ERP implementation: lessons from a case study

Many organizations have moved from stand-alone business information systems applications to integrated enterprise-wide systems, enterprise resource planning (ERP). The implementation of ERP packages has created an opportunity to re-engineer business processes within and beyond the organizational scope. Most notably, SAP R/3 has been widely implemented to create value-oriented business processes that enable a high level of integration, improve communication within internal and external business networks, and enhance the decision-making process. Though many organizations have reported dramatic improvements from SAP R/3 implementation, others have experienced difficulties in getting the R/3 modules aligned with other business components and systems. This paper describes a case study of a failed implementation of SAP R/3 to re-engineer the business processes of a major manufacturer. Lessons in terms of factors that led to failure and their future implications are discussed in the light of the contrasting experiences of several best practice companies. Introduction A useful tool that businesses are turning to, in order to build strong capabilities, improve performance, undertake better decision making, and achieve a competitive advantage is the enterprise resource planning (ERP) package. The ERP package aims to integrate all key business activities through improved relationships at all levels to achieve a competitive advantage (Al-Mudimigh et al., 2001; Davenport, 2000). IT-enabled re-engineering is an important approach used to achieve dramatic improvement in business processes. The development of ERP systems was a result of the increasing demand for re-engineering, combined with the advent of client/server technologies (BuckEmden, 2000). There was also a desire to replace MRP systems which fell short of supporting multiple plants, multiple suppliers and multiple currencies, and did not include functions such as inventory control, plan management and order processing (Kalakota and Whinston, 1997). ERP systems can be considered as an IT infrastructure able to facilitate the flow of information between all business processes in an organization (Martin, 1998). In particular, SAP R/3 has emerged as the dominant leader in ERP systems, and is now one of the most used tools to optimize and re-engineer business processes (Cooke and Peterson, 1998; Keller and Teufel, 1998). Siemens and Lucent, for instance, have implemented SAP R/3 to improve the integrity of their supply-chain (Elliott, 1997). The Emerald Research Register for this journal is available at The current issue and full text archive of this journal is available at http://www.emeraldinsight.com/researchregister http://www.emeraldinsight.com/0959-3845.htm