ERP CSFS Importance of ERP Consultants In ERP

ERP CSFS: Importance of ERP Consultants In ERP Implementation PREPARED AND PRESENTED BY: ADEKUNLE S. BALOGUN

Thesis Abstract ■ Enterprise Resource Planning, ERP is one of the most popular and successful information technology solution used in many organizations to share information within different business units to enhance and maximize productivity. ■ Main attributes of ERP implementation is that its: Ø Expensive Ø Time-consuming Ø Complicated to implement and manage.

Thesis Abstract Ø The complexity of ERP implementation have resulted in high rates of unsuccessful ERP implementation. Ø The failure of ERP implementation has then led to several studies to investigate the Critical Success Factors (CSFs) that could influence implementation during and after implementation phases such as lack of management support, clear project vision, etc. Ø Consultant in ERP as not been really discussed as success factor in most articles. Ø This study would analyze ERP consultant in light of its roles, participation, and implementation activities towards assuring ERP success.

What is ERP? ■ Sushanta Sengupta (2015) defines “Enterprise Resource Planning is a corporate business analysis and planning software which is typically a module of integrated applications that a company can use to collect, store, manage and interpret data. ■ Some of the business activities that can use ERP includes: Ø Production Ø Supply chain planning Ø Human resources Ø Manufacturing

Reasons for Implementing ERP Below are some of the reasons why organizations implement ERP Ø To improve information efficiency Ø To Improves decision-making process Ø To efficiently coordinate global demand, supply and production. Ø To improve efficiency of operation and execution Ø To improve the response time to customers and suppliers Ø Reducing the amount of data error Ø To have a reduction in the direct costs of operations

Reasons for Implementing ERP Panorama Consulting, a world leading independent ERP consultants in its 2015 report further categorized the primary reasons why organizations implement ERP as shown below: Reasons For ERP Implementation 18 16 14 12 10 8 6 4 2 0 Replace Old Ssytem Improve Centralized Position Reporting/ Standard Better serve Make Business System Company for Regulatory Global customers employee job Performance growth Compliance Operations easier Reduce working capital Other companies have ERP

Problem Statement ■ Enterprise Resource Planning implementation is associated: Ø High cost of implementation Ø Long duration to complete Ø It is complex to implement and to manage. ■ Due to the cost of implementation of ERP, its failure could bankrupt an organization. ■ According to Ribbers and Schoo, (2002) who says that “The rate of ERP failure is due to the complexity of the project and its broad project scope”. ■ Hugos (2003) also summarized that “Only one of every three ERP implementations is successful”.

ERP Consultant as a CSF What is Critical Success Factors (CSFs)? Ø Critical Success Factors areas of the ERP project which if done appropriately would yield successful project results. According to Ngai et al. (2008) states that: Ø By identifying the most relevant CSFs an organization can take effective measures to eliminate or minimize the causes that are negatively affecting the ERP systems implementation. This paper would discuss consultants as CSF in ERP projects by analyzing and comparing previous research articles.

Use of Consultants in ERP consultants is regarded as a CSF in ERP as they possess the following crucial skills to ERP success. Ø Right knowledge Ø Adequate experience Ø Technical skills Ø Understand industry best practices Ø Project management skills

ERP Implementation Outcome There have been various studies on the success rates of ERP implementation, including research by Jahangir Karimi, Toni M. Somers, and Anol Bhattacherjee (2007). Panorama Consulting report 2015 indicate 21 percent of ERP implementation fails. Implementation outcome 21% 58% 21% Success Failure I don’t Know

Related Articles on Consultant as a CSF The below articles discussed consultants as a CSFs in ERP. Ø Sushanta Sengupta (2015) investigated the activities performed by an ERP consultant across all the phases involved in implementation. Ø Sheida Soltani, Naemeh Elhhani and Aryati Bakri (2013) explored the impact of ERP project consultant’s in ERP during implementation and its effects on project partners. Ø Fiona Fui-Hoon Nah and Santiago Delgado (2006) investigated the Critical Success Factors for ERP implementation with recommendation on consultant as a CSF. Ø Markus, M. L. and C. Tanis (2000) discuss ERP model that could used to analyze the impact of CSFs during implementation.

