o a c h to
P e r c e n t a g e ............. 99
ERP
for
ERP
to
A d d r e s s ......... 101
S e l e c t i o n ....................... 102
I m p l e m e n t a t i o n S t r a t e g y in R e s p e c t
to R o l l O u t ........................................ 102
31.
Preparatory
Steps
32.
Reasons
Implementing
33.
T y p e ................. 98
S p e c i f i c P r o b l e m s as F a c t o r
in I m p l e m e n t a t i o n D e c i s i o n ..................... 100
28.
30.
E R P ................... 96
Typical Decis i o n - M a k i n g Process

T o w a r d I m p l e m e n t i n g E R P .......................... 97
25.
27.
Implementing
for
T a k e n ........................ 103
E R P .................. 104
Typical Decision-Making Process Toward

I m p l e m e n t i n g E R P .................................. 105
PAGE
TABLE
34.
Accuracy
of
Estimation
by
T y p e ........... 106
35.
A d v a n t a g e s of I m p l e m e n t i n g
a n E R P S y s t e m ......................................107
36.
D i s a d v a n t a g e s of I m p l e m e n t i n g
a n E R P S y s t e m ......................................108
x iv
TABLE
OF
FIGURES
FIGURE
PAGE
1.2-tier
2 .H o w
ERP
and
3-tier
system
Client/Server
Approaches
.. 27
w o r k s ................................ 33
CHAPTER
INTRODUCTION
Enterprise
attempts
a C iO 5 5
can
to
all
particular
as
does
warehouse.
own
is
a single
the p e o p l e
in
human
of
those
system,
that
that
share
information
resources
and
program
as w e l l
and
in
typically
optimized
that
various
3y3tlSIii
finance
together
program
the
in
department
t h e m all
software
so
the
ERP,
functions
software
departments
each
or
departments'
people
combines
database
different
and
CGmpU t
of
ways
integrated
a. S i l l y l S
ERP
software,
departments
needs
computer
ERP
easily
the
Each
particular
But
those
planning
all
iutO
needs.
serves
it
its
integrate
a. COuipctriy
serve
that
resource
for
does
into
runs
the
has
the
its
work.
a sin g l e ,
off
a single
departments
can
communicate
with
more
each
other.
That
payback
Take
if
integrated
companies
a customer
a customer
mostly
approach
install
order,
places
paper-based
an
for
order,
journey
can
the
have
software
example.
that
from
a great
correctly
Typically,
order
begins
in-basket
to
when
a
in
basket
around
keyed
into
along
the
baskets
keying
way.
into
the
there
to
turbulent
need
survival
the
(1999)
customer
services
in
of
enterprise.
which
helps
integrating
the
for
the
is
the
at
the
all
been
in
to
to b e c o m e
possible
business
gain
point
computer
shipped
there
is
value-added
such
knows
department,
today's
environment,
is
truly
given
finance
the
1999) .
that
integration
ERP
any
item has
stated
a company
resources
company
the w a r e h o u s e ' s
& Baatz,
shortest
demands
an
in
order
and d e l i v e r
turn,
all
invites
to c o m p e t i t i v e n e s s
the
in
systems
for o r g a n i z a t i o n s
guide
in
computer
the
business
around
re
systems
and
into
Derek,
computer
and
orders,
one
see w h e t h e r
keyed
lost
the
to g e t
Avraham
strong
and
no
of
being
lounging
is no w a y
(Christopher,
and
that
delays
status
often
departments'
different
example,
system
Al l
Meanwhile,
because
for
company,
different
causes
errors.
what
the
to
dynamic
is
global.
be
t i me.
Th is,
to
and
in
processes
a strategic
a competitive
and
The
closer
products
of b u s i n e s s
processes
tool,
edge
optimizing
available.
by
In
today's
fiercely
environment,
there
interaction
between
This
means
that,
has
to be
in
order
requirements
deliveries,
the
suppliers
improved
within
delivery
the
planning
and
harmonization
the
planning
States
these
top
and
systems
ERP
to
improve
companies
strategies
is
to be
full
spelled
have
business
have
the
out
to m a t c h
the
businesses
must
vision
they,
with
different
are
going
how
to
f ace
the
their
future
of
the
have
the
processes.
Gulf
ERP
future
which
These
the
synchronize
Arab
environment.
of
with
The
challenge,
and
of
implemented
businesses.
of
times
efficient
processes
and
to
this
lead
enterprise
in
linked
efficiency
enable
integrate
States
their
achieve
that
companies
the U n i t e d
closely
to
the
tailored
faster
need
streamlined
private
goods
decreased
the
to
be
To
in a l l
equips
into
manufacturers.
improved
systems
capabilities
functions
The
and
manufacturers
organization.
necessary
must
performance,
control
greater
and p r o v i d e
customers.
enterprise,
effectiveness,
and
business
to p r o d u c e
enterprise
and
much
customers
to c u s t o m e r
both
competitive
of
demands
future
a clear
policies,
economy.
The
implementation
time-consuming,
information
companies
they h a d
had
least
implementation
as
they
had
1997).
An
expensive,
of b a s i c
return
f or
ERP
good
McCausland
fortunes
to
find
improved
system
arduous
to
the
E RP
much
can
force
and may
1000
reported
license
be
the
not
t ha t
on
software
system
install,
processes,
as
Of
Fortune
44%
times
on
task.
from
ERP,
is a v e r y
change
provide
years.
companies
as
fou r
implementation
implement
n ot
years
business
The
Some
take
and
implemented
at
(Michel,
ERP
executives
spent
itself
an
expensive,
technology
who
of
and
as
that
spent
then
ERP
stated
software
their
E RP
is
their
found
they h a d
(2000)
on
at
have
of
out
expected
that
and
business
critical
money
the
them
and
time
results
to
were
to be.
companies
its
issue.
have
spent
implementation
performance
h as
only
not
all.
Habermann
(2000)
reported:
E R P f a c e s m a n y c h a l l e n g e s as it c o n t i n u e s to
gr o w and move into new markets. First and
f o r e m o s t a r e t h e c o m b i n e d c h a l l e n g e s of a n
o v e r l y s o p h i s t i c a t e d i m p l e m e n t a t i o n w i t h th e
s h o r t a g e of t r a i n e d s t a f f to h a n d l e the
imp le mentation. Recent trade journals have been
f i ll ed with ERP h o r r o r sto ries that include
p r o b l e m s w i t h cost and s c h e d u l e o v e r ru ns , r e
t r a i n i n g staff, c u l t u r e c h a n g e issues, a nd poor
R e t u r n On I n v e s t m e n t ( R O I ) . T he final c h a l l e n g e
t h a t ERP v e n d o r s f a c e is t h e o p e n s y s t e m s
p e o p l e w h o d o u b t m a r k e t s u s t a i n a b i l i t y for
an yon e o f f e r i n g a p r o p r i e t a r y system,
(p. 57)
ERP
System,
(SAP),
only
for
such
Application,
Oracle,
greater
market
Baan,
and
system
competitive
problems
study
to
be
affect
implementation
ERP
and United
emphasis
on
of
SAP
on
th e
States
as
an
of
ERP
number
in a n
identified
of
to
some
of
on
Gulf
the
States
business
enter
the
difficulties
such
that
not
systems.
affect
This
the
international
with
and
Arab
Gulf
special
example.
factors
enterprise
and
offer
opportunity
their
companies
Statement
A
can
systems
enough
factors
processing
the A r a b
to a c h i e v e
from
communication.
best
within
solution
the
and
the
adoption
the
data
also
However,
the
of
in
but
strong
market.
emphasized
States
one
States
and
package
teamwork
companies
United
objectives
is
the
PeopleSoft,
efficiencies
to h e l p
the
as
Products
interdepartmental
ERP
and
software,
of
Problem
affect
that
described.
the
has
The
implementation
not
intent
been
of
fully
this
study
is
to
identify,
affecting
the
special
Arab
Gulf
emphasis
R e c o m m e n d a tions
decision
and
about
on
to h e l p
ERP
primary
investigate
and
implementation
SAP
States
and
as
an
of
of
ERP
in
in
the
U.S.
companies,
example.
are
also
the
gain.
Purpose
t his
the
study
factors
is
using
SAP
to
affecting
international
companies,
factors
c o m p a ni e s to m a k e
implementation
determine
U.S.
ERP
and
these
purpose
of
of
States
Statement
The
investigate
implementation
international
with
analyze,
the
the A r a b
software
Gulf
as
an
example .
Because
companies
a number
have
of
already
recommendations
and
Arab
Gulf
implemented
guidelines
research
can
be u s e d
to
avoiding
the
potential
and
ERP,
gleaned
assist
other
problems
U.S.
from
this
companies
in
associated with
implementation.
Significance
In
the
companies
Arab Gulf
have
competitive
improvement.
to
States
create
advantage
of
an
and
t he
Study
the
United
environment
through
Therefore,
the
States,
of
continuous
deployment
of
the
ERP
system has
the
factors
necessary
whenever
right
or
not
process.
There
these
possible
such
of
companies
are
ERP
in
the A r a b
and
t h at
ERP
is
is
the
the
affect
them
as
in
the
the
to
knowledge
implementation
studies
much
This
implementation
new
th e
States
ERP.
contribute
generate
need
Gulf
anticipate
also
few p u b l i s h e d
assist
system
implementing
during
study will
are
of
considering
an
companies
encounter
companies
to
implementation
companies
States
factors
Understanding
them.
knowledge
regarding
ERP.
for
This
issue.
implementing
help
they
the
leaders
United
study will
existing
affect
and more
the
problems
a critical
the
decision
in
and
that
for
More
and
become
in
this
information
of
field,
as
implementation
of
ER P .
Limi t a t i o n s
The
following
1.
States
and
implemented
The
United
ERP,
limitations
study was
States
apply
limited
companies
which may
limit
to
to
that
this
the
study:
Arab
have
generalizing
results.
of
Gulf
2.
in
the
Respondents
Arab G ul f
implemented
results
SAP
do n o t
3.
Only
participated
and who
were
States
limited
and
software,
apply
the
in
to
and
completed
of
United
the
initial
companies
States
that
these
components
of
ERP.
team who
implementation
the
those
therefore
other
members
the
the
to
process
of
questionnaire
SAP
were
included.
4.
The
reported
5.
questionnaire
data
The
as w e l l
as
companies
SAP
(a)
within
the U n i t e d
6.
were
Those
excluded
7.
Those
software were
the
upon
self-
opinions.
designed
for
two
implemented
ERP
and use
Arab
Gulf
States
and
(b)
States.
companies
from
was
that
within
dependent
subjective
questionnaire
populations:
software
was
the
did not
implement
ERP
did not
implement
SAP
study.
companies
excluded
that
that
from
the
study.
Assumption
The
following
1.
instrument
The
were
assumption
areas
relevant
were
made:
represented
to
the
in
factors
the
survey
that
affect
the
implementation
Gulf
States
2.
and
The
of
U.S.
ERP
in
the
international
Arab
companies.
respondents
honestly
answered
the
questionnaire.
3.
actual
Respondent
and
4.
desired
The
data
answers
differentiated
between
responses.
could
be
obtained
by
the
use
of
questionnaire.
5.
to
The
correctly
respondents
state
implementation
6.
The
for m a k i n g
companies
7.
were
appropriate
obstacles
of
expertise
the
ERP.
respondents
decisions
had
about
primary
responsibility
implementing
ERP
in
the
in q u e s t i o n .
The
adequate
perceived
of
the
had
instrument
and
to m e a s u r e
factors
that
statistical
the
procedures
significance
affect
the
of
implementation
ERP .
8.
sample
The
might
companies
in
information
be
the
obtained
generalized
to
from
the
represent
survey
all
population.
the
of
10
9.
t he
Some
United
States
companies
have
in
already
the
Arab
Gulf
implemented
States
ERP
and
SAP .
Research
The
aim
describe
in
question
questions
Arab
3.
th e
What
How
are
decision
5.
between
in
the
of
do
study
the
Does
company
What
was
U.S .
of
are
as
of
The
ERP
Each
that
research
following:
that
that
affect
affect
the
and
those
size
affect
the m a i n
in
make
the
the
any
there
any d i f f e r e n c e
in the A r a b
in
Gulf
adopt
United
of
in
ERP?
behind
the
in
States?
difference
motivation
Is
th a t
companies
adoption
ERP?
States
the
between
adopt
United
factors
ERP.
to
companies
and
companies.
various
ERP d i f f e r
States
that
identify
implementation
factors
factors
of
to
ERP?
Gulf
factors
4.
identify
this
implementation
t he
and
implementation
for
is
affect
States
to
implementation
2.
study
that
Gulf
used
the
1.
this
factors
t he A r a b
affect
of
Questions
the
motivation
States
and
ERP?
those
and
11
6.
What
implementing
ERP
are
the
advantages
below
to
used
throughout
enhance
Enterprise
industry
supported
helps
Resource
for
the
by
multi
broad
or
of
planning,
parts
purchasing,
resources
(SAP):
with
tracking
modules
applications
must
order
be
the
defined
house
of
An
activities
software
business
manage
including
providing
ERP
can
finance
Products
and
that
built
and what
to b u i l d
a unit
in
specializing
Requirement
system
(ERP):
that
the
product
inventories,
customer
al s o
include
and human
a business.
for m i d d l e
Material
are
maintaining
orders.
for
of
set
business,
Application
Software
information
its
suppliers,
aspects
System
study
other
parts
application
the
application
important
and
Terms
Planning
module
a manufacturer
service,
of
understanding.
term
interacting
disadvantage
system?
Definition
Terms
and
large
determines
of
companies.
(MRP)
what
must
equipment
processing
in b u s i n e s s
size
Planning
materials
Data
by
is
an
assemblies
be p r o c u r e d
a certain
in
of
12
date.
It
queries
databases
to
the
derive
Manufacturing
bill
the
Resources
system
and
applications,
supp o r t ,
material
materials
necessary
information
related
of
that
inventory
elements.
Planning
integrates
(MRP-II):
all
including
requirements
and
An
manufacturing
decision
planning,
accounting,
and dis tr ibu tion.

Client/server:
client
(personal
requesting
machine,
area
network
tne e a r l y
or w o r k s t a t i o n )
is
the
t he
the
server
is
the
supplying
of w h i c h
are
connected
via
1990s,
centralized
in w h i c h
and
(LAN)
for b u i l d i n g
architecture
computer
machine
both
An
or w i d e
area
client/server
applications
minis
on
network
has
LANs
and m a i n f r a m e s
been
in
local
( W A N ) . Since
the
buzzword
contrast
with
to
dedicated
terminals.
Chief
always
Executive
also
reports
to
members.
the
the
Officer
president
chairman
of
of
CEO
is u s u a l l y
spokesperson
for
the
member
of
for
the
but
The
and b o a r d
the m o s t
important
the
results,
person who
and
the
not
CEO
board
company,
quarterly
Often
a company.
t he
The
responsible
(CEO):
is
best-paid
company.
13
Local
network
Area
t ha t
serves
geographical
area.
workstations,
Computer
to
It
Aided
design
or
a scanner
may
output
a CAD
be
electronically
an
not
receive
member
the
CAD
is
and
use
systems
used
to
for
are
high
CAD
drawing,
printed
a CAM
of
with
additional
either
transmitted
The
computers
for
is
of
Officer
al l
The
input.
and
The
or
s ys t e m ,
same
is
Now
nations
for
when
the
of
(CIO):
information
C I O s j o b
praise
Information
taken
which
Euro:
servers,
syst e m ,
(CAD):
tablet
system
organization.
down,
of
operating
attached
in c h a r g e
often
a confined
up
desktop
Information
executives.
are
communications
which
objects.
Chief
officer
is m a d e
products.
A graphics
the
within
Design
software.
builds
link.
speed workstations
of
(LAN):
users
a network
communications
computers
Networks
and
systems
is
the
is
the
demanding
something
held
may
other
breaks
responsible.
monetary
European
as
but
in
in a n o r g a n i z a t i o n
until
official
executive
processing
rewards
granted
CIO
The
unit
of
Union.
11
14
Economic
and Monetary
consolidation
of
monetary
called
phased
that
unit
in
European
on J a n u a r y
deal
with
the
countries
have
to
On
must
available,
withdrawn
public
$150
and
of
processing,
titles
are
Data
notes
that
year.
companies
systems
and
and
Euro
coins
currencies
It
will
their
MIS,
Services,
is
expected
spend
more
information
that
than
systems
to
(IS):
or
IS
The
formal
ti t l e
department.
Other
Information
Management
Information
for
Processing,
Information
Services,
and
Technology.
Information
information
Euro
national
to be
participating
2002,
Processing,
Management
Information
the
native
System
a data
Systems,
began
Accounting
of
one
EMU.
Information
Information
1999.
which
both
modifying
the
Euro,
The
into
with
with
private
billion
accommodate
July
1,
(EMU):
currencies
currencies
January
by
1,
deal
values.
be
the
Union
by
Technology
computer
information-processing
and
(IT):
the
The
latest
processing
title
industry.
for
of
the
15
Organization
Chapter
I presents
development.
in
Chapter
used
in
the
collection
discussion,
further
A review
II.
and
the
of
Chapter
study.
conclusions,
are
III
A
and
the
Study
research
the
Chapter
analysis.
research
of
problem
literature
presents
the
IV d i s c u s s e s
summary
of
is
and
included
methodology
data
the
recommendations
in C h a p t e r
its
V.
for
16
CHAPTER
II
LITERATURE
The
study
the
in
review
is
the
organized
history
th e
of
of
United
summarized.
an
ERP:
s y s t e m will
provide
system.
Third,
enterprise
to
reviewed.
The
ERP
to
the
of
Gulf
that
the
States
ERP
what
of
help
focused
and
the
an
an
ERP
it,
ERP
the
the
implementation
section
is
implement
affect
that
(ERP)
the
benefits
that
those
leaders,
on
are
the
future
ERP
of
the
system.
ERP
As
noted
departments
linking
for
an
fourth
the m a r k e t
and
First,
Planning
presents
companies
and
survive
Arab
research
sections.
characteristics,
factors
ERP
this
Resource
section
its
for
major
the
is w o r k i n g ,
implementation
market,
and
second
of
ERP
four
Enterprise
description
how will
literature
into
States
The
REVIEW
and
in C h a p t e r
within
business
accounting,
s al e s ,
to
information
across
I,
History
ERP
serves
a manufacturing
computer
management,
Its
enterprise
such
manufacturing,
facilitate
an
systems
the
entire
all
smooth
as
by
those
used
and m a t e r i a l s
f l o w of
organization.
17
E R P is a v e r y s t r o n g s y s t e m a n d it c a n h e l p the
e n t e r p r i s e to a v o i d d u p l i c a t e d jobs.
Before
C o l u m b i a C o n t e c h i m p l e m e n t s E R P system, t h e y
m a n u a l l y c o s t e d t h e i r j o b s w h e n they w e r e
completed.
N o w t h e y do it t h r o u g h the s y s t e m .
O v e r a l l c o n t r o l , as far as c o n t r o l of
i n f or m a t i o n , has g o t t e n m u c h better.
(Crowley,
1998, p. 121)
Minahan
(1998)
Compaq,
Alcoa,
systems
to
lower
reduce
costs,
management
and
was
on
of
inventory
handle
improve
their
companies
have
such
utilized
shorten
cycle
overall
supply
then
the
United
Most
on
1970s
the
(Material
Requirements
translated
the
items
time-phased
ERP
times,
chain
master
of
the
focus
Planning)
schedule
net
components,
and
1960s
designed
to
inventory
shifted
to M R P
systems,
built
the
software
were
traditional
in
for
requirements
which
the
for
raw materials
end
the
sub-
planning
procurement.
In
as
States
systems
customized)
based
In
assemblies,
th e
control.
(usually
inventory
into
in
manufacturing
concepts.
and
Foods,
inventories,
History
focus
packages
Hershey
that
practices.
ERP
The
and
indicated
the
1980s
(Manufacturing
the
concept
Resources
of
MRP-II
Planning)
evo l v e d ,
which
18
was
an
extension
distribution
1990s,
like
MRP-II
was
within
Enterprise
describe
this
Timeline
to
(i.e.,.
of
Resource
ERP
human
the
business
expanded
floor
extended
finance,
any
shop
activities.
further
management
activities
MRP
management
engineering,
projects
term
of
and
In
to
the
early
cover
areas
resources,
complete
gamut
enterprise).
P l a n n i n g was
and
coined
of
The
to
perspective.
( P tak
& S c h r a g e n h e i m , 2000)
1960
E n t e r p r i s e R e s o u r c e P l a n n i n g (ERP) is b o r n in
the e a r l y 1 9 6 0 s f r o m a j o i n t e f f o r t b e t w e e n
J.I. Case, the m a n u f a c t u r e r of t r a c t o r s a n d
o t h e r c o n s t r u c t i o n m a c h i n e r y , a n d p a r t n e r IBM.
M a t e r i a l R e q u i r e m e n t s P l a n n i n g (MRP) is the
initial effort. This a p p l i c a t i o n software
s e r v e s as the m e t h o d f o r p l a n n i n g a n d
s c h e d u l i n g m a t e r i a l s for c o m p l e x m a n u f a c t u r e d
products.
1 970
I n i t i a l M R P s o l u t i o n s a r e big, c l u m s y a n d
expensive. They r e q u i r e a large technical
s t a f f to s u p p o r t t h e m a i n f r a m e c o m p u t e r s on
w h i c h t h e y run.
1 972
F i v e e n g i n e e r s in M a n n h e i m , G e r m a n y b e g i n the
c o m p a n y SAP. T h e p u r p o s e in c r e a t i n g S A P is to
p r o d u c e a n d m a r k e t s t a n d a r d s o f t w a r e for
integrated business solutions.
1975
R i c h a r d Lawson, B ill Lawson, a nd b u s i n e s s

partner, John C e r u l l o be g i n La w s o n Software.
T h e f o u n d e r s s e e t h e n e e d for p r e - p a c k a g e d
e n t e r p r i s e t e c h n o l o g y s o l u t i o n s as a n
a l t e r n a t i v e to c u s t o m i z e d b u s i n e s s s o f t w a r e
applications.
19
1976
In the m a n u f a c t u r i n g i n d u s t r y , M R P ( M a t e r i a l
R e q u i r e m e n t s P l a n n i n g ) b e c o m e s the f u n d a m e n t a l
c o n c e p t u s e d in p r o d u c t i o n m a n a g e m e n t a n d
control.
1977
J a c k T hom ps on, Da n Greg or y, and Ed M c V a n e y

f o r m J D E d w a r d s . E a c h f o u n d e r t a k e s p a r t of
t h e i r n a m e to c r e a t e the c o m p a n y m o n i k e r .
Larry Ellison begins Oracle Corporation.
1978
Jan Baan begins The Baan Corporation

provide financial and administrative
consulting services.
1979
O r a c l e o f f e r s the f i r s t c o m m e r c i a l S Q L
r e l a t i o n a l d a t a b a s e m a n a g e m e n t system.
1980
J D E d w a r d s b e g i n s f o c u s i n g on the I B M S y s t e m
138 in the e a r l y 1 9 8 0 s . M R P ( M a n u f a c t u r i n g
R e s o u r c e s P l a n n i n g ) e v o l v e s into M R P - I I as a
m o r e a c c e s s i b l e e x t e n s i o n to s h o p f l o o r a n d
d i s t r i b u t i o n m a n a g e m e n t activities.
1981
Baan begins
sys t e m .
1982
B a a n d e l i v e r s its f i r s t s o f t w a r e p r o d u c t .
E d w a r d s f o c u s e s or t h e I B M S y s t e m / 3 8
JD
1983
O r a c l e o f f e r s b o t h a V A X m o d e d a t a b a s e as
as a d a t a b a s e w r i t t e n e n t i r e l y in C (for
p o r t a b i 1i t y ) .
well
1984
B a a n s h i f t s th e
manufacturing.
1985
J D E d w a r d s is r e c o g n i z e d as an i n d u s t r y l e a d i n g s u p p l i e r of a p p l i c a t i o n s s o f t w a r e for
the h i g h l y s u c c e s s f u l IBM AS/400 c o m p u t e r , a
d i r e c t d e s c e n d a n t of the S y s t e m l 3 8 .
1987
P e o p l e S o f t is f o u n d e d b y
M o r r i s in 1987.
to u s e
Unix
focus
of
as
its m a i n
their
Dave
to
operating
development
Duffield
and
to
Ken
20
1988
PeopleSoft's Human Resource

