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Association for Information Systems
AIS Electronic Library (AISeL)
UK Academy for Information Systems Conference
Proceedings 2011 UK Academy for Information Systems
4-11-2011
Establishing A Critical ERPii Implementation
Pathway For Customer Facing Organisations
Andrew Laurence Norton
Durham Business School, andrewlnorton@yahoo.co.uk
Yvee May Coulson-omas
University of Lincoln
Follow this and additional works at: hp://aisel.aisnet.org/ukais2011
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Recommended Citation
Norton, Andrew Laurence and Coulson-omas, Yvee May, "Establishing A Critical ERPii Implementation Pathway For Customer
Facing Organisations" (2011). UK Academy for Information Systems Conference Proceedings 2011. Paper 35.
hp://aisel.aisnet.org/ukais2011/35
ESTABLISHING A CRITICAL ERPII
IMPLEMENTATION PATHWAY FOR
CUSTOMER FACING ORGANISATIONS
Andrew Lawrence Norton
Durham Business School, Durham University, Mill Hill Lane, Durham DH1 3LB, UK.
Telephone: 0191 334 5233
Fax: 0191 334 5201
Email: a.l.norton@durham.ac.uk
Dr Yvette May Coulson-Thomas
University of Lincoln, Brayford Pool, Lincoln LN6 7TS, UK.
Prof. Colin Joseph Coulson-Thomas
University of Greenwich, Old Royal Naval College, London SE10 9LS, UK.
Dr Colin Ashurst
Durham Business School, Durham University, Mill Hill Lane, Durham DH1 3LB, UK.
Abstract
This paper presents a combination model which sets out a critical pathway for ERPII implementation
for customer facing organisations (CFOs). The model incorporates a resource based view of
implementation and the implementation lifecycle (from conception to completion), allowing identified
critical success factors (CSFs) to be considered at each stage. A case study analysis was undertaken to
identify potential CSFs. These were subsequently appraised by four senior management members
within the project team two years post go–live and cross referenced for validation against the views of
seven highly experienced consultants within supplier organisations. Analysis of the validated CSFs
using the combination model identified that CFOs require specific CSFs at particular stages of the
implementation lifecycle. This type of organisation should invest heavily in people-related CSFs, with a
particular emphasis upon these in the exploitation phase.
Keywords: ERPII implementation; customer facing organisation; implementation
lifecycle; critical success factors; critical pathway
ESTABLISHING A CRITICAL ERPII
IMPLEMENTATION PATHWAY FOR
CUSTOMER FACING ORGANISATIONS
Abstract
This paper presents a combination model which sets out a critical pathway for ERPII implementation
for customer facing organisations (CFOs). The model incorporates a resource based view of
implementation and the implementation lifecycle (from conception to completion), allowing identified
critical success factors (CSFs) to be considered at each stage. A case study analysis was undertaken to
identify potential CSFs. These were subsequently appraised by four senior management members
within the project team two years post go–live and cross referenced for validation against the views of
seven highly experienced consultants within supplier organisations. Analysis of the validated CSFs
using the combination model identified that CFOs require specific CSFs at particular stages of the
implementation lifecycle. This type of organisation should invest heavily in people-related CSFs, with a
particular emphasis upon these in the exploitation phase.
1.0 Introduction
Enterprise Resource Planning (ERP) is a software system that operates through a
centralised relational database and, as such, is capable of integrating business
processes within organisations (Ross & Vitale, 2000). AMR research estimated the
global ERP market to be $28b in 2006 (Jacobson et al., 2007). In addition, AMR
research estimates the average cost of an ERP implementation for a fortune 500
company to be between $40 million and $240 million, whilst upgrades to ERPII have
been reported by AMR and Gartner to cost on average 18% and 30%, respectively, of
the initial ERP project cost (Beatty & Williams, 2006). A recent report by Forrester
Research has shown that 25% of European and Asian organisations intend to invest in
their existing ERP systems in 2011 (Hamerman et al., 2011).