Method of Research This study reviewed twenty-five (25) previous research articles that were analyzed and compiled using key words referencing to ERP Consultant. The procedure to collect data for this study followed four specific (4) steps: Ø Decide the Level of Analysis Ø Comparing Articles that Address the Problem Statement Ø Compile the Data in Articles that support the Thesis Ø Analyze the Results

Procedure to collect data The data obtained from the review of the literature involve search of several ERP journal, including: Ø International Journal of Computer Applications Ø International Journal of Computer Science Ø Journal of Systems and Information Technology Ø Electronic Journal of Information Systems Evaluation Ø Journal of Management Information Systems.

Procedure to collect data The research articles that were reviewed were chosen based on the search result as shown in the table below: Journal Searches Searched Phrase(es) ERP Implementations Enterprise System “AND” Implementation ERP Implementation Phases Enterprise Planning “AND” Implementation Phases Enterprise Resource Planning ERP, ERP adoption, ERP implementation Critical Success Factors in ERP “AND” Success Factors ERP Consultant Role ERP “AND” Consultant “AND” Role Consultant Value Additive to ERP Projects ERP “AND” Consultant “AND” Value ERP success ERP “AND” Success

Results & Discussions The 25 research papers were reviewed and 15 were considered to be relevant to the purpose of this thesis which are analyzed and compiled. Some of the research articles below discussed consultants in ERP: Ø Wachnik (2013), and Xu centered its research on the transfer of knowledge from ERP consultant to the users in the organizations. Ø Marc N. Haines and Dale L. Goodhue (2000) discussed knowledge of ERP implementation after implementation has been completed by the consultant. Ø Przemysław Leah (2014) discussed the management of consultants during implementation. Ø Chang et al. (2013) discussed the implementation role of a consultant in configuring ERP

Results & Discussions Ø Sheida Soltani, Naeimeh Elkhani, and Aryati Bakri (2013) concluded that ERP implementation users ability to effectively use the system based on knowledge acquire. Ø A. Wong, et al (2005) summarized that the effective participation of a consultant during implementation would positively influence the implementation outcome. Ø R. Sharma, and P. Yetton (2007) concluded that effective user training would result in ERP satisfaction by the implementing organization. Ø K. Reimers (2002), Ufuk Cebeci (2009), E. Ertugrul Karsak discussed how implementation process can be impacted by activities of consultants during ERP product selection, conduct requirement analysis, and perform system configuration.

Results & Discussions Table: Frequency analysis of ERP Consultant in research articles Consultant Contribution to Enterprise Resource Planning Frequency To provide organization’s project team with necessary ERP skills 18 To manage the entire ERP implementation from project initiation to closing. 15 To serve as a consulting partner in analyzing the ERP project 11 To assist organization in selecting the appropriate ERP solution 5 To support organization during Business Process Re-engineering (BPR) 4 To implement necessary changes to help turn-around ERP project 4 Others 2

Analysis of Results The chart below represents the analysis of ERP consultant in the fifteen (15) reviewed the literature and case studies based on the searched criteria identified in the methodology section. No of times cited in articles Analysis of ERP Consultant Literature 20 15 10 5 0 Provide ERP Manage ERP Training implementation Serve as a consulting partner Select appropriate ERP solution Provide BPR Manage and support ERP at -risk projeect Consultant Contribution to ERP Others

Results The key observations in this study include the following: Ø Many of the articles focused on few aspects of ERP consultants such as transfer of knowledge from consultant to users, and consultant implementation phases. Ø Only few researches has been conducted on the aspect of ERP consultants as a critical success factor in ERP implementation. Ø None of the review articles discussed the entire consultant role towards achieving a specific project success.

Conclusion The compile articles reveal that consultants were effective in the following areas: Ø Administration of ERP implementation phases/stages Ø To successfully transform their implementation approaches into detailed work plans Ø Consultant keep focus on the business benefits of the solution Ø Add value to the project as they know what is appropriate base on experience

Recommendation In light of the analysis of the reviewed articles, below are some of the recommendation that further research should endeavor to discuss: Ø Consultants should be involved in ERP projects from the beginning. Ø Researchers should provide more information as regards to the actions required by consultants to successfully manage and implement ERP projects. Ø ERP implementation process should be discussed more broadly and not just a particular aspect such as knowledge transfer, implementation phases, etc. Ø Project managers should be included on ERP projects in other to effectively aligning the strategic business goal with the system.