(HRMS) is d e v e l o p e d .
1990
B a a n s o f t w a r e is r o l l e d out to 35 c o u n t r i e s
through indir ec t sales channels.
The term
E n t e r p r i s e R e s o u r c e P l a n n i n g is c o i n e d in the
e a r l y 1 9 9 0 s w h e n M R P - I I is e x t e n d e d to c o v e r
a r e a s l i k e e n g i n e e r i n g , fin a n c e , h u m a n
resources, and project management.
1991
P e o p l e S o f t s e t s up o f f i c e s in C a n a d a . T h i s
l e a d s th e w a y to t h e i r p r e s e n c e in E u r o p e ,
As ia, A f r i c a , C e n t r a l a n d S o u t h A m e r i c a , a n d
t h e P a c i f i c Rim.
1995
B a a n g r o w s to m o r e
w or l d w i d e and over
1999
JD E dw ard s has more than 4,700 c u s t o m e r s with

s i t e s in o v e r 100 c o u n t r i e s . O r a c l e h a s 4 1 , 0 0 0
c u s t ome rs w o r l d w i d e (16,000 U . S . ) . P e o p leS of t
s o f t w a r e is u s e d b y m o r e t h a n 50% of t h e h u m a n
r e s o u r c e s m a r k e t . S A P is the w o r l d ' s l a r g e s t
i n t e r - e n t e r p r i s e s o f t w a r e c o m p a n y a n d the
world's fourth largest enterprise independent
s o f t w a r e s u p p l i e r ov e ra l l. SAP e m p l o y s over
2 0 , 5 0 0 p e o p l e in m o r e t h a n 50 c o u n t r i e s . To
date, m o r e t h a n 2 , 8 0 0 of B a a n 's e n t e r p r i s e
s y s t e m s h a v e b e e n i m p l e m e n t e d at a p p r o x i m a t e l y
4,800 si te s a r o u n d the world.
2000
Most ERP systems are enhancing their products

to b e c o m e " I n t e r n e t E n a b l e d * so t h a t c u s t o m e r s
w o r l d w i d e c a n h a v e d i r e c t a c c e s s to t h e
s u p p lie r' s ERP system.
ERP
In
the
p a st,
organizations
environment,
in
have
rather
Arab
grown
than
System
than 1,800 c u s t o m e r s
1,000 employees.
the A r a b
most
Management
Gulf
Gulf
more
by
States
States
by managing
focusing
on
the
internal
21
efficiencies.
This
era
low
consumer
awareness
th e
entry
more
of
the
wake
of
markets,
up
and
Now more
systems
their
as
change
to
initiative,
order.
Arab
Gulf
and
need
commitment
of
to
needs
implement
for
to
ERP
improving
in
the
top
in m a n y
States
other
it r e q u i r e s
With
players
implementation
any
and
the
is
expensive
organizational
sustained
management
for
it
succeed.
An
could
be
evolution
any ap pr oac h
pragmatic.
implementation
would
move
in c y c l e s
modules
implemented
sophisticated
software
Arabia;
the
the b a s i c
features
According
to
has
sheer
ERP
means
with
being
to
This
sophisticated
ERP
in
Like
end.
industry
effectiveness
ERP
shortages,
an
foreign
infrastructure
and
Any
to
States
house
consuming.
involvement
Gulf
ever,
a basic
efficiency
time
coming
organizations
marketplace.
and
its
than
manufacturing
is
licensing,
efficient
Arab
put
of
Saudi
size,
and
an
of
complexity,
all
to
the
the m o r e
later.
Solutions
easy
entire
from basic
implemented
Arabian
never been
t he
features
first
are
that
implementation
sell
(1999),
in
expense,
Saudi
and
the
22
collection
many
the
of
horror
organizations
benefits
organizations
ERP
ERP
projects.
of
Petroleum
of
large
at
some
stage
$200
manufacturing
organization
such
as
& Minerals
of
in
toward
The
ERP w a s
practices
their
manufacturing
Saudi
a competitive
Arabian
an
Group
that
bring
move
as
embark
University
many
ERP
is m o v i n g
its
is
particular
in
as
80%
or
solution.
on e
that
on
evaluating,
president
in
driving
just
t his
vice
to
to put
However,
are
Fahad
are
organization.
must
g o od.
t ha t
Kingdom
in
enough
projects
indicate
indicated
to
for
and ARAMCO
Zamil
ERP,
being
from King
organization
implementing
in
the
million
(ZAC)
remain
ERP
implementing,
Conditioners
that
idea
SABIC
Statistics
Financials.
to
the
successful
business
The
Oracle
of
off
stories
the
of
aim
entire
case,
Zamil
Air
of
the b e s t
business
Also,
indicated
this
he
direction
to
position.
Solutions
(1999)
stated:
T h o s e o r g a n i z a t i o n s that have l oo k e d into ERP

h a v e r e a l i z e d , t h e m a i n c o s t is n o t n e c e s s a r i l y
g e n e r a t e d b y the s o f t w a r e l i c e n s e s , b u t r a t h e r
b y t h e m a m m o t h p r i c e t a g a t t a c h e d to c o n s u l t i n g
services.
Gartner Group statistics indicate
t h a t i m p l e m e n t a t i o n s e r v i c e cost s, i n c l u d i n g
c o n s u l t i n g , a m o u n t to a n y t h i n g f r o m 55% to 70%
of t h e t o tal c o s t of a n E R P p r o j e c t ,
(p. 32)
23
According
t he
fear
of
businesses
huge
to
implementation
cheap,
to
on
costs
Arabian
Solutions
c o n s u l t i n g bills
attempt
resulting
consulting
Saudi
to m u d d l e
their
in
own,
or
led m a n y
through
to
organizations
to m i n i m i z e
has
(1999),
Saudi
ERP
deploy
ERP
on
the
slashing
implementation
expenses.
Saudi Orac l e ' s a c ting ma naging director, H i s h a m

S e r r y , a c k n o w l e d g e s the e x i s t e n c e of a s e v e r e
s h o r t a g e of q u a l i t y E R P c o n s u l t a n t s w i t h i n t h e
Kingdom.
T h e i s s u e is not the p r o d u c t i o n , it
is t h e h u m a n r e s o u r c e s , s a i d S e r r y .
To p r o t e c t
o u r q u a l i t y of s e r v i c e t h e r e a r e s o m e p r o j e c t s
w e h a v e h a d to t u r n d o w n b e c a u s e w e c o u l d n o t
p r o v i d e the r e q u i r e d human resou rc es , e v e n w i t h
our p a r t n e r s .
D e s p i t e o r g a n i z a t i o n s b e i n g a w a r e of the
s h o r t a g e of q u a l i t y staff, t h e r e is n o c l e a r
s o l u t i o n at h a n d .
F e w of th e K i n g d o m ' s
m a n u f a c t u r i n g b u s i n e s s e s c a n a f f o r d to h e a d h u n t
t a l e n t in the US, b u t t a k i n g l o w c o s t t a l e n t
f ro m I nd ia or E g yp t does not g u a r a n t e e
o r g a n i z a t i o n s w i l l f i n d the c o n s u l t a n t s w i t h
th e r i g h t b l e n d of t e c h n o l o g y a n d b u s i n e s s
s a v v y to i m p l e m e n t a p r o j e c t .
D e p e n d i n g on
fo reign staff has a negative aspect, w a r n e d
A b d u l l a h Al M e f d a a , a p r i v a t e s e c t o r IT
management consultant.
( C i t e d in S a u d i A r a b i a n
S o l u t i o n s , 1999, p. 32)
24
A Description
Characteristics
Integrated
A
seamless
integration
and
McCausland
(2000)
consistency
noted
ERP
client/server
distributed
object
oriented
system
is
distribution,
integrated
view
resources
and
example,
laptop
through
that
if
the
parts
like
RDBMS,
An
ERP
manufacturing,
and
project
provides
a remote
of
their
all
company's
to
with
from
For
order
into
transaction
alerting
the
procurement
to be o r d e r e d
and
telling
the
spot
the
system
to r e s e r v e
company
available
a new
the
This
a single,
customers.
logs
management.
users,
plant,
the road,
company,
manufacturing
on.
aspects
like
at
on
so
system
any busine ss
a salesperson
need
architecture,
to
addresses
commitments
computer
enterprise.
in a d d i t i o n
and
provide
that
approach
real-time
to
solution
finance,
a buyer
the
technology
programming
within
essential
across
addresses
a bandwidth
area
to
Components
is
that
requirements,
CEO
and
ERP
System
visibility
broad
of
in
his
flows
system
25
production
Minahan
queue
(1998)
for
the
newly
ordered
product.
indicated:
D a v i d C a r u s o , d i r e c t o r of e n t e r p r i s e
a p p l i c a t i o n r e s e a r c h at A d v a n c e d M a n u f a c t u r i n g
R e s e a r c h (AMR) Inc. of Bost on, d e s c r i b e s ERP
s y s t e m s as "a t r a n s a c t i o n a l b a c k b o n e " that
g i v e s c o m p a n i e s a c c e s s to the i n f o r m a t i o n t h e y
n e e d to m a k e m o r e k n o w l e d g e a b l e d e c i s i o n s or to
f u e l m o r e t a s k - s p e c i f i c a p p l i c a t i o n s , s u c h as
e l e c t r o n i c c o m m e r c e or s u p p l y - c h a i n p l a n n i n g
software.
For p u r c h a s i n g , ERP s y s t e m s c a n tie
t o g e t h e r f o r m e r l y d i s p a r a t e i n v e n t o r y , order,
and procurement systems, helping procurement
o r g a n i z a t i o n s c o n s o l i d a t e buys, r e d u c e
i n v e n t o r y on hand, a n d i m p l e m e n t s o u r c i n g
s t r a t e g i e s c o m p a n y w i d e . (p. 112)
Client/Server
On
the
System
technology
traditionally
compiled,
information
on
handle
amounts
run
and
huge
According
for
server
linked
computing
with
little
access
to
(1997),
with
shared
systems
and
other
PCs,
company
company-wide
costly
even
to
less
systems.
began
architecture
of
could
they w e r e
companies
computing
across
but
flexibility
to a n e t w o r k
power
and
These
data,
integration
to N e f f
a client-server
of
businesses
stored,
a mainframe.
offered
opportunity
front,
moving
that
uses
to
a
disburses
and pr o vi d e s
information.
users
26
On
one
progression
systems
1999).
in
employ
As
system)
level,
shown
runs
management,
an
ERP
this
is
simply
Figure
1,
application
e tc.)
next
b u s i n e s s -c o m p u t i n g
client/server
in
the
tha t
database
management
system
reflects
the
concept
crend.
ER P
technology
(Taschek,
the
(client's
user's
(accounting,
accesses
common
logical
information
system
of
inventory
from a
( s e r v e r ) . This
decentralized
computing.
T h e p r i m a r y s t r a t e g i e s for i m p l e m e n t i n g
c l i e n t / s e r v e r a re t w o - t i e r , t h r e e - t i e r a n d
I n t e r n e t / I n t r a n e t . F i g u r e 1 s h o w s the
d iff e r e n c e between two-tier and three-tier.
In
a t w o - t i e r a p p r o a c h , the c l i e n t m a c h i n e
c o n n e c t s to a s i n g l e s e r v e r m a c h i n e .
Usually
the s e r v e r c o n t r o l s the c e n t r a l d a t a b a s e a n d
the c l i e n t c o n t r o l s the u s e r i n t e r f a c e .
In a
t h r e e - t i e r a p p r o a c h , the c l i e n t m a c h i n e
c o n t r o l s the u s e r i n t e r f a c e a n d s o m e p r o c e s s i n g
logic, a n a p p l i c a t i o n s e r v e r m a n a g e s the
e nt e r p r i s e business appli c a t i o n processing, and
o n e a i d m a n a g e m e n t of v e r s i o n r e l e a s e s a n d the
e n t e r p r i s e b u s i n e s s rul es.
C l i e n t / s e r v e r technology relies on robust
c o m m u n i c a t i o n s b e t w e e n the m a c h i n e s th at a r e
involved.
L o c a l A r e a N e t w o r k s b e c o m e an
e x p e n s e a n d a m a n a g e m e n t h e a d a c h e for m o s t
companies.
Moreover, u p d a t i n g so ftw are
v e r s i o n s , p a r t i c u l a r l y for t h e n u m e r o u s
d i s t r i b u t e d PCs, b e c o m e a n a l m o s t u n s o l v a b l e
p r o b l e m . (L a n g e n w a l t e r , 2000, p. 210)
27
Application
Central
Computer
Enterprise
Server ' r
Fi gure 1 . 2-tier and 3-tier

(L a n g e n w a l t e r , 2000) .
Enterprise-Wide
ERP
of
the
with
are
all
no
via
(Burt,
a common
200 0 ) .
the a p p l i c a t i o n s
redundancies
ensured.
McCann
in
(1999)
applications
available
business
encounter.
systems
may
cover,
manufacturing
management,
include
and
and
approaches
Database
operates
system
client/server
The
in
noted
to
fit
core
interacts
system,
and
the
thus
there
integrity
is
that
there
are
ERP
just
about
any
need
Major
finance,
areas,
human
supply
analysis.
at
database
the
the d a t a
logistics,
data
database
As
which
these
resources,
chain
shown
in T a b l e
28
these
sectors
are
components
with
a variety
of
functions.
Table
Some
1
Components
of
an
ERP
System
Components
(McCann,
1999)
Descriptions
FINANCE
General
ledger
Keeps c e n t r a l i z e d charts
accounts and corporate
financial balances.
of
Accounts
receivable
T r a c k s p a y m e n t s d u e to a
c o m p a n y f r o m its c u s t o m e r s .
Accounts
Schedules
suppliers
Fixed
payable
assets
b i l l p a y m e n t s to
and distributors.
Ma na g e s d e p r e c i a t i o n and
other costs associated with
tang ib le assets.
Treasury
management
M o n i t o r s and an al y z e s cash
holdings, financial deals and
i n v e s t m e n t risks.
Cost
A n a l y s e s co r p o r a t e costs
r e l a t e d to o v e r h e a d a n d
m a n u f a c t u r i n g orders.
control
(table
continues)
29
Components
Descriptions
HUMAN RESOURCES
HR a d m i n i s t r a t i o n
Automates personnel management

p r o c e ss es incl udi ng staffing,
b u s i n e s s travel, a n d v a c a t i o n
t ime .
P a y r o 11
Handles accounting and

p r e p a r a t i o n of c h e c k s r e l a t e d
to e m p l o y e e s a l a r i e s , w a g e s
and b o n u s e s .
Self-service
HR
Lets w o r k e r s c h an g e their
personal information and
b e n eficial a l locations online
w i t h o u t h a v i n g to s e n d f o rms
to h u m a n r e s o u r c e s .
MANUFACTURING
AND
LOGISTICS
Production
planning
Performs capacity p l a n n i n g
creates a daily p r o d u c t i o n
s c h e d u l e for a c o m p a n y ' s
m a n u f a ct u r i ng plants.
Order
A u t o m a t e s the d a t a e n t r y a n d
p r o c e s s of c u s t o m e r o r d e r s a n d
k e e p s t r a c k of the s t a t u s of
orders.
entering
Warehouse
management
and
M a i n t a i n s r e c o r d s of
w a r e h o u s e d goods a n d pro cesses
m o v e m e n t s of p r o d u c t s t h r o u g h
warehouses .
(table
continues)
30
Components
Descriptions
Transportation
management
Schedules and monitors

d e l i v e r y of p r o d u c t s to
cu s tom er s via trucks, trains
and other vehicles.
Proi ec t
management
M on it o r s costs and w o r k
s c h e d u l e s on a p r o j e c t - b y project b a s i s .
Plant
Sets p la n and o v e r s e e s u pk e e p
of i n t e r n a l f a c i l i t i e s .
maintenance
Customer service
management
Administers installed-based
service agre em en ts and checks
contracts and w a rranties when
c u s t o m e r s c a l l for h e l p .
SUPPLY-CHAIN
MANAGEMENT
Advances planning applications

to m o n i t o r p r o d u c t i o n
constraints, demand
fo re c a s t i n g and o r d e r d e l i v e r y
promi s e s .
DATA ANALYSIS
D e c i s i o n s u p p o r t s o f t w a r e t hat
lets e x e c u t i v e s a n d o t h e r
users analyses t ransactions
d a t a to t r a c k b u s i n e s s
performance.
31
Applications/Modules
Each
ERP
applications
are
the
vendor
(or m o d u l e s )
functional
systems
order
start
additional
All
of
provide
However,
set
of
applications
across
ERP
entire
and
core
procedures
users
as
hiU rn2 n
1999) . M o s t
a company
fully
These
each
modules
operations
require
for
(Parker,
are
ERP
s - in 5 n c 0
and visib i l i t y
systems
processes
of
systems.
packages
from wh i c h
consistency
activities
the
with
their
such
processing
modules
these
unit
a number
for
software
i n cli v i.clu.2.1 b u s i n e s s
resources,
provides
and
can
offer
choose.
integrated
for
all
to
the
(Baan,
to
ERP
1997c) .
comply with
described
by
the
application.
Industry-Specific
Vendors
account
given
for
such
services,
For
also
or
example,
specific
offer
unique
industry.
markets
Applications
as
processes
These
SAP,
retail
an
for
ERP
service
health
environment
vendor,
patient
applications
and procedures
modules
government,
the
modules
specialized
financial
(McKie,
management
within
vertical
care,
offers
to
1997).
health
that
care
support
32
all
patient-oriented, pr oc es se s
hospital
(SAP,
1997) .
vendors
moving
into
such
supply
chain
and
as
sales
Do
their
systems
ERP
business
improve
encompassing
of
the
is
shows
very
forecasting
ERP
to
high
Do?
that
functioning
Manufacturers
package
1999) .
expectations
anticipated
overall
areas,
(Sh e r m a n ,
Expect
have
It
software
want
that
an
runs
ERP
of
all-
every
aspect
the b u s i n e s s .
ERP p r o v i d e s
buyer
view
at
of
their
functions
its
plant,
at
the
delays,
times,
allowing
resources
the
a company
An
ERP
shipping
by
CEO
to a
real-time
combines
them.
a company
duplications,
and by
ERP
application
a difference
of
a single,
available
integrates
end
from company
with
customers.
every
and
distribution
user s ,
company's
to
of
job
can make
all
a remote
commitments
do
often
overnight.
demand
and m a r k e t i n a
systems.
will
trend
the
specialized
management,
Manufacturers
Manufacturers
of
current
even more
automation
What
The
throughout
and
needed
requires
system
to
also
and
reducing
and m i s t a k e s
on
manufacturing
delivery
to b e c o m e
more
33
flexible.
smaller
to
and
stock
not
Shipments
cheaper.
materials
become
(Loizos,
obsolete
go
direct
and
In a d d i t i o n ,
or
finished
and
have
therefore
there's
units,
to
are
be
so
no
need
stocks
written
do
off
1998) .
How
As
can
shown
Do
in F i g u r e
data
warehouse,
data
are
is
housed.
in
This
information
fl ows
activities,
through
execution
ERP
Systems
2,
the
data
th e m i d d l e
figure
from
the
the
and accounting
Work?
bucket,
where
depicts
the
chart
functional
area
called
common
how
planning
plan,
to
the
activities.
Top Mgmt Plans

