BCO6603: ERP Systems Journey Research Report and Analysis

This report delves into the concept of Enterprise Resource Planning (ERP) systems and their implementation journey, arguing that the process of benefit realization is often ongoing rather than immediate. It explores why an ERP journey may never truly end, examining the various stages involved in ERP implementation, from initiation and planning to design and development, and highlighting the potential benefits associated with each stage. The report also identifies the drivers and barriers that influence a company's progression through these stages. Through case study examples, the report demonstrates how different companies experience varying levels of success and benefit from their ERP systems, illustrating the complexities and nuances of ERP implementation and its lasting impact on business operations. The report also explores the never-ending journey of ERP implementation as changes in various modules can be reflected by the change in the working functionality.

Running head: ERP
Enterprise Resource Planning Systems
Name of Student
Name of University
Author Note

ERP
Table of Contents
Introduction..........................................................................................................................2
1. Enterprise Resource Planning System (ERP): The Concept...........................................2
2. ERP’s Never Ending Journey..........................................................................................4
3. Stages in an ERP systems Journey and Benefits.............................................................6
4. Drivers and Barriers for Company..................................................................................9
4.1. Drivers for Companies to move from one stage to Next........................................10
4.2. Barriers for Companies to move from one stage to Next.......................................10
Conclusion.........................................................................................................................11
Recommendations..............................................................................................................11
References..........................................................................................................................13
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Introduction
Implementation of an Enterprise Resource Planning System (ERP) and realization of its
benefits might be a never ending story mainly because the process of benefit realization of ERP
varies in a significant manner (Leon 2014). ERP systems are mainly used for integration of the
different software solutions that supports the information flows within a business. The key
purpose of the ERP is to implement and maintain necessary information systems that handles,
stores and distributes the information needed within an organization. The main benefit of an ERP
is that it helps in its speed and efficiency (Chofreh et al. 2014). Effective and proper data
processing becomes and essential need for every organization and therefore, majority of the
organizations make usage of the ERP for supporting the various functional areas of an
organization.
The deployment of an ERP is any organization is generally found to be a never ending
process (Tarhini et al. 2015). Although traditionally, the development and the implementation
process of ERP is formed in accordance to certain pre-defined stages, the modern process of ERP
implementation does not follow that traditional approach. Therefore, an organization might need
to change their approach and work processes while implementation of an ERP and thus, going
live might not always indicate the termination of ERP journey.
The undertaken report converses the perception of an ERP system and a company’s
journey towards implementation of an ERP. The report will discuss the various phases of
employment of an ERP and the reason why the deployment of ERP might fluctuate for different
companies. The aids that a business can achieve with each stage of ERP implementation is
debated in the following paragraphs.
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1. Enterprise Resource Planning System (ERP): The Concept
An ERP can be described as a unified software that has a capability of effectively
assimilating all the business methods running in a business organiztaion. The ERP has the
capability of replacing all the existing business process to increase the business efficiency (Costa
et al. 2016). ERP is used by the organization to complete the business tasks by the process of a
centralized and integrated system. ERP is a technology infrastructure that is generally used by
the company for integration of all the key information of several departments to be used to
manage the suppliers and the customers (Kurbel 2016). The key benefit of ERP is that it helps in
easier customer relationship management by integration of information from all departments.
Thus, these systems are generally used by the companies for enhancing the strong information
infrastructure. It allows the administration by commencing efficient and better decision making
(Masa'deh, Mufleh and Alrowwad 2017). ERP is an important consideration of any business
organization as business performance of the company is largely enhanced by achieving the
competitive advantage.
