Information Technology Reference
In-Depth Information
Measurement, and Use. Starting with defining
ERPs, it can be said that relatively often ERPs
are strongly connected to the system that SAP
AG has developed and then starts to deliver it
labeled as SAP R/3. However, it is noteworthy
that ERPs consist of many more software pack-
ages, not only SAP R/3. In order to explain and
define ERPs, it is necessary to give some kind of
historical overview. According to Møller (2005),
ERPs emerged in the 1950s and 1960s, when
computers were introduced into organizations;
today, however, these systems are seen as legacy
systems, and not many would describe them as
ERPs. Alternatively, ERPs as a software pack-
age were probably invented in the 1990s, with
the introduction of, for instance, SAP R/3. This
type of software is often defined as standardized
packaged software (Xu & Brinkkemper, 2007)
designed with the aim of integrating the entire
value chain in an organization. (Lengnick-Hall
et al., 2004; Rolland & Prakash, 2000). Wier et
al. (2007) argue that ERPs aim to integrate busi-
ness processes and ICT into a synchronized suite
of procedures, applications and metrics, which
goes over firms' boundaries. Kumar and van Hil-
legersberg (2000) purport ERPs originated in the
manufacturing industry, where the first genera-
tion of ERPs was introduced. According to these
authors, development of the first generation ERPs
was an inside-out process, going from standard
inventory control (IC) packages, to material re-
quirements planning (MRP), to material resources
planning (MRP II) and then expanding it to a
software package with the aim of supporting the
entire organization and all its business processes
(second generation ERPs). This evolved software
package is then described as the next generation
ERP, labeled as ERP II (Møller, 2005).
This development has increased the complexity
both for when it comes to usage and for develop-
ment of ERPs. The complexity comes from the
fact that ERPs are systems that are supposed to
be integrated into the organization (both inter-
organizational as well as intra-organizational)
and its business process in a one suite package
(Koch, 2001). From an historical overview, ERPs
and the way in which organizations use ERPs
have changed a lot. The fact that the ERP market
continually changes also influences how ERPs
are developed and sold, which impacts not only
the stakeholders that are in an ERP value-chain
(Ifinedo & Nahar, 2007; Somers & Nelson, 2004),
but also the work tasks that respective stakeholders
have in the value-chain (Johansson & Newman,
2009). Summing up the ERP definition, we can
say that ERPs are a standard software package
that aims at coordinating and integrating the
information flow in the adopting organization
(Hedman, 2003). ERPs also include what could
be called “best practices” and therefore have a
high impact on adopting organizations' business
processes (Hedman & Borell, 2004). This high
impact makes it very interesting to investigate
and measure utilization of ERPs in organizations.
Another area of interest when it comes to diffusion
of ERPs is the organizational size. It is clear that
for ERP vendors, SMEs are the focus for their
future sales of ERPs. This adds to the motivation
to focus on ERP systems utilization in SMEs.
When discussing IS diffusion in SMEs the
definition of SMEs is fundamental. In this paper,
we adopt the definition of SMEs delivered by the
European Commission: “A small enterprise is
an enterprise with fewer than 50 employees and
a medium-sized enterprise is an enterprise with
more than 49 and fewer than 250 employees.”
There are two more concepts that need to be
defined, namely:
measurement
and
use
, which are
the main focus of this chapter. We aim to present
a method for measuring use by describing min
relation to ERP systems utilization. However, we
will first discuss the use of IS in SMEs and exist-
ing knowledge on measuring use of IS.
Search WWH ::
Custom Search