Customizable Standard Application Software - Essay Example

Literature Review and Project Specification (Study) - Lau Kin San 347467 MSc SBIT Details - for Cohort Started September 2006 (Word Count 2,616) Literature Review Rosemann and Wiese (1999) define ERP system as customisable, standard application software which includes integrated business solutions for the core processes and the main administrative functions. As may be deduced from the foregoing definition and as confirmed by Rizzi and Aamboni (1999) an ERP system is integrated software for enterprise business organisation, management, and supervision. It gathers inside single standard software all the functionality of stand-alone applications, making it compatible with different business processes (Rizzi and Zamboni, 1999). It envisions business cross-functionally, viewing the application as support for core business processes with the understanding that these processes distance multiple departments. ERP systems are complex and warrant careful planning and execution for successful implementation (Somers and Nelson, 2001). They are not purely software systems, and their implementation is not merely an IT project. An ERP system affects how a business conducts itself , and affects an organisation's business processes, people's jobs, and information flows (Bingi et al., 1999). Therefore, and due to the complex and integrated nature of an ERP package, the large investments involved (time and money), and the relatively high implementation failure rates, it is imperative for organisations to study the experiences of others, and learn from their practices and success factors. In essence, organisations have to learn how to identify the critical issues of ERP implementation to realise the benefits and to avoid implementation failure (Holland and Light, 1999). Implementing an ERP system is for many organisations the largest project they have ever undertaken, entailing the largest potential advantages and possibly the largest potential risks. Davenport (1998), Gibson et al. (1999) and Holland and Light (1999) all agree that most companies adopting an ERP system will be required to reengineer the company's core business processes to fit the requirements of the system. In a sense, ERP systems can prove extremely expensive. Rizzi and Zamboni (1999) and Davenport (1998) agree that the implementation of ERP, whether it is developed by an IT department in an organisation or bought as a ready-made package from the market, requires major capital investments. Overall, ERP is a relatively new phenomenon, and the empirical research related to it is not extensive (Somers and Nelson, 2001). Zarotsky (2006) suggests that the questions regarding to ERP system implementation are being raised faster than they can be answered. In general, most of the researches on ERP systems deal with the question of how to implement it successfully in an adopting organisation (Brehm and Markus, 2000; Brehm et al., 2001). Markus and Tanis ( 2001) point out that some studies have concentrated mainly on initial implementation activities, and have not paid enough attention to the overall ERP software life cycle, particularly ongoing use and upgrades. However, Zarotsky (2006) cites that some researches have started to investigate the use of diverse theoretical frameworks and perspectives to address various ERP issues. However, on the whole, most studies have paid little attention to differences between the ERP package life cycle and the traditional system development life cycle (SDLC) (Markus and Tanis, 2001). Textbooks on system analysis and design focus mainly on traditional custom software development, often neglecting maintenance, and many do not mention the ERP software package as a way to support business processes (Markus and Tanis, 2001). In this respect, the over riding factor to keep in mind is that the implementation of an ERP system is essentially different from a traditional systems development life cycle (Somers and Nelson, 2001). In fact, successful ERP project implementation is complex and difficult. Implementing an ERP system package causes vast change that needs to be managed carefully to get the full advantages of an ERP software (Ehie and Madsen, 2005). The literature review undertaken, however, revealed a lack of research with regard to some critical factors of ERP implementation (e.g. client consultation, schedule and plans) and that, in general, there has not been a holistic methodology or a best practice approach that covers all aspects of ERP system implementation (Ehie and Madsen, 2005). Proceeding from the facts outlined in the foregoing literature review, this study will rely on an extensive range of literature for the purposes of elucidating the main challenges confronting ERP implementation and the critical success factors of ERP implementation. The purpose of doing so is the provision of a model for ERP implementation in textile manufacturing SME's in Hong Kong. . Project Specification Intention - there are no customers involved and the results will be used to produce a research paper on ERP implementation. Project Title - A Model for Enterprise Resource Planning Software Implementation Project Topic Area Overview For obvious reasons, there is a great deal of current interest in ERP systems. The reasons motivating such interest are self-evident. On the one hand, the implementation of ERP systems invaluably contributes to the increased efficiency of an organisation's business process and raises both financial and non-financial performance indicators. However, the challenges confronting successful implementation have effectively discouraged countless organisations from adopting an ERP system and limited the capacity of SMEs to do so. This is because, typically, implementation