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ORIGINAL ARTICLE

ERP: a literature survey

Eslam Nazemi & Mohammad Jafar Tarokh &

G. Reza Djavanshir

Received: 17 January 2011 /Accepted: 7 November 2011 /Published online: 25 February 2012# Springer-Verlag London Limited 2012

Abstract Most of organizations have a “functional struc-ture,” which is composed of various functional units. Insome cases, each functional unit works towards their owngoals and objectives, rather than the organizational goals.This is further aggravated because information flow isrestricted by functions, and even when other functionalunits want to take a systemic view, they do not have theneeded information to do so. These are the issues addressedby “Enterprise Resource Planning” (ERP) software solu-tions providing a common and consistent system to captureinformation organization-wide, with minimum redundancy.Today, many organizations acquire and implement ERP toimprove their operational performance and create strategicvalue; however, they fail to achieve these objective due tolack of knowledge and better understanding of ERP and itslifecycle. Although, so far, hundreds of research article arepublished separately focusing on ERP and various issuesrelated to its lifecycle and management, there is no surveyand overview of the article published in different top-tierjournals. We believe that a survey of the articles related toERP provides better understanding of ERP and attempts tocreate an information bank of the published articles these in

turn, contribute to improving the performance of anenterprise in terms of achieving its strategic value creationgoals. In this study, we attempt to summarize our surveyand review of the articles related to ERP.

Keywords Enterprise resource planning . ERP performancemeasurement . ERP success factors . Strategic value

1 Introduction

Enterprise resource planning (ERP) systems are softwarepackages composed of several modules, such as humanresources, sales, finance and production, providing cross-organization integration of information through embeddedbusiness processes. These software packages can becustomized to cater for the specific needs of an organiza-tion. During the 1990s, ERP systems became the de factostandard for replacement of legacy systems in large andparticularly multinational companies [144, 145, 221].

Regarding the significant impact of ERP systems in acompany, Chen et al. [38] state that, “the success of acompany increasingly depends on timely information(internal and external) being available to the right personat the right time for crucial managerial decision-making,”ERP system integrates all business process and functionsenabling organizations to improve efficiency [70, 104, 157,159, 194]. Davenport [45] states that, “the business world’sembrace of enterprise systems may in fact be the mostimportant development in the corporate use of informationtechnology in the 1990s.” However, ERP’s contributions toorganizations strategic value creation efforts depend on manycritical factors including its right implementation and theeffective management of its operational performance duringits lifecycle [48].

E. NazemiComputer Engineering Faculty, Shahid Beheshti University,Tehran, Irane-mail: [email protected]

M. J. Tarokh (*)Industrial Engineering Department,K. N. Toosi University of Technology,Tehran, Irane-mail: [email protected]

G. R. DjavanshirCarey Business School, Johns Hopkins University,Baltimore, MD, USAe-mail: [email protected]

Int J Adv Manuf Technol (2012) 61:999–1018DOI 10.1007/s00170-011-3756-x

In the literature, there is a considerable volume ofresearch focused on the specific issues of ERP; however,there are no consensus on the definition and the issuesrelated to ERP. According to Jacobs and Bendoly [97],“Enterprise resource planning (ERP) has come to meanmany things over last several decades. Divergent applica-tions by practitioners and academics, as well as byresearchers in alternative fields of studies, has allowed forconsiderable proliferation on the topic and for a consider-able confusion regarding the meaning of the term.”Additionally, successful implementation and effective man-agement of ERP’s operational performance during its lifecycle is still a major problem in today’s organizations [138].Therefore, researchers argue the need for more ERPresearch [63, 64, 77, 97]. We provide herein, a survey ofthe literature on ERP and its implementation, operationalperformance, and other issues related to its lifecycle.

This study provides a survey of literature on ERPpublished in the major information systems, relatedjournals, and conference proceedings during the period1997–2010. It categorizes them through an ERP life cycle-based framework that is structured in phases. Originally,this bibliography started as an extension of the onedeveloped by Gable and Rosemann [66], which focusedon ERP and measurements of ERP. We extended theirbibliography with a significant number of new publicationsin all the categories used in this paper.

2 Definition of ERP

The term Enterprise Resource Planning is originally coinedin 1990 by The Gartner Group to describe the nextgeneration of MRP II software. Historically, ERP evolvedfrom material requirement planning (MRP) and manufac-turing resource planning MRP II systems of the 1970s andthe 1980s, respectively [2]. MRP and MRP II systems weredesigned to systemically link different aspects of processinformation within specific business context such asmanufacturing [97]. Within the literature, different authorshave defined ERP in a different way, for example,according to Jacobs and Bendoly [97], ERP can be definedas a concept and as a system. Its conceptual definitioninvolves the integration of business processes within anorganization, with improved order management and con-trol, accurate information on inventory, improved work-flow, and supply chain management, and betterstandardization of business and best practices. And ERPas a system is about technological infrastructure designed toprovide the required functional capability required to turnthe ERP concept into a reality. ERP systems should not be amere technological artifact; it is a core platform designed tosupport and lever the capabilities of the tools and processes

used by an organization [97]. ERP system is the techno-logical manifestation of the ERP concept, its benefits,capabilities, goals, and strategic value.

Akkermans et al. [2] also state that ERP can be definedfrom different perspectives such as functional, technical, orfrom business perspective that provides strategic valueencompassing the entire organizations. Tarantilis et al. [209]define ERP as a system that integrates traditional accounting,manufacturing, sales, management, and other managementproducts to offer an “all-in-one” solution that deals with allbusiness management aspects of organizations.

3 Contribution of ERP to strategic value creation

Firms are spending large sums of money on informationsystems, but the benefits of spending on informationsystems are expected to have strategic values [77]. Intoday’s dynamic economy, continuously generating newknowledge, combined with operational efficiency andeffective delivery mechanisms increase the strategic valueof a firm [17, 73, 153, 168, 170, 202]. As shown in Fig. 1, afirm must first have the three fundamental value generators(drivers) in place that are critical to a firm to createsustainable strategic value. The combination of newknowledge creation with at least one of the two other valuegenerators is fundamental to a firm’s sustainable competi-tiveness. These matches the two-stage value creation modelthat is suggested and described by Gobeli et al. [73] tocreate sustainable firm value. Figure 1 also shows that ERPsystem, if planned, deployed, and implemented properly,acts as a value enhancer that empowers all these three valuegenerators (process and operational efficiencies, informa-tion delivery, and new knowledge creation activities) that inturn contribute to the strategic value creation in a firm [57, 61].