There are several advantages of making use of an ERP as it provides a complete
visibility of the key business processes of an organization leading to its easier management. All
the departmental processes are integrated with the support of ERP and therefore, another prime
advantage of making use of an ERP module is the facility of enhanced and effective
communication (Weng and Hung 2014). The ability of an ERP to share evidence with all the
different modules of a business process generally helps in elimination of any unnecessary
operations and data thus, increasing the work processes of an organization. Thus, it can be said
that ERP is needed for automating all the major business function of an organization. However,
the benefits or the advantages that a company can expect from their ERP system can happen over
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a long time period and not once. The realization of the benefits of ERP in companies varies for
several reasons. Any issues in the deployment of the system can affect the benefit realization
process. The benefits of an ERP can be realized in different stages of its implementation, which
is another significant reason behind the difference in the benefits an organization can achieve
with deploying an ERP. Thus, it can be assumed that a journey of ERP may never end
(Abdinnour and Saeed 2015). There are several cases of success and failure of employment of an
ERP system. In the succeeding paragraphs, the drivers and barriers associated with a company
to go from one implementation stage to another stage of implementation is discussed to
comprehend the process behind why the ERP system’s journey of a company may never end,
2. ERP’s Never Ending Journey
The ERP implementation is a never ending story as changes in various modules of ERP
can be reflected by the change in the working functionality. The interpretation of knowledge and
information generally differs in a number of ways and incorrect interpretation of the key issues
and needs of an organization can significantly affect the normal implementation process of ERP
(Hustad, Haddara and Kalvenes 2016). The adoption of ERP in a business significantly affects an
organization and the members working on it. ERP systems are supported by parts of knowledge
management and therefore, organizations are needed to be aware of the effective knowledge
management in successful execution and implementation of an ERP.
ERP implementations are never easy as a lot of works are needed to be completed to
ensure that the ERP modules are working as per expectations. Incorrect planning and
implementation process linked to the use of ERP, can disturb the organization. Evolution of the
functionalities of an ERP system is generally never ending as with the changes in the business
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processes, changes or modifications in the modules of ERP becomes mandatory as well. ERP
system is said to be evolving for more than 50 years although the term ERP is only 20 years.
Initially, planning and manufacturing operations were initially done by the main frame
computers which later evolved to form an ERP system (Circa et al. 2015). The changes in the
modules and the functionality of an ERP is mainly observed with the changes in the processes of
a business. The journey of ERP if not successful can act as a black hole to the progress of the
business. As per the organization, the ERP implementation is comprehensive in that stage where
they can achieve immediate benefits. No shortcut can ensure successful ERP implementation as
missing procedures, training and shortcomings can affect the entire implementation process in a
negative way (Ozorhon and Cinar 2015). The impact of any shortcut taken for the deployment
and operation of ERP can affect a business in a negative manner. The shortcuts that are generally
taken while implementation of an ERP include less detailed planning, lack of training and
improper testing. For Example, the ERP deployment project of Hershey failed mostly because
the team had set minimal time for planning the entire implementation process (Samara 2015).
Along with that the lack of proper testing of the ERP modules resulted in development of a
faulty system leading to improper system functioning and business loss during their busiest
business days.
Even after the go live or launch of ERP in a company, changes in the business functions
or change in the number of staffs and customers, might require modifications in the functionality
of the ERP and therefore, changes in the software configurations might require. The functionality
or the working process of an ERP is still evolving and with that, the journey of ERP in an
organization never ends. However, to ensure maximum benefits of an ERP, continuous up
gradation to the latest modules of ERP is necessary (Czari and Jarander 2015). With the
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inclusion of the new business processes and the system, and organization needs to upgrade their
ERP modules as well. With rapid change in the business structure and business processes, the
journey of ERP deployment, in a company may never close. The rapid change in technology
further requires continuous modification of the existing systems leading to the journey of ERP
being a never-ending process.
3. Stages in an ERP systems Journey and Benefits
The operation of an ERP is a critical and complex process and needs detailed planning.