is often an extremely costly trial and error undertaking. The system is implemented without its being customised to the peculiarities of the entity in question and without that entity adapting itself to the automation of a large array of its process. Therefore, problems arise. A generic model for implementation is needed. Situation Overview The research is set in Hong Kong and will focus on the efforts of six textile manufacturers to implement an ERP system. Presenting Problem Definition The problem for SMEs is the successful and cost-efficient implementation of an ERP system. Real-World Target If the problem of ERP implementation is solved, SMEs will be able to engage in the cost-efficient and successful implementation of the system, and subsequently benefit from its associate business gains, resulting in increased competitiveness and higher levels of customer satisfaction. Research Question How can SMEs undertake the successful and cost efficient implementation of an ERP system Personal Theory The topic is extremely problematic because there is no generic model for ERP implementation. Consequently, while large business enterprises are eventually, through costly trial and error, able to finally successful implement an ERP system, SMEs cannot. They do not have the resources to do so, with the consequence being that they are denied the business and managerial benefits of ERP systems. The development of a generic model for implementation is needed. It is quite possible, through identification and analysis of the critical success factors underlying ERP implementation, to develop such a model. From a personal perspective, this model should account for both the customisation of ERP systems for a firm's unique needs and characteristics and the adaptation of the firm's business processes to the ERP system in question. Intended Project Outcome The study will explore the theoretical foundations underlying the process of ERP project implementation, and present a better understanding of this process based on the identification of the critical success factors of implementation. The answer will be in the form of a generic ERP implementation model. Strategic IT Value The development of a generic model for ERP implementation will, indeed, be useful and, according to the literature reviewed, can effectively reduce implementation costs by over 50%, possibly 70% (Ehie and Madsen, 2005). Such a model will allow for the wider implementation of ERP systems, especially among SMEs who have largely denied its benefits to data, since it reduces the risk of software system implementation failure. Ethical Overview Although ERP systems are widely implemented in large-sized organisations and are in trial implementation stages in some SMEs, there are no ethical issues involved in testing implementation success and failure rates. This is because the objective of doing so is the design of a generic implementation model which would reassure potential users that success does not necessarily have to proceed along the lines of a costly trial and error basis. Nevertheless, interviewees need be informed that their organization's experience with ERP implementation success and failure is going to be exploited within the context of the study as lessons learnt, thereby informing the design of the implementation model. Aim The main aim of this study is to propose a generic model for effective implementation of ERP projects based on best practices perspective. This requires the identification and empirical assessment of critical factors of ERP project implementation and the investigation of how the ERP process and identified factors are being addressed and implemented in the project. Objectives 1. To develop a conceptual holistic view of ERP project implementation from the literature, to be explored in the field through a complementary empirical investigation using a combination of qualitative and quantitative methods. 2. To document key critical factors which facilitate the effective implementation of ERP systems. 3. To assess the level of importance of the elements that constitute the holistic approach to ERP project implementation and their effectiveness in ERP projects. 4. To propose a generic model for holistic ERP project implementation. Research Design - Research Method This study represents exploratory research that aims to enhance existing theories, and understanding of ERP system project implementation concepts from a holistic perspective. Therefore, measurements of 'what', 'how', and 'why' are needed to understand the process of ERP project implementation. The 'what' aspects of research require the use of quantitative methods, while the 'how' and 'why' require the use of qualitative methods. In this study, a methodological triangulation approach, which combines quantitative and qualitative methods, is adopted through a complementary use of secondary data, mail questionnaire survey, and case studies (Creswell, 2003). The use of secondary data as a part of this research aims to get a richer picture of the level of importance of the elements that constitute the holistic approach to ERP project implementation and factors that contributed to implementation success or failure. The purpose of using case studies as a part of this study is to investigate how ERP system software is being implemented in an organisation. It will consider each factor of ERP project implementation and analyse the similarities and differences between the experiences of ERP implementation in selected companies. After the collection of data, analysis will take place. Based on the comprehensive discussion and interpretation of the results, a generic model for ERP project implementation is proposed. Research Design - Phase 1: Primary Data Collection