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The complexities in making an enterprise resource planning (ERP) upgrade decision have been widely cited in the trade press. As a consequence, a significant percentage of ERP clients deferring the upgrade decision is resulted. Yet, to date we observe paucity of research with which to conceptualize and explain the important factors influencing ERP u...
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Context 1
... business efficiency and effectiveness can lead to better customer service, higher customer satisfaction, lower production costs, transaction costs, cheaper product price to the customers, and increased profits. Figure 1 illustrates the transformation from firm's resources to firm's competitive advantage. This second scenario is important in explaining how resources create competitive advantage when these resources by themselves are not rare, imitable and substitutable. ...
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The study is a contribution to a new line of trade theory arguing that good trade policy depends on many factors. By using effective rate of protection (ERP) concept, the study provides analysis of the current tariff structure from 2005 to 2009 in order to estimate the structural change of ERP by goods sectors, and the impact of trade barriers (thr...
Citations
... Practice-oriented studies, typically meant to prescribe what to do, focus on issues such as critical success factors (Nah & Delgado, 2006;Olson & Zhao, 2006) and best practices (Beaty & Williams, 2006;Herschberg, 2004;Paul, 2009). On the other hand, theory-oriented output studies, i.e. theory-building in particular, are focussing on explaining why an ERP upgrade phenomenon happened, (Khoo & Robey, 2007;Ng, 2006Ng, , 2011. However, most of these theory-testing papers merely propose theoretical frameworks useful to understand this phenomenon but they have not provided sufficient empirical findings to support or refute the proposed research frameworks. ...
... This is the motivating forces that drive an ERP upgrade decision (Khoo & Robey, 2007). In general, the incentives or benefits that can be obtained from an ERP system can be grouped into two perspectives, i.e., the technology and business needs (Ng, 2006;Rahim, Shanks, & Johnston, 2011). The incentives possibly derived from an ERP upgrade, from the technology perspective, can be conformity to government regulation (such as financial and environmental compliance), the information technologies adopted by the supply chain and best practices (such as internal control and risk management) (Kumar, 2008), better IT platform such as service-oriented architecture and better integration with other systems (Bjorlin, 2008), and fewer hardware & software costs and maintenance costs (Jimenez & Lee, 2011). ...
This chapter is based on four case studies and the findings are based on three rounds of qualitative data coding. This study finds that the type of business benefits expected to be derived from an ERP upgrade project, and the similarities between a firm and a new ERP system business processes have a strong impact on an ERP upgrade decision. Strategic business benefit has a relatively high impact on the upgrade decision than the managerial and operational business benefits. In contrast, symbols attached to an ERP system and top management supports are not salient factors influencing the ERP upgrade decision. However, based on further analysis of the pattern-matching of cause-effect relationships tested in this study, this research suggests that top management supports are necessary but not a sufficient factor to justify for an ERP upgrade, when there are lack of strategic business benefit incentives and similarity between a firm and a new ERP system business processes. This also indicates that ERP upgrade decisions are made rationally rather than habitually and socially defined.
... Organisational Upgrading provides an opportunity to evaluate, consolidate and restructure existing business operations to ensure continuous improvement (Ng, 2006). The new version improves performance by automating the processes or aligning business strategies with new functionality (Otieno, 2010). ...
... For example, high initial costs due to testing and reapplication of modifications could sway organisations not to upgrade. However, the potential of reducing the overall operational and maintenance costs such as licensing fees can positively influence upgrade decisions (Ng, 2006). While top management involvement is minimal during upgrade projects, their participation plays a significant role in supporting upgrade decisions and the selection of upgrade options (Olson and Zhao, 2007) Top management involvement Continuous improvement Automate existing business processes Restructure and consolidate business processes Reduce maintenance and operational costs ...
... For example, vendors use high support pricing schemes for older versions and sometimes remove support for these, as a strategy to encourage organisations to upgrade (Kremers and van Dissel, 2000). The threat of losing support or not paying a high premium for support are primary reasons why some organisations upgrade their ES (Ng, 2006). Another key factor is compliance with legislation, standards, mode of operating, especially in highly regulated environments such as the banking industry (Khoo and Robey, 2007;Ng and Wang, 2014) Attain continuous vendor support Comply with legislation and national standards Acceptable structure and mode of operating JEDT 15,6 2.4 Enterprise systems upgrade decision processes Figure 2 provides a graphical representation of ES upgrade decision-making derived from extant literature. ...
Purpose - Enterprise systems (ES) upgrade is fundamental to maintaining a system’s continuous improvement and stability. However, while the extant literature is replete with research on ES upgrade decision-making, there is scant knowledge about how different decision processes facilitate this decision to upgrade. This paper aims to investigate and better understand these processes from an organisational perspective.
Design/methodology/approach - The study adopted a qualitative survey design, and used a Web-based questionnaire and semi-structured interviews to collect data from 23 large organisations. Data accrued were qualitatively analysed and manually coded to identify the various decision processes undertaken during ES upgrade decisions.
Findings - Analysis results reveal complex interrelations between the upgrade drivers, the need to evaluate the new version’s functionality and the upgrade impact. Understanding the interaction between these elements influences the upgrade decision process.
Research limitations/implications - The study proposes ES upgrade processes that support a decision to upgrade major releases. Further research is required to offer either similar or conflicting arguments on the upgrade decision-making and provide a probabilistic generalisation of the decision-making processes.