The proper planning and implementation of ERP isnecessary to enhance the strategic values of an organization[13, 15, 18, 73]; otherwise, it may create unintendedconsequences. The proper planning, implementation, anddeployment of ERP systems are among the critical factorsthat many scholar point out about the success of ERP [68,97, 193, 217].

Jacobs and Bendoly [97] points out that ERP should notsimply be viewed as a technological artifact that assistsorganizations in fulfilling their tasks or as a productivitytool with a fixed output, rather it should be considered as acritical technological infrastructure that enhances thecapabilities of all other tools and processes.

Similar to planning of any information systems, inplanning to acquire ERP systems, a firm should addressmany questions, including the following basic questions:Why does it need an ERP system? How do the ERPsystems contribute to organizational efficiency? How long

1000 Int J Adv Manuf Technol (2012) 61:999–1018

Strategic Valueof Organization:

Value Generators (Drivers):

Value Enhancer (s): Infrastructure Technology: ERP System

New Knowledge generation

Improved capabilities

Extending Services

Effective Transaction Processing

& Information Delivery

New Products, Services, and Process Innovations, Differentiations,

Cost Advantages,

Sustainable Competitive Advantage- Unique outcomes that clients

Efficient Processes &

Organizational Operations

Fig. 1 The contributions ofERP system to strategic valuecreation

Int J Adv Manuf Technol (2012) 61:999–1018 1001

will its implementation take and when is the break-eventpoint? How much does it really cost and what are its hiddencosts? How do a firm’s emerging business activities, suchas e-commerce, benefit from the ERP system? And otherquestions that a firm deem them to be critical to theirbusiness.

We will try to provide some basic answers to some ofthese questions in the following paragraphs.

Why does a firm need an ERP system? There are fivemajor reasons why companies undertake ERP project:

1. Standardize and speed up processes2. Standardize HR information3. Integrate financial information4. Integrate customer order information5. Reduce inventory

It is obvious that an ERP system contribution should bealigned with their ways of conducting business, before itsacquisition, implementation, and deployment begin. Themost common reason that companies abandon multimillion-dollar ERP projects is that they discover that the systemdoes not support one of their important business processes,or they see no linkages between the benefits of an ERPsystem and their ways of doing business [21, 23]. At thatpoint, they may make two decisions: They can customizethe system to fit the process and accommodate it; this mayintroduce excruciating bugs into the system. Because thecustomizations may need to torn apart and rewrite thesystem to fit it with the business process, they can changethe business process to accommodate the system, which maymean deep changes in long-established ways of doingbusiness and reorganize important people’s roles and respon-sibilities [26]. However, according to Jacobs and Bendoly[97], any redesign and changes of a business process that the

system planned to support should not be carried out with theintent of supporting the planned system. Rather, any processredesign should involve the implementation of best practicesthat are supported by the planned system so that they providesystemic improvement for the firm’s performance as a while[28, 29].

How does an ERP system contribute to organizationalefficiency? ERP systems’ contribute to operational anddelivery efficiency in many ways including its critical rolein improving the way a firm takes customer orders andprocesses them into invoices; this process is also known asthe order fulfilment.

How does ERP fit with e-commerce? ERP offers atremendous value to e-commerce firms’ performance[224]. However, vendors were not prepared for theonslaught of e-commerce. ERP is a complex system andnot intended for public consumption. It assumes that theonly people handling order information will be trainedemployees and are comfortable with the technical com-plexities of the system. However, customers and suppliersare demanding access to the same information such as orderstatus, inventory levels and invoice reconciliation—exceptif they want to get all this information simply, without allthe ERP software jargon, through the firm’s website.

How long will an ERP project take? To do an ERP projectright, its deployment, implementation and use should fit theway that the organization conduct its business. Accordingto Akkermans et al. [2] and Prahalad and Krishnan [155],depending on the size of a firm implementation of an ERPproject, ERP takes anywhere between 12 and 30 months.However, ERP provides a critical technological infrastructure

to firms; therefore, a more important issue is not how long itwill take; rather, firms need to understand why it needs ERP,what are its costs, particularly hidden costs and its benefits,and how it will be used to create strategic values.

What does ERP really cost and when is the break-evenpoint? Meta Group did a study looking at the total cost ofownership (TCO) of ERP, including hardware, software,professional services, training, and internal staff costs. TheTCO numbers include getting the software installed and thetwo years afterward, which is when the real costs ofmaintaining, upgrading and optimizing the system for thefirm’s business are felt. Among the 63 companies surveyed—including small, medium and large companies in a range ofindustries—the average TCO was $15 million (the highestwas $300million and lowest was $400,000).While it’s hard todraw a solid number from that kind of range of companies andERP efforts, Meta came up with one statistic that proves thatERP is expensive no matter what kind of firm is using it. TheTCO for a "heads-down" user over that period was astaggering $53,320.

A Meta Group study of 63 companies found that it tookeight months after the new system was in (31 months total)to see any benefits. However, the median annual savingsfrom the new ERP system were $1.6 million.

What are the hidden costs of ERP? Although differentfirms will find different issues in the budgeting process,those that have implemented ERP packages agree thatcertain costs are more commonly overlooked or under-estimated than others. Armed with insights from across thebusiness, ERP pros vote the following areas as most likelyto result in budget overrun.

