Critical success factors within ERP implementation phases

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Frame of reference

This chapter will provide the literature that is chosen and will serve as theoretical foundation of the study in order to analyze an existing framework and compare to the empirical findings. The 13 critical success factors investigated in the framework is individually summarized and explained from the user perspective. Each CSF are then linked to its related phase of an ERP implementation. By steering the frame of reference in this order will allow the study to answer both research questions

Introduction

This literature review is based on the research of Reitsma and Hilletofth (2017) as shown in Table 4, as they identified 13 CSFs within ERP system implementation with a focus on the user perception. The framework provides an overview of the CSFs as well as an investigation of the importance of these from a user perspective. This provides a necessary foundation for this study since the perspective of the user is in focus. The frame of reference will aid the study and must be fulfilled for the interview guideline to be completed and finally the research questions to be answered.
In this chapter, the 13 CSFs will first be explained on a general level to then be described on a perspective level covering three perspectives namely, users, senior managers, and project managers. The perspective of the users will be explained more in detail, whereas the other two perspectives briefly presented

Critical success factors

Project team

The first CSF within the framework was identified as ‘project team’ (Laughlin, 1999; Nah et al., 2003; Wang et al., 2008). A project team of an ERP implementation generally include top management, a project leader and usage of a project team that can provide a successful implementation by allowing a mix of IT personnel and users with an understanding of organizational processes (Shanks et al., 2000; Wang et al., 2008). A project team must be composed into a cross-functional group which consists of knowledgeable consultants along with users to improve required technical skills needed for design and implementation (Somers & Nelson, 2001; Sumner, 1999; Woo, 2007).
Somers and Nelson (2001) argued that the success of an ERP system implementation often is related to the presence of having a project champion who owns the project, communicate the development of the project to the employees and who understand the business and organizational context

Top management involvement

The second CSF within the framework was identified as ‘Top management involvement ‘(Ehie & Madsen, 2005; Dezdar & Sulaiman, 2009). Top management involvement is critical in the early stages of the ERP implementation to provide leadership, essential resources and dealing with resistance from employees (Bingi et al., 1999; Laughlin, 1999; Shanks et al., 2000)

Strategic decision making

The third derived CSF within the framework was identified as ‘strategic decision making’ (Dezdar & Sulaiman, 2009; Motwani et al., 2005). In-Depth strategic thinking can result in improved understanding of a company’s business processes and is critical when implementing an ERP system as well as developing a business case to provide an understanding of the ERP system (Ehie & Madsen, 2004; Gargeya & Brady, 2005). Clear goals, as well as a business plan, are essential factors for a project to succeed, where the business plan should include strategic and tangible benefits, resources, costs, risks and its timeline (Holland et al., 1999; Nah et al., 2003; Rosario, 2000).

Communication

The fourth CSF used within this framework was identified as ‘communication’ (Loh & Koh, 2004; Sumner, 2000). Communication amongst the different systems and functional divisions in the organization is vital to the success of ERP implementation (Davenport, 2000; Xu et al., 2002). Expectations from the management must be communicated at every level of the organization and input from the user must be handled effectively to share their requirements, comments, reactions and their approval (Loh & Koh, 2004; Rosario, 2000).

Project management

‘Project management’ was the fifth identified CSF within the framework (Dezdar & Sulaiman, 2009; Saade & Nijher, 2016; Umble et al., 2003). It is required to have effective project management by establishing a project team with clear responsibilities to reach a particular organizational goal to achieve a successful implementation project (Ehie & Madsen, 2005; Loh & Koh, 2004; Umble et al., 2003). Furthermore, it is vital that project management involve the establishment of clear project targets, definitions of performance objectives, work, and a resource plan as well as tracking of the project process for the project to succeed (Ehie & Madsen, 2005; Laughlin, 1999).

Project support

‘Project support’ was the sixth identified CSF within the framework (Dezdar & Sulaiman, 2009; Wang et al., 2008). For the ERP system implementation to succeed, project support is a vital factor as it involves technical assistance, updates, emergency maintenance and training for the users. Especially when the needed technical- and transformational competence within the company is not available (Bingi et al., 1999; Somers & Nelson, 2001; Sumner, 2000; Wang et al., 2008).

