T HE E NTERPRISE S YSTEMS

I MPLEMENTATION :
A N I NTEGRATIVE F RAMEWORK

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I NTRODUCTION

With the pace of change and challenges faced by the

organizations, the organizations are forced to be more outward
looking, market-oriented, and knowledge driven. Study
provides a research framework of the critical issues involved in
ES adopting process,.

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è 2uild strong capabilities & improved performance

è Undertake better decision-making, and achieve a competitive

advantage is Enterprise Systems (ES) software.

è Increase supplier and customer satisfaction and increased

productivity.

 
   
  
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M ETHODOLOGY:

ë The paper is based on three sources of data:

è Academic literature review.

è Articles drawn from the web and the respected practitioners'

magazines.

è Personal semi-structured interview and structured interviews.

ë The size of the sample is small but enough for qualitative

research.

 
   
  
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DISCUSSION OF ISSUES
IDENTIFIED

Taking into account the technological, organizational and

behavioral impact of ES the following issues have been
identified:

è Unsuitability, as most of the time the ES modifications does not

meet institutionalized business operations

è The extent of business processes re-engineering required prior to

the implementation of the software

è Enterprise prefer to adapt their business processes to software¶s

in-built best business practices£

 
   
  
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C HARACTERISTICS OF ES

è ES is both strategic and operational.

è Strategic system is different from back office applications and

make organization flexible as well as responsive to customer
needs.

è Strategic aspect is concerned, a key factor is the identification

of the degree to which the adoption of an ES contributes to
business strategy of the organization .

è To assess this degree various methods can be used such as

likert scale or cognitive mapping. Simulation, probability and
sensitivity analysis are also helpful.

è Some overlapping between strategic and operational factors is

inevitable .
 
   
  
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A NALYSIS
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A number of ES¶s stakeholders operate outside the organization¶s
boundaries, For achieving the full potential of ES the evaluators
should consider the impact of Enterprise Systems on external
stakeholders, specifically the customers, suppliers and business
partners.
For eg. Coca-cola
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It is important that both tangible and intangible assets and hidden
costs should be taken into account from the outset when considering
ES projects.
Intangible or hidden and underestimated costs are also a major
concern among ES specialists.
Services by ES support industry can exceed the initial software cost
by a factor of seven to ten .
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 O RGANIZATIONAL I MPACT

è A major implication of ES deployment is that it involves

drastic changes in the organizational structure, business
processes and the people of an organization.

è Change management is effective, competitive advantage and

financial returns on investment are expected.

è The estimation of the effectiveness of change management is

not straightforward as it is dependent on the analysis of many
uncontrollable factors related to human resources and the
psychological climate of the organization

 
   
  
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 PROPOSED INTEGRATIVE 

FRAMEWORK FOR ES
ADOPTION
  
 

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è Vision must clarify the organization¶s direction, the goals,

and the business model behind the implementation of the
project.

è Investment in ES is a strategic action, which can

have significant consequences for the competitive position
of the organization.

è ES requires substantial business process re-engineering.

è Integrated ES system .

 
   
  
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è Made according to both the current and the future status
of the enterprise.
è Various constraints such as technological, organizational
and financial should be kept in mind.
è ES functionality and enhancements requirements matrix,
the organizational and technological changes required for
the successful implementation of the ES system should be
developed and evaluated according to certain criteria.
è Re-engineering for ES involves extracting the best
finance, logistics and sales practices from multiple
divisions and then standardizing them into an integrated
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ES system .      
 
  
   
  
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è 2oth current and future business needs, have to be

balanced against various technological, work and
organizational constraints.

è External competitive pressure needs to be looked into.

è Require collaboration between partners, coordination of

decisions, as well as accurate and real-time information flow
in a network of enterprises.

è A radical change in business processes, towards

simplification and efficiency, must take place

 
   
  
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CONSTRAINTS

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è Scalability and flexibility of the IT infrastructure is critical in

order to support additional applications and systems.

è Changes in the IT infrastructure may be necessary in order to

support the ES system.

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è These include the degree of the decentralization, the

management structure, the style of leadership, the rigidity of
business processes, and the company¶s culture.

è Resistance to change, prestige, job security feelings and

departmental politics are also involved.
 
   
  
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 P RODUCT , VENDOR A ND
S UPPORT S ERVICES
E VALUATION
‰ Selection of ES modules that support critical business functions , eg
SCM.

‰Certain weighted criteria for the selection of vendor, product and

implementation partner should be set and evaluated.

‰ The most important issues involved in the ES process is the ability of

the vendor to deliver the promised system on time and on budget .

‰ ES packages offers a broad functionality, they certainly exhibit

individual strengths and weaknesses compared to individual business
requirements.
 


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è The availability and functionality of additional applications to

support current and future business needs such as SCM or CRM.

è multi-language and multicurrency capabilities

è support a certain business practice or operation, which is

considered critical, such as make-to-order or make-to-stock
manufacturing.

è availability of experts in the system, the partnering company that

will assist in the implementation, the training courses available
by the vendor or third parties as well as vendor¶s financial
position and pricing models.

 
   
  
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A LL IN ONE V S 2 EST OF
2 REED ES S OFTWARE
è All in one approach: applications can be acquired from the
vendor of the ES, from another vendor closely collaborating with
the first, from a third party vendor, built-in-house or outsourced.
Eg. Colgate¶s Palmolive SAP R/3 solution.

è 2est of 2reed Approach: used to achieve increased functionality.

Eg. the 2oeing Commercial Airplane Group.

è It has been reported that industry watchers agree that about 80%
of companies will adopt the all-in-one solution but the remaining
20% will demand best-of-breed applications from multiple
software vendors.

 
   
  
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C ONCLUSION

è ES vendors and third party companies are offering a large

variety of ES core and extended module.

è Complexity in taking the decision to acquire an ES and the

adoption process due to the changing and competitive
environment.

è Enterprises pursuing systems integration should evaluate and

select systems that contribute to this goal without of course
sacrificing the functionality of applications they believe are
crucial for their business.

 
   
  
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 Î UESTIONS

‰Which of the following is not the benefit of ES

a) 2etter performance
b) Customer satisfaction
c) No effects on productivity
d) Competitive advantage
 

‰ Which of the following method is not used to measure the degree

of ES contribution in business strategy

a) Likert scale

b) Thurstone scale

c) Simulation

d) Sensitivity analysis

 
   
  
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‰ 2usiness vision for ES adoption excludes which of the following:

a) Organization goals

b) Organization direction

c) 2usiness model

d) Organization¶s management

 
   
  
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