& Training& Integration and testing& Customization& Change Management& Transaction Cost Economics& Data conversion& Data analysis& Consultants ad infinitum& Replacing your best and brightest& Implementation teams can never stop& Waiting for ROI& Post-ERP depression

4 Research methodology and survey approach

The research methodology used in this study is the reviewof literature on ERP. The focus of the literature review was

on articles published in major scholarly journals andconferences’ proceedings over that past 11 years (1997–2010). The journals surveyed were:

ACM Association for Computing MachineryCAIS Communications of the Association for

Information systemsDSS Decision Support Systems JournalEJIS European Journal of Information SystemsEJOR European Journal of Operational ResearchHBR Harvard Business ReviewIJIM International Journal of Information ManagementISJ Information Systems JournalISR Information Systems ResearchJGIM Journal of Global Information ManagementJIT Journal of Information TechnologyMISQ Management Information Systems Quarterly

The academic conferences and events surveyed were:

ACIS Australasian Conference on Information SystemsAMCIS Americas Conference on Information SystemsECIS European Conference on Information SystemsEMRPS Enterprise Management and Resource Planning:

Methods, Tools and ArchitecturesHICSS Hawaii International Conference on Systems

ScienceICIS International Conference on Information

SystemsIRIS Information Systems Research Seminar In

ScandinaviaPACIS Pacific Asia Conference on Information SystemsIIEC Iran Industrial Engineering Conference

The search was made using keywords such as enterpriseresource planning, enterprise resource planning performancemeasurement, enterprise wide systems, enterprise systems orsoftware packages and the main ERP vendors such as SAP,Oracle, Baan, Peoplesoft, and JD Edwards. Publicationsduring theperiod 1997–December 2010were analyzed. Table 1lists the number of publications identified from IS journalsand conference proceedings. We also included relevantarticles from other scientific publications we found duringthe collection process. During 1997 and December 2010,nearly all the information systems conferences mentioned inTable 1 dedicated panels to the subject, AMCIS [140], ECIS[141], ACIS [139] as well as the ICIS [137].

5 ERP bbiliography analysis

After we collected all the publications, they were analyzedand categorized using a simplified version of the ERPlifecycle framework proposed by Esteves and Pastor [51].One of the ways to analyze qualitative data is to use a


classification system that includes a quest for regularity andstandards, as well as topics encompassed by the data. Theclassifications must then be summarized by words orphrases [27]. We used this process to analyze andcategorize the publications found.

The ERP lifecycle (Section, Esteves and Pastor [51])represents the various phases through which an ERP systemproject passes in an organization. The ERP lifecycle isstructured in dimensions and phases, generic enough topermit the classification of publications and comprehensiveenough to give a general vision of the whole ERP lifecycle.

5.1 General directions

Main topics researched ERP systems overview, theirexpectations and motivations are well-covered subjects inthe publications found. Recently, some researchers focusedon knowledge management concerns and applied knowl-edge theories in the ERP context. Few issues are addressedin terms of performance measurements and businessmodeling and how modeling can be improved [48, 52, 70,78]. Our review of the literature shows that development ofERP products centered mainly in technological issues.

We also categorized the publications on ERP issues notrelated to ERP lifecycle phases into six main topics (Fig. 2):

& research issues,& organizational knowledge,& business modeling,& ERP product development issues and& ERP and business intelligence& ERP performance modeling

We discuss each of these topics in the next section.

& Research IssuesThis topic is concerned with ERP research issues and

trends. It covers such aspects as research agendas; ERPoverview, motivations and expectations; proposals onhow to analyze the strategic value of ERP systems; andhow to deal with ERP research projects (Fig. 3).

& Liang et al. [109] suggest that research and studies couldbe carried out based on comprehensive data collectedglobally from a large sample of vendors in “difficult”parts of the globe to study the assimilation of ERPsystems, the article effects of institutional pressures, androle of top management during the assimilation process.

Table 1 ERP publications at selected international IS Conferences 1997-2011

Is/It source 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Total

ACIS 2 2 1 1 2 1 1 10

ACM 1 6 1 2 1 11

AMCIS 1 2 30 28 1 2 3 4 3 1 75

ECIS 3 1 5 2 11

EJOR 1 3 1 1 1 1 2 1 11

EMPRS 4 23 3 4 3 6 3 1 47

HICSS 3 3 1 1 8

HBR 2 2 1 1 1 1 8

ICIC 1 4 7 7 1 1 21

IS/IT Journals 1 1 1 1 3 1 1 9

ISR 2 3 1 5 2 2 15

Journal of IT 1 2 6 1 4 1 3 18

MIS Q 1 1 1 1 1 2 7

PACIS 1 3 1 1 6

OTHER SOURCES 4 10 10 15 1 1 3 1 1 1 2 10 5 5 69

TOTAL 13 24 80 81 2 1 13 8 2 4 8 10 42 22 16 326

Fig. 2 Number of publications by category


They are commends that future research can beconducted to study the way institutional pressuresinteract with top managements’ learning related con-structs to affect ERP assimilation processes.

& Jacob and Bendoly [97] argue that ERP means differentthings to different researchers, and practitioners in termsof its applications. They also discuss the currentresearch steams on ERP, its operations managementand provide some suggestions on for related futureresearch. Finally, in their paper, they discuss thefundamental corporate capabilities required for success-ful implementation of ERP systems.

& Allen [4] provides his observations on current researchand studies carried out on ERP and informationeconomics, ERP development and he provides “research-able” directions for ERP systems development and itsimpacts on organizations.

& The research issues and overviews of ERP systems areanalyzed and research agendas proposed in Esteves andPastor [51] and Mini-Panel [127].

& David et al. [46] argue that research in the ERP areamust not proceed haphazardly; rather we must developa systematic means for identifying the patterns under-lying these systems and for comparing the symbolicabstractions to find differences in functions, processes,information architecture, and organization.

& Holsapple and Sena [93] identified the integration ofERP and decision support systems for further researchand development.

& Sor [195] suggests that a better understanding of issuessurrounding ERP systems could be achieved by movingthe discourse towards management theory and dealingwith ERP systems as special cases of theoreticalpremises that were developed in the 1960’s.

& Oliver and Romm [135] discuss the behavioralsubjects related to ERP systems deployment, opera-tions, and its use. Specifically, they discuss in issuessuch as the motivations and expectations about ERPsystems.

& Chang et al. [35] summarize a set of research issuesabout public sector ERP implementations and devel-oped by using the Delphi method.

& Ross and Vitale [162] present the preliminary findingsfrom a research project that examined how firms aregenerating business value from their investments inERP systems.

& Kumar and Hillergersberg [106] present a generaloverview of ERP systems, some ERP experiences, andissues and their evolution. The article is very helpful inproviding not only a general overview of the ERPsystems, but also how the firms’ application areas,expectations, experience change during ERP systemsfunctional operations in the firms.

& Everdingen et al. [53] analyze ERP adoption byEuropean midsize companies.

& Markus and Tanis [119] provide a theoretical frameworkfor analyzing, both retrospectively and prospectively, thebusiness value of enterprise systems.

