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Implementing Enterprise Resource Planning Systems: The Role of Learning from Failure
Information Systems Frontiers
Abstract
ERP implementations remain problematic despite the fact that many of the issues are by now quite well known. In this paper, we take a different perspective from the critical success factors and risks approaches that are common in the information systems discipline to explain why ERP implementations fail. Specifically, we adapt Sitkin's theory of intelligent failure to ERP implementations resulting in a theory that we call “learning from failure.” We then examine from the viewpoint of this theory the details of two SAP R/3 implementations, one of which failed while the other succeeded. Although it is impossible to state, unequivocally, that the implementation that failed did so because it did not use the approach that was derived from the theory, the analysis reveals that the company that followed many of the tenets of the theory succeeded while the other did not.
... For example, in previous case studies of IS implementation, the Cadbury firm faced significant disruptions in its supply chain due to inadequate change management during the IS implementation, and this led to financial losses, delayed shipments, and an increase in workers' dependence on legacy systems, in other words, resistance to change (Scott and Vessey, 2000). This case study pointed out the significance of the strategic change management plan as a core condition to reduce or minimize the degree of resistance to change or dependence on the legacy system (Scott and Vessey, 2000). ...
... For example, in previous case studies of IS implementation, the Cadbury firm faced significant disruptions in its supply chain due to inadequate change management during the IS implementation, and this led to financial losses, delayed shipments, and an increase in workers' dependence on legacy systems, in other words, resistance to change (Scott and Vessey, 2000). This case study pointed out the significance of the strategic change management plan as a core condition to reduce or minimize the degree of resistance to change or dependence on the legacy system (Scott and Vessey, 2000). ...
... They should be able to assume that they will receive appropriate training and will perform well in their new environment. However, the insecurity caused by the lack of communication leads to high turnover and resistance to implementing new systems (Barker and Frolick, 2003;Scott and Vessey, 2000). In addition, a culture in which the possibility of failure can be discussed freely can reduce employees' anxiety about change (Scott and Vessey, 2000). ...
Research on information systems (IS) has identified diverse problems encountered in system implementation and organizational change. We reviewed and analyzed the implementation problems explored in prior research to determine the core problems and the important causal relations between the problems. The causal mechanism behind the relations was articulated with illustrating examples. This analytical review provides a deeper understanding of the fundamental aspects of IS implementation processes, which are conducive to preparing for the implementation of artificial intelligence (AI) systems. AI systems are an information system as well. However, by embedding machine learning elements and necessary data flows, the implementation of AI systems would be much more complicated and challenging. We derived useful implications for AI systems implementation by advancing the understanding of the core problems of IS implementation and connecting them with the fundamental problems inherent in AI systems. The analyses and discussions motivate further studies on implementing IS with or without AI.
... During ERP implementation phases, enterprises must focus on external factors (e.g., consultant and vendor commitment) and internal factors (e.g., project management). IT governance also plays a crucial role in enhancing the quality of ERP implementations (Scott & Vessey, 2000). According to the literature, roughly 70% of ERP projects fail to deliver their estimated benefits and three-quarters of ERP projects fail to succeed. ...
... Furthermore, according to a slew of studies, a phased strategy is better for implementation because it allows the organization to make changes in the event of unforeseeable circumstances. As a result, it is also argued that the implementation strategy's flexibility has a significant impact on ERP implementation success (Saini, et al., 2013;Scott & Vessey, 2000). According to Mandal and Gunasekaran (2004), this is the most important CSF for a successful ERP implementation from the perspective of a top manager. ...
... Several questions must be answered to create a well-functioning implementation strategy: what are the particular information demands at the operational and management levels, how will the ERP system interact with the existing system, and what is the implementation schedule? By answering these questions, a company can develop a plan that will increase its chances of success by 90% when compared to companies which do not have one (Mandal & Gunasekaran, 2003 (Scott & Vessey, 2000). ...
