An agency theory model of ERP implementation

Enterprise resource planning (ERP) systems are becoming rapidly indispensable in order for large and medium sized organizations to run their operations. Therefore, management needs to know the factors that drive successful ERP implementation, a product of the continuous interaction between the implementation consultants and client firms. Agency theory has been successfully used by different researchers to explain relationships between two parties seeking a common outcome. This paper develops a model of testable propositions for applying agency theory to study the relationship between implementation consultants and client organizations deploying the ERP systems, and to consequently evaluate how the relationship affects the implementation success

ERP customization failure: Institutionalized accounting practices, power relations and market forces

Purpose: This paper examines a detailed case study of Enterprise Resource Planning (ERP) customization failure in an Egyptian state-owned company (AML) by drawing on new institutional sociology and its extensions. It explains how ERP customization failure is shaped by the interplay between institutionalised accounting practices, conflicting institutions, power relations and market forces. Methodology/Approach: The research methodology is based on using an intensive case study informed by new institutional sociology, especially the interplay between conflicting institutions, power relations and market forces. Data were collected from multiple sources, including interviews, observations, discussions and documentary analysis. Findings: The findings revealed that the inability of the ERP system to meet the core accounting requirements of the control authorities (the Central Agency for Accountability) was the explicit reason cited for the ERP failure. The externally imposed requirements of the Uniform Accounting System and planning budgets were used to resist both other institutional pressures (from the Holding Company for Engineering Industries) and market and competitive pressures. Research limitations: There are some limitations associated with the use of the case study method, including the inability to generalize from the findings of a single case study, some selectivity in the individuals interviewed, and the subjective interpretation by the researchers of the empirical data. Practical implications: The paper identifies that the interplay between institutional pressures, institutionalised accounting practices, intra-organizational power relations, and market forces contributed to the failure to embed ERP in a major company. Understanding such relationships can help other organisations to become more aware of the factors affecting successful implementation of new ERP systems and provide a better basis for planning the introduction of new technologies. Originality/value of paper: This paper draws on recent research and thinking in sociology, especially the development and application of new institutional sociology. In addition, the paper is concerned with ERP implementation and use and management accounting in a transitional economy, Egypt, and hence contributes to debate about exporting Western accounting practices and other technologies to countries with different cultures and different stages of economic and political development. Classification: Research paper/ case stud

IT governance in SMEs: trust or control?

It is believed by many scholars that a small and medium-sized enterprise (SME) cannot be seen through the lens of a large firm. Theories which explain IT governance in large organizations and methodologies used by practitioners can therefore not be extrapolated to SMEs, which have a completely different economic, cultural and managerial environment. SMEs suffer from resource poverty, have less IS experience and need more external support. SMEs largely contribute to the failure of many IS projects. We define an out-sourced information system failure (OISF) as a failure of IT governance in an SME environment and propose a structure for stating propositions derived from both agency theory and theory of trust. The theoretical question addressed in this paper is: how and why do OISFs occur in SMEs? We have chosen a qualitative and positivistic IS case study research strategy based on multiple cases. Eight cases of IS projects were selected. We found that trust is more important than control issues like output-based contracts and structured controls for eliminating opportunistic behaviour in SMEs. We conclude that the world of SMEs is significantly different from that of large companies. This necessitates extra care to be taken on the part of researchers and practitioners when designing artefacts for SMEs

Extending the enterprise: An evaluation of ERP and EAI technologies within a Case Study organisation

It is widely understood that both Information Technology (IT) and Information Systems (IS), provide great benefits in improving the visibility of supply and value chains within and across organisational boundaries. Those enterprises which can realise the benefits of extending their core business processes outwards to clients and trading partners, will be able to create unique supply chain-dependent products and solutions. Thus, such business infrastructures have enabled organisations to expand and improve the effectiveness of their enterprise. One method to achieve this, has been to integrate Enterprise Resource Planning (ERP) systems with web-based and other IS systems, using Enterprise Application Integration (EAI) technologies. This paper seeks to investigate those factors which contributed to a case organisation’s extended enterprise experiences, by using extant ERP and EAI implementation IS evaluation criteria; and by placing the research results within the context of applicable IS research techniques in the area

