It is referred to as enterprises resource planning (ERP) systems, enterprise-wide systems, or enterprise business system, these comprehensive, package software solutions look for to integrate the entire range of a business’s processes and functions so as to present a holistic view of the business. The critical success factors for ERP implementation embody prime management support, a transparent business vision, and problems specific to ERP like ERP strategy and software configuration. However, a number of the more important factors are the problems associated with re-engineering business processes and therefore the integration of varied core processes to the ERP system. Few business managers can disagree on the worth that ERP applications will bring to their firms. However, most organizations don’t seem to be putting in place the procedures to manage the changes and customizations they need to make to ERP systems for establishing a competitive advantage. Most corporations are too busy building and running the technical aspects of their ERP systems to recognize the requirement, and long-run value, of modification and business process management. This value extends well beyond application development, and, in fact, provides the backbone for successful installations and operation of an ERP system. When implementing an ERP system, top management commonly faces an unwanted attitude from potential users for one reason or another, they resist the execution process. Top management should, therefore, proactively deal with this problem instead of reactively confronting itIntroductionThe evolution of computers and communication technologies are pushing the physical disintegration of markets and enterprises to its global limits. Businesses in the recent years have witnessed an unparalleled period of change in terms of advances in technology and globalization of markets. Increased global competition has put a premium on the ability of organizations to generate timely and accurate information throughout the enterprise and collaborate with their business partners and consumers to remain com. Over the years, many information and communication technologies have been developed for integrating various activities of a firm. A technology that has benefited corporations the most in their ability to integrate their operational processes to improve information flow, reduce costs, streamline business processes, offer product variety, establish linkage with business partners and to reduce response time to customer needs is the enterprise resource planning (ERP). Firms that successfully implement integrative technologies have been viewed as highly competitive in the global. An ERP system is a set of business modules, which interconnects functional areas of an organization, such as finance, accounting, production, purchasing and customer service into a tightly integrated single system with a common platform for flow of information across the enterprise. The Internet has enabled firms to expand ERP applications beyond the corporate boundaries and to connect their internal business processes with the business processes of their customers and suppliers. ERP can be used as a platform for electronic business applications allowing organizations to reduce their inventory costs and to better manage their supply chains and customer relationship. Manufactures, suppliers and retailers can coordinate their activities and track items. Tracking items is a well-used and convenient benefit of ERP systems. By using bar codes or placing radio frequency identification tags on items companies can find exactly where the item is in the value chain, prevent theft and determine its delivery time accurately so that the customer receives the goods on time. The current trend for enterprise systems is to include Web components for e-business and international communications. One important aspect of an ERP system for both manufacturing and service sectors is its ability to improve the information flow across multiple sites, even in different countries. ERP systems have the ability to take language translation into consideration. Of course, languages are rarely translated with 100 percent accuracy, but the systems have the ability to communicate through the language barrier. These systems can also take into account differences with currencies. Because exchange rates are available via the Internet and in real time, business transactions can be conducted with real-time adjustments for currency values. ERP systems also can be set up to include for various human resources laws and regulations unique to individual locations. The ERP systems allow managers to access business transactions that are conducted anywhere within their multi-site ERP system. Enhancing the information flow will lead to increased visibility of product and customer information at any of the multi-site location when needed.There are dozens of players in the market for ERP systems but the top 5 players in the market are SAP, PeopleSoft, Oracle, JD Edwards and Baan, out of which more than 50% market is captured by SAP.There are many companies who have applied ERP system in their organization successfully like Samsonite, Whirlpool to name a few. There are many tangible and intangible benefits of applying ERP system, few are listed below:1. TANGIBLE BENEFITS:a. Inventory reductionb. Personnel reductionc. Productivity Improvementd. Order Management improvemente. Financial Cycle improvementf. Procurement cost reductiong. Maintenance reduction 2. INTANGIBLE BENEFITS:a. Information visibilityb. Improved processc. Customer responsivenessd. Cost reductione. Standardizationf. Globalizationg. Business PerformanceThe decision to implement ERP system consist of many