Implementing an ERP system is not an easy task, indeed there have been many high
profile accounts of bankruptcy occurring through failed ERP implementations
(Davernport, 1998; Kim et al., 2005; Ragowsky & Somers, 2002). The high street
retailer, Woolworths, was investing in a substantial ERPII implementation project up-
grade to serve its 820 UK stores (Ferguson, 2008) just prior to filing for bankruptcy in
2008. In addition, a report by the Standish Group shows that, of all successfully
implemented ERP systems, only about 30% deliver the full benefits initially outlined
(Krumbholz et al., 2000). Empirical research has highlighted that even when the
technical implementation itself has been a success, there can be difficulties in
establishing the most effective processes for achieving the desired benefits (Al-
Mashari & Al-Mudimigh, 2003; Ward et al., 2005), which has been termed technical
isomorphism (Batenburg et al., 2008). Implementation problems have resulted in only
35% of all ERP implementations being delivered on time and within budget (Dong et
al., 2009).
Extended ERP (ERP II) has been defined as a next generation ERP system and allows
internal business systems to be connected with those of the external environment of
customers, suppliers and business partners (Bond et al., 2000). ERPII systems can be
used in both public and private sector organisations. Benefits that can be realised
include: information sharing capability, considerable cost savings, process
improvements, improved decision making ability, greater business efficiency, and
better management of customer and supplier relationships (Beheshti, 2006). ERPII
facilitates electronic customer relationship management (e-CRM), which supports
customer service personnel and improves interaction with customers leading to better
services and customer satisfaction (Adebanjo, 2003). Customer facing organisations
(CFOs), which focus on developing customer facing activities (CFAs), can use this
system to design business infrastructure around customers‟ needs.
Many public sector organisations have CFAs and have therefore been investing in
ERPII systems with the hope of achieving improvements in the form of e-CRM. For
the public sector, business benefits include e-governance which has been shown to
add substantial value to these organisations (Daniel & Ward, 2006). One important
example of ERP driven e-governance is the development of online enterprise portals
which allow council staff, local residents and business partners instant access to their
specific information requirements and associated transactional services.
Research has looked to successful implementations in order to find so-called critical
success factors (CSFs) which organisations should incorporate to avoid
implementation failures (Nah et al., 2001; Soja, 2006; Verville & Bernadas, 2005;
Woo, 2007). The literature appears to relate to CRM CSFs rather than those
specifically relating to CFOs implementing ERPII. The current research has identified
a critical pathway that CFOs should follow to successfully implement ERPII.
2.0 Research design and methodology
The current research focused on revealing the CSFs for a CFO which delivered a
successful ERPII implementation. All methods applied adhered to the ethics and
safety protocols of the Durham Business School Sub-Committee for Ethics.
This research undertook a positivist approach, relying upon empirical observation of a
successful implementation to discover patterns existing within its social context
(Denscombe, 2002). Careful attention was paid to the research design, data collection
and data analysis in order to ensure rigorous analysis (Dube´ & Pare´, 2003). The
research design involved a review of the extant literature on critical issues for
ERP/ERPII implementation, the identification of appropriate data collection points
(Figure 1), the selection of an appropriate case study environment, the development of
a combination model for understanding the identified issues, the preparation of
interviews with senior management members within an ERPII project team, and
subsequently with experienced consultants within supplier organisations for validating
prospective CSFs.
Figure 1. Data collection points (key research events)
2.1 Critical success factor analysis
Some of the earliest research in the field of information systems (IS) adopted a CSF
methodology (Rockart, 1979; Rockart & Flannery, 1983), and it is now a standardised
methodology for this type of research. Several studies have reviewed and ranked
CSFs identified for ERP implementations (Finney & Corbett, 2007; Somers &
Nelson, 2001). Although the CSFs described by these researchers are similar, there is
no general consensus as to their prioritisation, with the exception of top management
support, nor is there any allocation to particular stages of the implementation
lifecycle. These studies have provided a useful theoretical background by which to
evaluate the current research findings.