Resource
Profit
Budget
Sales
Plans
Production Plans
M PS
Data Bucket
History
Tracking
Sales
Order Release
Status
Result
Accounts
Receivable
Order Completion
Payable
Figure
2000 )
2 . H ow ERP
s y s t e m works.
(Jacobs
& Whybark,
34
What
ERP
allows
provides
a company
systems
(Lieber,
applications,
ERP
keeping
of
track
the b o o k s
in
Does
to
different
1995).
In
can
handle
has
the
its
The
of
ERP
on
the
of
result
is
a business
people
at
t asks
from
to b a l a n c i n g
the
get
It
information
levels
systems
right
enterprise.
a range
streamlined
parts
Do?
the
Depending
manufacturing
essence,
to
for
standardize
1995) .
that
between
Really
a backbone
accounting.
organization
information
ERP
an
data
flow
(Lieber,
the
the
right
right
time
(S h e r i d a n , 19 9 5).
Benefits
Easier Acce s s
to
which
had
easy way
systems
database
systems,
find
management
accounting
or
run a c r o s s
the
data
have
CAD
and
stored
or
1995).
utilized
MRP
Th us,
rather
for
s ystems,
them,
transfer
sourcing,
enterprise
in
ERP uses
system.
optimal
System
Information
like
data
the
(Sheridan,
ERP
companies
important
to
an
Reliable
Traditionally,
incompatible
of
with
it b e t w e e n
common
decisions
example,
than
no
on
can
looking
at
cost
be
35
separate
operational
coordinate
data
the
across
units
information
multiple
(Collett,
provides
opportunity
and
to
data
ensure
(Gilbert
to
accurate,
& Swea t ,
Driven
by
business
within
units
an
database,
of
such
tasks
to a n o t h e r .
data
might
1995 ) .
can
can
in
maker
just
an
by
of
the
With
data
system
reporting
and
comparable
reduces
functional
applications
is
no
need
data
CIO
office
rid
sharing
repetition
application
a piece
places
of
(Sheridan,
eliminate
the
Steelcase
Inc.,
remarked
reduction
of
business
from one
furniture,
million
getting
of
redundancy
and
for
systems,
company
The
$80
other
re-engineering,
six di f f e r e n t
help
some
Operations
systems
In n o n - i n t e g r a t e d
achieve
expenses
there
processes.
$3 b i l l i o n
we
ERP
inputting
reside
ERP
redundant
as
and
processes
integrated
a common
reconciling
integrated
improve
Data
organization.
utilizing
An
to
1999).
Redundant
of
or
with
consistent,
of
implementation
trying
manually
2000) .
Elimination
the
then
interfaces
application
an
and
that
in o p e r a t i n g
redundant
processes
36
and
cleaning
up
our
data
(Cited
in Stei n,
1997b,
p.
time
critical
89) .
Reduction
ERP
of
systems
constraint
business
1997).
Cycle
recognize
variable,
and
and
the
information
Time
delays
Times
reductions
by
that
driving
retrieving
(Sherman,
2000) .
how
Palmolive
dealt
customer
orders
Increased
ERP
before
Efficiency,
allows
This
improved
and
control
that,
a year
in M o l i n e ,
from
six
from
in-progress
life
of
two
on
inventory
shop
floor
ERP
implementation.
Reducing
2000).
reduced
in
to
dropped
Costs
to b e
of
superfluous
ERP,
lead
(1997)
Par
time
noted
Industries
to
customers
performance
more
than
almost
went
analyzed
timesavings,
Appleton
delivery
order
noted
after
decisions
time
(1997)
tracked
elimination
weeks,
60%
Stevens
implementing
Illinois,
to
increased
after
minimizing
and
results
(Habermann,
Group,
with
Hence
business
enterprise-wide.
operations
and
by
both
disseminating
information
Colgate
for
(META
achieved
or
variable
technology
are
is
95%,
60%,
from w e e k s
work-
and
the
to h o u r s
37
Granados
increased
(1997)
cited
another
example
of
efficiency:
In Boise, Idaho, J R S i m p l o t Co., a p o t a t o

product manufacturer recently achieved
s i g n i f i c a n t b e n e f i t at m i n i m a l c o s t f r o m
i m p l e m e n t i n g an ERP system.
Be ca us e they are a
l o w - m a r g i n b u s i n e s s , S i m p l o t o p t e d to r u n a
t r i a l E R P i m p l e m e n t a t i o n . W i t h i n f o u r m o n t h s of
i n i t i a t i o n , the p r o j e c t w e n t live. T h e t r i a l
w a s c o n d u c t e d for $ 1 0 0 , 0 0 0 i n c l u d i n g t r a i n i n g
costs. The b e n e f i t s w e r e a c h i e v e d a l m o s t
immediately: redundant p a p e r w o r k was
eliminated; control was impro ve d through more
r i g o r o u s l o t c o n t r o l of t h e i r p r o d u c t s ; c o s t s
w e r e re du ce d by more e f f i c i e n t l y o r d e ri ng
p a c k a g i n g supplies; y i e l d im pr ov ed by more
e f f e c t i v e l y s c h e d u l i n g to m a x i m i z e r a w
m a t e r i a l s i n v e n t o r i e s . It is e s t i m a t e d t h a t the
t r i a l p a i d b a c k m o r e t h a n 4 0 0 % of t h e i r
original investment,
(p. 18)
Easily
Adaptable
Recognizing
it
takes
systems
in a C h a n g i n g
companies'
to b r i n g
are
goods
designed
to
Business
need
and
to
reduce
services
respond
and
expanded
without
disrupting
the
course
The
required
to d e p l o y
and
continuously
1997).
go
to
processes
The
companies
market.
manager
will
Larry
be
are
greatly
always
Ferrere,
for m a n u f a c t u r i n g
at
changed
J.D .
of
finding
or
business.
reduced
industry
ERP
to n e w
demands
business
time
to m a r k e t ,
quickly
easily
t he
business
time
can be
Environment
improve
(SAP,
new ways
marketing
Edwards,
pointed
to
38
out,
"Your
products.
business
Internally
requirements,
change"
Y2K
not
you
so y o u
(cited
always
will
have
to
in G u r l e y ,
involve
have
be
new
the
business
positioned
1999,
p.
same
for
142) .
Enabled
The
year
important
th e
only
four
2000
The
used
and
accounting,
two
enabled.
This
converting
These
as w e l l
requires
(SAP,
current
and
these
systems
are
able
that
conduct
extrapolation
of
to
to
failed
ERP
instead
in
data-
software
is Y 2 K
support
(for e x a m p l e ,
ERP
customers
resource
the
administer
year
the
research
beyond
drain
of
2000.
multi-year
extend beyond
data
of
fields
resulting
support
market
issues
to
critical
Thus,
and
the m o s t
year
systems
system
expense,
orders
as
other
01/01/99) .
burden,
companies
contracts
2000,
versus
the
2000,
1997a) .
numbering
of
from d a t e
define
year
that
one
technology
systems
and
(Baan,
means
four-digit-year
the
to
the
inventory,
problems
01/01/1999
digits
process
was
stemmed
Computer
related
(Y2K)
information
problem
digits.
recognize
avoided
problem
business
decade.
th a t
of
may
the
year
that
year
19 97 ) .
2000
39
Euro
Enabled
Europe
also
known
blip
on
introduced
as
the
the
currency
way
enterprises
th at
the
times
ERP
dual
or
are
than
software
are
example,
functions
as
as
to
the
currency
be
higher
offer
in
(SAP,
of
failures
the
implementation
of
success.
to
failure
of
is
two
six
1997) .
the
(Knowles,
support
the
tools
sessions
transitioning
Implementation
ERP
implementations
ranges
of
it
following
the
estimated
(K nowles,
of
the
on
to
the
that
The
impact
change.
and
in
order
smoothly
1997).
factors
ERP,
America,
Euro
a set
(L a n g e n w a l t e r , 2 0 0 0 ) .
understand
to
than
comply with
the
information
Affecting
classified
tools
customers
percentage
of
Euro,
more
It
conversions
developing
its
The
business.
requirements
well
in N o r t h
already
the
much
corporations
Y2K
SAP wi ll
not
significant
systems
support
Factors
cost
to
new
screens
doing
did
currency,
Though
have
will
currency
1997)
F or
will
Euro
more
EMU.
computer
new
a new
from
If
are
to
ERP
that
60%
can
and
companies
affect
can
40%
of
the
increase
the
their
factors
chances
that
implementation.
lead
40
Speed
The
quick
and Difficulty
success
by benefits
necessitates
DOT
system
a very
is
arduous
ERP,
it m u s t
internal
implemented
least
four
did
first
from
ERP,
times
on
the
reaped
rPVio
from
deal
and
the n e e d
fortune
as
which
leads
1000
severalall
much
software
on
of
issues,
interview with
t hat
they
that
had
implementation
license
around
general
companies
reported
and
implementation
for
In an
to
q EiTl P.P
with organizational
1999) .
44%
This
operations
physical
on h o w
it.
expensive,
before
with
the
depends
T_mr>1_oTn0r'i t- zj {-
example,
begin
(Vowler,
executives
solution
implementation,
company
politics,
consensus
be
Implementation
time-consuming,
For
billion-dollar
can
ERP
jp^ v'i_ ClS
task.
the w o r l d
an
can
rapid
cVinvHono^
they
of
of
itself
IT
had
spent
help
at
than
(Michel,
1997) .
Avraham
scenarios
of
(1999)
could
noted
be
that
two
implementation
distinguished:
1 . C o m p rehensive Imple me nt at io n Scenario: Here

th e f o c u s is m o r e on b u s i n e s s i m p r o v e m e n t t h a n
on t e c h n i c a l i m p r o v e m e n t d u r i n g t h e
i m p l e m e n t a t i o n . T h i s a p p r o a c h is s u i t a b l e
w h e n : I m p r o v e m e n t s in b u s i n e s s p r o c e s s e s arer equired. C u s t o m i z a t i o n s are n e c e s s a r y
41
D i f f e r e n t a l t e r n a t i v e s t r a t e g i e s n e e d to b e
e v a l u a t e d . H i g h l e v e l of i n t e g r a t i o n w i t h
o t h e r s y s t e m s is r e q u i r e d . M u l t i p l e s i t e s h a v e
to b e i m p l e m e n t e d .
2. C o m p a c t I m p l e m e n t a t i o n S c e n a r i o : H e r e the
f o c u s is o n t e c h n i c a l m i g r a t i o n d u r i n g the
implementation with enhanced business
i m p r o v e m e n t s c oming at a later stage. This
a p p r o a c h is s u i t a b l e w h e n ; I m p r o v e m e n t s in
b u s i n e s s p r o c es se s are not r e q u i r e d
immediately Change-minded organization with
firm deci si on maki ng process.
Company
o p e r a t i n g a c c o r d i n g to c o m m o n b u s i n e s s
p r a c t i c e s . S i n g l e s i t e h a s to b e i m p l e m e n t e d ,
(p. 121)
However,
pain
out
program
of
ER P
software
Accelerated
gained
su it e )
encapsulates
Business
from
t h is
This
conform
processing
scenarios
Adopting
addition
itself
is
to
ERP
the
SAP
expertise
teams
operating
SAP
has
of
is n o t
an
difficulties
complicated
to
that
R/3
(SAP
takes
the
flagship
and
called
assists
SAP m o d u l e s
style
the
introduced
a product
product
configure
take
to d a t e
into
( C o llins,
to
(ASAP)
thousands
implementation
the
trying
implementations
Engineer.
to
are
implementation.
called
knowledge
vendors
of
some
100
to
business
1999).
easy
decision.
noted,
the
In
software
install.
42
A n o t h e r g r i p e a b o u t E R P s y s t e m s is t h a t t h e y ' r e
d i f f i c u l t to i n s t a l l .
The t y p ic a l ERP
i m p l e m e n t a t i o n takes b e t w e e n two an d three
years.
Larger, m o r e c o m p l e x i n s t a l l a t i o n s can
s t r e t c h to f i v e or s i x y e a r s . In a d d i t i o n , m o s t
of t h e s e s y s t e m s a r e n ' t v e r y u s e r - f r i e n d l y ,
r e q u i r i n g c o m p a n i e s to s p e n d s i g n i f i c a n t t i m e
up f r o n t e s t a b l i s h i n g r u l e s for u s i n g the
s y s t e m a n d t r a i n i n g e m p l o y e e s to f o l l o w them.
[ERP] p r o v i d e s y o u w i t h this g r e a t d a t a
w a r e h o u s e s y s t e m , s a y s C h u c k B eck, v i c e
p r e s i d e n t of g l o b a l m a t e r i a l s a n d s o u r c i n g for
C o l g a t e - P a l m o l i v e , w h i c h is i m p l e m e n t i n g S A P
R/3 as p a r t of its g l o b a l , s u p p l y c h a i n
management initiative.
T h e d a t a is in there,
but t h e r e ' s this e x c r u c i a t i n g l y p a i n f u l e f f o r t
to m a k e s u r e t h a t w h a t y o u p u l l o u t is w h a t y o u
need.
( C i t e d in M i n a h a n 1998, p. 112)
Selection
of
the
Wrong
ER P
systems
force
engineer
current
practices
processes
described
wrong
software
ERP
commitment
not
fit w i t h
(Hecht,
role
tha t
the
Edelstein,
could
we
vice
Bristol-Myers
modules.
result
Software
and
used
are
an
has
to
in
president
(cited
of
an
re
the
Selecting
strategic
taken
over
s h o p , " said
that
do
goals
the
"We u s e d
defining
to be
an
David
information
in W e s t o n ,
the
unwilling
applications
have.
SAP
to
fit w i t h i n
organization's
hardware
Now
their
Software
customers
to
architecture
1997).
I B M shop.
at
to
by
their
ERP
management
1997).
43
However, not e v e r y o n e v ie w s t h es e c o n f o r m e d
f u n c t i o n s as h i n d e r i n g t h e i r p r o p r i e t a r y
p r o c e s s e s . S t e e l c a s e Inc. f o r m e r l y r e l i e d on
its o w n c u s t o m i z e d a p p l i c a t i o n s fo r its
m a n u f a c t u r i n g o p e r a t i o n s . H o w e v e r thi s
c u s t o m i z a t i o n r o u t e w a s t a k i n g to o l o n g a n d
c o s t i n g too m u c h .
S A P R/3 s y s t e m p r o v i d e d t he
day-to-day order fulfillment and addressed
p r o c e s s e s r e q u i r e d to b u i l d t he p r o d u c t s . S a y s
C I O M a r k G r e i n e r ; w e h a v e a l w a y s b e e n a b l e to
make h i g h e r q u a l i t y furniture n o w we realize
it' s n o t j u s t h o w w e l l w e m a k e it, b u t h o w w e l l
w e s e l l it.
( C i t e d in Stein, 1 9 97b , p. 89)
Commitment
Letting
company's
one
vendor
enterprise
risky p r o p o s i t i o n
to
a Single
provide
systems
(Weston,
Vendor
most
is an
or
all
of
attractive
but
1997).
If y o u d e p e n d o n a s i n g l e v e n d o r , y o u get a
common arc hi tec ture, lower supp or t costs and
c h e a p e r s eats, a r g u e s V i n n i e M i r c h a n d a n i , a n
a n a l y s t w i t h G a r t n e r G r o u p Inc.
O n the o t h e r
hand, u p g r a d e s b e c o m e a b e a r b e c a u s e y o u h a v e
to do e v e r y t h i n g at on c e . Al s o , as y o u b e c o m e
more d e p e n d e n t on a single vendor, you risk
o u t s o u r c i n g y o u r e n t i r e I n t e g r a t e d S y s t e m (IS)
d e p a r t m e n t to t hem.
( C i t e d in S t e i n , 1997a, p.
45)
System
sync
with
with
the
( l a test
improvements
the
business
vendor.
versions)
the v e n d o r
ERP
to
(Lo izos,
and
upgrades
cycle;
systems
ensure
systems
must
are
have
remain
continued
not
in
to m o v e
current
support
1998) .
from
44
Too Ma ny
Fully
features
the
integrated
and
features
in m o v i n g
People
that
software
quality,
and
feature
of
dynamic
lot
capable
of
this
u^
a
. j_
x
xs
>
O
G
L C
U uux C
O
company
efficiency.
sizing.
cause
actually
the p r i c e
is
system n e e d ed
will
access
come
based
and
to u s e
of
all
of
c ^ i 1 .x.
a
G
l.
U^ uuUx x j
example,
in an
though
the
lo t
size
negative
in
i_^
.
x
j_
high
a common
ERP sy st em
system
is
value
the
is
daily,
production
effects
on
the
1997) .
Cost
doesn't
lot
profitability,
disruptions
have
provides,
u i. C
module
the
have
tend
For
Even
huge
(Appleton,
ERP
toward
recalculating
and
company
their
a production
would
cycles
i
wx
-
the
systems
functions.
^
x
_
c
:y
C
i.tv
_
x
.^
G
O
O
ERP
Features
on
of
an
ERP
cheap.
the
As
System
with
most
functionality
the n u m b e r
of
seats
or
software,
of
the
users
who
it.
T h e c o m p l e x i t y of E R P (and the t h r e a t of a
f a i l e d i n s t a l la ti o n) g e n e r a l l y d e m a n d that
c o m p a n i e s h i r e a c a d r e of c o n s u l t a n t s a n d
t e c h n i c a l g u r u s w h o s e f e e s c a n r u n as h i g h as
f i v e to 10 t i m e s t h e p r i c e of t h e s o f t w a r e .
I t s n o t u n u s u a l for t h e big, c o m p l e x d e a l s to
be $ 5 0 , 0 0 0 to $ 7 5 , 0 0 0 p e r c o n c u r r e n t u s e r , "
s a y s C h r i s Jone s , v i c e p r e s i d e n t a n d r e s e a r c h
45
d i r e ct o r for the m a n u f a c t u r i n g and l o g i s t i c s

