Study of Barriers to Success Implementation ERP Software in SME Company Data Analysis Chapter

Pages: 15 (5312 words)  ·  Bibliography Sources: 12  ·  File: .docx  ·  Level: Master's  ·  Topic: Business

ERP Implementation

Thailand has hundreds of vendors that qualify as SMEs, according to the criteria discussed earlier in this study. The research identified four providers of ERP in Thailand. The names and locations of the companies will not be revealed for legal purposes. All four of the companies requested that their identities be kept confidential. The reason for the request was that the interview and the questionnaire would touch on company sensitive information and they were afraid, that although they were assured that company information would be kept confidential, they still preferred to remain anonymous as a condition of their participation. The findings will be analyzed qualitatively and compared, using the critical decisions found in Malhorra & Temponi (2010). These factors are team structure, implementation strategy, transition technique, database conversion strategy, risk management strategy, and change management strategy.

Case #1

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The company that will be used in case #1 offers ERP software solutions specifically designed for clients engaged in manufacturing processes. They have approximately 240 employees and are owned by a sole proprietor. The proprietor serves as the key decision-maker in the company. The owner was asked a series of interview questions to help determine what they considered to be the most important critical factors in the implementation of ERP. The manager asked that certain information be omitted, such as exact costs and trade secrets. The following summarizes the interview with this manager.

Data Analysis Chapter on Study of Barriers to Success Implementation ERP Software in SME Company Assignment

The manager informed the researcher that SMEs use ERP in their companies on a regular basis. Many of their customers are SMEs. In terms of providing a cost estimate of ERP implementation, the respondent felt that this question was difficult to answer, as the needs, sizes and business processes of every customer are different. There are simply too many variables to determine an average cost. They are a small provider and have the advantage of being able to customize the packages that they offer to meet the needs of a diverse customer base. They have had small, partial implementations cost an equivalent of £5,000 and they have had larger project go well over £50,000, It all depends on the customer and their needs. They have a choice in the services that they choose and how they are implemented. The cost for implementing ERP in a small company is often smaller in terms of overall cost, but the cost is relevant to the size of the company. SME's can afford less than larger companies. The respondent was willing to talk about cost in general terms, but unwilling to reveal exact numbers or specific cases due to confidentiality issues.

When discussing infrastructure needs, the respondent felt that here too, the needs of the company differed. The factors that made the key differences were what the companies needs were and what business they operated. He gave the example that the ERP needs of banking would be different from those who made paper. His clients were localized in the manufacturing industries, therefore were production oriented. Whether the company had to spend and upgrade their infrastructure depended on what they already had on site. Some companies were already modernized in terms of hardware and infrastructure. Others needed to make considerable changes. For instance, some had to simply add in a few routers and network cables. Others had to upgrade every PC and hard drive in the company. It all depended on what they had. This was something that had to be discussed with the client before the purchase and plans were made for implementation.

The need to upgrade systems depends on the type and purpose of the software to be installed. Their company does not take a one-size-fits-all approach. One of the key competitive advantages is their ability to suit the needs of a small niche market and to provide software solutions that are specifically designed for that market. They also provide a system that will work across multiple platforms. The ability to adjust to the client's needs was a key advantage to their system over those of the competition. This was all he was willing to reveal on this topic. However, he did comment that although they could work with a number of different customers, they could not install any of their products on Windows 95 or older.

When asked about the importance of an outside technical consultant, the respondent said that too depends on the needs of the company. However, he did add that many times companies feel that at the beginning of the project, they do not need a technical consultant. For those that have a large internal IT department, this if often true, They often have someone who can work directly with our staff from the beginning of the project, through the end of the project and understand the process and needs of the process with clarity. We have found that this is the rare case and that most of the time, customers try to go it alone in the beginning and only after considerable wasted time, money and effort, they hire an outside consultant.

These are lessons from the trenches and customers must see the need for outside consultants before they see their necessity. This is especially the case in small companies where they have only one IT person who has limited knowledge. The integrated approach to ERP is a different approach than they are used to. This is the real reason why consultants are valuable, as they are familiar with the software and can often foresee problems before they occur that could not have been seen by an inhouse person.

The respondent commented on the change process. He said that change is always difficult for any company. The introduction of ERP represents a new way of doing business. People have to learn to communicate in new ways. The process for the implementation of ERP follows the same steps as any business process change or software installation. First, one of our representatives goes to the company and meets with key personnel to get an idea of what they want and to learn about their business. Next, our company representative meets with the customer to determine what goals the customer has for the project. They try to gain a vision of that the customer wants the project to look like in the end. Sometimes this can be harder than it would seem. The customers is not always sure what they want, they just know that they want and need an improvement. Next our employee meets with any consultants that have been hired to discuss resources and needs.

After the existing resources and needs have been analyzed, our team determines a project plan and flow, taking into account the customer's needs, resources and liabilities. One of the key concerns is continuity of business during the change process. Businesses often have to continue with business as the process is taking place. This can sometimes be a logistical nightmare. Once the proposed plan in laid out, a meeting is held with all concerned parties and the plan is presented. The customer, their consultants and professionals have a chance to address any changes or ask questions. The planning stage is the longest, but the most important to the success of the project.

The next phase is where the actual work begins. Sometimes a guerilla approach is used where the entire operation is suspended, the software and new system is installed, employees are trained on the new system and operations are begun. Our staff stays with the company to address any concerns or problems that arise once the new system begins to be used. Next the system is live tested and any performance issues are addressed. When the customer is satisfied with the new system, we pull out. However, we offer continual support for the life of the system. At this time, this interviewee indicated that he had no more time and had to end the interview.

Case #2

Case #2 was a large national supplier of ERP software systems in Thailand. They had satellite offices on a global basis and is one of the largest firms in Thailand. This company was chosen as a contrast to the other case studies. The employer has over 2,000 employees and is one of the most well-known suppliers. None of the upper-level executives were willing to participate in the interview. The person with whom I was able to meet was actually a middle manager in the IT development area of the company. He could only give me an hour of time, but I was able to learn how larger ERP firms operate, as compared to smaller firms.

The manger indicated that many of the systems that they installed were built for larger clients with a larger database or handle, Their systems were designed for companies who wished to add a minimum of 20 users or greater to the system. They only dealt with larger corporations and did not offer software that would be appropriate for SMEs. They operated in their software to general business clients. They… [END OF PREVIEW] . . . READ MORE

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