Abstract
This paper suggests a new direction for studying Enterprise Resource Planning (ERP) implementation. This direction is based on the perspective of managing stake-holders involvement in ERP implementation. A successful ERP implementation case will be presented and analysed. The stake-holders involved in the implementation process presented in the case will be defined and explained. The paper's contribution can be seen in providing guidelines and recommendations for successful implementation, as well as for furthering research in the area of stake-holder management in ERP implementation.
1. INTRODUCTION
Enterprise resource planning (ERP) software technology is a prominent tool that organisations often find themselves in a need to implement as a total software solution in order to handle their information systems (IS) requirements under one application software umbrella in a tightly integrated manner [1]. ERP can provide management with cost and operational information necessary to make strategic decisions concerning their competitive position [2].The aim of this paper is introduce a new perspective of studying ERP based on the stake-holders involved in the implementation process. Examples of stake-holders involvement in ERP implementation shall be identified based on an analysis of a successful ERP implementation story. The implementation success story shall be explained with more emphasis on the stake-holders issues.
2. ERP IMPLEMENTATION MODELS
Despite of the great benefits of ERP systems, not all ERP implementation are successful. Fig1 [3] explains clearly this fact as it shows that:
• average cost over run 178%.
• average schedule overrun 230%.
• average slide in functional improvements astonishing 59% deficit.
• only 10% on time, on budget and as planned.
IS researchers responded positively to the ERP failure phenomena. The research topics with regards to ERP failure falls under categories like:
1. Lessons learned from ERP implementation.
2. Failure case studies analysis.
3. Success stories analysis.
At a later stage of ERP research history, researchers focus more on generating models for ERP implementation. These models aim to provide guidelines to increase success and reduce failure in ERP implementation.
2.1 Generic critical success factors CSF(s) perspective.
The generic CSF(s) models addressed ERP implementation with no special interest focus. All factors that can contribute to ERP success can be included whether they are related to process, people or technology. Generic CSF(s) aims to extract and identified any factor that can make or break ERP implementation.
Nah F & Lau's model is an example of the generic CSF(s) model. The research group has chosen ten latest articles (from 1998 - 2000) that addressed ERP CSF(s). They analyzed the fragmented research articles with regards to the success factors. Eleven critical success factors were gathered from those research articles.
The researchers classified these eleven factors based on the four phases in the ERP life cycle [4]:
a) “ Chartering – Selection process.
b) Project – bring the system up and running.
c) Shakedown - stabilizing, eliminating "bugs", getting to normal operations.
d) Onward and upward - maintaining systems, upgrades and continuous improvement.”
7. Appropriate business and legacy systems
8. Change management program and culture
9. Business process reengineering (BPR) and minimum customization
10. Software development, testing and troubleshooting
11. Monitoring and evaluation of performance 1. ERP teamwork and composition
2. Top management support
3. Business plan and vision
4. Effective communication
5. Project management
6. Project champion
Table 1 explanation of Nah F & Lau’s Model [4]
2.2 ERP implementation model from a training perspective.
Under this category, some researchers studied the implementation from the training angel due to the importance of training to the success or failure of the ERP implementation. Learning Requirements Planning (LRP) is a model, which focuses on integrated learning for ERP success. This model is centered around the assumption that ERP training is the source for either success or failure. Research shows that the lack of enterprise-wide training represents the biggest reason for ERP implementation failures [5]. The LRP model considers training as a wider perspective that involves six-step enterprise levels. Each level compelled by a detailed checklist. These check-lists can be integrated together to form LRP CSF(s) model. Table 2 explains briefly LRP model.
2.3 ERP implementation model from a process change perspective.
Process change management is another perspective being considered while suggesting a model for ERP implementation by some researchers.This model by Al.Mashari is inferred from exploring the ERP phenomenon from a process change management (PCM) perspective. Table 3 [6] framework is used to highlight the various PCM constructs in the context of SAP R/3 implementation. Evidence on how these constructs are operationalized in practice is drawn from a large collection of R/3 case studies representing various organisational experiences. This has linked PCM framework provided by Grover’s, which embodies five groups of facets, table 3 [6] has identified for each PCM facet key ERP issues to be considered.
No Stage Description
0 What is LRP? LRP is an explosion of corporate strategic goals into discrete, measurable ERP training and implementation objectives combined with proven feedback methods and systematic performance analysis
1 Analysis The purpose of this process is to identify learning objectives based on the strategic business needs driving their ERP implementation.
2 Diagnosis In this stage a gap between the existing skills and competencies and the skills and competencies required to obtain the stated strategic and ERP implementation goals of an organization.
3 Design This stage aims to design training instruction. This includes best training method, presenting of information and distribution of the information to the learner.
4 Implementation Implementation involves utilizing LRP process to effectively implement the ERP system
5 Evaluation At this stage, the focus on the evaluation of the training and learning that occurs in relationship to the ERP implementation.
6 Continuation This stage addresses building a mechanism in the organization to continually develop employee skills as they relate to ERP system.
Table 2 Overview of LRP Stages Summarized from [5]
No PCM facet ERP Factors
1 Change management 1. People
2. Communication
3. Tools and methodology
4. Interactions
2 Project Management 5. Team formation and development
6. Roles and responsibilities
7. External entities
8. Measurements of progress
3 Continuous process management 9. Process redesign
10. Process performance measurements
11. Continuous process improvement
4 Strategic planning 12. Performance gap analysis
13. Change justification
14. Projects strategies
5 Technology management 15. Software selection
16. Technical analysis and design
17. Installation
Table 3 PCM CSF(s) Model [6]
2.4 Influence of the three models on ERP implementation
The previously explained ERP implementation models and many others have helped organisations while implementing ERP systems. As an observation, disaster experience stories almost disappeared. More successful stories were being reported. Partial failure and dissatisfaction feedback, however, is still expressed by organisations who implemented ERP systems. IDC, a leading provider of global IT research and advice, conducted the survey during the first quarter of 2008 [7]. The survey found firm evidence of growing dissatisfaction with currently installed enterprise resource planning (ERP) solutions, which respondents say are lacking the business process requirements and cost controls needed in today’s economic environment [7].
Nearly a quarter of those surveyed said their dissatisfaction with their current solution capabilities had moved from 17% dissatisfied to 25% dissatisfied, between the fourth quarter of 2007 and the first quarter of 2008 [7].
3. ERP STAKE-HOLDER DEFINITIONS AND SIGNIFICANCE
There is no doubt that existing ERP models contributed positively to the success of ERP implementation. Latest survey's by IDC any many others, on the other hand, revealed the need for more research work to improve ERP implementation outcomes to increase the level of success and to reduce failures. Existing models for ERP implementation are complementing each other. Introducing a new dimension of the research towards constructing new model doesn't mean discarding or contradicting existing ones.
The new suggested dimension of the research work on ERP implementation is towards more people focus. ERP as its core is a people project [8].
Generic critical success factors models explain what to be done in order to make successful implementation. Answers of key questions, on the other hand, are still required to ensure all parties involved in the implementation are clear on their role at all stages of the implementation. The call for a paradigm shift in analyzing and studying ERP implementation aims to answer those key questions. The ultimate goal of the research outcomes using this suggested research dimension is to design a comprehensive framework for ERP implementation from a stake-holder stand point. The new framework is expected to design a specific agenda, To-DO list, etc for each stake-holder members involved in the implementation.