d i v i s i o n of T h e G a r t n e r G r o u p , a S t a m f o r d , C o n n
b a s e d r e s e a r c h h o u s e . J o n e s e m p h a s i z e s t h a t the
c ost of E R P i n s t a l l a t i o n s c a n v a r y b y m o r e than
20%, d e p e n d i n g o n the s c o p e a n d c o m p l e x i t y of
the i n s t a l l a t i o n .
H o w e v e r , to s a y a t y p i c a l
ERP i n s t a l l a t i o n is n e v e r l e s s t h a n $ 2 5 , 0 0 0 p e r
c o n c u r r e n t u s e r is p r o b a b l y n o t true.
(C it e d
in M i n a h a n 1998. p. 112)
According
system
such
is
as
users,
to
Saunders
extremely
the
size
variable,
of
the n u m b e r
the
of
support
also
associated
support
the
system,
implementation,
Loizos
costs
(1998)
are
user.
can
is
and
indicated
anywhere
Thus,
expect
consulting
that
between
to p a y
about
ratio
software
consulting
users
have
and
is a v e r y
a minimum
training
small
the
whether
There
initial
and
costs.
$20,000
company;
Bear
a
30
a basic
are
The
$800,000
costs.
are
to
software
approximately
of
of
for u s e r s .
costs
at
company would
costs
ERP
for
training
and
with
costs
an
factors
hardware
for
Consulting
on
not.
$400,000
system.
a 2:1
or
$8,000
a company with
of
the n u m b e r
upgrading
training
cost
purchased,
included
with
the
depending
company,
modules
first-year
costs
(1998)
users
ERP
estimated
same
in
in m i n d
larger
per
that
company
30
must
46
expect
to
spend
system before
Due
to
several
it g o e s
the
implementation
dollars
of
almost
ERP
always
accompanied
process
re-engineering.
of
project
cost,
the b u s i n e s s
process
their
ERP
systems,
business
(ERP)
on
live.
nature
is
million
up
to
The
7 0%
to
re-engineering
by
largest
80%,
is
itself
part
doing
(Stevens,
1997 ) .
However,
considered
system.
of
when
Returns
apparent,
use
several
but
legacy
systems
must
and h a r d w a r e
evaluating
on
the
costs
are
developments
implementation
of
the
elimination
legacy
costs
of
must
an
be
ERP
of
keep
up
systems.
when
be
with
very
must
costs
not
systems
considered
of
an
ERP
immediately
continued
hi g h .
with
Legacy
software
1998).
usually
All
be
However,
requires
of
estimating
these
true
system.
the p r i m a r y
implementations
may
(Stedman,
ERP
Unrealistic
One
true
also
to
the
factors
costs
associated
adjusted
of
the
investment
systems
be
opportunity
is
that
Expectations
causes
the
of u n s u c c e s s f u l
expectations
of
the
ERP
47
company
greatly
exceed
the
capabilities
of
the
sys t e m .
T h e b i g g e s t m i s t a k e c o m p a n i e s m a k e is that t h e y
think, if I b u y this b i g s o f t w a r e p a c k a g e , it
w il l fix my problem, says M a r k Orton, a s s i s t a n t
d i r e c t o r of the N e w E n g l a n d S u p p l i e r I n s t i t u t e
(NESI ) i "! 13 c S ^ ^ ^
IT *-( T q c c
a
r*io c
a
1Ah
of t h i n k i n g a b o u t w h a t its s u p p l y c h a i n
s t r a t e g y is a n d a r t i c u l a t i n g w h a t its b u s i n e s s
p r o c e s s e s are, t h e s e t o o l s a r e g o i n g to be of
l i t tl e use.
An
change
ERP
system
a company
not m a k e
their
are
realistic
The
of
level
sales
from
2000).
fully
technically
o n l y an
the
the n u m b e r
the
is
in
by
the
reality
and
it w i l l
When
setting
of
the
t h e m at
2 000 ) .
of
the
system
information
is
(Wah,
is
very
It
requires
it.
integrated
the n u m b e r
quite
project
system,
to s u p p o r t
than
itself,
diminishing
to e f f e c t .
completely
it c a n n o t
implementation
the v e n d o r
integrated
greater
by
competitive.
company
philosophy
and
is o f t e n
difficult
of
all-powerful,
(P e t e r s e n ,
effective
corporate
Europe
task
pitch
different
A
more
utilized
first
expectations
not
immediately,
a company
consultants
ERP,
is
but
For
ERP
not
also
the
e xamp le,
systems
in
in N o r t h America.
48
This
is
due
to
the
essence
corporate
philosophies.
companies
tend
opposed
North
to
America
Lack
of
When
Attention
it
comes
management
in
for
extremely
to
that
and
to
the
units
Infrastructure
ERP
availability
frustrating
to c o n s i d e r
and develop
a cle a r ,
concise,
plan
starting
the
before
nature,
as
in
planning
issues
surprise.
all
and
Planning
applications,
infrastructure
application
important
by
business
implementing
and
European
1998) .
ignore
a costly
respective
integrated
autonomous
ILoizos.
organizations
be
more
the
Culturally,
to b e m o r e
the
of
of
the
could
It
is
issues
thorough
project
implementation
(Gurley,
that
to
19 99 ) .
Loizos
depth
survey
large
and
Inc.
(1998)
of
availability
application
C D O),
user
such
training,
in d e t a i l
and
companies
issues
and
are
according
technology
and protection,
configuration,
process
senior
mid-sized
(NYSE:
addressed
noted
critical
in
network
to E R P
at
Comdisco,
infrastructure,
hardware
support
th e
by
in-
application
desktop
help-desk
early
executives
sponsored
as
an
must
and
be
implementation
implementation
49
success,
according
conducted
by
to
OmniTech
Companies
required
often
fail
resources
also
education
are
of
the
forcing
are
ERP
project
financial
implementation,
amount
Sufficient
for
of
time
but
other
and
a successful
complex.
regularly
completion
probability
completion
was
& Hi 1 l e g e r s b e r g , 2000) .
is
greatly
the
the
technically
project
ineffectual
ERP
factors
(Kumar
project
d e a d l i n e , the
an
recognize
crucial
very
the
for
which
Group.
realize
necessary.
implementation
systems
to
survey,
Consulting
generally
commitment
they
the
of
be
enormity
underestimated.
by
By
a specified
the p r o j e c t
increases.
should
The
ERP
T h us ,
being
ample
allotted
time
for
(Bassirean,
2000).
Adequately
the
success
of
trained
an
ERP
users
project.
to
change
hardware
and
or
months
to
learning
And
the
benefit
'best'
to
(Stedman,
made
in
scale
ERP
1998).
training
if
no
may
but
curves
in
critical
only
it
knows
takes
can be
how
investment
on n e w
take
(Crowley,
the w o r l d
one
Significant
employees
also
It
software,
system
a company
are
business
days
weeks
1998) .
of
to u s e
must
for
be
no
it
50
processes.
As
Michael
business
strategy
and
software
acquisition
(1999)
ERP
and
Centralized
Campos
systems
(2000)
agreed
benefits
of
Having
senior
executive
happen
and
the
who
happen
change
the
the
As
Minahan
mistake
companies
they
do
not
have
They
do
not
understand
underestimate
it
company'
Senior
critical
staff
decisions
background
or
the
countered
by
the
authority
will
lot
change
to m a k e
(Michael,
1999) .
Strategy
with
what
takes
that
for
how
ERP
is
to
ERP
to
the
biggest
implementation
mistake
who
to m a k e
help
time
management
to p e r s o n n e l
ERP
led by a
noted
prepared
operating
are
of
implementation
Insufficient
Another
to
users
business
a strategy
what
commit
of
of
make
you
the
management
wasting
(1998)
that
risks
has
Lack
before
your
installation.
quickly
without
evaluate
Decision-Making
centralized
processes.
plan
indicated
that
said,
use
all
go
that
about
about
implement
it.
and
it.
Experience
is
not
the
cannot
may not
temperament
to
is
for
having
ERP
s ys t e m .
relegate
have
this
the
critical
the
type
of
51
decision
making
indicated
that
experience
conduct
in
th e
(Michael,
organizations
implementing
full
review
implementation
experienced
infrastructure
of
ERP
of
and
that
had previous
However,
often
secondary
support
(1999)
applications
process.
implementation
Welt i,
infrastructure
organizations,
i m p l e m e n t e r s , put
areas
1999) .
or
tended
needs
early
less
first-time
focus
to
ER P
on
disregarded
those
altogether.
T h e p e r s o n n e l s h o u l d b e in the h i g h l e v e l of
k n o w l e d g e a b o u t E R P to s a v e the c o m p a n y a lot
of m o n e y a n d time.
O we n s C o r n i n g took s i m i l a r
c a r e to t r a i n its p e o p l e to u s e ERR.
In fact,
th e c o m p a n y , w h i c h s c h o o l e d p e r s o n n e l on h o w to
p r o p e r l y i np ut d ata into SAP and use v a r i o u s
m o d u l e s , e x p e c t s n e a r l y 13 % of its t otal
i m p l e m e n t a t i o n b u d g e t to g o to t r a i n i n g .
Our
p e o p l e w e r e n ' t g i v e n a c c e s s to a p a r t i c u l a r
[SAP] m o d u l e u n t i l t h e y c o m p l e t e d the
c e r t i f i c a t i o n a n d w e r e a u t h o r i z e d to a c c e s s it,
says Sheets.
Undue
Hecht
cost
millions
Th us,
of
it w o u l d
this
options
use
(1997)
money
of
Haste
indicated
dollars
make
a quick-pick
ERP
to p u r c h a s e
sense
to
investigating
available.
that
spend
the
when
and
often
implement.
a small
various
Unfortunately,
scheme
systems
fraction
software
many companies
choosing
an
ERP v e n do r.
52
Allowing
agendas
often
with
to
no
in
the
match
(Markus,
the
very
to
regardless
of
ERP
the p r o j e c t .
must
time,
be v i s i b l y
2.
progress
not
the
ERP
can
data,
of
the
result
in
a company's
computer
cost
system
is
does
irrelevant
Implementation
and
ERP
the
from
to
the
project
of
budget
is
some
implementation,
project:
from
upper
get
on
are
commitment
supportive
to
vision
following
support
going
without
no
track
and
Without
Communicate
of
on
The
education)
is
ERP
successful
high
vendor
2 0 0 0) .
an
vendor
political
a single
reflect
goals,
Fen e m a ,
the
and
the
projects
Provide
project
end
difficult.
on
decisions
not
Survive
ERP
for
(money,
does
internal
conducted
Hasty
the
&
and
criteria,
business's
guidelines
1.
in
Tani s ,
Keeping
for
search
that
If
How
often
fear,
selection
system.
system
objectives.
not
the
evaluation
of
ERP
h y pe,
focus
results
value
an
vendor
of
management,
very
this
outside
resources
far.
Management
project.
world.
s h o u l d be
the
The
readily
53
discernible
to
all
organization.
front
end
of
the
Involve
and
keep
employees
the
users
user
in
the
community
involved
on
the
(L a n g e n w a l t e r ,
2000).
3.
may not
being
its
perform
us ed.
expectations.
In
as
system
to
plus
other
T he
Do
system
not
are
magnitude
will
anticipated.
solving
5.
vendor's
even
if
upgrades
force
be
User
not
code
this
from
being
how-to
change
should
means
live
live
more
on
basic
be
to
fo r of
reduce
be
cycle
trade-off
a specific
only when
time
should
used
of
the
date.
data
this
than
include
on
problem
routine
1998) .
software
as
sacrificing
release
may
training
Kaplan,
Sc
currently
implementation
take
ERP
20 00) .
training
as
cases,
implemented
there
going
An
some
applications,
taken
often
(Cooper
Do
is
( S tedma n,
ready.
as w e l l
functions
ERP
the
benefits,
should
and users
as
integrate
functionality
4.
well
Because
ability
times,
in
Manage
much
c o de.
as
The
possible,
functionality,
release
can be
done
so
easily.
54
There
is
vendor
always
a possibility
to p r o v i d e
that
of
influencing
functionality
later
the
on
(S t e v e n s , 19 97).
6.
with
th e
If
th e
Do
business
data
new
expect
processes
they
problems
not
produce
are
system
not
as
fix
cannot
through
fixed,
well
to
be
a bad
fixed
by
a different
they will
(Vowler,
data.
be
Problems
running
system.
apparent
in
1999) .
P e r h a p s the m o s t i m p o r t a n t s k i l l s n e e d e d for a
s u c c e s s f u l ERP i m p l em en ta ti o n are t e a m - b u i l d i n g
and c o m m u n i c a t i o n skills.
Effective
i m p l e m e n t a t i o n of an E R P s y s t e m r e q u i r e s
i n t e g r a t i o n of u n l i k e d e p a r t m e n t s w i t h i n a
company.
Thus, p e o p l e a r e r e q u i r e d to c r e a t e
n e w w o r k r e l a t i o n s h i p s , s h a r e i n f o r m a t i o n t hat
was once closel y guarded, and make bu sin es s
d e c i s i o n s t h e y w e r e n e v e r r e q u i r e d to m a k e
before.
F a i l u r e to r e c o g n i z e t h i s c a n r e s u l t
in u n i n t e n d e d c o n s e q u e n c e s , s u c h as
a p p r e h e n s i o n a n d e m o t i o n a l f a l l o u t a m o n g the
employees.
A b o u t h a l f of E R P i m p l e m e n t a t i o n s
f a i l to a c h i e v e h o p e d - f o r - b e n e f i t s b e c a u s e
m a n a g e r s s i g n i f i c a n t l y u n d e r e s t i m a t e th e
e f f o r t s i n v o l v e d in c h a n g e m a n a g e m e n t .
( A p p l e t o n , 1997, p. 50)
ERP
ERP
the
is
one
software
year,
the
top
of
market
10
in th e M a r k e t
the
fastest
(Scannell
ERP ven dors
Place
growing
segments
& Jastrow,
have
1999).
earned more
of
This
than
55
$5.8
billion
1996.
than
in r e v e n u e s ,
Analysts
30%
in
(Michel,
estimate
an
the ERP m a r k e t
1997) .
increases
up
As
the
and becomes
industries
will
imperative
for
from
$4.8
annual
growth
through
the
functionality
more
consider
of
in
of m o r e
year
diversified,
ERP
a continued
billion
2000
ERP
more
implementation
competitive
edge.
A c c o r d i n g to the A M R R e s e a r c h , t h e E R P s o f t w a r e
m a r k e t w i l l g r o w at a c o m p o u n d a n n u a l g r o w t h
r a t e of 37 p e r c e n t o v e r the n e x t f i v e y e a r s .
It a l s o p r e d i c t s E R P p e n e t r a t i o n w i l l g r o w f r o m
t h e c u r r e n t 1 0 - 2 0 p e r c e n t ( p e r c e n t a g e of t o t a l
e m p l o y e e s c u r r e n t l y u s i n g the E R P sy stem) to
4 0 - 6 0 p e r c e n t w i t h i n the n e x t f i v e year s .
ERP
o r i g i n a t e d in the m a n u f a c t u r i n g m a r k e t a n d h a s
s p r e a d to n e a r l y e v e r y t ype of e n t e r p r i s e
i n c l u d i n g retail, u t i l i t i e s , the p u b l i c s e c t o r
a n d h e a l t h c a r e o r g a n i z a t i o n s . ( C i s s n a 1998, p.
43 )
Today's
Five
providers
ERP
software
the
top
ERP
B aan,
J.D.
which
account
E dwards,
have
grown
61%,
according
Research
control
mar k e t .
vendors
for
over
Inc.
Market
nearly
According
include
and
64%
of
ERP
Several
two-thirds
to C o p e l a n d
SAP AG,
Oracle.
the p a s t
to an
Leaders
the
These
at
software
vendors
the
(1998),
companies,
revenue,
swift
report
have
the
People-Soft,
ERP m a r k e t
year
of
pace
of
by AMR
entered
the
ERP
56
market
with
complete
tried
some
have
more
industry-specific
companies
SAP
dominant
market.
In
Walldorf,
the m a r k e t
applications.
the
ERF
for
with
package
is
company
has
by
whereas
offering
However,
five
market.
the
vendors
with
in
This
new
number-one
have
zero
been
growth
competitor
overtake
among
big
the
first
to
hit
spot
in
playing
at
SAP,
of
German
terms
of
circles,
has
or
SAP's
the
the
Q-tip
R/3
user s ,
it
and
the
software
for
introduced
its
enterprise
resource
the m a r k e t
(Menezes,
development
put
E RP;
other
catch-up
ever
since.
it w o u l d
of
have
software
of
years
as
become
tape
before
emerged
31%
manufacturing
technological
a couple
this
name
products.
suite
has
commanding
Scotch
unknown
1993,
SAP
business
like
selling
was
software
ERP,
company's
favorite
SAP
(1998)
in m o s t
ERP,
been
product
1 999 ) .
in
consumer
a
years.
planning
leader
fact,
certain
R/3
to M i n a h a n
Germany,
synonymous
to
on
solutions,
AG
the
in
focus
dominate
According
25
to
enterprise
take
Even
any
triple-digit
powerhouse
SAP
(McKie,
growth
1997).
SAP m a y
everyone.
provide
Despite
Steelcase's
with
not
CIO
successes
Greiner
scheduling
make-to-stock
its
plant
but
complete
says,
solutions
with
we
SAP
found
operations,
and
we m a k e - t o -o rd e r
for
R/3,
SAP
was
focuses
(Stein,
weak
on
1997b,
89 ) .
Oracle
Corp
Stedman
provider
of
(2000)
relational
is
a distant
of
the m a r k e t .
Oracle
second
Its
modules
Corp.
covering
and
resources
and
sales
Recently,
Oracle
applications
three
of
has
force
has
as
race,
systems,
commanding
known
its
first
years
ago
roots
more
14%
as
more
into
application
(Wilson,
in
than
financial
35
modules
computing,
control
a growth
aggressively
leading
available.
automation
focused
the
management
enterprise
production
business
reaching
also
now
facet
Oracle ,
package,
software
Oracle
every
ERP
introduced
manufacturing
to b e
is
original
applications,
the
complete
approximately
With
that
database
in
Applications,
Oracle
2000).
noted
to
human
(Michel,
attention
engine
the
from
and
1997)
on
its
seems
territory
58
targeted by
middle-market
(Stedman,
2 0 00) .
companies
standardizing
Oracle's
J.D.
accounting
General
Electric
is
its b u s i n e s s
one
of
units
the
on
applications.
Edwards
Stedman
established
(2000)
in
indicated
1977
to
computers,
the E R P
ranks.
The
users
total
ERP
and One
World
(client-server
based
solution
finance,
and
over
supported
(J.D.
are
around
of
vulnerability
m o m e n t u m of
needs
to
190
IBM's
areas
through
hours
transition
18
based)
a processsuch
and
as
supports
of
direct
partners.
languages
a day,
and
are
a worldwide
7 days
company's
current
AS/400
in
offers
business
through
its
advanced
a network
the
The
small-
logistics/distribution.
in
24
or
implements,
globe
for
(AS4 00
based)
for
and
Edwards,
company
in W o r l d
third-party
1997).
is
quickly
available
support
Edwards,
has
modules
worldwide
Its p r o d u c t s
network
with
distributes,
its p r o d u c t s
offices
solution
J.D.
software
Denver-based
manufacturing,
company
that
develop
and m e d i u m - s i z e
Th e
players
a week
greatest
reliance
on
the
platform.
J.D.
Edwards
to n e w p r o d u c t
lines
and new
59
platforms
(McKie,
to m a i n t a i n
its m a r k e t - l e a d i n g
position
1997) .
PeopleSoft
Founded
in
1987
as
a provider
resources
software,
PeopleSoft
offerings
to b e c o m e
Controlling
California
financ e,
7%
materials
the n e w e r
old,
the
rates
during
(Southwick,
being
applications
then
arena,
in
integrated
nine
of
fall
system
PeopleSoft's
one
offer
Solutions
PeopleSoft
its
biggest
into
of
the
1996,
it
(Southwick,
and
financial
offered
growth
payroll
software
its
first
1996).
most
possible
our
target
Albert
10
systems.
cover
says
of
advantages
industry-specific
definitions,
one
100%
nine
markets
is
annual
resources
model
for
and
Barely
exceeding
human
expanded
the
ERP
definitions
of
its
Pleasanton,
distribution,
for c l i e n t / s e r v e r
PeopleSoft
the
experienced
5 years
expanded
provider.
ERP m a r k e t .
has
One
human
has
Enterprise
1998).
the
the p a s t
to
ERP
management,
company
first
and
offers
in
1996).
Inc.
ER P m a r k e t ,
( M inah an,
players
years
every
the
company
manufacturing
was
of
leading
of
ERP
industries.
into
one
Duffield,
of
We
have
those
PeopleSoft's
60
senior
vice-president
Daniel,
1997,
industries,
p.
of
38).
operations
The
financial
services,
transportation
and
sect or,
education,
Baan
higher
Co.
has
the N e t h e r l a n d s
from
years
there
are
markets
American
are
service
communications,
health
retail,
a clear
force
care,
and
public
manufacturing.
market
further,
in o v e r
Baan's
1994
major
support
announced
distributors
concentrate
in
on
this
of
a desire
with
its
spring
in
California.
the
enterprise
like
three
to b e
the
resource
the
Baan
past
IV
North
ERP
suite
Boeing
on
its
multi-national
In
1995,
it
expanded
and di s t r i b u t i o n
(Michel,
securing
over
companies
one
pronouncements
entered
sales
Europe
grand
Baan
operations.
countries
Park,
actions
complex,
establishing
40
any
indication
in
sold
manufacturing
been
1997a) .
headquarters,
in M e n l o
in w o r l d w i d e
(Baan,
to
corporate
one
not
site,
and p r o m p t l y
ability
two
and
have
either
dominant
also
utilities,
units
in
Co
Baan
While
nine
(cited
1 997 ) .
that
and North
small
it
centers
Moreover,
signed
America
on
that
and m i d - s i z e d
companies.
27
Baan
new
will
61
Future
According
represents
allows
r-\
systems
are
management
between
the
the
office
directly
suppliers
mixing
are
to
add
new
go
big
entire
stuff
to
among
software,
and
MRP-II
their
noted
and
ERP
with
syst e m .
by
of
ERP
1997).
custom
are
or
with
an
1998).
recognizing
portfolio.
By
expecting
companies
vendors
systems
their
with
(Penelope,
and
These
& Stein,
systems
provide
systems
their
manufacturers
product
can
supply-chain
1998) .
(Wilder
ERP,
become
manufacturing
linking
that
Mr\c h
ERP
applications
edge
which
worldwide
their
(Mullin,
enterprise
(1996)
of
company
customers
to
supplier's
expansion
competitive
beyond
the
trend
functionality
Gumaer
to
to
products
customers
subsequently
existing
important
their
the d i v e r s e
and
narl-narc
that
software
best-of-breed
to
so
the
companies
a n /-J
enhancing
Today,
front
Internet
supply-chain
access
integrating
the
enabler,
v a f ^ A n o
is
(1999)
technology
direct
companies
ERP
major
I n t e r n e t -enabled
have
Sprecher
the n e x t
rapid
m-iil t- -J
to
of
are
the n e e d
busy
BAAN
adding
for
62
example,
has
already
Intelligence
( Mon e y
Resource
Resources
companies
Product
Finite
for
the
to
number
ERP
is
to
By
end
"small
of
has
Product
rate
for
middle
1.7%
(Baan,
systems
ERP
inventory
of
like
and MRP-III
acquired
Data
like
Visual
Management,
1997b).
and
vendors
their
to
increase
clients
(McKie,
it
is
growth
is
1997).
that
ERP m ar k e t
the
annual
rate
forecasted
as
the
will
growth
will
for
This
their
expected
high-end
are
products.
lower-end markets
The
without
increase
sales
of
22.1%
1998).
evolved
to
for
2000,
the
due
to a s h i f t
to m a t e r i a l
to m a n u f a c t u r i n g
finally
decreases,
vendors
services
control
enterprises
Conversely,
and
(Loizos,
has
ERP
year
3.2%.
and
larger
markets
rate
by
and
and
business"
the
decrease
(MRP)
(IRP)
technologies
systems
causing
growth
annually
of
find n e w
appeal
ERP
concepts
Scheduling.
pressure
annual
Planning)
strategic
client/server
the
Planning
Configuration.
As
forced
introduced
ERP.
focus
requirement
resources
Through
in
each
planning
stage,
from
planning
(MRP-II)
more
and
63
more
one
modules
uniform
have
been
linked
together
to
result
in
suited
for
application.
Summary
Enterprise
industries.
improve
ERP
systems
dollars
in
maintain
overall
and
have
continuous
efficiency
their
of
are
Integrated
systems
staff.
The
modules,
allow
enabler,
management
between
partners.
Most
ERP
s a v e m one y ,
able
allow
companies
companies
able
to
to
have
implemented
save
millions
reduce
cycle
and
often
core
best
package
increase
the
Today,
processes
th at
handled with
that
is
of
times,
businesses.
many
remain
an
cheaper
and
anything.
reduce
support
for
Internet
technology
to
that
than
and
are
their
up-to-date
analysis,
best
improvements,
application
data across
is
costs,
realize
business
Planning
been
operating
enterprise
more
and
Countless
manufacturers
run
systems
efficiency,
competitive.
ERP
Resource
the
more
easier
allows
multiple
systems
reconcile
the
training
next
rapid
operations
are
to
extensive
cross
represents
which
need
of
major
supply-chain
and
enhancing
trading
their
64
products
to
customers
supplier's
become
worldwide
ERP
Internet-enabled
can
system
have
direct
(Stevens,
so
that
access
to
1997).
the
65
CHAPTER
METHODS
AND
Overview
The
factors
purpose
affecting
Resource
Planning
U.S.
companies,
The
differences
States
and
factors
that
the
United
in
an
the
and
in
factors
Arab
in
the A r a b
the
between
study
motivation
Gulf
States
and
a number
of
companies
in b o t h
ERP,
research
other
companies
ineffective
number
implementation
of
of
literature
avoiding
regions
can
be
problems
implementation.
factors
ERP
those
ERP.
this
in
the
also
adopted
assist
to
were
that
implemented
Gulf
regard
affecting
This
and
example.
relationship
examined.
in
States
States
States
used
of
the
the d i f f e r e n c e
have
review
companies
as
implementation
already
software
the
Enterprise
Gulf
ERP
companies
to
Arab
of
affect
E RP w a s
leading
SAP
the
determine
United
of
to
to
the
adoption
Because
was
in
a company
the
in
between
of
in
Study
implementation
(ERP)
size
between
the
study
Additionally,
investigated
PROCEDURES
of
this
using
those
analyzed.
the
of
III
that
were
and
affect
selected
included
on
the
based
the
on
the
survey
for
66
the
respondents
respondents
of
those
letter
to
were
factors
described
research
and was
instrument.
Appendix
individually
asked
that
th e
to
indicate
affect
emailed
Examples
along
of
each
population
implemented
Gulf
an E R P
States
addresses
the w e b s i t e
The
clients
SA P
as
service
of
of
nature
are
the
found
of
cover
the
survey
in
care,
the
population
United
directory
companies
SAP
that
software
States.
were
The
have
in
the
names
obtained
those
and
oil
companies
respondents
consisted
Gulf
and
120
consumer
financial
and
gas,
utilities.
listed
to
classified
chemical,
construction,
respondents
States
using
the
providers,
150
all
and
high-tech,
directory,
Sample
from
SAP.
and
of
the
system
customer
population
be
perception
adoption.
with
and
included
automotive,
engineering
health
their
The
A.
The
and
ERP
confidential
Population
Arab
evaluate.
the
of
from
in S A P ' s
were
30
From
services,
the
customers
The
companies
the U n i t e d
products,
pharmaceutical,
randomly
survey.
these
selected
to
150
from
the
St at e s .
Arab
67
Instrumentation
Fraenkel
research
of
has
and
the
information
Wallen
potential
from
Therefore,
the
The
instrument
of
survey
this
The
four
sections
from
literature
The
first
developed
to
the
held
and
section
to c o l l e c t
the
the
before
and
company
second
installation
each
level
elements
survey
a great
deal
individuals.
used
in
for
was
this
the
study.
purposes
divided
problems
into
identified
and
This
t he
included
ERP
questionnaire
information
and
size,
was
(b)
the
was
pertaining
position
classification,
of
ERP,
and
the
ERP
implemented.
of
the
business
questionnaire
strategy
made
the
to
the m a i n
These
reasons
focused
ERP
plan
acquisition
status
designed
activities
system.
and
software
current
section was
of p r e p a r a t i o n
company
the
status
has
commitment
implementation.
the
the
company
section
a company's
a
of
respondent,
modules
(a)
on
location
implementation
on
of
developed
general
current
The
was
questionnaire
based
that
providing
sample
method
was
stated
sources.
company's
by
of
small
survey
study.
(1990)
before
of
ERP
to m e a s u r e
adopted
preparation
for
implementing
68
ERP,
the
decision-making
conditions
ERP,
the
estimate
cost,
t hat
ERP
was
ERP
to
software,
preparatory
of
the
address,
the
the
the
taken
before
implementing
specific
approach
implementation
steps
for
of
problems
selecting
strategy,
installing
and
the
the
ERP
sys tern.
The
designed
third
section
to a s s e s s
respondents
about
implementation
critical
success
projects,
those
satisfactorily
ERP
main
the
the
of
department,
This
aspects
indicators
of
that
failure,
the
questionnaire
effect
the
the
implementation
ERP
not
the
of
to
level
upon
avoid
success,
the
in
the
of
influence
the
users'
the
implemented
pitfalls
of
the
measured
were
ERP
was
section
consultants,
and
of
affecting
the m e a s u r e s
systems
and
for
a company,
toward
client/server
factors
factors
in
the
perceptions
ERP.
implementation,
satisfaction
of
of
IT
skills
on
implementation.
Items
advantages
in
and
the
fourth
section
disadvantages
of
dealt
with
implementing
the
ERP
systerns.
69
The
instrument
designed
Items
to b e
fo r
the
literature
consisted
completed
instrument
relating
to
of
dissertations,
business
questionnaire
following
1.
review
and
2.
critique
was
first
draft
was
second
and
affect
the
included
journals.
through
submitted
advisory
d raft was
the
to
the
committee
third
the
from
draft
fo r
was
the
test,
SAP
of
of
for
The
th e
panel
technology
management
management
with
of
five
selected
validity
included
of
members.
by
Instrument
personnel
experience
the
approved
ERP
The
of
group
the
information
and
ERP
system
as
study pop ulati on.

