Optimal Allocation of Standardized Application Software Packages to Business Process Steps: a Simulation Study Based on Communication and Automation Costs

Most research on the utilization of standardized application software packages in large companies is focussed on introducing a certain package for entire processes or even the entire company. A mix of existing, mostly individual applications and selected modules of different standardized application packages, however, may be superior in certain situations. A cost-based model for information systems optimization is presented. A cost-minimal allocation of software packages can be determined for every set of communication costs associated with information flows between modules and automation costs associated with process steps. Moreover some general hypotheses on software package introduction in large companies are validated by a large number of optimization series basing on the underlying decision model. The paper presents the general decision model, its application to evaluate package allocation, and general simulation results.