Originality/value - The research offers a comprehensive and empirically supported methodical approach that embraces an evaluation of a new version’s functionality, technical requirements and concomitant upgrade implications as intrinsic decision processes. This approach assists in the decisions to establish the upgrade need and determine the level of change, effort required, impacts and associated benefits.
... However, technically motivated modifications, though able to ensure a stable well performing system, are not directed towards new or improved integration of business, and are unlikely to emphasize cost minimisation or increase in productivity gains. As such, only modifications that include new business functionality will provide capabilities for more cost-effective business operations (Ng 2006). Thus, the following are proposed: ...
... For instance, explorative modifications potentially deliver new functions and/or technologies, and are not only focused on the internal functioning of the ERP system within organisation to deliver process efficiency, but also on the ability of the firm to process and disseminate information. New user interface, better reporting structures and add-on products supported by new versions are able to facilitate increased use of information (Kremers and Dissel 2000;Ng 2006), thereby improving informational ERP capability. Likewise, business motivated modifications, which are undertaken in response to business needs and aimed at attaining a greater fit between the organisation and the ERP system, have the potential to deliver capabilities that enhance ERP capability for resource utilisation and increased responsiveness (Karimi et al. 2007b). ...
E-procurement systems, which represent a core e-supply chain initiative, revolutionise the procurement function of organisations and promise many benefits. However, realisation of benefits is not always guaranteed. Existing e-procurement studies are primarily descriptive in nature and do not help management predict the likely benefits that their organisations may experience from implementing an e-procurement system. We thus propose a model to better explain the benefits that organisations may experience from these systems. The model identifies four types of relationships which organisations could establish with suppliers while deciding to introduce an e-procurement system, and associates each relationship type with several predicted benefits. We further present the e-procurement experience of an Australian local government agency, analyse it in terms of the model, and provide initial empirical support for the applicability of part of the model. Finally, the contributions of our study together with its implications for future research and practice are highlighted.
... However, technically motivated modifications, though able to ensure a stable well performing system, are not directed towards new or improved integration of business, and are unlikely to emphasize cost minimisation or increase in productivity gains. As such, only modifications that include new business functionality will provide capabilities for more cost-effective business operations (Ng 2006). Thus, the following are proposed: ...
... For instance, explorative modifications potentially deliver new functions and/or technologies, and are not only focused on the internal functioning of the ERP system within organisation to deliver process efficiency, but also on the ability of the firm to process and disseminate information. New user interface, better reporting structures and add-on products supported by new versions are able to facilitate increased use of information (Kremers and Dissel 2000;Ng 2006), thereby improving informational ERP capability. Likewise, business motivated modifications, which are undertaken in response to business needs and aimed at attaining a greater fit between the organisation and the ERP system, have the potential to deliver capabilities that enhance ERP capability for resource utilisation and increased responsiveness (Karimi et al. 2007b). ...
The objective of this research in progress paper is to develop a theory-driven model to categorise post-implementation modifications to ERP systems and to understand the relationship between the identified categories and business process outcomes that are generated as a result of the modifications. While ERP systems can improve the efficiency, effectiveness and flexibility of business processes, the relationship between these outcomes and post-implementation modifications is not understood adequately. The model proposed here provides a theoretical foundation for research into the impact of modifications on business process performance, and brings clarity to the definition of an ERP modification by developing a typology of modifications.
... However, technically motivated modifications, though able to ensure a stable well performing system, are not directed towards new or improved integration of business, and are unlikely to emphasize cost minimisation or increase in productivity gains. As such, only modifications that include new business functionality will provide capabilities for more cost-effective business operations (Ng 2006). Thus, the following are proposed: ...
... For instance, explorative modifications potentially deliver new functions and/or technologies, and are not only focused on the internal functioning of the ERP system within organisation to deliver process efficiency, but also on the ability of the firm to process and disseminate information. New user interface, better reporting structures and add-on products supported by new versions are able to facilitate increased use of information (Kremers and Dissel 2000;Ng 2006), thereby improving informational ERP capability. Likewise, business motivated modifications, which are undertaken in response to business needs and aimed at attaining a greater fit between the organisation and the ERP system, have the potential to deliver capabilities that enhance ERP capability for resource utilisation and increased responsiveness (Karimi et al. 2007b). ...
The objective of this research in progress paper is to develop a theory-driven model to categorise postimplementation modifications to ERP systems and to understand the relationship between the identified categories and business process outcomes that are generated as a result of the modifications. While ERP systems can improve the efficiency, effectiveness and flexibility of business processes, the relationship between these outcomes and post-implementation modifications is not understood adequately. The model proposed here provides a theoretical foundation for research into the impact of modifications on business process performance, and brings clarity to the definition of an ERP modification by developing a typology of modifications.
... Therefore, it is imperative to examine the complementary outcomes that the implementation of an ERP resource can facilitate (resource complementarity). It has been found by some research that the implementation of an ERP system can impact organizational performance directly or indirectly (Ng, 2006;Wade and Hulland, 2004). ...
... Differences in market performance are basically due to the distinctive resources and capabilities of a given firm (Barney, 1991;Wernerfelt, 1984;Wade and Hulland, 2004). Ng (2006) presented two different scenarios that give a firm a competitive advantage. Figure 2.2.2.2 illustrates the transformation process of resources to a competitive advantage for a firm. ...
... A firm can create unique organizational capabilities by firm-specific and optimal assembling, organization, and deployment of its resources. The unique organizational capabilities that are embedded in unique organizational and business process create a firm's competitive advantage and provide better business efficiency and effectiveness than its competitors (Grant 1991;Ng, 2006). Improved organizational performance leads to better customer service. ...