and
upon
purposes.
field w a s
th e
committee
a panel
readability,
questionnaire.
of
based
subsequently
validation
pilot
representative
the
designed
recommendations
Validation
assessed
that
the
recommendations.
committee
experts
from
literature
developed
an d was
15 m i n u t e s .
gleaned
magazines,
dissertation
and
3. A
For
than
factors
The
items
procedures:
researcher's
the
ERP.
30
less
were
the
implementation
The
in
of
general
implementation.
70
Feedback
in
the
from
survey
these e x pe rts
instrument.
panel's
suggestions,
made
the
in
adoption
items
of
ERP
In
led
the
additions
based
and
dealing with
to m o d i f i c a t i o n
of
the
revisions
factors
were
affecting
the
systems.
Data Co l l e c t i o n
The
survey
instrument
was
http://fp.uni.edu/alsehali.
of
data
access
collected,
this
group.
th e
sample
To
thus
August
limiting
2000,
an
of c o m p a n i e s
and
the
United
Sta tes
explaining
the
purpose
the
instrument,
survey
complete
the
are
study.
an
certainly
for
use
the
response
of
most
increasing
follow-ups,
th e
to
and
the
to
access
target
in
to
was
sent
the A r a b
a message
study,
time
the
to
Gulf
briefly
format
required
Berdie and A n d e r s o n
essential
The
this
accuracy
of
to
survey.
According
ups
of
with
the
necessary
e-mail
population
States
at
ensure
a password was
survey,
During
on-line
or
the
phase
follow-ups,
potent
After
any
or
mail
rate.
were
yet
follow-
questionnaire
reminders,
technique
response
reminders,
r a te.
of
(1974)
is
discovered
Therefore,
used
fo r
increasing
one week,
the
first
71
follow-up
e-mail
responded.
About
e -mail ,
who
not
did
were
was
second
sent
on e
week
out
of
total
of
th e
150
t hat
(SPSS)
Statistical
was
used
statistical
Package
was
for
the
conducted
the
The
at
.05
the
analyze
variables.
squares,
determine
the
measures
and Mann-Whitney
the
differences
implementation
of
ERP,
motivation,
and
the
affecting
factors
the
the
of
tests
in
t-test,
were
factors
differences
of
were
of
used
c h i-
used
that
Sciences
level
percentages
relationship
ERP
those
e-mailed.
data.
to
statistical
to
Social
and
The
sent
were
Frequencies
and
follow-up
questionnaires
significance.
compute
not
first
was
67
had
Analysis
to a n a l y z e
test
who
the
e-mail
Data
The
those
after
follow-up
respond.
returned
to
to
affect
the
in
company
size
adoption.
to
72
CHAPTER
RESULTS
This
The
chapter
initial
in a
total
these w e r e
were
rate
of
not
either
usable
76
of
general
for
to
first
data
of
of
location
of
the
company,
position
of
the
respondent,
company,
implementation
company,
and
related
discussed.
research
body
of
provided.
this
they
analyses
section
Nine
of
they
incomplete.
The
a return
the
distribution
the
the
chapter
describes
respondents,
Characteristics
income
of
the
of
ERP
in
of
the
the
implemented.
of
this
research
chapter,
statistical
questions
convenience
questions,
referred
to b y n u m b e r
are
on
company,
classification
status
based
the
include
reader's
chapter,
resulted
because
the
the
For
modules
to
stud y.
questionnaire.
characteristics
second
the
2).
representing
the d a t a
The
analysis
2 illustrates
th e
of
follow-up
or w ere
67,
section
ERP
results
(see T a b l e
blank
Table
STUDY
subsequent
totaled
44.6%.
the
responses
returned
respondents
The
and
used
returns
THE
presents
e-mail
of
OF
IV
are
the
in
repeated.
the
73
1.
What
are
implementation
2.
How
do
implementation
the
Arab
3.
th e
decision
5.
between
in
th e
company
that
was
and
affect
any
are
ERP
the
in
the
in
the
companies
the
any
of
motivation
advantages
in
States?
in
ERP?
behind
the
in m o t i v a t i o n
Gulf
adopt
United
difference
adoption
Arab
that
the
between
difference
States
What
affect
affect
make
the
the m a i n
Is
United
that
those
size
ERP?
there
that
differ
to a d o p t
States
and
those
E RP?
and
disadvantage
system?
Respondent
Population
A rab Gulf
States
Total
ERP
Does
implementing
United
of
companies
6.
Table
factors
States
What
factors
ERP?
Gulf
factors
4.
of
the
States
Population
First
e-mai1
n
%
First
f o l l o w up
n
%
Second
fol l o w up
n
%
Usable
n
%
30
20
15
10
11
7 .3
21
3 1.3
120
80
33
22
17
11.3
46
68.7
150
100
48
32
28
18.6
67
100
N o t e . Nin e returns were n o t inclu ded in

an a ly s i s bec ause they w e r e either b l a n k
incomplete.
the data
or
of
74
General
Characteristics
Information
the
of
company,
the
was
the
collected
income
respondent,
of
the
of
the
the
on
the
classification
the
current
implementation
company,
and
the
modules
implemented.
Tables
The
The
presented
Gulf
United
of
in T a b l e
States
2-6
numbered
States,
46
the
of
Table
respondents
the
$100
the
these
of
position
the
status
of
ERP
in
been
results.
Companies
companies
respondents
(31.3%)
the
of
have
responding
The
21
and
from
those
is
the A r a b
from
(68.7%).
Income
As
of
the
2.
that
present
Location
location
location
company,
company,
ERP
Respondents
of
3 sh ow s ,
is
respondents,
over
the C o m p a n i e s
the
income
of
$1 b i l l i o n .
income
ranges
almost
For
between
half
about
$0
28.3%
and
Million.
of
75
Ta bl e
Income
of
the
Companies
Income
$0-$100
S100
Million
Million-$l
Billion
$1 B i l l i o n - O v e r
Position
Table
4 reports
of
the
the
respondent.
More
The
next
group
Table
largest
the
was
19
28.3
17
25.0
31
45.8
Respondents
position
than
a third
system
in
the
company
selected
analyst
of
"other."
at
26.9%.
Position
in
the O r g a n i z a t i o n
Posi t i o n
Board member
4 .5
13 .4
4 .5
1 .5
1 .5
18
26.9
13 .4
23
34 . 3
Information
Technology
Chief
Executive
Chief
Finance
Chief
Information
System Analyst
Senior
Other
Manager
Manager
Officer
Officer
Officer
76
Classification
The
respondents
were
classification
of
their
5,
of
the
about
43.3%
the m a n u f a c t u r i n g
within
Table
the
of
asked
to
company.
indicate
As
respondents'
sector,
classification
and
23.9%
shown
the
in T a b l e
companies
did
not
ar e
fall
listed.
Classification
of
Classification
Banking
1 .5
11
16 .4
Education
3 .0
Food
3 .0
29
43 .3
Retai1
1 .5
Telecommunications
1. 5
Utilities
3 .0
W h o l e s a l e /di s t r i b u t i o n
3 .0
16
23.9
&
Computer
finance
software
& services
& beverage
Manufacturing
Other
in
77
Current
The
status
Implementation
respondents
of
reported
ERP
6,
implemented
an E R P
companies.
system within
the
currently
in
Table
of
to
indicate
that
system
in
three
they
22%
past
2 years.
respondents
had
process
had
companies.
quarters
SAP
of
software
implemented
Some
of
ceased
the
As
the
had already
using
Over
the
their
in C o m p a n i e s
within
an
ERP
indicated
implementation,
they
and
implementation.
Current
Implementation
Implementation
Under
asked
about
indicated
4.5%
ERP
implementation
in T a b l e
are
of
were
respondents
their
Status
Status
Implementation
Implementation
ceased
I m p l e m e n t e d since:
1 y e a r or le ss
2 years
3 years
4 years
5 year s and over
Status
of
ER P
in C o m p a n i e s
n
13
19 .4
4 .5
13
15
8
10
10
19 .4
22 .4
11 .9
14 .9
9 .0
78
ERP
The
respondents
of m o d u l e
(see
they
Table
reported
in
modules
had
they
their
been
respondents.
was
The
Implemented
asked
to
indicate
implemented
in
their
of
the
respondents
had
implemented
and
86.6%
had
Sales
implemented
by
next
most
at
the
(91%)
operations
and
73.1%
commonly
t ype
companies
implemented
companies.
production
and
finance
marketing
of
implemented
67.2%
ERP M o d u l e s
Type
were
Most
modules,
modules
Table
have
7).
that
logistics
module
Modules
They
Have
Implemented
Yes
n
of m o d u l e
No
%
61
91.0
9 .0
Production
45
67 .2
22
32.8
Human
36
53 .7
31
46.3
Finance
58
86.6
31.4
Sales
49
73.1
18
26.9
11 .9
59
88 .1
17
25.4
50
47 .6
Operations
logistics
resources
and marketing
Research
Other
and
and
development
79
Statistical
Analyses Related
Questions
Research
The C r i t i c a l
Proj e c t s
The
Success
critical
success
projects
were
(55.2%)
and
strategy
of
the
factor
by
exercise
for
th e
for
management
clear
(43.3%,
training
support
the
see
(29.9%)
the
Table
was
the
ERP
of
another
end-user
Research
Implementation
major
implementation
and
scope
Strategic
implementation
and
ERP
support
8).
the
that
definition
(33.8%)
ERP
for
reported
factors
top
Question
Factors
respondents
to
involvement
and
alignment
critical
projects,
success
followed
involvement
(28.4% ).
and
80
Table
Critical
Proj ec ts
Success
Ranking
factors
Top management support

and involvement
37
55.2
Clear
scope
29
43.3
Strategic alignment
the e x e r c i s e
26
38.8
Training
20
29.9
End user
support
19
28.4
Careful change
management
17
25.4
Capability
Consultant
14
20.9
8
Note.
for
the
ERP
d e f i n i t i o n of
and strategy
of
involvement
of t h e
chosen
Implementation
and
IT
E x p e r i e n c e d i n - h o u s e IT
10
team
R a n k o r d e r s c a l e d f r o m 1 = m o s t to
Critical Success
Satisfactorily
The
critical
Factors
respondents
success
satisfactorily
9,
Factors
careful
in
change
Not
were
factors
their
to
were
companies.
management,
8 = leas t .
Implemented
asked
that
14 .9
with
identify
not
As
due
the
implemented
shown
in T a b l e
consideration
81
to
cultural
that
the
and p o l i t i c a l
highest
satisfied
clear
percentage
about.
p e r c e n t a g e were
definition
aspects,
Other
of
(37.3%)
factors
end-user
was
were
and
and
strategy,
factor
not
receiving
involvement
scope
th e
high
support,
and
training.
Table
Cr iti ca l Success
Satisfactorily
Factors
Not
Implemented
Factor
No
Yes
n
Strategic alignment
of the e x e r c i s e
11
16 .4
56
83 . 6
Clear
scope
19
2 8.4
48
71.6
12
17 .9
55
82 . 1
11
16 .4
56
83 . 6
Top mana gemen t s u p p o r t

and involvement
13
19 .4
45
80 . 6
Careful
25
37 .3
42
62 .7
End user involvement

and support
20
29 .9
46
68 .7
Training
19
28 .4
48
71.6
7 .5
62
92 . 5
and strategy
Experienced
IT t e a m
in-house
C a p a b i l i t y of the
co nsultant chosen
Other
IT
change m a n a g e m e n t
82
Success
of
The
Implementation
respondents
implementation
As
shown
their
in T a b l e
believed
Table
in
their
were
10,
asked
whether
organization
61
of
the
implementation
67
was
of
ERP
was
successful.
(91%)
respondents
successful.
Implementation
No
Yes
Status
n
Success
The
Elements
respondents
level
of
agreement
agree
to
strongly
important
11).
consultants
to
but
asked
disagree
On
help
respondents
element,
were
23.9%
that
the
91.0
Affecting
on a s c a l e
elements
Table
the
61
Most Important
Implementation
of
not
10
Success
(see
or
in
the
to
regard
affecting
ERP
availability
with
the
agreed
did not
on
9.0
ERP
indicate
ranking
from
to
their
strongly
the m o s t
implementation
of
qualified
implementation,
the
importance
37.3%
of
agree.
this
83
The
importance
understanding
very
critical.
surveyed
th e
of
product.
the
consultants'
the p r o d u c t
As
agreed
of
shown
that
Only
considered
in T a b l e
their
4.5%
was
of
11,
44.8%
consultants
the
to
be
of
those
understood
respondents
strongly
di s a g r e e d .
As
shown
in T a b l e
disagreed
t ha t
completed
on
One
of
of
the
the
the
schedule,
that
what
expected,
was
they
what
they
the
whereas
in T a b l e
estimates.
indicated
37.3%
of
implementation
questions
cost
11,
cost
and
Of
of
th e
of
the
11
the
respondents
ERP was
29.9%
focused
respondents
implementation
20.9%
agreed
that
opposite.
on
accuracy
41.8%
was
not
the
cost
expected.
Table
Most
11
Important
Elements
Elements
Affecting
SD
the
ERP
Implementation
A
Availability
o f qua 1 i f ied
consultants
4 .5
16
23.9
11
16.4
C o n s u l t a n t s of
understanding
the product
4 .5
10
14.9
18
C o m p l e t i o n of
.implementation
on s ched ule
6 .0
25
37.3
14
20.9
28
41.8
A c c u r a c y of
co s t es t i m a t e
N o t e . SD = s t r o n g l y d i s a g r e e , D
A = agree, SA = s t r o n g l y agree.
SA
%
25
37.3
12
26.9
30
44.8
11.9
20
29.9
10
13.4
14
20.9
= disagree,
%
11.9
S' . 0
14.9
.o
= neutral,
00
tp*
85
Effects
of
The
Attention
respondents
concentrating
on
lo s e
focus
on
core
(see
Table
12).
in
the
Table
on
IT
IT
were
Issues
asked
issues,
issues
Most
to
lead
indicate
the
critical
respondents
if
the
organization
to
its
business
(71.6%)
answered
to
affirmative.
12
C o n c e n t r a t i n g o n IT I s s u e s , at the
I s s u e s C r i t i c a l to the B u s i n e s s
Expense
of
Core
R e s p o n s e ___________________________________n_____________ %
Yes
48
71.6
No
19
28.4
Total
67
100.0
E f f e c t of the I m p l e m e n t a t i o n
a n d E R P o n the IT
The
respondents
implementation
increased
at
departments
finance.
the
such
As
asked
if
a client/server
the p o w e r
department
and
of
were
of C l i e n t / S e r v e r
and
influence
expense
as
of
in
the
system
and
of
IT
the
ERP
conventional
production,
shown
System
Table
projects,
13,
marketing,
slightly
more
86
than
half
of
the
respondents
th e
client/server
and
influence
conventional
Table
of
system
the
IT
(52.2%)
did
not
indicated
increase
department
at
the
the
that
power
expense
departments.
13
Effect
Client/Server
of
System
on
the
IT
Department
Response
Yes
32
47.8
No
35
52.2
Total
67
100.0
Need
of
for
Computer
The
respondents
implement ation
proficien t
respondents
(see
Proficiency
were
required
Table
agreed
asked
if
employees
14).
that
Among
it
About
Employees
the
to
be
92.5%
computer
of
did.
87
Table
Need
14
fo r
Computer
Proficiency
Among
n
Response
Yes
No
Total
Increased
The
Employee
increased
As
in T a b l e
shown
answered
in
the
62
92 .5
7 .4
67
100 .0
Turnover
respondents
turnover
Table
Employees
were
after
15,
asked
the
53.7%
if
the
employee
implementation
of
the
of
ERP
respondents
affirmative.
15
Increased
Employee
Turnover
After
Response
Yes
ERP
Implementation
n
36
%
53 .7
No
31
46 .3
Total
67
100 .0
ERP
Implementation
The
respondents
implementation
and
Employee
were
eventually
asked
led
Layoffs
if
to
the
ERP
employee
layoffs
88
(see T a b l e
16).
implementation
80%
indicated
that
did
not
lead
Implementation
and
E m p l o ye e L a y o f f s
Table
ERP
Over
to e m p l o y e e
ERP
layoffs.
16
Response
Yes
13
19 .4
No
54
80.6
Total
67
100 .0
C o s t of
Revenue
Implementation
Most
of
t o tal
cost
their
annual
provide
of
this
those
as
Percentage
responding
implementation
revenue.
indicated
was
However,
information
of
less
over
(see T a b l e
Annual
that
than
40%
the
10%
did
of
not
17) .
89
Table
17
Tot al Cost
Revenue
% of
0%
of
Implementation
the A n n u a l
as
Percentage
- 50%
51%
- 100%
101%
Total
N o t e . Of the r e s p o n d e n t s 29 d i d
t o t a l c o s t of i m p l e m e n t a t i o n as
revenue.
Research
Success
Factors
Th e M a n n - W h i t n e y
whether
or n o t
companies
United
in
No
found.
differences
support
in
success
projects.
were
the A r a b
States
critical
there
(see
81.6
15 . 8
2 .6
ERP
Implementation
test
was
used
any
to
th e
for
in
regard
Table
end
and
between
those
ranking
ERP
of
in
the
the
implementation
significant
they were
to
to d e t e r m i n e
differences
States
statistically
However,
for
Gulf
factors
38
100.0
n o t p r o v i d e the
p e r c e n t a g e of a n n u a l
Question
were
regard
31
- over
Critical
Projects
Annual
Revenue
-10%
11%
of
nearly
user
differences
significant
involvement
18).
and
90
T ab le
18
Critical
Proj ects
Success
Factors
for
ERP
Implementation
Arab Gulf
States
Ranking
Factors
Cop
management
support and
involvement
Clear
de f ini t ion
scope and
s trategy
U .S .
%
p*
iu
14.9
27
4 0.2
.234
11.9
21
3 1.3
.505
of
Strategic
a l i g n m e n t of
the e x e r c i s e
8.9
20
29.8
.498
Training
7.4
15
22.3
.256
End user
involvement
and support
5.9
15
22.3
.058
Careful
change
management
5.9
13
19.4
.279
C a p a b i 1 i ty
t h e IT
Consultant
chosen
5.9
10
14.9
.779
Experienced
i n - h o u s e IT
team
4.4
10.4
.278
of
N o t e . R a n k o r d e r s c a l e d f r o m 1 = m o s t to 8 = l e a s t .
A l l p v a l u e s > .05, no s t a t i s t i c a l d i f f e r e n c e .
91
Critical Success
Satisfactorily
As
Table
significant
Arab Gulf
regard
the
Factors
19
shows,
differences
States
and
critical
not
Implemented
there
were
between
those
in
success
no
statistically
companies
the
United
factors
not
in
the
States
in
implemented
satisfactorily.
Table
19
Critical Success
Satisfactorily
Factors
Factor
Strategic alignment
Clear
scope
a n d Strategy-
Experienced
IT t e a m
Capability
consultant
Top
and
of the
chosen
IT
management support
involvement
Careful
End
and
in-house
change
management
user involvement
support
Training
All
p values
>
Implemented
A rab Gulf
States
n
%
7 .4
5
n
6
7 .4
14
20.8
.577
7 .4
10.4
.395
8 .9
7 .4
.070
2 .9
11
16.4
.167
7 .4
20
29.8
.123
5 .9
17
25.3
.143
5 .9
15
22.3
.253
2 .9
4 .4
.664
Other
Note.
not
.05 , n o
u ..S .
statistical
%
8 .9
difference.
'
.270
92
Most I m p o r t a n t
Implementation
The
t-test
there w e r e
Arab
Gulf
regard
any
Elements
Affecting
was
to d e t e r m i n e
used
differences
States
to m o s t
and
those
important
implementation.
Mo
differences
found
Table
were
between
in
the
elements
statistically
(see
Table
the
ERP
whether
or
not
companies
in
the
United
States
affecting
the
in
ERP
significant
20).
20
Most I m p o r t a n t
Implementation
Elements
Elements
Availability
consultants
of
qualified
C o n s u l t a n t s of
u n d e r s t a n d i n g the
of
N o t e . All
cost
the
ER P
Arab Gulf
States
mean
SD
3.38
1.20
mean
3.41
SD
1.17
.270
3.38
. 80
3.39
1.08
.577
3.14
1.15
3.09
1.28
.3 9 5
2.38
1.07
2.46
1.17
.070
U.S.
P*
product
C o m p l e t i o n of
implementation
on s c h e d u l e
Accuracy
Affecting
estimate
p values
>
.05,
no
statistical
difference.
93
Research
Critical S uccess
Satisfactorily
Factors
A chi-square
of
company
sizes
was
on
Question
not
used
the
Implemented
to
determine
critical
satisfactorily.
No
significant
differences
found
Critical
Proj e c t s
Success
The
whether
Factors
Mann-Whitney
company
critical
success
projects.
No
(see
2 2).
Table
size
effect
factors
(see
Table
21).
ERP
Implementation
test
was
used
any
for
statistically
n ot
statistically
f or
makes
factors
the
success
implemented
were
to
determine
difference
ERP
in
the
implementation
differences
were
found
Table
21
Critical
Success
Factors
not
Implemented
Satisfactorily
C o m p a n y 's S i z e
$0-$100Million
Factor
$100
(I n c o m e )
Million-$lBillion
$ IBi - l i o n - O v e r
Strategic
alignment
5.9
4.4
5.9
.662
Clear definition
of s c o p e a nd
strategy
11.9
7.4
8.9
.057
E x p e r i e n c e d inh o u s e IT t e a m
7.4
2.9
7.4
.257
C a p a b i l i t y of
IT c o n s u l t a n t
chosen
5.9
5.9
4.4
.429
Top management
suppor t
and involvement
7.4
2.9
8.9
.153
Careful change
management
7.4
13.4
11
16.4
.575
End-user
involvement
support
7.4
5.9
12
17.9
.296
11.9
.166
All
the
and
Training
Note.
p values
>
11.9
.05, no
3
statistical
4.4
di f f e r e n c e .
it *
Table
22
Critical
Success
Factors
for
ERP
Implementation
Projects
C o m p a n y 's I n c o m e
Rankingi
$ 0 - $ 1 O O M i 11 i o n
Factor
ii
$100
Million- $lBillion
n
$ l B i l l i o n -O v e r
ri
Top management
suppo rt and
involvement
10
14.9
10
14.9
17
25.3
.400
Clear definition
of s c o p e a n d
s t ra t eg y
10
14.9
13.4
10
14.9
.756
Strategic
a l i g n m e n t of
the exe r c i s e
8.9
10
14.9
10
14.9
.834
Training
8.9
7.4
13.4
.088
End-user
involvement
support
8.9
10.4
8.9
.261
Careful change
managemen t
8.9
7.4
fa
8.9
.738
C a p a b i l i t y of
the IT C o n s u l t a n t
7.4
7.4
5.9
.2 4 5
E x p e r i e n c e d inh o u s e IT t e a m
7.4
5.9
1.5
.4 2 9
and
N o t e . R a n k o r d e r s c a l e d f r o m 1 = m o s t to 8 = leas t .
A l l v a l u e s > .05, no s t a t i s t i c a l d i f f e r e n c e .
vo
cn
96
Research
Reasons
for
Implementing
Respondents
reasons
Table
62%
for
23,
business
financial
Table
65%
cited
ERP
asked
implementing
over
cited
were
Question
ERP
to
identify
system.
functional
reasons,
and
their
As
shown
reasons,
61.2%
in
over
cited
reason.
23
Reasons
for
Implementing
ERP
Reason
Yes
n
%
No
n
Financial
41
61.2
26
38.8
Functional
44
65.7
23
34 .3
Technical
37
55 .2
30
44 .8
Bus i n e s s
42
62 .7
25
37 .3
11 .9
52
88 .1
Other
Typical
ERP
Decision-Making
Respondents
were
asked
decision-making
process
Table
over
was
24
made
shows,
by
Process
61%
to
toward
Toward
indicate
and
the
implementing
indicated
to p m a n a g e m e n t ,
Implementing
that
only
th e
typical
ERP.
As
decision
9% n o t e d
that
97
the
decision-making
process
was
proposed
by-
functions .
Table
24
Typical
ERP
Decision-Making
Process
Process
Toward
Implementing
No
Yes
n
Strategic business
planning exercise
27
40. 3
40
59.7
C o n s e n s u s at
o p e r a t i o n a l level
27
40 . 3
40
59.7
Top
41
61.2
26
3 8.8
9 .0
43
64 .2
27
40 . 3
39
58 .2
4 .5
64
95 .5
management
Proposed
by
Recommended
consultant
functions
by
outside
Other
Accuracy
of
Estimates
Respondents
statement,
training
were
time
respondents
46.3%
did
25).
Only
25
t he
asked
cost,
correctly
said
not
were
cost
estimate
to
time
respond
schedule,
estimated?
was
the
respondents
correctly
cost
to
Over
and
50%
of
estimated,
correctly
provided
the
the
the
but
(see T a b l e
percentage
of
98
the
cost
overrun.
50%
(see
Table
Most
of
estimated
Schedule
the
time
Tables
Two
they
time
Only
and
thirds
correctly
were
Table
(88.1%)
correctly
implementation.
21%-50%
for
9 of
2 of
the
respondents
by
l ess
the
25
were
than
20%
under
(see
the
respondents
overruns
and
under
the
by
the
(67.2%)indicated
training
ll%-50%.
time
time.
Only
estimated
Six
3 of
by
of
the
21%-50%
26).
25
Accuracy
of
Estimation
by
Type
Estimate
Ye s
Cost
Time
21%-
the
estimated
respondents
25
of
of
estimated
of
had
Table
overruns
26).
respondents
(see
schedule
were
schedule
25
11 h a d
respondents
overruns
respondents.
these,
26).
the
the
Of
schedule
Training
time
No
n
36
%
53 .7
n
31
%
46 . 3
59
88 . 1
11 .9
45
67 . 2
22
32 . 8
99
u dP
a)
TS
c
D C
01
c
'H
c
H
dP
(0 c
in 3
Eh >4
0) c
?>
o
in
tn
t-4
i
1
in
m
m
CM
dP
in
(i
tn
.
t-4
c
d)
<1
3
'O
a)
dP
X.
o G
CO 3
14
^1
d) C
>
o
ii
t1
o
<i
in
(-4
in
*
to
in
t-4
cu
u
u
d)
1-1 dP
d)
T3
C
O
G
CM
dP
in
G
3
14
>4
d)
> G
o
r-
16 .
<d
01
<a
u
<Tl
c-
10 .
1-1
d)
T>
C
D
13
r-
rH
in
t1
i-4
in
in
in
--1
t-4
r4
t-4
ti
>,
X3
a)
jj
05
g
-r4
-U
W
w
.o
tn
0
a
Oj
4-1
o
CO
CM
>
14
<D
dP
(-4
100
05
Eh
3
U
O
<C
50
xt
20
03
d>
rH
I
rH
rH
i
i
CM
1
t-4
in
>
O
1
rH
O
rH
100
Specific
Decision
Problems
as
a Factor
As
shown
in T a b l e
ER P w a s
taken
to
by
65%
over
Table
of
27,
address
the
in
the
the
Implementation
decision
certain
to
specific
implement
problems
respondents.
27
Specific
Decision
Problems
as
Factor
in
Implementation
Response
Yes
44
65 .7
No
23
34.3
Total
67
100 .0
Specific
Problems
Among
the
inefficient
external
for
specific
availability
information
The
or
for
to A d d r e s s
problems
information
boundaries,
respondents.
ERP
flow
cited
next
most
delayed
decision
cited
across
by
internal
almost
common
half
of
and
the
p r o b l e m was
availability
making
was
of
non
critical
(see T a b l e
28).
101
Table
28
Specific
Type
of
Problems
for
to A d d r e s s
problem
Inefficient
f 1 ow
information
for
profitability
Stagnant
growth
Others
Approach
co
Most
ERP
of
the
No
Yes
L a c k of i n f o r m a t i o n
dec i s ions
Falling
ERP
33
49.3
34
50 .7
30
44.8
37
5 5.2
9.0
61
91.0
7.5
62
92 . 5
13
19.4
54
80 .6
Selection
respondents
an
approach
ERP
software
selection.
have
selected
a best-of-breed
respondents
(see T a b l e
system
now
implementing
for
ER P
(85.1%)
have
chosen
an
Only
all-in -one
10 .4%
approach
2 9).
102
Table
29
Approach
Type
of
to
ERP
Selection
n
approach
10 .4
57
85.1
0 ther
4 .5
Total
67
100 . 0
Best-of-breed
Al 1 - i n - o n e
Implementation
The
Strategy
respondents
in
were
Respect
asked
implementation
strategy
in
shown
30,
half
in
chosen
Table
the
over
about
respect
of
to
to
the
Roll
Ou t
their
roll
out.
respondents
As
have
complete-system, roll-out-at-once
s tra t e g y .
Table
30
Implementation
Type
of
Complete
once
Gradual
Total
Strategy
in
Respect
strategy
system,
roll
out
to
Roll
Out
n
roll-out-at-
35
52 .2
32
47 .8
67
100 . 0
103
Preparatory
Most
of
institute
of
Steps
the
Taken
respondents
a project
the p r e p a r a t o r y
system.
The
resources
Table
same
as
team
with
steps
have
a strong
before
percentage
a major
(91.0%)
leader
implementing
allocated
reparatory
chosen
step
to
as
an
budget
one
ERP
and
(see T a b l e
31) .
31
Preparatory
Steps
Taken
Strategy
No
Yes
Institute a project team