The study explores critical success factors of remote ERP implementation in the Sri Lankan context from system users’ perspective. As a result of the Covid-19 pandemic, ERP implementation has become more complicated, and ERP software vendors have shifted to remote ERP implementations. Although, there are several studies on identifying Critical Success Factors (CSFs) in ERP implementation, there is a void in the literature on identifying CSFs in remote ERP implementation. As a result of the literature review, it was discovered that only a small amount of research has been done on remote ERP implementation. Therefore, the current study tries to bridge these gaps by identifying the CSFs of remote ERP implementation during Covid-19 by taking Sri Lanka as a case study.
... Dengan adanya panduan tersebut, organisasi dapat lebih fleksibel dan tanggap terhadap kebutuhan bisnis yang terus berubah, memastikan bahwa tujuan-tujuan organisasi tercapai tanpa mengorbankan stabilitas atau efisiensi operasional. Selain itu, panduan ini membantu organisasi dalam melakukan penyesuaian yang lebih cepat dan tepat terhadap peluang maupun tantangan baru, sehingga perubahan tidak hanya menjadi reaksi, tetapi juga strategi proaktif untuk meningkatkan daya saing dan pertumbuhan jangka Panjang (Abu Ghazaleh et al., 2019;Ali et al., 2023;Capaldo & Rippa, 2009;Comuzzi & Parhizkar, 2017;Dempsey et al., 2022;Gavali & Halder, 2020;Koh & Simpson, 2005; C. K. Lee et al., 2008;Mourtzis, 2016;Pishdad & Haider, 2013;Scott & Vessey, 2000;Wu et al., 2022). ...
Penelitian ini mengeksplorasi peran manajemen perubahan dalam implementasi sistem Enterprise Resource Planning (ERP). Masalah utama yang dihadapi adalah tantangan integrasi proses bisnis dan peningkatan efisiensi operasional yang sering terhambat oleh resistensi terhadap perubahan dan kurangnya dukungan manajemen. Metodologi yang digunakan adalah tinjauan literatur sistematis, yang melibatkan pencarian di berbagai basis data dan menghasilkan 30 artikel relevan yang diterbitkan antara tahun 2000 dan 2023. Hasil penelitian mengidentifikasi empat kategori utama peran manajemen perubahan dalam implementasi ERP: organisasi, sumber daya manusia, teknologi, serta kesuksesan dan evaluasi. Faktor Kritis Keberhasilan (CSFs) yang mempengaruhi implementasi ERP termasuk dukungan manajemen puncak, manajemen proyek, keterlibatan pengguna, pelatihan, dan komunikasi efektif. Berdasarkan hasil analisis yang telah dilakukan, dapat disimpulkan bahwa strategi manajemen perubahan yang efektif, seperti Kotter's 8-Step Change Model, Lewin's Change Management Model, dan ADKAR Model sangat penting untuk mengatasi resistensi dan memastikan kesiapan organisasi, yang pada akhirnya meningkatkan kinerja keseluruhan. Penelitian lebih lanjut dapat difokuskan pada evaluasi kinerja ERP dan eksplorasi hubungan antar CSFs untuk mengembangkan kerangka konseptual yang komprehensif dalam membimbing organisasi dalam implementasi ERP.
... Furthermore, some streams of literature indicate that learning from entrepreneurial failure is driven by certain antecedents (Drupsteen and Hasle, 2014;Edmondson, 2011;Scott and Vessey, 2000) based on two perspectives: voluntary and deterministic (Amankwah-Amoah, 2018; Mellahi and Wilkinson, 2004). The voluntary perspective views business failures as an internal affair (individual or organisational) that the entrepreneur could control (e.g. ...
Purpose
This study's main objective is to examine the effect of learning from entrepreneurial failure on performance, with a type of failure as a moderator variable. Interactions between internal and external causes of failure and learning from entrepreneurial failure are also investigated, as well as entrepreneurs' aspects (i.e. age, experience and education) and organisational contextual factors (i.e. size, sector and location).
Design/methodology/approach
This study employed a hypothetico-deductive approach through a survey of 250 purposively sampled entrepreneurs who had suffered business failures. The survey data were subjected to regression analysis and moderated regression using WarpPLS software and an independent sample t test for an in-depth analysis.