2.2 Case study analysis of a CFO
The issues associated with ERP/ERPII implementations are complex; they embrace
change at many levels and different aspects are affected all of which need monitoring
simultaneously. The current research adopted case study analysis at the outset to assist
in the formulation of ideas (Benbasat et al., 1987). Case study analysis allowed these
issues to be evaluated in their real life context (Yin, 1994). Sekaran (2003) suggests
that due to the qualitative nature of case study analysis, it can be used to reveal the
causative factors in successful IS implementations.
A single case study was undertaken as this allowed for a more detailed evaluation of
prospective factors contributing towards the successful outcome. During this stage of
the empirical research, the six sources of evidence listed by Yin (1994) were
incorporated into the research methodology: (i) documentation, (ii) archival records,
(iii) interviews, (iv) direct observations, (v) participant observations, and (vi) physical
artefacts. To facilitate participant observation the researcher took on a role of
employee within the project team, preceding and during the delivery phase of the
ERPII implementation. This is an approach ideally suited for the collection of data in
organisational and management research (Easterby-Smith et al., 1993). Information
gathered from the participant observation was used to formulate the prospective CSFs
evaluated during this research.
The City of Bradford Metropolitan District Council, a UK local authority which
serves a population of 477,770 with a staffing capacity of 6,000, was selected for this
case study. The council invested £170m in 2005 in a project called Bradford-i and the
main aim was to improve efficiency and customer service through ERPII (Marshall,
2008). The system went live in 2007. IBM and Serco worked in partnership to deliver
a SAP based ERPII system. Benefits were described as: “Web-enabled secure access
to core applications decreases the need for paper forms and manual data entry –
reducing administrative workload and improving data quality. Integration of finance
and procurement processes boosts efficiency and aids auditability and compliance.
Employees can now interact directly with HR systems to perform administrative
tasks. Simplified IT architecture improves flexibility and makes it easier to add new
services.” (IBM, 2010).
2.3 Interview analysis of the prospective CSFs
Structured interviews were undertaken in order to understand which of the resource
allocations contributed towards the realisation of benefits initially outlined. Compared
with other research methods, face-to-face interviews offer little chance of
misinterpretation (Hodgson, 1987) and this two-way dialogue offered the best way to
reveal valuable personal opinions from interviewees. To ensure reliability, the seven
stages of interview design described by Kvale (1996) were incorporated into the
preparation of all of the interviews held. Interviewees were presented with a copy of
the questionnaire a week before the interview and transcriptions of their statements
were presented back to them for self-review purposes one week after each interview.
Initially, follow-up interviews were scheduled with key Bradford-i project team
members two years post go-live. The questionnaire prepared was structured around
specific issues identified in the case study (36 prospective CSFs). These were
validated using a funnel approach (Bickart, 1993), whereby a general open (non
leading) question regarding each specific issue was followed by a leading question,
which contained the identified CSF. Special attention was paid to the terminology
(Couper, 1996; Edmondson, 1996; O‟Brien, 1984) to avoid ambiguity (Abramson &
Ostrom, 1994; Bollinger, 2001; Stout, 1994) in decoding the responses. To ensure that
each prospective CSF was evaluated by an appropriate person, the head of training
answered the people-related questions, whilst the accountancy manager, programme
change manager and technical manager answered the process and technology-related
questions.
Consultant interviews were held four months after the completion of the project team
interviews. Within the field of ERP/ERP II research, interviewing consultant
practitioners has proved to be a successful way to provide a taxonomy of CSFs (Parr
& Shanks, 2000; Taylor, 2005). The views of the client organisation were presented to
seven experienced consultants within selected organisations to further validate the
findings. The consultants involved included: two founding directors, one sales
director, one general manager, one head of sales and marketing, one project team
manager and one team leader of global IS solutions. These views assisted in gaining a
greater understanding of opportunities presented during ERPII implementations.