with a strong leader
61
91.0
9 .0
Define
56
83.6
11
16.4
61
91.0
9 .0
project
procedures
Allocate
budget
Set
detailed
schedule
45
80.6
13
19.4
Provide extensive
information
internal
48
71.6
19
28.4
11
16 . 4
56
83.6
up
and
resources
Other
Research
Reasons
As
not
for
Implementing
shown
reveal
any
in T a b l e s
Ques tion
ERP
32,
statistically
the c h i - s q u a r e
significant
test
did
differences
104
in
the
motivation
States
Table
and
those
between
in
the
companies
United
in
the
Arab
Gulf
States.
32
Reasons
for
Implementing
Reason
ERP
A r a b Gulf
States
n
U. S.
?*
Financial
11
16 .4
30
44.7
. 3 17
Functional
16
2 3.8
20
29.8
.220
Technical
12
17 .9
25
37.3
.831
Business
13
19 .4
29
3 4.2
. 929
Other
Note.
All
Typical
ERP
As
not
in
Process
Toward
shown
3 3,
chi-square
in T a b l e s
any
typical
implementing
States
>
7.4
.689
difference.
Decision-Making
reveal
the
p values
3
4 .4
5
.05 , no s t a t i s t i c a l
and
statistically
the
significant
decision-making
ERP
those
between
in
the
Implementing
process
companies
United
in
te st
did
differences
toward
the
Arab
States.
Gulf
105
T ab le
33
Typical
ERP
Decision-Making
Process
Toward
Arab Gulf
States
n
%
8
11.9
Process
Strategic business
planning exercise
Implementing
U.S.
n
19
?*
%
28.3
.804
C o n s e n s u s at
o p e r a t i o n a l level
11
16.4
16
23.8
. 173
Top
11
16 .4
30
44 .7
.317
P r o p o s e d by
functions
4 .4
4 .4
.721
R e c o m m e n d e d by
outside consultant
10 .4
20
29.8
.268
management
Other
N o t e . All
Accuracy
P values
of
test
or n o t
there were
in
Arab
States
in
training
Gulf
regard
time
statistically
(see
Table
>
Estimation
Chi-square
t he
2
.05,
and
by
was
any
2 .9
1
1 .4
. 177
no s t a t i s t i c a l d i f f e r e n c e .
Type
used
determine
whether
between
companies
differences
States
and
to
cost,
if
to
the
they
significant
those
in
time
correctly
the U n i t e d
schedule,
and
estimated.
differences
were
found
3 4).
No
106
Table
34
Accuracy
of
Estimation
Type
A r a b Gulf
States
n
%
14
20.8
Estimate
Cost
Time
by
schedule
Tr a in in g time
N o t e . All p values
>
of
(80.6%)
cited
uniform
information
(79.1%),
across
resources
35
as
the
communication
in
an
important
basis
organization
(62.7%),
and
large
ERP
most
implementing
as
an
of
computers
standardization
the
Question
Implementing
seen
.689
.288
23.8
29 43.2
no s t a t i s t i c a l d i f f e r e n c e .
in T a b l e
advantages
14 20.8
16
.05,
shown
of
. 151
26.8
As
advantage
?*
n
%
22 32.8
18
Research
Advantages
U .S .
6
System
the
system
ERP
were
Other
making
quality
efficient
improvement
complex
the m a j o r
real-time
and be t t e r
the
as
system.
for d e c i s i o n
(77.6%),
respondents
of
control
use
of
internal
organizations
(61.2%) .
107
Ta bl e
35
Advantages
ER P
of
system's
Real-time
b a s i s for
Implementing
an
ERP
Ye s
advantage
Efficient
%
79.1
n
4
%
20.9
35
52.2
32
47 .8
42
62 .7
25
37 . 3
41
61 .2
26
38 .8
systems
54
8 0 .6
13
19 .4
communication
37
55.2
30
44 .8
52
77.6
15
22.4
26
3 8.8
41
61 .2
33
49.3
34
50.7
6 .0
63
94 . 0
controls
use
of
resources
Improves internal
communication
Uniform
computer
R e m o v a l of
probiems
Standardization
Improved
customer
Identification
bottlenecks
satisfaction
process
Other
Disadvantages
As
Table
respondents
disadvantage
expense.
No
n
53
i n f o r m a t i o n as the
decision making
Diagnostic
System
of
Implementing
36
indicates
more
(56 .7 % ) r e c o g n i z e d
of
implementing
Another
for m a i n t e n a n c e
as
41.8%
an
cited
ERP
than
that
an
ERP
Sys tern
half
the
the m a j o r
system
expensive
a disadvantage.
of
is
its
outsourcing
Almost
39%
found
108
the
ERP
system
disruptive
indicated
that
the
ERP
system's
of
system
Implementing
disadvantage
Extremely
expensive
Rigid and
change
not
system
passive
easy
to
Does not i m p r o v e
collaborative effort
handle
subjective
Expensive outsourcing
for m a i n t e n a n c e
Other
10 . 4 %
of
does
and
respondents
not
improve
effort.
Time c o n s u m i n g and
disruptive exercise
Cannot
is sues
Only
time-consuming,
36
Disadvantages
ERP
rigid,
exercise.
collaborative
Table
to be
an
ERP
System
No
Yes
n
26
%
38.8
n
41
%
61.2
38
56.7
29
43.3
26
38.8
41
61.2
14
20.9
53
79.1
10.4
60
89.6
22
32.8
45
67.2
28
41.8
39
5 8 .2
9 .0
61
91.0
109
CHAPTER
SUMMARY,
This
t he
final
study,
finding,
The
DISCUSSION,
presents
and
and
implementation
and
The
the
and
test,
of
this
ERP
the
United
consisted
of
countries
SAP
returned
and Mann-Whitney
in
150
the
to
affecting
the
Arab
randomly
that
the
Gulf
total
survey
this
study.
was
of
an
44.7%
ER P
of
instrument,
t_-test,
U test,
selected
implemented
the
including
chi-square
conducted
at
the
responded
are
significance.
half
of
the c o m p a n i e s
t he m a n u f a c t u r i n g
an
ERP
Operation
implemented
factors
software.
analysis,
less.
of
States.
Data
of
on
st udy was
in c o m p a n i e s
for
implemented
or
purpose
developed
Almost
in
Findings
those
finding
recommendations.
was
level
based
of
the
using
the
Summary
of
respondents
which
.05
in
RECOMMENDATIONS
summarizes
determine
sample
companies
system
in
AND
conclusions
offers
primary
investigate
States
chapter
by
most
sector,
and
system w i t h i n
and
of
logistics
the
who
similar
number
had
the p a s t
two
years
modules
had
been
respondents.
110
Top
as
management
the m a j o r
critical
implementation
Almost
all
support
of
by
the
costs
needed
always
in
accurate.
computer
most
field
respondents
for
was
seen
as
did
employee
their
implementation
fo r
seen
ERP
Estimates
need
led
that
believed
The
d i d not
of
was
of r e s p o n d e n t s .
successful.
implementation
agree
involvement
factor
respondents
was
t i me
success
the m a j o r i t y
implementation
and
and
employee
to e m p l o y e e
that
not
proficiency
Although
ERP
layoffs,
turnover
the
were
critical.
believe
of
the
increased
majority
after
implementation.
In
the
ranking
factors
not
implemented
statistically
companies
United
in
of
critical
successfully,
significant
the
Arab
success
differences
Gulf
States
and
factors
there
and
were
no
between
those
in
th e
States.
Functional
reasons
were
most
main motivation
for
implementing
to
ERP
system was
implement
an
management,
often
many
the
cases,
information
to a d d r e s s
problem was
across
internal
often
ERP.
usually
specific
cited
The
made
as
decision
by
top
problems.
the
inefficient
and
external
the
flow
In
of
boundaries.
Ill
Widely
taken p r e p a r a t o r y
project
team with
sufficient
budget
implementation.
significant
Arab
Gulf
regard
strong
and
were
differences
and
leader
resources
There
States
included
no
for
in
allocating
the
statistically
between
those
and
forming
companies
the
United
in
the
States
in
to m o t i v a t i o n .
The
seen
steps
major
advantage
as m a k i n g
organization.
of
ERP
computer
system
Cost
cited
was
implementation
uniform
as
across
was
th e
the m a j o r
di s a d v a n t a g e .
Conclusions
Because
is
seen
as
top
authority
management
critical,
implementation
and
led
to m a k e
by
it
is
Discussion
support
important
a senior
change
and
happen
involvement
to
have
executive
and
the
with
happen
th e
quickly
( M i c h a e l , 1999).
Change
the
affect
organization
Chief
culture
executives,
managers,
and
recognize
these
everyone
ERP
chief
change
an
are
o r g a n i z a t i o n ; even
(Marion,
financial
project
facts
in
managers
setting
2000) .
officers,
who
fail
themselves
IT
to
up
failure.
for
112
Scheduling
herding
ca t s .
subprojects,
and
There
and
are
many
political
and
extremely
important
and
organizing
many
organizational
to
projects
people,
potentially
consider
a c lear,
concise,
before
starting
the
is
like
many
conflicting
issues.
develop
plan
ERP
all
and
It
of
is
the
issues
thorough
implementation
project
(Gu r l e y ,
1999) .
Such
a plan
picture
of
include
many
these
t he
cost
of
hidden
systems
convert
would
da t a ,
also
give
implementation,
costs.
As
might
also
tweak
existing
require
In
complexity
of
threat
installation)
cadre
c an
of
run
as
high
t he
implement
priority
In
IT
t he
generally
consultants
software.
th a t
(and
as
demand
and
5 to
a related
these
ERP
times
point,
infrastructure
a new
that
technical
10
technology
issues
overhaul
t he
failed
companies
gurus
Michael
not
noted,
to
hire
whose
the p r i c e
changes
system are
and
addition,
of
may
(1998)
companies
systems,
infrastructure.
realistic
which
Minahan
networking
ERP
a more
of
the
(1999)
required
given
fees
noted
to
the
deserve.
high
113
Adequately
the
success
of
trained
an
ERP
users
project.
to
change
hardware
and
or
months
to
learning
Sufficient
Graig
ERP
training
(2000)
project
must
scale
noted
reconsider
Organizations
today
will
industry
face
cost
It
millions
follows
of
that
fraction
of
software
options
companies
ERP
this
use
vendor.
employee
dollars
it
would
money
complete
system,
However,
implementation
selected
according
may
include
the
or
about
50%
to
that
sense
strategy.
100%
and
strategy
to p a r t i c u l a r
of
issues
above
the
to
often
implement.
spend
a small
the v a r i o u s
when
many
choosing
respondents
roll-out-at-once
an
to b e g i n
Unfortunately,
availability
weeks
employees.
systems
investigating
the
days
probability).
ERP
scheme
for
1998) .
retention
(0.7
make
of
take
takes
retain
to p u r c h a s e
a quick-pick
A majority
it
retention
2000
available.
only
organization with
rates
indicated
critical
(Crowley,
to a d d r e s s
through
(1997)
help
every
turnover
average
Hecht
also
fail
but
curves
in p r o g r e s s
its
that
may
also
It m a y
software,
that
either
are
chose
an
a
strategy.
must
be
carefully
limitations,
human
which
resources,
of
114
specialized
of
time
(Welti,
Daniel
previous
tended
needs
less
expertise,
(1997)
indicated
conduct
early
in
of
study
respondents
a project
budget
and
extensive
fulfill
company
willingness
critical
a secondary
support
and
have
or
taken
team with
and
and
an
ERP
processes
However,
first-time
ERP
on
disregarded
Most
those
of
the
preparatory
strong
of
succeed.
failure.
and
is
leader
steps:
and
generally
operation
responsibility
and
process.
focus
system
expectations.
to
applications
infrastructure
often
some
with
resources.
and preparedness
success
of
ERP
altogether.
re-organization
is u n l i k e l y
between
review
time-consuming
commitment
ERP
implementing
implementation
Implementing
costly
resources,
organizations
implementation
and
areas
allocating
that
organizations,
i m p l e m e n t e r s , put
forming
of
a full
the
experienced
infrastructure
financial
1999).
experience
to
of
their
requiring
internal
structures
Therefore,
from
to
without
top m a n a g e m e n t ,
Organizational
make
the
key
difference
Understanding
component
parts
the
is
of
115
the g r e a t e s t
importance
implementation
yield
strategy
be
What
similar
is
strategy
successful
results
in o n e
in a n o t h e r
approach
of
an
carefully
tailored
to
suit
The
no
the
ERP
companies
States
that
in
that
statistical
implementation
must
the n e e d s
Arab Gulf
had
significant
behind
implementing
the
reason
respondents'
for
and
implementation
behind
that
companies
had
therefore,
the
factors
Also
the
same
to
chosen
system
implementation
motivation
the
reason,
implemented
behind
of
ERP
is
implemented
ERP
system
in
regard
ERP
and
most
of
all-in-one
in
their
that
have
similar.
chosen
system,
in
system.
ERP w e r e
which
and
of
is b e c a u s e
ERP
the
approach
ERP
implemented
affected
for
ERP
difference
the m o t i v a t i o n
companies
of
States
implemented
the
approach
not
The
affect
the
may
organization.
factors
However,
company
company.
the U n i t e d
have
sound
is b a c k g r o u n d -
and
particular
to
achieving
results.
Implementation
dependent:
in
all-in-one
the m e a n
system
was
same .
the
116
Recommendations
The
results
recommendations
1.
goals
Determine
a
ERP
in a
taken
into
implementing
for
adopting
from
and
top
the
following
consideration:
objectives
an
the
and
establish
ERP
system.
system
and
management.
prepare
company
company
functions
in
should
the
ERP
understanding
result
in
the
implementation.
processes
the
suggest
for
will
be
the
fact
affected
that
by
the
implementation.
and an
will
before
Understand
3. A
all
be
commitment
process
study
business
strategy
full
2.
every
this
should
Identify
business
have
of
and
software
of
have
system.
the
company
Be
a clear
ready
Extensive
concepts
saving
py
vision
of
much
having
accurate
arrives.
This
data
on
planning
ERP
system
time
examining
all
hand
about
in
the
business
before
will
reduce
cost
and
estimates
before
committing
lead-time.
4.
Evaluate
cost
to a s o f t w a r e
installation.
including
resource
the
assumptions
determine
made
for
the b ud g e t
Clear
models
the
and
project,
planning,
overall
will
help
to
required.
117
5 . Do
the
not
expense
education
6.
budget
for
for
the
basis
9.
Select
not
take
Choose
th e
and
technology
team and
t h at
jeopardize
about
allocate
at
the
r i ght
implementation
their
team's
an
ERP
system
extensive
operational
software
of
jobs.
adopting
selection
such
features
that
package
if y o u
developing
account
specialized
for
level.
the
company's
as
an
availability
of
do
need
and
not
need
implementation
the p a r t i c u l a r
expertise,
you
of
financial
it.
strategy,
limitations
human
do
of y o u r
resources,
of
resources,
an d
a strong
leader
time.
12.
as
the
a whole
When
into
company,
the
preparation
at
program.
employees
not
as
technology
needs.
install
11.
such
information
discussions
particular
10.
issues
decision
of
information
the project
Assure
system will
internal
of
new
on
training
8 . Make
on
core
Educate
7.
ERP
of
focus
Appoint
a preparatory
will
help
offered by
a project
step
employees
an
ERP
to
team with
implementation.
understand
the
various
The
team
options
package.
118
13.
S et
reserves
to
up a p r o j e c t
cover
budget
unforeseeable
cost.
shortfall
may
delay
the
project
financial
resources
are
not
easy
Suggestions
for
Further
project
implementation,
following
t he
the
complexity
further
suggestions
results
of
1.
differences
in
the p u b l i c
study
for
this
A budget
very
much,
as
to
obtain
during
ERP
is n e e d e d .
further
study
factors
The
research
might
are
explore
affecting
including
sector
of
Study
based
study:
future
the
implementation,
in
enough
period.
Considering
on
with
ERP
motivation,
versus
those
in
the
in
companies
th e p r i v a t e
sector.
2 . Another
the
on
effect
of
the
implementation
3.
has
question
any
ERP
on
examining
implementation
would
approach
be
used
itself.
Whether
impact
worth
t he
or n o t
factors
i m p l e m e n t a t i o n wou ld be
an
a company's
that
affect
interesting
classification
ERP
research
topic.
119
4.
factors
that
type
module
of
future
affect
that
5 . Future
activities,
carried
action
6.
to
studying
ERP
consultants
toward
investigate
tasks
arrive
determine
differ
on
and
if
at
factors
the
they
are
a recommended
activities.
perspective
the
by
the
preparation
when
implementation
the
if
implementing.
focus
implementation,
to
the
to
is
could
what
pre-ERP
interesting
are
a company
order
for
could
implementation
research
in
After
in r e g a r d
ERP
describing
out,
plan
study
of
it w o u l d
views
affecting
of
companies
be
the
ERP
implementation
s ame.
120
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t hat a p l a n to c o n n e c t f r o n t e n d to b a c k e n d
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the
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r e p o r t s s a l e s a n d e a r n i n g f o r the f o u r t h q u a r t e r
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D. (1998).
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s o f t w a r e s o l u t i o n ? I n d u s t r y W e e k , 33.
M a r k u s , L . , T a n i s , C., & F e n e m a , P.
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Marion,
L. (2000). E R P s u c c e s s f r o m
smart cha ng e
m a n a g e m e n t [On-line]. Avai lable :
h t t p : / / w w w .i n t e r e x .o r g / e r p n e w s / e r p 9 0 5 / 0 2 g e t . h t m l
[6-2-2000].
123
Mc Cann, S.
(1999) .
Career opportunities with
e n t e r p r i s e r e s o u r c e p l a n n i n g (ERP)
[On-line].
Available:
h t t p : / / w w w .c o m p u t e r w o r I d .c o m / h o m e / f e a t u r e s . n s f / a
11/99092 0 q s _ e r p 1 [3-11-1999] .
M c C a u s l a n d , R.
personal.
McKie, 5.
DBMS,
(2000, M a y ) .
ERP suites: G e t t i n g
A c c o u n t i n g T e c h n o l o g y , 16, 62.
(1997) .
10, 64 .
Packed
apps
for
the m a s s e s .
M e n e z e s , J.
(1999, A p r i l ) .
SAP, o t h e r s a i m at
u s e r - f r i e n d l y ERP. C o m p u t i n g C a n a d a , 25, 1.
M E T A Group.
(1997, D e c e m b e r ) . A d a p t i v e s y s t e m s :
T h e r o l e of e n t e r p r i s e w i d e t e c h n i c a l
a r c h i tec t u r e [ O n - l i n e ] . A v a i l a b l e :
h t t p : / / w w w .m e t a g r o u p .c o m / n e w w h o s .ns f / I n t e r N o t e s /
L i n k + P a g e s /e a s + - + d e l t a 2 [ 2 - 1 4 - 2 0 0 0 ] .
M i c h a e l , D.
(1999, A u g u s t ) .
Su cc es sf ul ERP
i m p l e m e n t a t i o n the f i r s t t i m e
[On-line].
Available: w w w . m i d r a n g e E R P . c o m
[3-14-2000].
Mic h e l , R.
(1997) .
R e i n v e n t i o n r i g n s : ERP v e n d o r s
redefine value, pl an n i n g and elevate customer
service.
M a n u f a c t u r i n g S y s t e m s , 15, 28.
Mi n a h a n , T. (1998, J u l y ) . E n t e r p r i s e
planning.
P u r c h a s i n g , 125, 112.
Neff,
resource
J.
(1997, M a r c h ) .
E R P s o f t w a r e a i m s to t a m e
pl anning beast.
F o o d P r o c e s s i n g , 58, 109.
M ull i n , R.
(1998, A u g u s t 19).
B a d t i m e for g o o d
news: S u p p l y c h a i n IT o p t i o n s d e b u t .
Chemical
Week, 160, 3 3 .
Parker, A.
modules
52 .
P e n e l o p e , 0.
for all.
(1999, J u n e ) .
E R P 's f u t u r e l i e s in
r a t h e r than monolit hs.
C o m p u t e r Weekly,
(1998, N o v e m b e r ) . A l l
P e t e r s e n , S.
(2000, J u n e
b l u e s ? e W e e k , 5.
12).
for
What's
one
and
behind
the
one
ERP
124
Ptak,
SAP
C., & S c h r a g e n h e i m , E.
(2000) .
ERP tools,
t e c h n i q u e s , a n d a p p l i c a t i o n s f o r i n t e g r a t i n g the
s up p l y chain.
B o c a Raton, FL: C R C p r e s s L L C .
(1997, N o v e m b e r 25) S A P AG O n - l i n e ] .
h t t p : / / w w w .s a p .c o m [ 5 - 2 0 - 2 0 0 ] .
Available:
Saudi A r a b i a n S o l u t i o n s .
(1999).
F a c i n g the E R P
c h a l l e n g e : D o e s S a u d i A r a b i a h a v e the r i g h t
s k i l l s to i m p l e m e n t E R P ?
(Available from The
I n f o r m a t i o n a n d T e c h n o l o g y P u b l i s h i n g Ltd, PO
B o x 6 1 4 8 0 S u i t e 102, Al H i l a l B u i l d i n g , G a r h o u d
Road, D u b a i , U n i t e d A r a b E m i r a t e s )
S a u n d e r s , J.
(1998, D e c e m b e r ) . D a t a
smart with c o s t - b a s e d accounting.
C a n a d a , 24, 22.
tools get
Computing
S c a n n e l l , T., Sc J a s t r o w , D.
(1999, M a r c h 29).
E n t e r p r i s e i m p l e m e n t a t i o n s l o w d o w n takes toll
ERP w oes h it C a m b r i d g e T e c h n ol og y . C o m p u t e r
R e s e l l e r N e w s , 7.
S h e r i d a n , J.
(1995) .
Which
I n d u s t r y W e e k , 244, 41.
path
to
follow?
S he r m a n , E.
(1999, A u g u s t 2).
The shared services
c h a l l e n g e : R e t o o l i n g IT as an i n t e r n a l v e n d o r to
de li ver b e t t e r se rv i c e works for many but it's
e a s y to h i t s n a f u s a l o n g the w a y .
Computer
W o r l d , 3 9.
S h e r m a n , E.
(2000, F e b r u a r y ) .
ERP attitude
adjustm ents; E a r l y ERP i m ple me nt at io ns have
p r o v e d to b e c o s t l y a n d t i m e - c o n s u m i n g .
C o m p a n i e s a r e n o w t r y i n g to i n t e g r a t e ERP
s o f t w a r e w i t h o t h e r systems, c r e a t i n g new
staffing challenges.
C o m p u t e r W o r l d , 52.
S o u t h w i c k , K.
(1996) .
Is
C o m p u t e r W o r l d , 4, 14.
PeopleSoft
tough
enough?
125
S p r e c h e r , M.
(1999, A u g u s t ) .
T h e f u t u r e of E R P in
the p u b l i c s e c t o r .
G o v e r n m e n t F i n an ce Review,
15, 49 .
S t e d m a n , C.
(1998, D e c e m b e r ) .
B e t t e r w a t c h out:
A p p l i c a t i o n a d d - o n s test u n p r e p a r e d u s e r s .
C o m p u t e r W o r l d , 1.
Stedman,
C. (2000).
Bu ndl e Software.
J.D. E d w a r d s , S y n Q u e s t ,
C omp u t e r W o r 1 d , 56.
IBM
St ein, T.
(1997a, D e c e m b e r ) .
E n t e r p r i s e apps - Not
j u s t E R P a n y m o r e : Some c u s t o m e r s w a n t sales,
s u p p l y - c h a i n , and other l i nk s b u il t into their
e nt e r p r i s e resource pl an ning products. Vendors
a r e s t e p p i n g up.
I n f o r m a t i o n Week, 13.
St ein, T.
(1997b,
Integration.
Stevens,
245,
September).
K e y word:
I n f o r m a t i o n W e e k , 64 9,
T. (1997) .
37 .
ERP
Explodes.
89.
Industry
W eek,
Taschek,
J. (1999, A u g u s t ) . T h e r a c e is o n
to W e b E R P : T o p p l a y e r s find t h e y m u s t m a k e m a j o r
a d j u s t m e n t s in m o v e f r o m c l i e n t / s e r v e r . PC Week,
1.
Vowler,
J. (1999, A p r i l ) . T h e m y t h o l o g y
implementation.
Wah,
of
ERP
L.
(2000, M a r c h ) . G i v e E R P a c h a n c e - m a n y
b u s i n e s s e s h a v e d e c l a r e d E R P a w a s t e or a
b u r d e n , b u t e x p e r t s u r g e c o m p a n i e s n o t to
d is mis s this technology.
M a n a g e m e n t R e v i e w , 20.
W e l t i , N.
(1999) . S u c c e s s f u l S A P R/3
i m p l e m e n t a t i o n p r a c t i c a l m a n a g e m e n t of E R P
p r o j e c t s . E sse x , E ng l a n d : A d d i s o n W e s l e y L o n g m a n
Limited.
W e s t o n , R.
World,
(1997).
31, 73 .
Tooling
around.
Computer
126
W i l d e r , C . , & Stei n , T.
(1997, O c t o b e r 6).
App
I n t e g r a t i o n Chain - C o m p a n i e s are li nking
e n t e r p r i s e s y s t e m s to the a p p s of t h e i r
supplie rs and customers. The payoff: Sho rt er
m a n u f a c t u r i n g cycles.
I n f o r m a t i o n W e e k , 18.
Wils o n , T.
(2000, M a y 8).
Shortcuts
deployment.
I n t e r n e t W e e k , 22.
speed
ERP
127
APPENDIX
QUESTIONNAIRE
AND
A
COVER
LETTER
128
SURVEY FORM
All
be
used
information
only
responses
resolute
form
for
will
of
only,
no
responses
academic
be
the
and
kept
research
in
survey
strict
will
individual
be
in
thi s
purposes.
Your
confidence.
The
reported
company
form will
in s u m m a r y
information
will
r e v e a 1e d .
Part
1 . In w h i c h
O Gulf
country
States
QSaudi
Q
United
2 . Please
CD
CD
$0
to
$10
is y o u r
organization
Arabia
Bahrain
0
UAE
select
$10
your
company
Kuwait
Million
Million
to
$ 1 00
Million
to $ 250
Million
CD
$250 M i l l i o n
to $5 00
Million
$500 M i l l i o n
to $1
Billion
Over
Qatar
income
$100 M i l l i o n
$1
States
CD
CD
CD
Oman
based?
to
$5
Billion
Billion
$5 B i l l i o n
be
129
3 . What best describes