Process This part of the research design will concentrate on the construction of a reliable primary data collection methodology, which will later be processed for the generation of the expected answer. Basic Activity for Generating Data The basic idea is to identify the variables in successful versus unsuccessful implementation experiences and to compare them against each other. This method will generate a list of critical success factors and order them according to the importance awarded each. This is a valid method for generating data insofar as it allows for the analysis of what has been tested and found to be sound and take a series of measurements on each in order to highlight differences and, thereby, indicate an outlier. Primary Data The main tools for the analysis questionnaire data will be the Statistical Package for Social Scientists (SPSS) and Microsoft Excel 2003 for descriptive data analysis. The purpose of the questionnaire is the determination of the relationship between main factors of ERP implementation (independent variables) and successful ERP project (dependent variable) and to investigate the effects of the independent variables on the dependent variable. Linear regression will be used and, to determine the most effective independent factor, the stepwise method in linear regression shall be exploited. However, in the stepwise procedure, only the significant factors will be considered. Location - The sampling frame involved was a list of textile manufacturing SMEs in Hong Kong. The below formula will be used for calculating the required sample size: n = x2NP (1-P) [d2 (N-1) +x2P (1-P)] The business directory establishes that there are 128 textile manufacturing SMEs in Hong Kong, with calculation establishing the sample size at approximately 27. Collection Protocols - The collection will proceed through a survey format wherein respondents will be asked to select, from a list of critical success factors, the dependant and independent variables which they believe influenced the success or failure of their firm's bid to implement an ERP system. Survey questionnaires, pending arrangement with the HR directors in the selected firms, will be sent and collected through email. The primary data will be input into SPSS and stored electronically. Primary Data Collection Presentation The primary data will be included in the project document appendix and presented in tabular format. The five columns will represent the value of importance awarded each variable and the eleven rows will represent the 11 critical success factors distilled from the literature. Research Design - Phase 2: Processing and Presentation The primary data will be manipulated in order to generate the outliers, hence ensuring the measurement process. Data processing will involve three steps, wherein the raw primary data will first be manipulated, the processed data will be presented in graphical form and finally, manual inspection will extract the features from the graphs. Design of Pre-Processing for Primary Data Collection The files produced in the first phase will be used to read the metric data. Following that, the data will be statistically processed in order to generate the cross-similarities between the tested critical success factors. Principle component and multidimensional analysis will be used. The outcome will be a set of two values, one for the dependant critical success variables and the other for the independent ones. Design for Results Presentation The values derived from the first data processing phase will be plotted in two dimensions, and the results indicating the most significant critical success variables will be presented in two graphs, one illustrating the dependant and the other the independent variables. Design for Generating the Intended Project Outcome Once the data has been processed and the graphs have been generated, the identification of outliers will be a relatively simple task. The argument here is that common critical success factors will cluster together while those which are different will appear as outliers. The assumption, or the hope, here is that that there will be a similarity between the critical success factors for the firms surveyed, as well as commonalities between the reasons for failed implementation. Upon the identification of both the critical success factors and the factors affecting failed implementation, the design of a generic model for implementation will be a comparatively straightforward task as it will be based on identified critical success factors, including both the dependant and the independent variables. The design of this model, based on the generated data, will be the final step in the project. Logistics and Tools - Resources Required This research necessitates the utilization of software programs to compile and process the data and to present it in logical table format. Most of the resources required for the collection of secondary data can be obtained through the university library or the internet. Outline Content List for Project Project Title: A Model for Enterprise Resource Planning Software Implementation Chapter 1: Introduction Introduction and Situation Overview Data Quality Problem Definition and Target Speculation and Personal Theory Discussion and Research Question Project Scope, Aim and Objectives Project Constraints Chapter 4: Evaluation Outcome Evaluation Practice Evaluation Chapter 2: Literature Review Concept and Definition of ERP Different Types of ERP Systems Challenges Confronting ERP Implementation Overview of ERP Implementation Models Chapter 5: Conclusions Statement of Conclusions and Reflections Recommendations Chapter 3: Research Design Case Study Research Method Primary Data Collection Plan Data Specifications Data Locations and