& Esteves and Pastor [52], Muscatello et al. [129],Holland et al. [88], Holland and Light [90], Panel[141], Parr et al. [143], Scheer and Habermann [177],Shanks et al. [183], Sumner [206, 207, 208] and Vikramet al. [216] provide some case studies and offers thatmost of the information about the failures and successesand risks are based on reports on implementations inlarge manufacturing and service organizations. However,enterprise resource planning vendors are now steadilyturning their marketing sights on small and medium-sized manufacturers. The research focuses on implemen-tation activities that foster successful installations andare developed. Articles related to this topic include:

& Organizational KnowledgeOrganizational knowledge focuses on issues of

people skills, know-how, organizational processes, andculture; that is, issues that change an organization sothat it can face a new ERP context. It covers aspects oflearning and managing competencies from a peopleperspective and the identification and management ofknowledgeable artifacts from an information manage-ment perspective. Articles related to this topic include:

& Liang et al. [109] studied a model that facilitates thediffusion and assimilation process of ERP withinorganizations. Their model explains the role of topmanagements in mediating the impacts of externalinstitutional pressures on the effective use of ERPwithin organizations [214].

& Gattiker and Goodhue [68] present a model thatdemonstrates a better fit between ERP systems and itsorganizational context. They suggest that, according toorganizational information process theory the perfor-mance is, “influenced by the level of fit between

Fig. 3 No of articles not related to lifecycle issues


information processing mechanisms and organizationalcontext. Two important elements of this context areinterdependence and integration among subunits oforganizations. Because ERP systems include data andprocess integration, the theory suggests that ERP willbe relatively better fit when interdependence is high anddifferentiation is low”.

& Sirkka et al. [188] in a seminal article examine the criticalrole of trust in information technology-enabled relation-ships. ERP is a member of information technology;therefore, their paper also provides an insight on migratingthe cultural resistance to organizational learning, trust, andassimilation process of ERP within organization.

& Ronca [160] considers the need of investing inorganizational knowledge and change management foran enterprise to be successful in adopting ERP.

& Taxen [212] proposes a strategy for organizationalknowledge evolution and describes how it can beapplied in the ERP system context.

& Eliciting information about organizational culture vialaddering in ERP environments is discussed by Rugg etal. [171]. This is article provides useful insights inminimizing the cultural inertias that may prevent thebetter alignment of ERP within organizations.

& Gable et al. [65] develop a research project about themeans to understand the extent of the ERP knowledgeamong the key players- (vendors, implementers, part-ners, and clients) and to understand better what thesethree key players can do with ERP knowledge.

& Al-Mashari [5] explores the ERP phenomenon from abusiness process and change management perspectives.The article provides the relationship between ERPsystems and business process redesign. Finally, theauthor provides useful recommendations along withseveral ideas for future research.

& Rosemann and Chan [166, 167] propose a frameworkwhich structures the knowledge required to manageenterprise systems. They suggest how knowledge canbe modeled in the enterprise systems context to identifywhat is relevant during different stages of an enterprisesystems project.

& Hedman [82] presents a competing value approachenterprise systems (CES) framework to discuss enterprisesystems from an organizational effectiveness perspective.

& Finally, Klaus and Gable [100] and Scott and Gable[179], attempt to relate the deployment and use of ERPsystems to knowledge management. The article alsoexplores the knowledge of knowledge management heldby senior managers who are ‘immersed’ in ERP systems.

& Business ModelingThe objective of the business modeling process is to

help an organization to define an effective business

vision and strategies that will reduce the effort involvedin adopting the ERP business model. It helps organ-izations to understand, manage, and communicate theirbusiness processes. It covers aspects such as usage ofmodeling tools applied in ERP contexts, new businessmodeling approaches, and comparisons between pro-cesses [63, 64, 77, 97, 112, 114, 196]. Articles related tothis topic include:

& McAfee and Brynjolfsson [122] discuss the roles ofmodern technologies such as ERP on creating strategicvalues for their firms and competitive advantage in themarket. They provide an insight into creating effectivebusiness models by making ERP and other technologiesas an integral part of their organizational model.

& Konstantas et al. [103] propose the active businessobjects (ABOs) as a new paradigm to build informationsystems for businesses.

& The ABO project aims at the design and development ofan agent platform where mobile agents represent businessprocesses. The agents encapsulate the policies, businesspractices and models of different business activities.

& Stirna [205] analyzes the acquisition of EnterpriseModeling tools. He also outlines a number of situationalfactors to be considered by organizations when choosingamong enterprise modeling tool acquisition strategies.

& Formica and Pizzicannella [58] discuss a new approachfor high-level enterprise modeling referred to as reification.The approach is based on the reification of the businessprocesses of an enterprise, that is, their representation asstatic entities by using the object-oriented paradigm.

& Wagner [219] shows that enterprise and businessprocess modeling could greatly benefit from agent-oriented approach, called Agent-Object-Relationship(AOR) modeling.

& ERP Product Development IssuesThis topic is related with the first-hand development

andmanufacturing of ERP products. It covers aspects suchas: new modules, interfaces, componentization, increasedflexibility, and introduction of new emerging technologiesand platforms [62, 67, 71, 75, 81, 92, 117]. Articlesrelated to this topic include:

& Chen et al. [38] provide heuristics for selecting robustdatabase structures with dynamic query patterns. Theysuggest the usefulness of creating database of the corecomponent of ERP that integrates and supports allbusiness processes.

& Hagel and Brown [79] and Caglio and Newman [33]discuss the potential problems in ERP architecture thatmay lock companies into rigid and inflexible businessprocesses. Therefore, they recommend a new approachbased on the Web service architecture.


& Sutcliffe [211] proposes a framework for engineeringreusable components that serves two purposes. First, itcan help designers think by making design trade-offexplicit. Second, it proposes a cost driven evaluation ofreusable components that can inform decision makingduring reuse oriented development.

& Frank [59] uses research within extended transactionmodels, replication methods, and countermeasuresagainst the missing isolation property in order toillustrate how to design distributed ERP systems withhigh performance and availability.

& [34, 101] propose architecture for e-Business thatextends ERP-centric architectures to address the newchallenges of business networking.

& Platner [149] and Avital and Vandenbosch [13] describesthe SAP R/3 software development process and thepossibilities R/3 offers for "configuration to order".

& Sprott [197] describes how the componentization ofERP packages is likely to evolve.