2.4 Data analysis
The six steps of analysis described by Kvale (1996) were adhered to during the
analysis of the information obtained in the current research. The information was
presented using a combination model that was developed by the author. In total, there
were considered to be eight responses, or organisational views; the Bradford-i project
management team and seven different ERP/ERP II suppliers. The factors were then
classified as being strongly supported (7 or 8 respondents agreeing it was critical),
marginally supported (4 to 6), weakly supported (1 to 3) and unsupported (0). Heat
mapping was used to visually display all factors within the combination model. All
strongly supported CSFs were then analysed by a process of discourse dissection.
Meredith (1998) outlines that there is little benefit in adopting statistical analysis to
single case study research, noting that richness of data is key for qualitative analysis.
2.5 Model application to identify the CSFs relating to benefit realisation
The combination model was based upon the work of Melville, Kraemer et al. (2004)
and Ashurst, Doherty et al. (2008) and was developed to map CSFs to the different
stages of the implementation lifecycle. The IT Business Value model of Melville,
Kraemer et al. (2004) was used to classify identified CSFs into the three resource
categories (people-related, process-related and technology-related) and subsequently
the Benefits Realisation Capability model of Ashurst, Doherty et al. (2008) was used
to locate them at appropriate stages of the implementation lifecycle (benefits
planning, benefits delivery, benefits review, and benefits exploitation).
3.0 Findings
A total of 19 CSFs were classified as being strongly supported from the interview
feedback and considered to be critical for successful ERPII implementations for
CFOs. By using the combination model developed by the author, these CSFs were
allocated to the different stages of the implementation. This generated critical
pathway steps from a resource based perspective, which lead to a successful ERPII
implementation (Figure 2).
Figure 2. Critical pathway steps for CFOs implementing ERPII
3.1 Analysis of identified CSFs for CFOs
From a resource based perspective, people related factors account for nearly 50% of
the CSFs identified in this research, whilst process and technology account equally for
the remaining CSFs (Figure 3). This immediately highlights that whilst critical issues
reside across the resource base of the CFO, particular attention must be paid towards
people (training) related issues.
Figure 3. CSFs by resource base
From a benefit realisation perspective, our findings show that although opportunities
present themselves throughout the implementation lifecycle, people-related benefits
can be maximised by allocating resources primarily in the exploitation phase, whilst
process-related resources should be allocated mainly into the planning and reviewing
stages and technology-related resources largely allocated into both the planning and
delivery stages (Table 1).
PLANNING
DELIVERY
REVIEW
EXPLOITATION
PEOPLE
25%
12%
25%
38%
100%
PROCESS
40%
20%
40%
0%
100%
TECHNOLOGY
40%
40%
0%
20%
100%
Table 1. CSFs by implementation lifecycle.
3.2 The technology-related CSFs identified for CFOs
Within the area of technology (Figure 2), our findings show that during the planning
stage it is critical to develop new capabilities by clearly explaining desired outcomes
of the system to the supplier(s). Consultants of software suppliers and application
service providers can usually “see where an area of an application would be of benefit
to users … then drive that forward” (Simon Hulse, Team Leader of Global IS
Solutions, Torex). During the planning stage, inputs and activities must be clearly
outlined for each stakeholder. It is critical to establish knowledge transfer systems
from the supplier to the client and, as part of this the client must set up an internal
network to foster this. For example, office space should be allocated to accommodate
members of the supplier staff, so that they feel more integrated with the team.
During the delivery stage, CFOs must strive to improve customer facilitation through
portal integration, providing a fully operational and integrated interface. In the case of
the City of Bradford Metropolitan District Council, this was the one stop shop which
was developed and maximised to improve transactional opportunities for the residents
of Bradford. It is also critical to ensure strong stakeholder collaborations, possible
through a contract. “The object of a contract is to facilitate an ongoing client supplier
relationship” (Dominic Rea, Sales Director, K3 Business Technology Group), “but the
contract mustn‟t be so inflexible that you will just push the technology in and you
don‟t look at the benefits” (Hamid Aghassi, Founding Director, 1 Team Energy).