r g a n i za t i o n ?
Board
o
o
Information
your
position
in
the
Member
Techno logy Mana ger
Of f i c e r
Chief
Executive
o
o
0
Chief
Finance
Chief
Information
Chief
Technology
o
o
Chief
Operation
Senior
Internet
O f f i cer
Off i cer
0 f ficer
Of f i c e r
System Analyst
;.P l e a s e
Manager
Specialis t
select
your
Banking
Computer
Education
Food
Government
Manufacturing
Retail
Telecommunications
organi zation
& Finance
Software
S: S e r v i c e s
& Beverage
I I T r a n s p o r t a t i o n
130
Utilities
Whole
Other,
5 . W h a t is
in y o u r
sale/Distribution
please
be
specific
the curren t i m p l e m e n t a t i o n
organization?
I m p l e m e n t e d si nce:
1 Y e a r or les s
4 Years
Under
Implementation
2 Years
5 Years
and
status
of
ERP
3 Years
over
Implementation
ceased.
6 . Wh i c h ERP m o d u l e s
all that apply)
have
Please
you
indicate
reasons
implemented?
(Choose
O p e r a t i o n s a n d L o g i s t i c s (e.g., i n v e n t o r y
m a n a g e m e n t , MRP, p u r c h a s e , etc.)
P r o d u c t i o n (e.g.,
m a n a g e m e n t , etc.)
Human Resources
p l a n n i n g , e t c .)
F i n a n c i a l s (e.g.,
c o s t i n g , e t c .)
production
(e.g.,
management,
payroll,
accounts,
quality
personnel
general
ledg e r ,
131
Sales
sales
Research
^ Other,
a n d M a r k e t i n g (e.g.,
m a n a g e m e n t , etc.)
and
please
order
management,
Development
list
Part XI
7 . W h i c h of t h e f o l l o w i n g w e r e r e a s o n s for
i m p l e m e n t i n g E R P in y o u r o r g a n i z a t i o n ? (Cho ose
al l t h a t a p p l y )
F i n a n c i a l r e a s o n s (e.g., c o s t
p r o d u c t i v i t y i n c r e a s e , etc.)
F u n c t i o n a l r e a s o n s (e.g.,
p r o c e s s r e d e s i g n , etc.)
Technical
decision,
Business reasons
dec is i o n )
Others
reasons
e t c .)
(please
(e.g.,
(e.g.,
saving,
process
global
global
automation,
corporate
corporate
describe)
132
8. W h a t t y p i f i e d the d e c i s i o n m a k i n g p r o c e s s t o w a r d s
i m p l e m e n t i n g the E R P ? ( C h o o s e all t h a t apply)
Decision
Planning
evo lved out

Exercise.
Extensive
consensus
Decision
made
Proposed
by
of
Strategic
internal disc ussions and

at o p e r a t i o n a l level.
Recommended
Others
by
Top
O
O
and a s s i s t e d
By
>
others
(please
by
outside
consultant.
describe)
Cost:
Oyes
Time
S c h e d u l e :O Yes
No
for
estimated?
ôverrun by |
O
No
Oyes
No
| %under by
ôverrun
%under
time:
Operations ;
By
9 . Were the f o l l o w i n g r e q u i r e m e n t s
i m p l e m e n t a t i o n of E R P c o r r e c t l y
general
Management.
functions:
(please
Training
Business
by|
by
%overrun
by
%under by
list)
133
10. W a s t h e d e c i s i o n to i m p l e m e n t E R P t a k e n
address certain specific problems?
Yes
to
No
11. If t h e a n s w e r to the a b o v e is yes, w h i c h of the

f o l l o w i n g s p e c i f i c p r o b l e m s the o r g a n i z a t i o n
i n t e n d e d to a d d r e s s t h r o u g h i m p l e m e n t a t i o n of
E R P ? ( C h o o s e a l l t h a t app ly)
g
L a c k of c o m m u n i c a t i o n
orga ni zation
Inefficient information
external boundaries
N o n - a v a i l a b i l i t y or d e l a y e d a v a i l a b i l i t y
c r i t i c a l i n f o r m a t i o n for d e c i s i o n m a k i n g
Falling
Stagnant
Others
across
internal
and
of
growth
(please
describe)
have
Best-of-Breed
vendors)
All-in-one
vendor)
Other
flow
a complex
profitability
12. W h a t a p p r o a c h
s ele c tion?
within
you
selected
(combining
modules
(buying mo dul es
(please
for
ERP
software
from different
from a single
describe)
134
13 . W h a t w a s the
to r o l l o u t ?
implementation
Complete
Gradual roll
applications
14 . W e r e
were
system
roll
out
one
Institute
Define
Allocate
Set-up
Extensive
campaign
Others
a project
project
in
respect
once
functional
preparatory
that apply)
team with
steps
strong
that
leader
procedures
budget
and
a detailed
resources
schedule
internal
(please
at
(implement
b y one)
there any specific

ta ke n? (Choose all
out
strategy
information
and
education
describe)
Part III
15. W h i c h of t h e f o l l o w i n g in y o u r v i e w a r e c r i t i c a l
s u c c e s s f a c t o r s for t h e E R P i m p l e m e n t a t i o n
p r o j e c t s ? P l e a s e r a n k t h e m in a n u m e r i c a l o r d e r
of i m p o r t a n c e b y f i l l i n g in the r a n k i n g n u m b e r in
the c h e c k b o x e s below.
[1 is the h i g h e s t rank]
S t r a t e g i c a l i g n m e n t o f t h e e x e r c i s e (i.e.,
d e c i s i o n e v o l v e s out of s t r a t e g i c b u s i n e s s
I I C l e a r d e f i n i t i o n
s trategy
of
scope
and
the
plan)
implementation
135
Experienced
in-house
Capability
Top
Careful change management

to c u l t u r a l a n d p o l i t i c a l
End
Others
of
management
user
the
team
IT C o n s u l t a n t
support
involvement
(please
IT
and
and
chosen
involvement
wit h due
aspects
consideration
support
describe)
16. W h i c h of the a b o v e c r i t i c a l s u c c e s s f a c t o r s w e r e
n o t i m p l e m e n t e d s a t i s f a c t o r i l y in y o u r
o r g a n i z a t i o n ? P l e a s e c h e c k the a p p r o p r i a t e b o x e s
below.
S t r a t e g i c a l i g n m e n t of the e x e r c i s e (i.e. the

d e c i s i o n e v o l v e s out of s t r a t e g i c b u s i n e s s plan)
Clear definition
s trategy
Experienced
Capability
Top
Careful change management

to c u l t u r a l a n d p o l i t i c a l
End
Training
in-house
of
management
user
of
the
scope
IT
and
implementation
team
IT C o n s u l t a n t
support
involvement
and
and
chosen
involvement
with due
aspects
consideration
support
136
[] O t h e r s
(please
describe)
17 . W h a t a r e the p i t f a l l s t h a t y o u w o u l d a d v i s e
o t h e r s to a v o i d in the p r o c e s s of E R P
implementation?
18. W o u l d y o u c o n s i d e r the E R P i m p l e m e n t a t i o n
o r g a n i z a t i o n to be a s u c c e s s ?
Q Yes
in y o u r
No
19. If yes, w h a t a r e the m a i n p a r a m e t e r s

i n d i c a t e t h a t it has b e e n a s u c c e s s ?
that
20. If y o u t h i n k it w a s a f a i l u r e
i n d i c a t o r s of t h i s f a i l u r e ?
what
are
21. If y o u t h i n k it w a s a f a i l u r e
r e a s o n s for t h e f a i l u r e ?
what w ere
the m a i n
the m a i n
137
22. P l e a s e i n d i c a t e y o u r l e v e l
following statements.
Strongly
of
Disagree
agreement
Neutral
with
Agree
Disagree
the
Strongly
Agree
Qu a 1 i f ied
consultants
were available
the
implementation
Our
i m p l e m e n ta t i o n
consultants
u n d e r s t o o d the
p r o d u c t __________
Our
implementat ion
was completed
on s c h e d u l e
implementation
was what we
e x p e c t e d _________
23. Do y o u f e e l that, c o n c e n t r a t i n g o n IT i s s u e s ,
o r g a n i z a t i o n m i g h t l o o s e f o c u s on c o r e i s s u e s
c r i t i c a l to its b u s i n e s s ?
Yes
No
24. H a s the i m p l e m e n t a t i o n of c l i e n t s e r v e r s y s t e m
a n d the E R P i n c r e a s e d t h e p o w e r a n d i n f l u e n c e of
IT d e p a r t m e n t at the e x p e n s e of c o n v e n t i o n a l
d e p a r t m e n t s s u c h as p r o d u c t i o n , p r o j e c t s ,
marketing, finance etc.?
O Yes O
No
138
25. Has t h e i m p l e m e n t a t i o n n e c e s s i t a t e d r e q u i r e m e n t
of a n e w s k i l l set a m o n g e m p l o y e e s , in t e rms of
computer proficiency?
O Yes
No
26. D i d e m p l o y e e t u r n o v e r i n c r e a s e
i m p l e m e n t a t i o n of E R P ?
Yes
the
No
27. D i d E R P i m p l e m e n t a t i o n
em plo yee lay-off?
O Yes
after
eventually
lead
to an
No
28. W h a t w a s the a p p r o x i m a t e t o t a l c o s t of
i m p l e m e n t a t i o n as p e r c e n t a g e of y o u r a n n u a l
revenue?
Part IV
29. A f t e r i m p l e m e n t a t i o n , w h i c h of t h e f o l l o w i n g , in
y o u r e x p e r i e n c e , a r e d i s t i n c t a d v a n t a g e s of
i m p l e m e n t i n g ERP s y s t e m s ? ( C h o o s e a l l that a p p l y )
Q
Decision-making
information
is b a s e d
Diagnostic controls
are i m p r o v e d
and
on
real
response
time
to
aberrations
139
Efficient
manpower,
u s e of r e s o u r c e s ,
(reduces
m a t e r i a l an d capital)
Improves internal
organizations
Uniform
computer
LJ R e m o v e s t h e
p r o b l e m s of
communication
systems
across
in
the
L e a d s to s t a n d a r d i z a t i o n a n d b e t t e r
c o n t r o l a c r o s s the o r g a n i z a t i o n
Improves
Others
large
of
complex
organization
c o o r d i n a t i o n and c o m m u n i c a t i o n
different geographical locations
customer
[H P o s s i b l e to
remove them
waste
satisfaction
identify
(please
quality
process
bottlenecks
and
describe)
30. W h i c h of t h e f o l l o w i n g in y o u r v i e w a r e
d i s t i n c t d i s a d v a n t a g e s of E R P s y s t e m s ?
C3 It is t i m e c o n s u m i n g a n d
far as i m p l e m e n t a t i o n is
disruptive
concerned
the
exercise
as
It
is e x t r e m e l y e x p e n s i v e
It
is r i g i d
implemented
It
is a p a s s i v e s y s t e m a n d it d o e s n o t p r o m p t
the m a n a g e r s to t a k e c e r t a i n a c t i o n s , i n s t e a d it
d oes g i v e t h e m t h e i n f o r m a t i o n if a n d w h e n t h e y
w a n t to h a v e it
Does
not
and not
improve
easy
to
or p r o m o t e
change
once
it
collaborative
is
effort
140
C a n n o t h a n d l e s ub j ec t i v e i ssues w h i c h are
d e v e l o p e d th ro ug h interaction and team work
E x p e n s i v e o u t s o u r c i n g for m a i n t e n a n c e
u p d a t i n g of t h e s y s t e m s
Others
Thank
(please
you
for
and
describe)
taking
the t i m e
survey
to
complete
this
141
August 24, 2000