Expectations Collection Protocol Primary Data Processing Plan Outline Results Project Outcome References and Bibliography Appendices Project specification and project schedule Inclusions Questionnaires Summary interview transcripts References & bibliography Project Plan References Bingi, P. et al. (1999) Critical issues affecting ERP implementation.' Information Systems Management, 16(3), 7-14. Cotteleer, M.J. and Bendoly, E. (2005) Order lead-time improvement following enterprise information technology implementation: An empirical study.' MIS Quarterly, 30(3), 643-660. Davenport, T. (1998). Putting the enterprise into the enterprise system.' Harvard Business Review, 76(4) 121-131. Creswell, J.W. (2003) Research Design: Qualitative, Quantitative and Mixed Method Approaches. California: Sage Publications. Ehie, I. C. and Madsen, M. (2005) Identifying critical issues in enterprise resource planning (ERP) implementation.' Computers in Industry, 56(6), 545-557.Holland, C.P. and Light, B. (1999) A critical success model for ERP implementation.' IEEE Software, pp. 30-35 Markus, M. Lynne, and Cornelis Tanis. 2000. The Enterprise Systems Experience-From Adoption to Success. In R.W. Zmud (Ed.) Framing the Domains of IT Research: Glimpsing the Future Through the Past. Cincinnati: Pinnaflex Educational Resources, Inc.: 173-207. Rosemann, M. and Weise, J. (1999) Measuring the performance of ERP software - A balanced scorecard approach,' Proceedings of the 10th Australasian Conference on Information Systems. http://www.vuw.ac.nz/acis99/Papers/PaperRosemannWiese-089.pdf Rizzi, A. and Zamboni, R. (1999) Efficiency improvement in manual warehouses through ERP systems implementation and redesign of the logistics processes.' Logistics Information Management, 12(5), 367-377. Somers, T. and Nelson, K. (2001). The impact of critical success factors across the stages of Enterprise Resource Planning implementations.' Proceedings of the 34th Hawaii International Conference on Systems Sciences. Zarotsky, M. et al. (2006) The first ERP upgrade project at DSW: Lessons learned from disillusion with simplicity expectations.' Journal of Cases on Information Technology, 8(14), 13-24. Appendix A - Submission Check List for Assessment 1A Part 3 The organization of my completed project as below: Word Count 2,616 The maximum permitted word count is 3,000 excluding project plan and reference list. 1. v I have written down the word count and it does not exceed the permitted value 2. v I have used the correct margins of 2cm top, bottom, right and left 3. v The work presented is in A4, MS .doc format using portrait orientation (project plan may be in landscape) 4. v I have used Arial narrow font at 12pt size except in the project plan, reading list and page footer where I have used 10pt. 5. v I have used a line spacing of 6 lines/inch 6. v Pages have centred footers in the form - Page 1 of 5 - Submission Date: 2004/05 7. v I have not used page headers 8. v All main text is right and left justified 9. v Headings are NOT followed by a blank line 10. v Headings are in the same font as the main text but are shown in bold 11. v I have used a blank line to separate paragraphs 12. v I have not numbered any paragraphs or sections 13. v I understand that indented sentences can be used where appropriate but bullets are not to be used 14. v The first page uses the assessment heading lines shown on the specification sample in workbook 3 section 3.5.2 15. v I have used the correct format for a specification as found in the sample contained in workbook 3 section 3.5.2 16. v The submission file is named with only my HEMIS No. (if anything else is added your file will be automatically deleted) 17. v I have sent my personal profile to the Research Methods tutor 18. v I have looked up and studied ALL the Workbook references mentioned in this assessment 19. v I have included all citation sources used in my work in my list of references 20. v My short Literature Review is not be made up of just quotes and paraphrase but is an evaluative dialogue 21. v I have cited other people's work properly using the Harvard APA format 22. v I have included a references list of at least 10 literature sources 23. v My reference list contains no more than thee books covering Research Methods and Statistics 24. v I have only used the citation form (Creswell 2003) for passing references to texts 25. v I have included at least 3 sources covering the core topic area of this research 26. v In the reference list no more that 20% are internet sources 27. v The specification includes a plan to get original data (primary data) and I do not have that data already 28. v I have ensured that the primary data collected can be used to generate a Strategic Business IT outcome of some kind. 29. v My data processing design will generate the stated outcome form and the plan is clear enough to be executed by anyone 30. v The project has a significant learning potential in the IT/computing field 31. v I understand for this degree only the project style known as "Study" is allowed. 32. v I have attached a scanned letter of support from the organization where I intend to collect data (see appendix E) 33. v Plagiarism Declaration - I confirm that the enclosed written work is entirely myown except where explicitly stated otherwise. I further declarethat whereverI used copying, paraphrasing, summarisations or other appropriate mechanismrelated to the use of anotherauthor's work it has been properly acknowledged in accordance with normal scholarly conventions. I further understand that wherever 6 or more consecutive words are extracted from a source they must be acknowledged and 10 consecutive words that are unacknowledged will be regarded as proof of plagiarism. Appendix B - Letter of Support Read More