In order to exploit the benefits of the implementation it is critical to assign new
responsibilities. Job roles and staff skills must be thoroughly mapped in order to help
the managers to assign individual responsibilities: “If you get your role outright and
you get your process mapping right then people understand what their responsibilities
are” (Wes Simmons, General Manager, The Sage Group plc).
3.3 The process-related CSFs identified for CFOs
Within the area of process (Figure 2), business scenario enacting should be planned
and carried out by acting out representations of real accounts, considering “the go-live
should be a non-event and if you have done this bit correctly then it will be” (Dominic
Rea). In addition, a collaboration based design should be developed whereby the
suppliers “have expertise, the client has an understanding of the existing way of
working” (Hamid Aghassi). This is to avoid technical isomorphism occurring.
Delivery of the implementation should be linked with the wider corporate vision so
“that vision is translated into reality” (Hamid Aghassi). This is about “cascading the
goals down ... because it is much harder for someone who is pushing the buttons to
get the big picture, but they need to understand their part in the picture” (Stephanie
Snaith, Founding Director, Gradient Consulting).
During the review stage, it is critical to ensure strong interdepartmental
communications, and “the clients themselves have to do this” (Dominic Rea). This
can be achieved through establishing a transition champion network; the transition
champions communicate the benefits to the end-users and relay the problems back to
the project team. In addition, cross-functional representation is critical, whereby
internal members are seconded from key departments to form part of the project team.
A full representation allows all departments and services to be considered during the
implementation. This is particularly important at this stage so that departments can
relay the problems that have arisen to a like-minded person within the project team
who understands the implications. These problems can then be successfully relayed to
the supplier, or internal IT, for action. “It is suicidal to do otherwise.” (Dominic Rea).
3.4 The people-related CSFs identified for CFOs
Within the area of people (Figure 2), during the planning stage it is critical to develop
a holistic training strategy which integrates aspects of customer management within
functional training, so as to address any customer facing transactional aspects of this
new system. By taking the views of many stakeholders including those of the supplier
who knows the software and those of the client who knows the organisation, a holistic
training strategy will encapture all essential training requirements so that it is bespoke
for each department and adapted towards the customer facing services they offer.
Integrating an element of customer management into the training material ensures the
end-users learn how to use the system in performing their roles.
During the delivery stage of an implementation, the timing of training delivery is
critical: “It is absolutely critical that you time the training before the go-live date”
(Hamid Aghassi); “it needs to be close enough to the go-live for them to remember
what they were shown” (Dominic Rea), “but enough time for them to practise”
(Staphanie Snaith).
During the review stage, it is critical to undertake skills based training by segregating
staff into managers and employees, and also separating core users from standard users
so that the core training is targeted and “more detailed for the core users” (Ian Farrar,
Head of Sales and Marketing, Datawright Computer Services Limited) once the
system is live. It is also critical to evaluate the mainstream training courses at this
stage, which is sometimes seen as “more analysis of the consultant to see if there is
any feedback that indicates the consultants themselves need more training.” (Neil
Rushby, Project Team Manager, Access Supply Chain).
In order to fully exploit the benefits, it is critical to promote the benefits of the system
which is a role of the transition champions, these “have to be internal staff”(Hamid
Aghassi) so that internal values are upheld. In order to fully exploit the benefits, it is
also critical to have ensured knowledge transfer from the vendor which can be
achieved by having them train the trainers. The client has “to take ownership of the
system, lock, stock and barrel and train the trainer is essential to that” (Dominic Rea),
ensuring they can initiate their own future training requirements. To internally
disseminate knowledge, a network of super users needs to be appointed and “you have
got to make sure the super users see it as a long term job” (Wes Simmons). It is also
critical to create knowledge workers who will be trained post go-live to deliver future
benefits from the new ERPII system. This is critical to avoid “system atrophies” (Wes
Simmons).