D e a r:
I am undertaking a study for my doctoral dissertation of industrial technology. The intent
of this study will be to identify, analyze and investigate those factors that will affect the
implementation of Enterprise Resource Planning (ERP) in companies located in the
international Arab G ulf States and the United States with special emphasis on SAP
software. You have been randomly selected to be part of this study, and I am requesting
your help. Since the study is about those factors that affect the implementation of
ERP, it is important that each member who has been involved in the deployment of
an ERP system complete the questionnaire as weil. I am hoping that you forward
this questionnaire to all such members of the team who contributed in the
implementation process of SAP too.
It is very important that we receive your responses because of your experience in the
implementation of ERP software. Your contributions will undoubtedly assist us and lead
to the ultimate success of our research project in this area. This instrument has been
tested by a panel of experts in the area of ERP and hence was revised in order to obtain
the necessary data while using a minimum of your time. The instrument is concise, and
should require a few minutes of your time to complete.
It will be appreciated if you will complete the instrument and submit it as soon as
possible. Your participation and contribution to this study is a vital part of the data
needed in this study. Any comments that you may have concerning the factors related to
the implementation of ERP which may not be covered in the instrument will be
welcomed Your response will be held in strictest confidence. To view this survey, please
go to: http://fp.uni.edu/alsehali/
Thank you in advance for your assistance. I will be pleased to send you a summary of
the study if you desire.
Sincerely Yours,
Saud Alsehali
Doctor of Industrial Technology Candidate
142
September 5. 2000
D e a r:
On August 24. 2000. a brief questionnaire was e-mailed to you. The questionnaire
pertained to those factors that affect the implementation of Enterprise Resource Planning
(ERP) in companies located in the international Arab G ulf States and the United States
with special emphasis on SAP software. Many companies across the Gulf States and the
United States have already responded, but I have not yet head from you. If you have emailed your response, disregard this second e-mailing and please accept my apology and
if you did not e-mail it yet, would you kindly take a few minutes to complete the survey?
To view this survey again, please go to: http://fp.uni.edu/alsehali/
It is important that each identified respondent complete the questionnaire. Your response
is vitally important to the study.
Sincerely Yours,
Saud Alsehali
Doctor of Industrial Technology Candidate
143
APPENDIX
RESPONDENTS
COMMENTS
144
In
some
order
to a c q u i r e
importance
issues,
the q u e s t i o n n a i r e
listed b e l o w
20,
21,
29,
What
are
and
was
for
5,
the
we
t his
8,
11,
respondents'
allocated
some
purpose.
These
12,
14,
15,
16,
view
about
items
in
items
17,
as
19,
30.
the
mean
reason
for
the
ceasing
of
the
implementation?
1.
Vendor
3rd p a r t y
concerns
contractual
2 . We
are
only
on
deliverables
and
other
issues.
providing
implementation
support.
3.
During
control
of
Chapter
11.
What
towards
financial
typified
the
implementing
1.
efforts
their
implementation
Largely
and
2.
What
an
were
organization
decision
the
the
implementation
of
and
filed
making
of
Y2K
lost
process
compliance
for p r o c e s s
by middle
specific
intended
company
ERP?
outcome
requirements
Assisted
position
the
improvements.
management
problems
to a d d r e s s
the
through
ERP?
145
1 . Y2k
upgrade
required.
2 .Replacement
and
consolidation
for
of
IT
an
aging
way
4 .M u l t i o l e
Currencies.
to
fix Y2K problem.
consolidation
6 .Y2K
considerations.
7 .Too
many
legacy
8 .Redundancy
technology
in
legacy
9 .Achieving
10. N e e d
in
Y2K.
systems
Outdated
compliance
single
IT p l a t f o r m
rollover,
life
and
systems
for o n e
12. E n d i n g
& maintenance.
systems
legacy
Y2K
11 . M i l l e n n i u m
system
efforts.
3 .Cheapest
5 . Systems
financial
cycle
Technology
of
previous
product,
Y2K
issue.
13. A i l i n g
14. L a c k
15. A v o i d
What
software
1.
does
not
complex
of
in-house
integration
and
obsolete
on
spot
systems
update
Y2K p r o b l e m s
approach
have
you
selected
for
ERP
selection?
Combination
support
GIS
of
SAP
and best
of
breed
etc.
as
SAP
146
2.
systems
All-in-one
or
other
systems
with
interfaces
to m e e t
to
legacy
business
requi r e m e n t s .
3 . All
but
V > ii
were
better
practices)
or
Were
were
to;
ERPs
or
SAP's
too
i.e.
there
an
any
I worked
r-ot-air-iorl
BBPs
non-existent
rvc
(best
on w e r e
q v t P^TTle; h H ^ t*
business
in
SAP
(specialized
sensitive
and
difficult
in-house
specific
SAP
payroll
to
system.
preparatory
steps
that
taken?
1 . Change
2.
management
Consultant
3 . Define
data
of
- e I~imo
than
maintenance)
migrate
two
integrator
sponsorship
from business
4.
as
and
ownership
for m a s t e r
units.
Heavy
Business
Process
Re-engineering
focus/education.
5 . External
training
6.
an
training
7.
Selected
development
Project
team
for
team members
implementation
partner
and
partner
training
and
full
time
commi t m e n t .
147
8.
Hire
knowledge
9.
what
Study
best
as
would
And
ERP
Emergent
order
4.
P os t
5.
ACCOUNTABILITY
6.
Plant
Makes
the
modules,
testing
of
in
the
all
of
Select
area
top
mgmt
And
other
where
ESSENTIAL
steps
this w o r k
success
factors
projects?
support
and
buy-in
importance.
AFTER
support
rank
end user
IMPLEMENTATION
system
that
- walk
has
and
a well-defined
as
g o o d data
in
easier.
communication
and
for
talk.
critical
not
040.
critical
conversion much
Constant
Can
the
with
between
8.
and
implementation
talk
and
Philosophy
Put
and
of c l i e n t
v i e w are
3.
7.
of
management
in
Scenarios
020
implementation
Middle
the w a l k
the
others.
in y o u r
2 . An
it.
education
success! ! SAP
done.
1.
institute
organization.
the p r e p a r a t i o n
be
the
Business
the
SA P
Which
for
the
suites
timely
such
to
base.
10.
to
professionals
involvement
strategy
of p r e
components.
some
of
the
CSF
are
equal
importance
148
9 . Project
team
1 0 . Consistent
11. T h i s
these
are
given
my
include
equal
other
were
not
commitment
implementation
in w e i g h t
opinion
hardware
Which
time
is a d i f f i c u l t
honest
numerous
full
of
as
choices,
task
schema
because
importance.
requested.
legacy
many
But
of
I have
#9 w o u l d
migration
&
requirements.
in y o u r
view
implemented
are
critical
satisfactorily
success
factors
in y o u r
organization?
as
1.
Business
2.
They were
they
unit
could have
planning
for
provider
to
ongoing
buy-in
successful
been.
the h a n d o f f
the
IS
support
Staff
once
the
&
support.
but
not
Technical
from
the
is m o s t
as
successful
documentation
consulting
critical
provider
leaves
for
the
p r o j ec t .
3.
a strong
following
4.
After
implementation,
focus/holding
global
This
employee
we
have
n ot
accountable
continued
for
workflows.
factor
is
limited
to
configuration
only.
149
5.
Clearly
implementation
held
the
is
lack
responsible
for
6.
Qualified
7.
Best
What
others
of
factor
support
and
for
fear
the w r o n g
each
for be ing
decision.
consultant
the
avoid
risk
making
practices
are
to
highest
of
SAP w e r e c u s t o m i z e d
pitfalls
in
t h at y o u
the p r o c e s s
of
would
advise
ERP
implementation?
1.
Take
more
time
resources.
Executive
management
are
an
Incomplete
3.
Have
personnel,
do no
study
let
is o v e r
the
until
"in t h e i r
4.
intended
minds"
and
strong
key
project
m ust.
3 in h o u s e
success
consultants
at
develop
Planning
least
the
and
sponsorship
absolute
2.
at
to p l a n
least
of
strong
you
t hi n k the
ERP
consultants,
and
implementation
3 months after
everything
is
complete.
The
implementation
end
end
users
at
strategy
every
should
stage.
include
Very
important.
5.
When
negotiating
the d e t a i l s ,
including
in the
"pitch".
sales
the
ERP
packages,
ones
that
get
aren't
ALL
of
covered
150
5 . Do
not
underestimate
to
th e
skimp
the
success
of
the
take
factor
will
increase
7 . Do
not
affected
by
and
culture
11. M a k e
longest
Without
to
is
critical
these
achieve
and
the
the
risk
significantly.
reexamine
users,
and
10. H u r r y
project.
that
how
much
business
time
it
takes
processes
ERP.
all
9 . Cost
and b i g
far
a n d do n o t
management
underestimate
the
8 .As k
training
change
return will
to r e e n g i n e e r
on
what
training
change
sure
that
Take
key,
respected
make
them
stakeholders
is
must
decision
you
want
always
be
to do
expected.
managers
the
is
in
budget
from
the
SAP?
underestimated,
by p r o j e c t
people
on
the
large
enough.
business
success
of
the
and
ERP
implementation.
1 2 . I believe
engineered
trying
to
business
around
force
business
the
the
ERP,
ERP
processes
and
should
improved,
to a d a p t
to
be
re
instead
existing
processes.
13 . A l w a y s
management
have
users
to
participate
management
is
and
top
involve.
14 . C h a n g e
critical
factor.
of
151
15. N o
scope
16 . M a n a g e
training
creep.
scope.
costs
and
Do
under
estimate
effort.
17 . C u s t o m i z a t i o n ,
breed,
not
rewriting
underestimating
the
need
code,
best-of-
for c h a n g e
management.
18.
day
one
since
You
is
not
these
Purchasing
hitting
must
a disaster.
systems
and
"enter"
ramifications
train
are
everyone
The
connected
vice
versa)
the
and
"sa ve"
have
outside
users
of
their
must
(i.e.
change
20. T h e
stuff
the
hard
critical
Hammer)
than
systems
21. D o n ' t
because
it's
selection,
People,
select
and
an
a b i g n a me.
and
change
tha t
to
of
department.
and
Michael
Finance
management.
stuff
(to q u o t e
and b e h a v i o r
is m o r e
flowcharts.
implementation
partner
Be
with
ensure p r o pe r
very
buy
strict
in
from
your
the
organi z a t i o n .
22 . P l a n n i n g
that
comes
and p l a n n i n g
so
serious
strategy
is
know
implications
19 . T r a i n i n g
soft
adequately
and p l a n n i n g
after
training.
that
152
23. I s o l a t e d
with
the
design
operational
24. D o n ' t
and
make
Critical
Operation
(avoid c o m p e t i n g
25. T e a m s
very
FI,
the
ERP
Task
is
not
in
touch
the
business
implementation
f or
the
entire
resources
the
organization
priorities).
tend
MM,
that
requirements.
underestimate
required
(e.g.,
team
PP,
to o p e r a t e
PM,
in
a modular
S D ) . Integration
fasion
testing
is
important.
26 . A n
a whole.
You
strategic
not meet
ERP
have
to
business
the
ensure
requirements
on
strategy
organization's
organization
the
tha t
of
availability
required
Management
benefits
requirements
27. E n s u r e
duration
system
state
t he
and
of
adequately
it m e e t s
even
the
of
key
users
it
readiness,
it d o e s
us e r .
Develop
implement
for
t he
a Change
Assess
and
training
as
the
when
end
project
by
organization
prepare
and
the
creating
buy-in.
28. Y o u
have
top
management
involvement
throughout
the
project.
be
early
involved
longer
must
formal
on
in
training
the
End
project.
periods
support
before
users
Plan
for
actual
and
must
153
implementation.
Plan
and
consulting
handoff
from
responsible
for
each
29 . M a n a g e m e n t
involvement
and
30. P l e a s e
strong
essential.
possible
an
choose
IT
to
to
as
sure
business
34. L a c k
to m a i n t a i n
of
depth.
End
user
important.
support
leader
with
team.
careful
planning
support
is
staff
as
outside.
training
functionality
data
is
followed
and
without
defining
from
the b u s i n e s s
post-implementation
managing
units
integrity
user
support
unit
design
scope
during
initial
implementation.
37. C h a n g e
management.
3 8 . Do n o t
under
Lack
VERY
in-house
proper
each b u s i n e s s
and
essential.
the
ownership
master
3 6 . Not
design
much
staff
requirements
35. U n d e f i n e d
within
guide
IS
rush.
33. D e s i g n i n g
clear
to
area.
is
are
little
32. M a k e
try not
modular
buy-in
documentation
provider
organization
Have
very
technical
training
experience
31. As
for
of
estimate
adequate
training
commitment
to
time
the
and
cultural
154
changes
that
will
implementation
time
39. D o n ' t
required
the
IT
team
and
41. T r a i n
data
before
advance.
needs
strong
sweeping
of
effort
changes.
understand
- business
impacts
users
it
is
processes
Staff
not
are
just
being
EVERYONE.
extensively.
Maintain
company
and
43. D e f i n e
a
to
the b u s i n e s s
configuration,
choose
it
end
Define
the a m o u n t
huge,
conversion.
42 . P l a n
the
amply.
implementation
re-engineered
within
frame .
these
40. E v e r y o n e
an
place
underestimate
to m a k e
project
take
unit
needs
Verify
a good
site
strategy
i.e.
legacy
team.
well
in
planning,
uploading
legacy
data.
t he
decision
making
process
AND
capable
external
first,
project
manager.
44. T r y i n g
45. S c o p e
low users
to
implement
increase,
participation
46. C o n c e n t r a t e
sure
that
on
the M a n a g e m e n t
implementation
47 . F o r m
lack
of
commitment.
End
User
is
Training
fully awa re
you up
project
all
knowledge
and
and backing
in-house
everything
of
at
o nce.
transfer,
and making
the
100%.
team and
training.
155
48. D o n ' t
and
don't
one
source
the
skill
49. P r e p a r e
the
company
make
learn
challenge
them willing
the
new
that
50. W e a k
the
on
ignore
cha n g e ,
and
rely
one,
you
are
implementing.
52. N e e d
personal
to
unlearn
familiar
going
to
for
the
with
the
old
of
method
the
face.
with
end users
outside
system
tact
team.
exiting
Do
implementation
transfer.
Coordination
implementation
51. K e e p
be
for
not
financial
partially
experienced
in
while
implement.
in-house
IT
team
or
good
Consultant.
53. D e f i n e
the
54. R e c r u i t
55. G o
for
of
the
experienced
the
56. S t r e s s
scope
on
phased
training
project
clearly
staff
implementation
and
knowledge
transfer
from consultants.
57. U n d e r
from your
the
effort
that
required
staff.
58. F o l l o w
early
estimate
the
SAP p l a n .
59. T o p - l e v e l
support,
end
and proc e s s
ownership
by
user
involvement
executive.
156
60. E n s u r e
of w h a t
moon
is b e i n g
and
choice
that
deliver
of
users
delivered.
a half
Do
one.
a consultant
61. M a k e
have
a clear
not
Also
expectation
promise
be
the
careful
full
in
the
partner.
sure
all
consultants
62. E d u c a t i o n
and
training
are
well
quali fi e d .
least
have
from a conceptual
some
training.
metrices
on w h e n
context
More
which
the
6 3 . It
and
Poor
to
is
is V a g u e
so
the
to
at
may
receiving
reporting
want
systems
training
individuals
into
will
system
cost
the
thought
you
view
in E R P
- what
extract
the
are
the
information
running.
Objectives,
estimates
Bad
Consultants,
& budgetary/project
control
etc .
64. T o p
ranking
Scope
and
down
champion
creep
is
commitment
in
also
the
and
client
VERY
an
ranks
detrimental
extremely
high-
is n e c e s s a r y .
to
schedules
budgets.
65. E n d u s e r s
give
full
support.
MUST
take
advise
customization,
of
MUST
be
Company
involved.
implementing
experienced
or v e r y
Management
little,
software
consultants
NO
if n e c e s s a r y .
MUST
157
66.
in h o u s e
Choose
consultant
the
by
right
consultant
educating
and
the b u s i n e s s
develop
& IT
employees.
67 . S t u d y
What
it
has
are
been
the
before
main
in m y
to
4 . Output
5 . No
and
th e
of
synchronized
sites
that
relies
on
the
ERP
due
are
increased
systems
It
necessary
reporting.
and
to
efficiency
of work.
implementation.
operating
in a m o r e
manner.
8. It w a s
was
indicate
plan.
7 . Informational
compliant.
fully
goods
downtime
6. A l l
aging
that
office.
3 . Kept
been
parameters
processing
2 . Financials
has
implementation
a success?
1 . Data
system
well
flow
implemented
would
not
also
aided
in
9 . Number
10. P e o p l e
there
of
are
systems
availability
dramatically.
that
as
and
were
rising
on
time
have
the
and
been
data
so m a n y
replace
many
Y2k
cleanup
that
systems.
users.
beginning
to
accept
it a n d
works.
it
an
158
11. It
is
is
or
not
by
teamwork.
only
12. T b e
the needs
teamwork
job
successful
and
our
work
only when
implementation
of
all
business.
was
on
W e not
it
is
time
yet
either
ERP
completed
and meets
received
f ull
ROI .
13. B e c a u s e
of
SAP
always
delay
established
16. W e
in
online
15. A l l
are
back
out
manner.
information
are
going
change
at
flows
for
reporting
information.
or b e t t e r
than
the
19. O p e n
as
planed.
management.
Skilled
IT
It
is
a very user
day-to-day
reporting,
business
"unfriendly"
goes
accountability
on.
and
transparency.
20. A b i l i t y
efficiencies.
staff
knowledge.
18. It w o r k s .
but
to r e t r i e v e
targets.
functional
system,
hard
up-to-date
metrics
17. P r o p e r
with
is
in a r e a s o n a b l e
14 . No
and
data
to m a k e
Cost
21. B u s i n e s s
major
savings
improvements
in m a n y
in
areas.
commitment.
159
22. T h e
operate
on
business
day
t ha t
able
to
successfully
one.
23. I w o u l d
reason
was
the
call
it
sheer
a success
magnitude
for
of
no
other
the
implementation.
24. H i g h
management,
management
good
commitment,
quality
strong
of p r o c e s s
owners
project
and
consultants.
25. A l l
planned were
critical
business
totally
functional
implementation.
within
the
time
26. I t ' s
it n e e d s
So
in
it
on
the
implementation
frame
neither
a person
experience
alone.
The
processes
who
that
were
first
day
date was
met
planned.
success
nor
is h a v i n g
the
business
needs
strong
not
failure
strong
merely
leadership
because
functional
in
IT
field
(project
leader).
27. I t ' s
intended
to
28. U p
working
meet
and
well
goals
running
29. B u s i n e s s
of
and
and
functioning
objectives.
and client
processes
as
did
not
is
happy.
break
during
implementation.
160
30. S h o r t - t e r m
manage
business
integration
legacy
data
to
problems
were
reported
implementation.
32. S e c u r i t y
required
minimal
33. N o
business
revising
delay
we
tables
on-time
day
excellent
to
user
roles
fit
with
ou r
cash
of
and
flow,
of p e o p l e ,
right
shipped
info.
away.
the
ERP
product
with
of
increased
for
productivity,
decision-making.
methodology,
tea m members,
level
the
Partner
scope
did
and
not
the
of
management
commitment.
39 . C o n s u l t i n g
understanding
bad
implementing
available
training
and
correct
No
consultants.
information
consultants,
start-up.
difficulties.
37. I m p r o v e d
38. Q u a l i t y
at
shipments
manufactured
few m i n o r
involvement
to
1 after
36. E x c e l l e n t
better
and
in s h i p m e n t s
or
in
35. F r o m
linked
changes.
downtime
files
Improvement
so f t w a r e ,
assignments
process.
34. N o
only
on
processes.
31. M i n i m u m
during
reliance
have
a good
cost.
161
40. C o m p a n y
with
full
capacity
41. W e
benefits.
are
Top
42. E R P
business
could
as
with
on
no
management
the n e w
Users
support
solution
planned
to
problems
schedule.
(SAP)
been
at
are
system
all.
seeing
getting
the
stronger.
utilized
by
the
for.
43 . M a n a g e m e n t
44. T h e
convert
commitment
Implementation
& Support.
Team
and
management
support.
45. S m o o t h
Flow
of
Information
for
Decision
Making.
46. E x c e l l e n t
teamwork.
47. C o o p e r a t i o n
48. K e e p i n g
49. M e e t
up
from
the
top
management.
project
the d e a d l i n e ,
and
schedules.
end
user
happy with
your p r o d u c t .
50. T o p
management
51. L a r g e
management,
project.
have
first
which
Without
and p u m p i n g
the
amounts
large
two
involvement.
of
allows
money
for
the
the m a n a g e m e n t
amounts
of
implementations
and
flexible
slippage
allowing
money
would
into
of
the
slippage
our pr oj ec t
probably
not
occurred.
162
52. S y s t e m
are
well
is
trained
5 3 . The
but
extent.
have
not
is
smoothly
all
and we
are
staff
software.
is
using
using
the
to
up
and
it
system
to
its
fullest
improve.
and
running;
minimum
downtime
changeover.
5 5 . Cost
Users
reductions,
Process
efficiencies,
and
satisfaction.
5 6 . The
year
the
room
54. S y s t e m
during
on
company
profitable
We
running
after
it
to
do,
to
operate
measure
"go
you
it
live"
go t
if
it
what
information
successful
you
yourself
5 7 . Significant
timely
of
is
doing
paid
after
benefits
flow,
comes
what
for
the
ERP
and
you
you
which
wanted
are
consultants
from accurate
helps
the
able
leave .
and
decision
making .
5 8 . Improves
5 9 . Better
internal
quality
6 0 . Standardized
communication.
control.
all
computer
system
software
hardware.
6 1 . Control
62. A s s e t s
of m a t e r i a l
movement.
control.
&
163
63.
Minimize
decision-making,
If y o u
indicators
and
think
of
this
in
3 . Total
the
end
support
what
are
the m a i n
failure?
the
prodllC
t~
o
nn r
C1
J.S
*-r' ,
f
T
'02rS
slightest.
misunderstanding
users
process,
communication.
failure
O Sî-Jp
2 . Not
traditional
clear-cut
it w a s
and
the
as
to
the
by m i d d l e
capabilities
management
of
the
sys tern.
4 . Financial
and we
lost
many
5 . The
of
not
been
realized
people.
into
appropriate
think
reasons
for
it w a s
the
Chapter
usage
11.
and
confusion
of
2 . Not
3 . Lack
understanding
processes
of
time
the
does
to
failure what
were
the
problems
with
software.
applicable.
capabilities
management
failure?
1.Unanticipated
th e
have
end u s e r s .
If y o u
main
good
company went
6 . Lack
the
returns
system.
of
not
take
spent
the
by middle
Lack
of u n d e r s t a n d i n g
system.
accept
advantage
to
of
management
of
The m i d d l e
change
system
business
efficiencies.
164
and
4.
Design
was
not
5.
Due
the
absence
higher
6.
Mot
of
the
business
good
project
needs.
leader
involved.
too
much
trust ina
power
the
to
the
In-House
consulting
employees
over
consultants.
7.
Too
8.
Extensive
After
are
cost
Giving
oartner.
the
to
reflect
expensive
implement
advantages
1 . There
and
maintain.
customization.
implementation,
distinct
2.
to
were
no
Highlights
which
of
in y o u r
implementing
experience
ERP
systems?
advantages.
business
process
issues
for
resolution.
3.
IS
Supporting
costs.
With
one
responsibilities
4.
business
Takes
are
the
of
the
system
system
easier
reduces
overall
cross-functional
to
politics
implement.
out
following
disadvantages
1.
Too
2.
Forced
version
ERP
ERP
of
inter-plant
transactions.
Which
distinct
one
complex
& vendor
of
to b e
ongoing
in y o u r
ERP
are
the
systems?
fully
cost
view
understood.
to m a i n t a i n
current
support.
165
3 . The
a n d we
may
fact
not
that w e
implement
just
went
across
through
a merger
the w h o l e
organization.
4.
changes
Must
to
5.
ho t
keep
keep
Vendor
Upgrades
packs
is
It
implement
are
has
takes
and
the
system
with
legal
support.
disruptive
difficult
understand what
6.
updating
without
and
the
testing
consultants
of
that
changed.
an
train
enormous
the
amount
staff
to
of
time
understand
to
and
operate.
7.
It
is
8.
While
objections,
(esp.
SAP)
practices"
and
THE way
one
"could"
I maintain
tha t
as
" f r e e "ride-along"
projects
a 20%
often
reduction
you
(at a p r o f i t )
in
today's
All
systems
management
of
if
must
the
not
to
can
handled
the
these
benefit.
an
remain
be
ROI
of
And,
1 to
costs!!
It
2
is
in b u s i n e s s
environment.
disadvantages
correctly.
full
ERP
Business
operating
business
above
support
"Best
show
in
expect
of
a well-executed
implementing
if
ERP
all
is
to go
9.
raise
also
well-executed
years
risky.
Once
to
again,
implementation,
or
166
the
What
system will
I would
installation
customization
not
like
of
to
to
it s
add
is
that
SAP w a s
involved.
upqraded
conversion
c om p a n y ,
and
learned were
work
has
is w o r k i n g
very
fullest
failure
Sinc e ,
been
the
first
mostly
due
to
"redo with
an
implemented
wonderfully.
expensive,
potential.
but
now
in
the
the
Lessons
have
paid
off.

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