There can be several phases in an ERP journey and planning and proper execution of each of
these phases ensure project success. The key stages of implementation of an ERP and the
possible benefits a company y might realize with the implementation of ERP are discussed as
follows-
Initiation and Planning Stage: This is the first phase of ERP deployment and this stage is
important for initiation of the design and deploying of an ERP. In this particular stage, the
business needs along with the goals and objectives of ERP implementation are identified. Also,
this stage is linked with identification of team members and developing a skilled team so that the
duties related to ERP implementation can be allocated to the team members. This stage therefore,
marks the foundation of ERP implementation (Cooley 2015). This stage is of significant
importance as it helps in easier identification of the potential gaps in the organization that can be
mitigated with the implementation of an ERP. The successful completion of this stage is linked
with development of a detailed plan for ERP employment.
This stage offers several benefits to a business. Since the specifications and the
requirements of an ERP system is finalized in this phase, the senior management of the team gets
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an understanding of the business needs. As per the multinational company Deloitte, this stage of
ERP implementation is the most noteworthy stage to decide on the approach to be taken for
successful ERP implementation.
Planning stage is of significant important. In Hershey’s ERP Implementation Failure,
very little time was allocated for planning the entire implementation process of the ERP, which
lead to development of an ineffective project plan, which ultimately lead to project failure
(Samara 2015).
Similar problems were faced in ERP implementation by Nestle as the implementation
strategy for ERP implementation was not properly defined (Dieringer 2004). Therefore,
throughout the implementation stage of Nestle, several large mistakes were done by the team that
almost led to project failure. However, later on, the organization appointed top 50 executives for
the task to assemble a set of best practices in ERP implementation in all the USA division of
Nestle.
Designing Stage: The next stage of ERP deployment is needed for recording the review
specification, alignment and the walkthrough of the system implementation. The walkthrough is
mainly carried out with the stakeholders of the project for defining the key activities that are
needed to be carried out during the ERP deployment process (Hustad and Olsen 2014). The
design stage is important for creation of the prototypes of the system to be implemented and the
output of this stage include the documentation of the ERP procedures to be followed.
The benefit that a company can achieve with the completion of this particular stage
include setting up of the design prototypes and clear explanation of the user’s need linked with
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ERP system (Blum 2016). At this stage, the project team has a clear understanding of the overall
design of the systems.
Development Stage: This is one important phase of ERP implementation as the primary
objective of the stage is expansion of the environment in which an ERP system is to be
developed. At this stage, customization of the ERP system along with incorporation of the
important qualities of ERP is determined (Saade and Nijher 2016). The software is coded at this
stage for final testing before go live. This stage is important as simulation is generally done at
this stage.
The key benefit of this stage include prior detection of the bugs, risks and issues before
the go live so that the issues can be eliminated from the system to be developed. The
development stage of ERP implementation in Cadbury was a success particularly because the
development stage was executed as per the plan (Poranki, Perwej and Akhtar 2015). The
company followed a Big Bang approach in developing and deploying an ERP module and
completed the entire implementation process in 1 year. This proves that success of any ERP
project largely depends on effective planning and proper deployment of the system as per plan.
Testing and Deployment: This is an important phase for successful ERP deployment in a
company. Testing is important as in the testing stage the developed system is verified and
validated. This stage mainly aims in formation of the ability for the end user of the ERP. There
are several Testing modules that are generally undertaken at this stage, the significant ones being
the performance testing and security testing (Arthur 2016.). Once the Testing phase is
successfully completely, the system is ready to go live. The deployment stage is linked with go
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live where the end users are delivered with a fully working system with all its components and
functions.
There are several benefits a company can achieve with this stage and this include proper
identification of the defects and deviation of the functionality. This stage is important for
enhancing the end user experience and for gaining the users’ satisfaction.