factors, only technical aspect can’t be considered, unfortunately many companies fell into this trap and failed to successfully implement ERP system. Gartner report stated that 70% of all ERP projects fail to be fully implemented even after 3 years; one major example to consider is the classic case of Hershey’s, they squeezed their deadlines to implement ERP and didn’t got the time to test modules and they chose the wrong timing to roll-out ERP system and hence they failed miserably.So we can say that apart from technical aspect there are several other factors which play a major part in successful implementation of ERP systems. Some of the factors to consider are:1. Financial commitment: It requires a huge amount of money to implement ERP so financial commitment is essential2. Business case should be developed: Management should not only consider profit to the company but also look into intangible benefits as well3. Personnel: There are 3 major areas where most of the money is spent while implementation of ERP that are- Software, Hardware and Personnel, while software and hardware costs can be quantified while the human cost can’t be quantified4. Dedicated team: There should be a dedicated team to oversee the implementation of ERP systems consisting of people from higher management and they should be given complete authority to make decisions?FindingsA fast survey of ERP research papers uncovered changed systems for executing ERP effectively. One can arrange these techniques into organizational, technical, and people strategies. Organisational Strategies for advancing ERP usage incorporate change strategy development and deployment, change administration strategies, organisational structure, resources and project management, administrative style and belief system, communication and coordination, and IS functional attributes. A portion of the specialized systems that have been proposed to decide ERP achievement incorporate specialized parts of ERP, ERP many-sided quality, sufficiency of in-house specialized skill, and time and cost of usage. Cases of individuals systems include staff and administration mentalities, inclusion, and preparing. Past ERP execution research might be portrayed as factor research, which includes recognizing the components or factors that are basic for actualizing ERP effectively. In spite of the fact that factor research is important for understanding ERP usage achievement, it embraces a fairly static view, which restricts in clarifying the elements of the execution procedure. Along these lines, factor research alone isn’t sufficient for clarifying how the progress from protection from progress has happened. Unlike factor research, process research can be used to see how ERP execution endeavors have happened; it in this manner gives a picture about how we got from time 1 to time 2.Critical Success Factors:The extant literature suggests that a successful ERP implementation often requires identification and management of critical elements and their constituents at each phase of the implementation. Through a comprehensive review of literature 12 factors, listed in Table I, were found to be often cited as critical to ERP implementation success. Participating companies were asked to identify which of the 12 factors they considered to be key factors in their ERP implementation process. Table I shows that only four out of six companies indicated that from the beginning top management support for the project was clearly communicated and the support from top management played a critical role in their ERP implementation. Top management commitment is key to the success of an ERP implementation, and many managers may be involved but do not communicate their commitment to all employees and fail to realize the importance of their role as a leader and facilitator of change. Lack of user involvement, training and poor communication of the objectives of the project by managers are often mentioned as the major contributing factors for the ERP failure. Often, lack of employee involvement at all company levels as well as inadequate training and education causes many users to become frustrated with the system due to its complexity and significant learning curve. Frequently, employees at lower levels of the organization are not as involved as they should be and lack encouragement from top management to express their concerns or suggestions to address functional issues. This can have adverse effects on the system, as the end-user will either revert to the old way of doing things or create make-shift workarounds that circumvent the ERP system altogether. Thus it is not surprising to see that having clear goals and objectives, user training and education as well as user involvement in evaluation and implementation were commonly considered by five of the case companies as key success factors; again, the only dissenter was Company B which was the only company not to have formal strategies for acquisition and implementation. ERP systems generally come with standard applications and are modular in nature. However, some companies may require customized version of ERP systems than others. Customization increases the cost of an ERP package. The more advanced and complicated the company and the system, the greater the cost. To avoid costly customization, companies may choose to minimize the degree of customization or to completely reengineer their processes to fit the ERP system. Business process reengineering and minimizing the amount of customization were considered critical by only half of the participants. ERP systems are based on a value chain view of the business where functional departments coordinate their work, focus on value-adding activities and eliminate redundancy. For