Findings
The results indicated that learning from entrepreneurial failure positively affected business performance, an effect moderated by the type of failure, particularly with large failures. Only perceived internal causes of failure exerted a positive effect on learning from entrepreneurial failure; the external causes did not. The effect of failure on business performance was stronger on entrepreneurs who were older and experienced, had non-university educations and operated small- and medium-sized enterprises (SMEs) outside Java–Bali islands.
Originality/value
This study's findings provide empirical evidence that supports the experiential learning theory and attribution theory in explaining the interaction between learning and failure, its cause, its consequences and its magnitude as perceived by entrepreneurs of SMEs in Indonesia, where the rate of failure is relatively high. The authors’ study also emphasises the roles of the entrepreneur and organisational contextual factors, which matter in learning to improve performance.
Organizational memory has a crucial role for businesses, especially in the context of cloud computing. Cloud computing technologies facilitate the storage, management, and access of organizational knowledge and data. By using cloud-based solutions, businesses can enhance the effectiveness of their organizational memory systems. Digitalization, combined with cloud computing, allows for easy access, retrieval, and sharing of knowledge within the organization, regardless of geographical locations or device types. In today's business environment, cloud computing integration is not only convenient but also necessary for organizations to effectively leverage their knowledge and information. It ensures that the organizational memory remains a valuable asset that contributes to informed decision-making, innovation, and sustained success. This study discusses to what extent organizational memory systems, enhanced by cloud computing, will be considered effective in new business conditions.
The purpose of this study is to explore challenges faced by public sector in the implementation of e-procurement. The project highlights the key factors that hinder successful implementation of e-procurement. The methodology used was survey design. Random sampling was used in collecting data. This data was analyzed using descriptive statistics. Findings of the study indicate that the public sector procurement in Kenya is facing challenges in the process of implementation of technology supported systems, deterring effective service delivery. These factors in order of their severity include but not limited to: lack of resources, corruption, lack of management support, government policies, and fear of the unknown, dynamic IT environment, security and job creation objective. This study, through the recommendations, will help ensure the customer/tax payer get the best value for their money. Through effective handling and management of materials in the supply chain, costs are contained and this means favorable prices will be passed to the end customers.
Efficient and resilient supply chain management is imperative for businesses to thrive in today's dynamic and uncertain market environment. This abstract explores strategies and innovations aimed at enhancing efficiency and resilience within supply chain operations. Leveraging digitalization and automation technologies such as IoT, AI, and blockchain enables real-time tracking, predictive analytics, and proactive decision-making, thereby improving visibility and control throughout the supply chain. Collaborative relationships with suppliers, diversified sourcing strategies, and resilient logistics networks contribute to mitigating risks associated with disruptions such as natural disasters, geopolitical tensions, or supplier failures. Additionally, sustainability practices, continuous improvement initiatives, and robust risk management strategies further strengthen the resilience of supply chain operations, ensuring adaptability and responsiveness to evolving market conditions. By embracing these strategies and innovations, businesses can optimize their supply chain management practices to withstand challenges and capitalize on opportunities in an increasingly competitive landscape.
Enterprise Resource Planning (ERP) systems are critical to the operational efficiency of the manufacturing industry, but their deployment and use present numerous problems. This extensive investigation digs into the key challenges that manufacturing organizations face while implementing ERP systems. The main hurdles include high startup costs, complex integration with existing processes, and large time requirements for complete adoption. Furthermore, employee resistance to change, insufficient training, and the requirement for regular system updates make ERP installation difficult. Data security and system reliability are also key concerns. Furthermore, aligning ERP functionalities with specific manufacturing requirements frequently necessitates substantial customisation, resulting in potential delays and additional costs. The report emphasizes that, while ERP systems promise increased efficiency and streamlined operations, getting these benefits requires overcoming significant challenges. Effective management solutions, such as extensive planning, robust training programs, and stakeholder participation, are required to address these difficulties. This study emphasizes the need of addressing both technological and human elements to guarantee the successful implementation and long-term use of ERP systems in the industrial sector.
Foxmeyer's project was a disaster. Was the company too aggressive or was it misled?