In this case the Hershey’s ERP implementation Failure can be cited again. The lack of
collaboration among the team members and allocation of very little time for the testing resulted
in roll out of the system without any proper functional testing. This resulted in faulty systems
being released leading to a huge business loss. On a contrary, the ERP employment of LG was
an achievement as the company adopted a strategic approach in implementation of ERP. The
familiarity of LG with oracle however, contributed to the delivery of a flawless ERP system. The
successful testing and deployment of ERP in LG helped the company in achieving benefits
which include centrally managed single system, transparency in their requirements process,
informed decision making and having a centralized control on the HR processes
(Mahendrawathi, Zayin and Pamungkas 2017). The implementation of ERP in LG was not a
cakewalk and it spanned over five years. Several challenges were faced by LG while deploying
the ERP system. However, the correct testing and deploying of ERP has allowed the company to
enhance their business process.
Support and Maintenance: This is the post production stage of ERP deployment where the users
are provided assistance in terms of system functions and resolution of their queries. The
advantage of this phase is that the final users of the system are provided with manuals and
documentation related to the system usage (van Roekel and van der Steen 2019). Trainings to the
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end users are also provided in this phase to ensure correct operation of the erp that has been
developed.
4. Drivers and Barriers for Company
As discussed earlier, ERP deployment in a business is a complex process and therefore
deployment of ERP in a Company might be associated with certain barriers. There can be several
drivers for implementation of ERP and success of ERP (Chang 2016). The successful ERP
implementation is linked with proper completion of each of the stages or ERP implementation
that are discussed in the previous section. The drivers and barriers for the company to go from
one phase to next phase are discussed in the following sub sections.
4.1. Drivers for Companies to move from one stage to Next
The panned deployment process with a skilled and experienced team is a major driver for
a company to go from one stage of deployment to other. ERP is mainly implemented in
organizations for achieving long term benefits in terms of flexibility in business operations and
cost control. One driver for a company to move to next phase, include the organization’s IT
readiness in adoption to the change that the company will be facing with the deployment of ERP.
The driver for a company to move from testing phase to the launch or deployment phase include
successful system testing with no performance issue being detected in the system. If an ERP is
implemented with a planned approach, it is possible to ensure successful deployment and launch
of the system.
4.2. Barriers for Companies to move from one stage to Next
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Majority of the ERP deployment project take a longer time than estimated and goes over-
budget. This mainly occurs as a result of the barriers that a company might face while moving
from one stage to another. One key barrier that a company might face while moving from one
stage to another include the financial issue (Harwood 2017). In the planning phase, if the cost
estimation for the entire project is found to be way more than the estimated cost, it might act as a
barrier and the deployment procedure of ERP may stop at the first stage.
In the design phase, the functionality of the ERP system is mainly aligned with the
overall business strategy. If a company fails to align the business strategy with the key
functionalities and the specifications of the ERP. The entire procedure of ERP deployment might
fail in the design phase.
One key barrier that can affect the normal execution of the ERP implementation project
include improper business processes management and process improvement. If any
implementation issues are identified in the testing phase, the entire process of ERP
implementation fails.
Conclusion
The report discusses the key causes behind the never ending journey of ERP in any
organization. ERP is mainly adopted in business organization to enhance the business stability
and flexibility. An ERP aids in rationalization the business processes to ensure that all the work
processes are completed in a minimum time. The report discusses the different stages of ERP
implementation and the benefits that a company can achieve in each stages. Throughout the
report, several examples of ERP success and failure are cited. There are several barriers for ERP
implementation, one of which is the financial barrier. The drivers for ERP implementation
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include proper testing and validation of the specification of ERP deployment. The ERP
deployment is a dynamic and never ending process that offers the benefit of easier business
process management within the organization.
Recommendations
The successful ERP implementation within an organization is possible with a planned
approach. However, the benefits that ERP can provide to an organization might vary. The
recommendations for realizing the maximum benefits are indicated as follows-
 The plan made for ERP implementation should be associated with the business
needs and specifications of the existing system
 Proper staffs’ training is necessary to ensure maximum advantage from the ERP
system modules implemented in an organization.
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References
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post-implementation phase to the pre-implementation phase. Journal of Enterprise Information
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Arthur, E.A., 2016. Successful Enterprise Resource Planning System Implementation: A Higher
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