this reason, interdepartmental communication becomes critical in creating a value chain throughout the company when implementing an ERP system. Organizational culture can facilitate or inhibit the integration of ERP systems. Managing change and corporate culture during the implementation phase can be most critical to the ERP implementation success. Interdepartmental communication was considered by five of the six respondents as key, whereas half of the case companies specified change management and organizational culture as critical to their ERP implementation.TABLE I Critical Failure Factors:The ERP industry has not been performing as originally expected. ERP implementations are notorious for taking a longer time and costing more money than is projected. Hence, in the last decade, organizations have struggled to implement ERP effectively, despite all of the benefits it offers. This is not because ERP solutions are poorly designed, but because there is inadequate understanding of the way that an ERP solution should be implemented. To this effect, companies have ended up exceeding their planned implementation budgets, and time to implement. Consequently, a large number of companies have cancelled their projects completely. Challenges in ERP implementation estimates that 96.4 per cent of ERP implementations fail, whereas 70 per cent of ERP implementations do not achieve their estimated benefits. Figure 1 shows the percentage of each failure factor in relation to all the critical factors. 17percent apply to lack of change management. Excessive customization, dilemma of internal integration, poor understanding of business implications and requirements and poor DQ, each make up 13 per cent of the failure factors. Lack of top management support constitutes 10 per cent of the failures cited. Hidden costs and misalignment of IT with the business each make up 6 per cent of the discussed challenges. And limited training constitutes 8 per cent of the critical failure factors.FIGURE 1 Strategies for ERP implementation:Improvement strategies, such as ERP implementation, oftentimes contain change. Hence, responsiveness after internal customers is crucial for an organization in order to avoid the difficulties related to this change. To aid top management including the complicated organizational problem on worker’s resistance according to ERP implementation, it is recommended an integrated, process-oriented conceptual frame component concerning 3 phases knowledge formulation, strategy implementation, and status evaluation.Knowledge formulation phaseThe first step in effectively managing change introduced by IT is to identify and evaluate the attitudes of individual users and influential groups. This analysis should address such questions as:• Who are the resisting individuals and/or groups? What are their needs?• What beliefs and values do they have?• What are their interests?The answers to these fundamental questions may offer a good starting point in determining the sources of employee’s resistance to the ERP system.Employee-raised facts, beliefs, and values are strong indications over what may cause their resistance after change. This should properly be applied after the context concerning implementing an ERP system. For example, some users may raise issues about their computer illiteracy, or may say that they have spent many years doing an excellent job without help from an ERP system. Other users may develop beliefs that their jobs will be threatened by the new system, or that they will not know how to do the job within the scope of such a system. Yet another group of users may stress values such as the importance of existing power and authority structures, which may be jeopardized by the new ERP system.Strategy implementation phaseManagement can use this knowledge of potential users from the prior stage to set up strategies that can best brush off user’s resistance to the ERP system, and to convince as many users as possible to use it. If this is the case, it is more suitable to find an action sheet for executing the selected strategies. The three-level adoption process provides a good basis for describing this phase.To change the outlooks of potential users of ERP, management must first try to affect the cognitive component of user’s attitudes. A major strategy for achieving this goal is communication. One efficient communication strategy is to inform prospective users of the benefits of ERP. The marketing people usually communicate the benefits of a product, rather than its attributes, to customers, to draw their attention and intensify their need. Top management, in the similar way, can create more applicable awareness for the ERP system by communicating its benefits to the workers. In many cases, ERP implementation failed because of lack of communication. Knowledge about what the system can be conveyed to the organization and its workers can build eagerness for the system. Nevertheless, one must watch out for unrealistic worker’s expectations, which may deepen the resistance problem, thus causing its failure from the start. Moreover, the success of future introduction initiatives depends on building a collective base of trustworthiness by management.Another communication strategy is to give a general description of how the implemented ERP system will work. ERP users are expected to be reluctant to welcome the new system if they do not know how it works. Teaching each of the various user groups how the ERP system works is important in creating awareness. Thus, from the start, management should explain to potential users how the ERP system is going to work. For example, management should clarify the general inputs and outputs of the system, determine departments that will