& Fan et al. [55] discuss the design methodologies forcomponent-based enterprise systems architecturesdevelopment.

& Huang [94] analyzes the influence of customer require-ments in the ERP software development process.

& Loos [116] focuses on future development of ERPsystems, emphasizing technical aspects of informationtechnology application as enabler.

& Sato [176] introduces quick iterative process prototyp-ing methodology for the analysis and design of businessprocess dynamic properties.

& Chellappa and Saraf [37] adopt a framework callednetwork theory to represent the complexity of the ERPmarket. With this framework, authors relate alliancesformation by business application software firms andcompatibility issues.

& Kobryn [102] analyzes the requirements of enterprisesoftware architectures and examines the UML con-structs and techniques to specify them.

& A historical perspective has been taken by Chung andSynder [39] and Kelly et al. [99] who, from differentcontexts, emphasize the maturing of IS towards anunambiguous business focus, as attributed to ERPsystems.

& Other traditional approaches in systems developmentproved to be less beneficial in the long-term than ERPsystems [32, 87].

& ERP and Business Intelligence

& David C. Chou and Hima Bindu Tripuramallu [47],introduce BI and ERP integration. They believe BI toolscan be used to generate various aspects of businessviews through manipulating existing data captured bycompany’s information systems. BI can be used for any

organization to structure its ERP information and otherdata repositories, for fast and effective decision-making.

& Turban E., and et al. [210], describe the road map of accessto Business Intelligence with Managerial Approach.

& ERP performance modelingThis topic is concerned with ERP performance

measurements and some modeling approaches formeasuring the performance of ERP and Total Systems[78, 105]. It covers such aspects as customer satisfac-tion, performance measurement and models of produc-tivity and introduction of new approach to develop amodel for performance measuring from single view.

& Gunasekaran et al. [77] have identified a set ofperformance metrics that are helpful to ERP projects.They suggest that particular considerations should begiven to how an organization at strategic, tactical, andoperational performance levels can benefit from acritical information system such as ERP.

& Cotteleer and Bendoly [42] present an empirical studythat investigates the influence of enterprise systems’implementation on operational performance. Theirstudy suggests that performance along a key metricmotivating the ERP project improve significantly aftersystem’s deployment.

& Michael Rosemann and Jens Wiese [164, 169] suggestthat the Balanced Scorecard (BSC), a frameworkoriginally developed in order to structure the perfor-mance measurement of an enterprise can be used for theevaluation of these tasks. Adapting the approach of theBalanced Scorecard and adding a new fifth projectperspective increases the completeness and the qualityof ERP implementation reports. At least it raises theawareness for relevant factors. Controlling the ERPusage can be based on a "classical" BSC (top down)and utilize the aggregation of ERP monitoring data(bottom up). It should be stressed that this approach isnot a typical Balanced Scorecard application. Moreoften, the Balanced Scorecard evaluates the perfor-mance of an enterprise or a department.

& Jen-Her Wu Yuh-Min Wang Mien-Chih Chang-ChienWei-Chun Tai [222, 223] focus on User satisfaction isone evaluation mechanism for determining systemsuccess. In his study, they concentrate on satisfactionresults; examine factors related to satisfaction, andcompare satisfaction differences between firms imple-menting foreign and domestic ERP systems. MeasuringERP impact directly from costs and benefits, produc-tivity improvements, competitive advantage and impacton decision-making would be ideal. In view of thedifficulty such measurement entails, user satisfactionhas received widespread acceptance as a surrogatemeasure, and was used in their study.


& To focus on enterprise sizes and industry sectors tocompare their difference on enterprise resource plan-ning (ERP) implementation development, packageselection, and user satisfaction in Taiwan [Jen-Her WuYuh-Min Wang and Hsi-Tze Wan [222, 223]]. Theyshow a survey, using the measurement instrument, oftwo representative samples of “large size enterprise vs.medium size enterprise” and “electronics & scienceindustry vs. traditional industry” is conducted toinvestigate different ERP implementation patterns andoutcomes. A comparative analysis of ERP implementa-tion rate, package selection, and user satisfaction basedon business-related factors is performed.

& As performance is a multidimensional construct (Eccles1991, Grant/Higgins 1996, Kitchenham 1996), a per-formance measurement system (PMS) has to manageboth financial and non-financial performance indicators(PIs). Depending on the performance measurementsystems (PMS) framework being applied (e.g. Bititci/Carrie (1998), Kaplan/Norton (1996), Kueng (2000),McNair et al. (1990), Neely/Adams (2000)), differentdimensions and PIs are relevant. Therefore, it isnecessary that PIs can be defined freely dependingupon the context in which an ERP system is planned tobe deployed and used.

& Most ERP systems are ill equipped to deal with thedemand of slow moving items such as spare parts.Based on data from a Fortune 500 company, presentsthe development and evaluation of a spare partsinventory control model. Compares the proposed modelwith the results achieved using the forecasting andinventory management modules of a popular ERPsystem [156].

5.2 ERP systems along their lifecycle

The ERP lifecycle In this section we use the ERP lifecycleframework proposed by Esteves and Pastor [52]. Thisframework is structured in phases, which consist of theseveral stages that an ERP system goes through during itswhole life within the hosting organization. The stages are:

& adoption decision,& acquisition,& implementation,& use and maintenance,& evolution,& retirement phase.

In the following, we describe briefly each phases.

Adoption decision phase In this phase, decision makers in afirm must question the need for a new ERP system while

selecting the information system’s justification approach[77] approach that will best address their critical businesschallenges and improve the organizational strategy. Thisdecision phase includes the definition of system require-ments, its relevance, goals, costs, and benefits, and ananalysis of the impact of adoption at a business andorganizational level.

Acquisition phase This phase involves selecting the prod-uct that best fits the requirements of the organization tominimize the need for customization. A consulting compa-ny is also selected to help in the phases of the ERP lifecyclethat follow, especially in the implementation phase. Factorssuch as functionality, price, training and maintenanceservices are analyzed, the contract is structured, and thecontractual agreement is defined. In this phase it is alsoimportant to analyze the return on investment of the productselected.

Implementation phase This phase deals with the custom-ization or parameterization and adaptation of the ERP packageacquired, to meet the needs of the organization. Usually thistask is performed with the help of consultants who provideimplementation methodologies, know-how, and training.Although training is present in all the phases, the largesttraining investment is made during the implementation phase.