 Minimum customization

The seventh CSF identified within the framework was ‘minimum customization’ (Saade Nijher, 2016; Saini et al., 2013; Somers and Nelson, 2001, Ziemba & Oblak, 2013). By customizing the ERP software, the implementation process will require a long time before going live (Bingi et al., 1999). According to Nah et al. (2003), it is vital to have a stable and successful business setting. Data and information systems must be available and open through the entire organization which will allow data exchange across all departments (Dowlatshahi, 2005). According to Somers and Nelson (2004), correct data is a critical requirement for the efficient use of an ERP system and to prevent any disputes amongst user departments, and management must assure that no department include any changes of the ERP system (Huang et al., 2004)

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Organizational change management

The eighth CSF identified within the framework was ‘organizational change management’ (Dezdar & Sulaiman, 2009; Rosario, 2000). Change management can have a significant influence on the implementation process (Rosario, 2000). Insufficient preparation for the imminent changes and lack of employee motivation methods can have an adverse outcome concerning unwillingness to the new ERP system. To overcome resistance, it is required to have a proper change management plan that covers the entire implementation process (Laughlin, 1999; Loh & Koh, 2004; Shanks et al., 2000).

Business process alignment

The ninth CSF identified within the framework was ‘business process alignment’ (Dezdar Sulaiman, 2009; Holland et al., 1999; Motwani, 2005. By re-engineering processes, the culture and information across the entire organization will be altered and by cleaning up processes a more balanced approach between the vendor and implementing organization can be achieved (Davenport, 2000; Gargeya & Brady, 2005). Implementation of an ERP system requires re-engineering of its business process, and when conducted appropriately, organizations find it easier to eliminate reluctance of change from the users (Huang et al., 2004). It is critical that the business process match the functionality of the ERP system and an organization cannot increase its performance without changing its business processes (Somers & Nelson, 2001; Bingi et al., 1999).

Software testing

The tenth CSF identified within the framework was ‘software testing’ (Dezdar & Sulaiman, 2009; Singla & Goyal, 2006). Testing the new ERP system before going live has been recognized as a key factor for having a successful implementation (Gargeya & Brady, 2005). Organizations often regret not spending sufficient time and allocating more attention to testing the software and changes that can occur throughout the implementation project (Davenport, 2000). According to Rosario (2000), rigorous and sophisticated tests of the software can simplify the implementation, and a plan for migrating and cleaning up data should be developed to smoothen the process for the ERP implementation project (Huang et al., 2004; Maguire et al., 2010).
Chang et al. (2014), Nah et al. (2003) and Singla & Goyal (2006) agreed with the generic perspective regarding software testing and argued the importance of performing adequate testing of software before going live with the system.

Performance measurement

The eleventh CSF identified within the framework was ‘performance measurement’ (Dezdar & Sulaiman, 2009; Wang et al., 2008). Performance measurement is an essential element as it aids to identify gaps and flaws in how the organization performs (Loh & Koh, 2003). By using quantifiable measures such as cycle time reduction, increased marked revenue and expected implementation time, organizations can develop a better understanding of ERP implementation success (Ehie & Madsen, 2005). As suggested by Roberts & Barrar (1992), two criterions can be used in performance measurement. Project management criteria allow organizations to measure completion dates, cost, and quality. Operational criteria aids to measure against the production system. Loh and Koh (2004) claimed that performance measurement is essential to acquire an overview of the progress and must be measured against the project goals as well as monitored against the milestones and targets.

Education and training

The twelfth CSF identified within the framework was ‘Education and training’ (Aloini et al., 2007; Singla & Goyal, 2006). By providing users with adequate training of the new system, organizations thereby allow themselves an increased possibility of a successful ERP implementation (Dowlatshahi, 2005; Nah et al., 2003). When employees are provided with sufficient training and education for the new system, the risk of resistance that might occur during the implementation of a new system is reduced (Dowlatshahi, 2005; Ramadhana et al., 2016). By offering sufficient training to users and internal team members, organizations can reduce the dependency of consultants and consequently save capital (Dowlatshahi, 2005). Training must cover all parts of the ERP system, operational skills of the new system, with the need of continuous training as well as proper documentation (Huang et al., 2004; Xu et al., 2002; Dezdar & Ainin, 2011)