provide the data, and define the computer knowledge needed to operate the system, etc. In all cases, it is of utmost importance that the support staff responsible for executing these communication strategies possess adequate political skills so that the awareness stage ends up in accordance with the plan.The second step in the strategy implementation phase is to influence the affective component of user’s attitudes. The first strategy that can be used by management is cost minimization. The low-cost strategy as one that can be used by marketers to help an organization survive in a competitive environment. If management wants the new system to be adopted by the users, then user’s adoption costs should be kept to a minimum.The cost minimization strategy should be developed in such a way that it affects both individual workers and influential groups. On the individual level, the ERP system has to minimize the perceived cost for each employee in order to create a positive adoption attitude. Influential groups within the organization are also looking at the cost aspect of the implementation effort. Another strategy that could help affect the adoption attitude of potential users is differentiation. The quality option as one important basis for product differentiation. In the ERP context, the user’s perceived high quality of the ERP system would surely have a positive impact on their attitudes toward that system. Some ERP systems have an unwieldy user interface, which can cause problems. Generally, system users do not scientifically measure quality attributes of the system, rather each user constructs his or her convenient perception about the system depending on his or her real experience.Practical training is another important driver of ERP implementation success. Training offers a good prospect to help users adapt to the change that has been introduced by the ERP system, and helps build positive approaches toward the management strategies. Further, training provides practical experience for the users: they appreciate the quality attributes of the system and its likely benefits.The last part in the strategy implementation phase is the conative stage. Getting the commendation and backing of well-known individuals and opinion leaders is the first strategy that can be used. Applying this strategy would help in ensuring the support of the leaders of the influential groups. To succeed in mobilizing opinion leaders, management must capitalize on its efforts in the second stage when it tried to build user’s objective to adopt the ERP system by minimizing the adoption costs of the groups. Also, convincing group leaders to effectively participate in the implementation process and make them feel that they are key players will ensure their valuable commitment. Because of their commitment, leaders of the groups will try to convince their colleagues that the ERP system is to their benefit.This gives top management a clear rule that the introduction of an ERP system should not be introduced until a positive attitude is built and persistent among potential users. For example, do not introduce an ERP when a critical mass of your employees feels threatened by the system or feels forced to accept the new system. Solving these problems before introducing the ERP would help set the stage for success.Most importantly top management’s commitment is critical for the success of the whole ERP implementation process. Transformation requires a strategic vision to ensure its long-term success. In a recent survey, leadership was ranked the number one catalyst of large transformation efforts. ERP implementation can only be accomplished when senior management is totally committed to the initiative. Management commitment and support is the ultimate strategy that will secure the necessary conditions for successfully introducing the change brought by ERP into the organization.Status evaluation phaseBesides having a performance measurement system to ensure that the desired business outcomes were achieved, it is as important to monitor the progress of ERP change management efforts. It is crucial that top management makes sure worker’s anxiety and resistance to ERP is under control. The status evaluation phase provides feedback information to top management in a active manner. To be useful, the feedback should be timely, accurate, and systematic.Based on status evaluation phase outcome, top management takes proper action. The feedback coming from the evaluation phase may be positive, which means that recorded performance of counter resistance efforts should be maintained. Alternatively, the performance feedback may be negative. Management may find that there is still strong workforce resistance to the operational changes resulting from ERP implementation. In such a case, top management should make every effort to understand what went wrong. For example, top management may want to re-identify user’s needs and re-evaluate the execution of adopted change management strategies to find an acceptable fit between the two.ConclusionIn the various research papers, we studied about both successful and unsuccessful implementation of EPR systems. We also studied about the critical success and failure factures. Further we looked into various implementation strategies which can be used to overcome the factors. After reviewing the strategies we can conclude that to overcome employees resistance to change, top management has to:• study the structure and needs of the users and the causes of potential resistance among them;• deal with the situation by using the appropriate strategies and techniques to introduce ERP successfully• evaluate the status of change management efforts.
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