Use and maintenance phase This phase consists of the use ofthe product in a way that returns expected benefits andminimizes disruption. During this phase, functionality, usabil-ity, and adequacy to the organizational and business processesare important. Once a system is implemented, it must bemaintained, because malfunctions have to be corrected,special optimization requests must be met, and generalsystems improvements have to be implemented.

Evolution phase In this phase, the system is upgraded bynew technology insertion and additional capabilities areintegrated into the ERP system to obtain improved benefits.The extensions can be classified in two types:

1. Evolution "upwards". Functionality is oriented todecision making with applications such as advancedplanning and scheduling, data warehouses, and busi-ness intelligence systems;

2. Evolution "outward" to the system’s environment, withapplications such as customer relationship manage-ment, supply-chain management, inter-organizationalworkflow, and electronic commerce.

Retirement phase When new technologies appear or theERP system or approach becomes inadequate to the


business’ needs, managers decide if they will substituteanother information system approach that is moreadequate to the organizational needs of the moment.Some organizations already passed through this phasefor reasons such as strategic changes, lack of trust inthe ERP vendor or the implementation partner, or badimplementation experiences.

5.3 The ERP lifecycle issues

5.3.1 ERP adoption

Main topics researched The research in this phase focusedon how some types of organizations adopted ERP systemsand the associated requirements, risks, costs and benefits.One study is centered in the modeling of organizationalculture before selecting and installing an ERP system.Some insights for researchers that want to research in thisphase are proposed by Oliver and Romm [135].

& Fichman [56] in his seminal research provide a modelbased on real options that can be used in makingdecision on ERP adoption. He states that makingdecisions when uncertainty about the taking full benefitof the system and irreversibility in the cost and the riskof its implementation are high and complicated.Therefore, he has developed a model using conceptsfrom real options to make decisions about the invest-ment and adoption of in a new system.

& Iansiti and Levien [96] state that ERP’s success in anorganization depends on understanding its eco-systemand the organization’s role in it. They suggest that anERP’s success depends on understanding of the impor-tance and the benefits of a company’s ERP systemswith its business partners’ enterprise systems. There-fore, companies’ ERP adoption process is influenced bythe complex interdependencies among them.

& Porter [150] warns against the cases in which IT worksagainst business strategy. He describes some cases inthat: “Package software applications were hard tocustomize, the companies were often forced to changethe way they conducted activities in order to conform to“best practices” embedded in the software. It was alsoextremely difficult to connect discrete applications to oneanother. Enterprise Resource Planning (ERP) systemslinked activities, but again companies were forced toadapt their ways of doing things to the software.”

& Ross and Weill [170] emphasize the fact that makingdecisions on adopting new technologies such as ERP isa “business-not just technological challenge”. Theysuggest the importance of senior manager’s activeinvolvements in making key technology decisions.

Otherwise, when the IT department in an organizationis left alone in making decisions on ERP and othertechnologies adoptions disasters may occur.

& Oliver and Romm [135] discusses the need of furtherresearch into the planning phase of the adoption processand outline some of the principles that should form thebasis of empirical research in this area.

& Rugg and Krumbholz [172] stress the importance ofcorrectly modeling the organizational culture beforeselecting and installing a system. They describe a modelof culture, which can be applied to the ERP context anddescribes a framework to select an elicitation techniquefor modeling organizational culture.

& Fulford and Solanki [60] describe the requirements,risks and rewards of an ERP adoption in a manufactur-ing organization.

& Hirt and Swanson [83, 84] develop a case study wherean ERP system’s adoption process is analyzed. Thisarticle provides good insights about some issues andfactors that are critical to an ERP system’s successfuladoption in a firm.

& Monday [128] examines the potential scope of ERP forsupply chain management in the wine industry and theextent to which ERPs can be considered as a potentialsolution.

& Oliver and Romm [136] outline the significance of ERPsystems and analyze the factors that lead to ERPadoption within universities.

5.3.2 ERP acquisition

Main topics researched The research in this area focuses onERP selection methods and criteria affecting ERP selection,specially the ERP selection process for SMEs. One of thestudies analyzed the differences in characteristics of theERP system selection process between SMEs and largeorganizations. One of the studies proposes a novel way tohelp vendors specify their products. Articles related to thistopic include:

& Abdinnour-Helm et al. [1] discuss the pre-implementationtasks and requirements that encourage acceptance,successful acquisition, and effective implementation ofERP systems within organizations.

& Sistach et al. [189] and Sistach and Pastor [190]propose a method for the acquisition of an ERP systemin small and medium enterprises (SMEs).

& McQueen and Teh [123] present an acquisitionprocess model that shows a progression from anorganization-oriented acquisition process to a market-oriented acquisition process and describe influencefactors in the process.


& Stefanou [201] provides a framework for the selectionprocess of ERP Systems, which can be useful for bothidentifying critical issues for further research andassisting managers considering ERP projects.

& Brown et al. [30] identify a long set of business and ITfactors that are related to the purchase and acquisitionof ERP systems.

& O’Leary [134] investigates the game-playing behaviorthat can manifest itself in the requirements analysisprocess, evaluation, and choice of ERP software. Thisstudy is based on three cases and two sets of require-ments analysis software.

& Stafyla and Stefanou [198] report the findings fromempirical research about managers’ cognition about keyfactors affecting the selection of ERP software. Acognitive mapping approach is used to investigateproject leaders’ perceptions engaging in SAP R/3projects in Greece.

& Shakir [181] maps six models of decision-making forthe evaluation, selection, and implementation phases ofan ERP system and uses a case study to conceptualizethe models.

& Bernroider and Koch [22] detail the results from anempirical study concerning differences in characteristicsof the ERP system selection process among small,medium, and large sized organizations.

& Leist and Winter [110] developed a cost-based model ofinformation systems optimization to derive an optimalallocation of business packages.

& Sammon and Adam [174] present a literature-basedmodel of ERP software selection that claims to be thefoundation for a model of managerial decision makingin ERP projects.

& Maiden et al. [118] propose the use case studies andscenarios to help vendors specify their products’ needsand requirements.