4.0 Discussion
ERP II offers end-users the ability to use information to analyse and provide the
information required for both pro-active and re-active interaction with the customer
(Pan & Lee, 2003). Within the public sector, ERPII can be used to facilitate eCitizen
relationship, which is particularly beneficial within local government (Wong et al.,
2007). However, there is little research for CFOs, particularly public sector
organisations implementing ERPII, looking to improve CFAs. Identifying CSFs at
different stages for reengineering and introducing new ways of working is a
methodology used in the EU COBRA project on corporate understanding (Coulson-
Thomas, 1995). The current research has used this approach to identify critical
pathway steps for successful ERPII implementations for CFOs. Implementation teams
need to understand which CSFs to concentrate upon at each stage and that resource
allocation may also need to be applied differently at each stage.
Organisations have found it difficult to establish the most effective processes for
achieving the desired benefits in ERPII implementations (Al-Mashari & Al-
Mudimigh, 2003; Ward et al., 2005). To overcome technical isomorphism, it is
essential to develop a good working relationship with the supplier. Failed ERPII
implementations have occurred on account of organisations not achieving this (Sharif
& Irani, 2005). In the current research, one consultant commented that: “We have a
motto which says „One team one plan‟. One team one plan is all about this
collaboration” (Hamid Aghassi), and this ensures that the technical capabilities and
process requirements are aligned.
Indoctrinating staff to the new ways of an ERP system, and training them to a level at
which they feel comfortable in utilising the system is key to benefit realisation from
ERP (Gardiner et al., 2002). It is important that the new ways of working are strongly
communicated to the worker (Boersma & Kingma, 2005). Our findings, regarding
ERPII, corroborate this observation; we observed that opportunities for benefit
realisation reside within the users of the system and, as such, particular attention
should be paid to people-related issues such as training. Organisations should invest in
training, just as they do in technology, to deliver continual post-implementation
training.
4.2 Previously advocated CSF for ERP and CRM implementations
Top management support has been identified as the single most important CSF in
both ERP and CRM implementations (Finney & Corbett, 2007; King & Burgess,
2008; Somers & Nelson, 2001). The current research provides understanding of the
extent of top management support and clarification as to the involvement of the CEO.
Top management support is critical for initialising the implementation project and
keeping it on track. However, the nature of the support should not extend to CEO
involvement in the details, which could be counterproductive, and there is no need for
them to play an operational role overly interfering in the critical pathway steps of the
implementation. Two consultants felt that CEO involvement could misdirect the
project; Wes Simmons commented that “Some CEOs have a very strange view of how
their business works, I would say wrong”, elaborating that “CEOs aren‟t involved in
the day-to-day enough and what happens is they … start to cut a really big corner off
and the people involved are going: “no, no the devil is in the detail!” ”. This view was
reinforced by Ian Farrar who commented that “CEOs tend to be non-detailed guys;
they want to know the top level information, they don‟t want to get involved with the
detail, and they leave that to the other board members or management team”. In
summary, in the words of Wes Simmons: “So senior management support, senior
management encouragement, yes, actually having a CEO in the design team, No.”.
5.0 Conclusions
The current research identifies critical pathway steps for CFOs ensuring pertinent
CSFs are used to deliver a successful ERPII implementation. The newly developed
combination model reveals the importance of devoting attention and resources to
people-related activities, such as pre- and post-implementation training. The people-
related CSFs are weighted towards the exploitation phase of the implementation, the
process-related CSFs towards the planning and review stages and the technology-
related CSFs towards the planning and delivery stages. It has been suggested that
ERPII upgrades need to be treated as a new project and organisations should not
underestimate the time and resources required (Beatty & Williams, 2006). We
therefore recommend that the critical pathway steps identified in the current research
for an ERPII implementation should also be considered for upgrade initiatives.
This research recognises that top management support is critical, however, it identifies
that CFOs should pre-define the role of the CEO involvement, so as to maximise their
political influence and their role in creating a supportive environment but avoid
derailment due to detailed operational involvement in project implementation.
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