Implementing e-Services in Lagos State, Nigeria: the interplay of Cultural Perceptions and Working Practices during an automation initiative : Nigeria e-government culture and working practices

Accepted for publication in a forthcoming issue of Government Information Quarterly.The public sector’s adoption of Information and Communication Technologies is often seen as a way of increasing efficiency. However, developing public e-Services involves a series of organisational and social complexities. In this paper, we examine the organisational issues of implementing an ERP system, which was designed and developed within the context of Lagos State’s e-Services project. By doing so, we showcase the impact of organisational cultural perceptions and working practices of individuals. Our findings illustrate the strong role of cultural dimensions, particularly those pertaining to religion and multi-ethnicity. Our study provides insights to international organisations and governments alike toward project policy formulation within the context of ICT-based initiatives and reforms that aim to bring forward developmental progress.Peer reviewedFinal Accepted Versio

Understanding Behavioral Sources of Process Variation Following Enterprise System Deployment

This paper extends the current understanding of the time-sensitivity of intent and usage following large-scale IT implementation. Our study focuses on perceived system misfit with organizational processes in tandem with the availability of system circumvention opportunities. Case study comparisons and controlled experiments are used to support the theoretical unpacking of organizational and technical contingencies and their relationship to shifts in user intentions and variation in work-processing tactics over time. Findings suggest that managers and users may retain strong intentions to circumvent systems in the presence of perceived task-technology misfit. The perceived ease with which this circumvention is attainable factors significantly into the timeframe within which it is attempted, and subsequently impacts the onset of deviation from prescribed practice and anticipated dynamics

Coupling Performance Measurement and Collective Activity: The Semiotic Function of Management Systems. A Case Study

Theories about management instruments often enter dualistic debates between structure and agency: do instruments determine the forms of collective activity (CA), or do actors shape instruments to their requirements, or are instruments and concrete activity decoupled, as some trends of new institutionalist theory assume? Attempts to overcome the dualistic opposition between structure and activity stem from diverse sources: actors’ networks theory, structuration theory, pragmatism, theory of activity, semiotics. Performance measurement and management systems can be defined as structural instruments engaged in CA. As such they constrain the activity, but they do not determine it. Reciprocally, they are modified by the way CA uses them and makes sense of them. The central thesis of this paper will be that it is impossible to study the role of performance measurement as a common language in organizations independently from the design of the CA in which it is engaged. There is a not deterministic coupling between structure (i.e. management technical tools) and CA (i.e. business processes). The transformation of CA entails a transformation in the meaning of the “performance” concept, in the type of measurement required and in the performance management practices. The relationship between performance measurement and CA is studied here in the production division of a large electricity utility in France. The research extended over several years and took place when two new management systems were simultaneously implemented: a new management accounting system and an integrated management information system (ERP), both in the purchasing process. The new management accounting system was designed by the purchasing department; the new management information system was designed by the operational departments. Whereas the coherence between both projects could have been given by their common subordination to the rebuilding of CA (the purchasing process), their disconnection from concrete CA opened the possibility of serious dissonances between them. Both the new performance management system and the new ERP met difficulties to provide common languages, since the dimension of CA was taken for granted and consequently partly ignored in the engineering of both systems. When CA incurs radical transformations, actors’direct discursive exchanges about it, “collective activity about collective activity”, become necessary to ensure a flexible and not deterministic coupling between CA and new management systems. This reflexive and collective analysis of the process by actors themselves requires the establishment of “communities of process”, which can jointly redesign the CA and its performance measurement system. We conclude that performance measurement can be a common language as far as there is a clear and shared understanding of how CA should concretely take place and should be assigned to the different categories of actors.Business Process; Collective Activity; Community of Process; Management Instruments; Performance Measurement; Semiotics; Theory of Activity