5.3.3 Implementation phase

Main topics researched Some authors studied implementa-tion approaches and others proposed new ones. However, wefound that ‘implementation’ does not mean the same thing toeveryone. Each author has his own model of implementationphases, for example, Umble et al. [215] provide implemen-tation procedures critical to ERP implementation. In ourviews critical success factors research are not well covered.Only a few studies provide ERP success factors’ definition[120, 121] and a limited number of them focus on ERPimpacts on the organizational, technological and businesslevel, on business process reengineering, and on organiza-tional change management issues. The number of studies isnot sufficient to create a body of knowledge in the area.

Case studies constituted the largest category of pub-lications. However, in some of them, there is noexplanation of research methodology or not enoughdata to interpret some of the results presented. Most ofthem lack assumptions or hypotheses (in theoreticalterms) for future studies. Therefore, more efforts shouldbe put in the definition and subsequent validation ofcritical success factors.

The publications related to the implementation phasewere categorized into the following two main categories:(ii) implementation approaches, (ii) and implementationcase studies.

Implementation approaches and successes This topic fo-cuses on how to deal with an ERP implementation project.It covers aspects such as taxonomies of ERP implementa-tions, implementation methods and techniques, and com-parisons with other software implementation projects.Implementation success deals with the issues of how tosucceed through an ERP implementation. It covers aspectssuch as ERP project success and failure definitions,problems and outcomes, critical success factors and riskmanagement.

& Umble et al. [215] identify success factors, softwareselection steps, and implementation procedures that arecritical to successful implementation ERP systems.

& Gattiker and Goodhue [68] discuss ERP implementationsrequirements within organizations. They also discuss thefactors to be considered in ERP implementations.

& Vincent et al. [2003] identify the factors that influenceeffective management of ERP systems implementationprocess.

& Al-Mashari et al. [6] provide taxonomy of criticalsuccess factors in ERP implementation process. Thetaxonomy provided in their paper is based on acomprehensive study of ERP literature.

& Nohria et al. [132] discuss that effective implementationdepends skills in four primary management practices-strategy, structure, execution, and culture. They alsoemphasize that flawless implementation of ERPrequires simplified organizational structure.

Implementation case studies We found several case studiesthat document specific ERP implementations. They coverdifferent perspectives in particular situations such as: ERPimpacts, organizational change management, businessprocess reengineering, people roles, and decision-making.The objectives of these case studies were:

& To study the influence of ERP implementation onoperational performance. An empirical study focusing


on changes in process dynamics as a source fororganization performance improvement is also providedby Cotteleer and Bendoly [42].

& To discuss the benefits of taking integrated approach inERP implementation and other critical issues involvedin efficient implementation of ERP [3, 69, 154].

& Davenport [45] presents an overview of ERP systems ashe called them, their main functions, their attractivenessand the problems related with their implementation.Davenport also analyzes the impact on a company’sorganization and culture.

& To survey, study, and analyze ERP system’s implemen-tations in manufacturing firms [133].

& to analyze the ERP impacts based in a benefit/costsanalysis [69];

& to describe the impact of ERP on job characteristics[147] and on organizational knowledge [16];

& to test the role of three key social enablers in ERPimplementations: strong and committed leadership,open and honest communication, and a balanced andempowered implementation teams [175];

& to make recommendations on how to maximize thebenefits from ERP [131] or how to avoid ERP projectfailures [180];

& to demonstrate how myth-making served to construct anERP system as an ‘ideal’ system and the legacy systemas a ‘dying system’ [7];

& to analyze the key decisions of the development teamand key success factors [40];

& to decide onto an ERP adoption and implementation[83, 84];

& to analyze ERP implementations from a knowledgetransfer perspective [108];

& to demonstrate tradeoffs between Big Bang versusslower ERP implementation approaches that allow timefor organizational learning [31];

& to describe the journey of Geneva pharmaceuticalsthrough the first two of three phases of SAP R/3implementation project [24];

& to compare the best of breed strategy with the singlevendor ERP alternative [113];

& to identify the critical elements of business processesand ERP systems alignment [192, 218];

& to define business process requirements for large-scalepublic sector ERP implementations [25];

& to explore strategic options open to firms beyond theimplementation of common business systems [89];

& to describe the implementation and measurement of aSAP system in a multi-cultural organization [43, 44, 76];

& to standardize ERP templates within the different ERPsystems of an organization [95];

& to study business process reengineering [161, 163, 191]and change management [8, 148];

& to determine the causes and nature of changing require-ments in user’s requirement definition [173];

& to analyze the special challenges of ERP implementa-tions outside the business world [80, 85, 86, 186, 187];

& to describe global supply chain management [36];& To examine a model that proposes various antecedents

to successful e-business change management in ERPenvironments [9].

& To focus on enterprise sizes and industry sectors tocompare their difference on enterprise resource plan-ning (ERP) implementation development, packageselection, and user satisfaction in Taiwan [222, 223].They show a survey, using the measurement instrument,of two representative samples of “large size enterprisevs. medium size enterprise” and “electronics & scienceindustry vs. traditional industry” is conducted toinvestigate different ERP implementation patterns andoutcomes. A comparative analysis of ERP implementa-tion rate, package selection, and user satisfaction basedon business-related factors is performed.

5.3.4 Use and maintenance

Main topics researched The main issues researched onthis area are ERP post-implementation benefits, limita-tions and factors that affect ERP usage. Some studiesanalyze the impact of ERP systems in organizationsperformance and accounting functions. Some authorsanalyze technological issues such as ERP upgrades,security, maintenance tasks, and databases performance.Article related to the use and maintenance of ERPsystems include:

& Tarantilis et al. [209] recommend the benefits a Web-based and application of ERP for managing real-worlddistributed business processes.

& Ash and Burn [10] provide a strategic framework forthe management of ERP enabled e- business. They alsoemphasize the critical role of change management inapplying ERP technology to e-business.

& Ranganathan and Brown [155] discuss the values andbenefits of investments in ERP to businesses. Theyargue that ERP projects with “greater functional scope(two or more value-chain) or greater physical scope(multiple sites)” result in positive, higher shareholderreturn.

& Bhargava and Choudhary [14] discuss the economicbenefits of information intermediary (info-mediary) tobusinesses. ERP can be used in info-mediary designthat facilitates establishment of a buyer-seller agreementand value-added services that provide enhanced benefitsfrom matching services.


& Holland et al. [91] present a framework for understand-ing the process and content of the development of thematurity of ERP systems in organizations.