Technical possibilities

The thirteenth CSF identified within the framework was ‘technical possibilities’ (Aloini et al., 2007; Dezdar & Sulaiman, 2009). The selection of ERP packages plays a large part in shaping the success of the implementation project (Motwani, 2005; Saini et al., 2013; Sommers & Nelson, 2001). The ERP package must be selected wisely as it needs to fit with the organizations’ cultural factors and be comprehensible for everyone involved (Xue et al., 2005. Janson and Subramanian (1996) argued the importance of carefully selecting an ERP system fitting simultaneously together with the organizations’ business process and strategy to reduce costs and risks of implementation failure

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Perspectives on the critical success factors

Project team

‘Project team’ was the first CSF within the framework for implementation of ERP systems and was investigated from a user perspective by Davenport (2000), Loh and Koh (2004) and Snider et al. (2009). They agreed upon the importance of users being involved in the implementation team from the start of the project. Snider et al. (2009) argued that users in their study were likely to solve problems concerning the ERP themselves instead of asking help from consultants who did not hold the soft skills needed to assist. Their study implies that users generally apprehend and value the impact that a knowledgeable project team can have in an ERP system implementation.
From the perspective of the senior managers, only the best suitable participants along with knowledgeable consultants should be a part of the project team. This establishes a higher knowledge foundation for the entire team (Nah et al., 2003; Sambasivan & Fey, 2008; Somers & Nelson, 2001).
Furthermore, project managers emphasize the need of consultants being a part of the team due to restricted time availability of internal employees. Firms employ knowledgeable consultants who have more relevant experience in managing implementation projects rather than internal leaders (Snider et al., 2009; Sumner, 2000).

Top management involvement

‘Top management involvement’ was the second CSF within the framework for implementation of ERP systems and was examined from a user perspective by Snider et al. (2009) and Ramadhana et al. (2016). Users generally welcome the involvement from top management and when high-level personnel support the implementation project (Snider et al., 2009). Ramadhana et al. (2016) argued that users find motivation and can improve their performance if they have adequate support from the top management.
Moreover, managerial support is essential to increase users’ perception that the organization is providing adequate attention to the users so that the increased use of ERP systems will occur (Ramadhana et al., 2016). The research by Ramadhana et al. (2016) and Snider et al. (2009) implies that users are generally comprehensible and value the impact that involvement from ‘top management’ has on the ERP system implementation.
From the perspective of senior managers, top management involvement is critical to provide sufficient resources, prioritizing the project as well as supporting the implementation team by providing them with sufficient time for their responsibilities (Nah et al., 2009; Snider et al., 2009). Moreover, from the perspective of the project manager, it is critical that top management is visible and committed by actively being a part of the implementation project as well as ensuring adequate communication with the users (Chang et al., 2014; Nah et al., 2003; Woo, 2007).

Strategic decision-making

‘Strategic decision-making’ was the third CSF within the framework for implementation of ERP systems and was examined from a user perspective by Woo (2007) who stated that users believe that senior managers should create a strategic approach to the implementation project. Without an envisioned strategic approach, the users will have difficulties understanding the purpose of the implementation and the advantages of changing the current setting which would lead to users questioning how the changes might affect their position and benefits (Woo, 2007). The study by Woo (2007) implies that users generally understand the value of ‘strategic decision-making’ for ERP system implementation when it is performed correctly.
According to Adam and O’Doherty (2000), senior managers were pointing out that by having clear goals and objectives as well as a collaboration with experienced ERP implementation professionals can lead to a less time-consuming process for the implementation. Furthermore, project managers emphasize the need of having defined goals and objectives from the start of the project to gain a better understanding of expectations leading to a more fluid implementation project (Plant & Willcocks, 2007)

1 Introduction
1.1. Background
1.2. Problem discussion
1.3 Purpose and research question
1.4 Scope and delimitations
1.5 Outline of the thesis
2 Research method 
2.1 Research philosophy
2.2 Research approach
2.3 Research design
2.4 Data collection
2.5 Data analysis
2.6 Research quality
2.7 Research ethics
3 Frame of reference 
3.1 Introduction
3.2 Critical success factors
3.3 Perspectives on the critical success factors
3.4 Implementation phases of ERP projects
3.5 Critical success factors within ERP implementation phases
4 Findings and analysis
4.1 Research context
4.2 Within case analysis
4.3 Cross-case analysis
5 Discussion 
5.1 User perception towards critical success factors
5.2 User perception toward critical success factors in relation to implementation phases
6 Conclusion 
7 Concluding discussion 
7.1 Theoretical implications
7.2 Managerial implications
7.3 Limitations
7.4 Future research
8 References
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