& Ming et al. [126] presented a decentralized mechanismdesign for supply chain management organizationsusing an auction market. ERP adds value by improvingthe coherence and integrating the needed information indecision making process.

& Shang [182] presents a framework that tries to classifythe types of benefit that organizations can achieve byusing ERP systems and provides a comprehensivefoundation for planning, justifying, and managing thesystem.

& Pozzebon [152] identifies the factors affecting ERPusage, combining a structural perspective with abehavioral-based model.

& Kelley et al. [98] analyze the ‘individual’s’ reactions toERP technology and subsequent behaviors through thecombination of Self-Efficacy Theory and AttributionTheory.

& Poston and Grabski [151] present a study on the impactof ERP systems on a firm’s performance.

& Askenäs and Westelius [11] show how a set of roles ofan ERP system (viewed as an IS) form a vocabulary fordiscussing the role played by the ERP system in relationto its users.

& Stijn and Wijnhoven [204] apply the systematicanalysis method of memory mismatches (SAMMM)to ERP systems in the usage stage and identify themethod’s theoretical and practical value and itslimitations.

& Granlund and Malmi [74] and Connellan and Howard[41] analyze the effects of ERP systems on managementaccounting and management work, especially whetherERP systems alleviate or limit the benefit gained frommanagement accounting systems for organizationaldecision-making and control.

& Fahy and Lynch [54] examine the impact of ERPsystems on organizations and, in particular, on themanagement accounting functions of large organiza-tions that implemented ERP systems.

& Stamper [199] points out the limitations of current ERPsystems and introduces the principles on which the secondgeneration could be built to achieve massive reductions indevelopment, support, and maintenance costs.

& Glass and Vessey [72] analyze the maintenance andenhancement tasks of ERP systems, trying to determinewhether ERP maintenance follows the 60/60 rule (i.e.,approximately 60% of the cost of an information systemis maintenance and approximately 60% of that mainte-nance is enhancement) and whether user-driven ERPsystem enhancement is treated the same way it is fortraditional IS.

& Loo [115] proposes the implementation of an informa-tion technology service management capability to helpin the management of information technology associatedwith the ERP solution implemented.

& Rosemann and Wiese [164] propose the evaluation ofERP software usage through a balanced scorecardapproach.

& Eriksen et al. [50] propose exploring the advantages ofcompetence centers to support and maintain ERPsystems.

& Kremers and Dissel [2000] discuss the motives andinhibitors for migrating ERP to a new version of thesystem, considered from the provider and customerviewpoint.

& Doppelhammer et al. [49] study the database perfor-mance of SAP R/3 using a standard benchmark fordecision support queries in business environments,named TPC-D.

& Riet et al. [158] study how ERP systems deal withsecurity.

5.3.5 Evolution phase

Main topics researched The evolution phase issues studiedare also mainly technology-oriented, such as developmentof interfaces with other systems, the integration of customerrelationship management modules and use of web technol-ogies. Another important issue studied is workflow man-agement, with new approaches and architectures beingproposed.

Article related to the use and maintenance of ERPsystems include:

& Shaw [184] analyzes the use of Web technology and itsrelation to supply-chain management.

& Lenzerini et al. [111] propose a framework forproviding an integrated view of data that is associatedwith the ERP system. The framework can deal with dataused from different kinds of applications.

& Park [142] develops a framework for a design interfacemodule in ERP systems that automatically extractfeatures required for a process planning.

& Meier et al. [124] develop an Editorial Workbench thathelps to manage knowledge spread in internal andexternal sources in order to distribute the right infor-mation to the responsible manager in time.

& Rosemann et al. [165] introduce two differentapproaches for possible workflow-based ERP archi-tectures and discuss the related advantages andconstraints.

& Bergamaschi et al. [20] propose a data replicationmodel, called DOT (Dynamic Ownership Transition),


to realize the integration between workflow anddatabase technology to support data intensive workflowapplications.

& Schönefeld and Vering [185] present a concept forintegrating ERP systems and Computer SupportedCooperative Work (CSCW) and describe the benefitsof the integration of both worlds.

& Last and Maimon [107] provide an approach toknowledge discovery in databases (KDD) applied toERP databases.

& Assogna [12] presents a project to explore the possibil-ity of "automating" the generation of a decision supportand operational IS, starting from an initial "businessidea" of top management.

& Mylopoulos [130] reviews goal-analysis research inrequirements engineering and illustrates how it canfacilitate the customization of a customer relationshipmanagement system.

& Becker and Bölsche [19] present an approach tofacilitate electronic coordination in enterprise spanningbusiness-to-business relationships.

& Themistocleous [19, 213] describes application integra-tion and proposes taxonomy. He also analyzes thefactors related with the impact of application integrationon organizations.

Retirement phase Very few articles relating the retirementphase of ERP systems were found. However, but somepublications [e.g. [45]; Scott [180]] cite cases of ERPsystems retirement. Some publications in the Press [e.g.New York Times, Wall Street Journal, the Economist]describe some ERP implementation disasters. The mostfamous retirement case is FoxMeyer Drugs [Scott [180]].At present, the majority of organizations are in theimplementation or in the use and maintenance phases.

6 Conclusion

The number of publications within the information systemscommunity on ERP systems appears small compared to thesize of the business they generated. The publicationsidentified in this paper originate from a small number ofsources and are quite recent. All major IS conferences andJournals since in 1997 dedicated at least a track or mini-track to ERP systems.

This study shows that ERP researcher mainly concen-trated on issues related to the in implementation phase ofthe ERP lifecycle. Until now, the other phases have beenalmost forgotten. One of the reasons is that the majority oforganizations are in the implementation phase. Also, in

some phases, namely acquisition and implementation, thestrong intervention of consultants makes it difficult toaccess information.

Although several ERP systems are in the market, themajority of case studies analyze SAP systems. Few studiesand little research generalize the findings to other ERPsystems.

ERP systems offer many potential areas for research,several of which are discussed in this article. Due to theirpervasive nature, ERP systems are of interest for a widerange of professional and scholarly communities (fromsoftware engineering to accounting), apart from the IS field.This suggests that ERP-related research could or should beinterdisciplinary. In our opinion, the number of publicationson ERP systems will grow exponentially in the comingyears, because many universities created research areas inERP systems and the interest of the IS community is alsogrowing.

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