This study examines how firms are able to effectively share knowledge across diverse functions and perspectives during enterprise resource planning (ERP) systems implementation. The primary objective of the study is to provide a theoretically grounded assessment of factors that enable firms to articulate and integrate the diversity of knowledge required for effective use of ERP. This includes factors that impact how existing knowledge is shared and how new knowledge is absorbed and transferred to become part of the firm\u27s core knowledge competency

Jones, Mary

Price, R. Leon

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Association for Information SystemsAIS Electronic Library (AISeL)ICIS 2001 Proceedings International Conference on Information Systems(ICIS)December 2001Organizational Knowledge Sharing in ERPImplementation: A Multiple Case Study AnalysisMary JonesUniversity of North TexasR. Leon PriceUniversity of OklahomaFollow this and additional works at: http://aisel.aisnet.org/icis2001This material is brought to you by the International Conference on Information Systems (ICIS) at AIS Electronic Library (AISeL). It has been acceptedfor inclusion in ICIS 2001 Proceedings by an authorized administrator of AIS Electronic Library (AISeL). For more information, please contactelibrary@aisnet.org.Recommended CitationJones, Mary and Price, R. Leon, "Organizational Knowledge Sharing in ERP Implementation: A Multiple Case Study Analysis"(2001). ICIS 2001 Proceedings. 70.http://aisel.aisnet.org/icis2001/701This study was funded by NSF Grant SES-0001998.2001  Twenty-Second International Conference on Information Systems 551ORGANIZATIONAL KNOWLEDGE SHARINGIN ERP IMPLEMENTATION:  A MULTIPLECASE STUDY ANALYSIS1Mary C. JonesUniversity of North Texasjonesm@unt.eduR. Leon PriceUniversity of Oklahomarlprice@ou.eduAbstractThis study examines how firms are able to effectively share knowledge across diverse functions andperspectives during enterprise resource planning (ERP) systems implementation. The primary objective of thestudy is to provide a theoretically grounded assessment of factors that enable firms to articulate and integratethe diversity of knowledge required for effective use of ERP. This includes factors that impact how existingknowledge is shared and how new knowledge is absorbed and transferred to become part of the firm's coreknowledge competency. Keywords: Organizational knowledge sharing, organizational culture, organizational structure, ERP.RESEARCH OBJECTIVES AND QUESTIONSERP systems are implemented to allow firms to leverage common processes and integrate knowledge across functions (Boudreauand Robey 1999). However, these systems are large, complex, and not easily modifiable to fit an individual organizationsrequirements. Thus, transition to an ERP framework is often a long and difficult process, and often does not facilitate theconsistent, stable sharing of data across functional areas as predicted (Scheer and Habermann 2000). ERP failures can be partlyexplained because firms often fail to adequately address how people use and share information (Davenport 1998). For example,Hershey failed to adequately address information flow between processes and, thus, was unable to perform some of its criticalprocesses after the ERP implementation (Stedman 1999). However, firms that have effectively addressed the information orknowledge sharing component of ERP implementation have realized greater successes with ERP (Al-Mashari and Zairi 2000;McNurlin 2001). Consensus is required from an entire enterprise to reengineer a core business process and take advantage of (ERP) software,(Holland and Light 1999, pg. 31). Thus, organizational members must collaborate and share their knowledge as a team tosuccessfully bring about the changes in the business required to realize long-term ERP benefits. If the right people are not involvedin the ERP transition, then a critical piece of knowledge is missing when it comes time to roll out the system (Al-Mashari andZairi 2000). Knowledge sharing is often ignored by firms until it is too late because people do not easily share what they know(Brown and Vessey 1999). Thus, it is critical for firms to focus on integrating new knowledge into existing knowledgecompetencies to enhance ERP success (Andreu and Ciborra 1996; Kogut and Zander 1992).The research question underlying this study is how knowledge sharing impacts how well a firm is able to integrate its processesand move autonomous, separately functioning areas out of silo behavior and begin to take advantage of the opportunity to leveragecommon processes and integrate knowledge. The objectives of this study are twofold. One objective is to provide a theoreticallygrounded assessment of factors that enable firms to articulate and integrate the diversity of knowledge required to make theorganization-wide transition to ERP. This includes factors that impact both how existing knowledge is shared and how newJones & Price/Organizational Knowledge Sharing in ERP552 2001  Twenty-Second International Conference on Information Systemsknowledge is absorbed and transferred to become part of the firms core knowledge competency. Another objective is to examinethe extent to which firms attempt to change their core knowledge competencies after ERP implementation. Due to the long-termnature of the impact ERP systems have on organizations, it seeks to provide guidance that other firms may find useful inimplementing their own ERP systems in the short run, and managing these systems for the long term.THEORETICAL FOUNDATIONTheory indicates that there are several contextual factors that may impact knowledge sharing such as organizational culture andstructure. Culture and behavior are the key drivers and inhibitors of internal (knowledge) sharing (ODell and Grayson 1998,pg. 166). A culture that values personal expertise and knowledge creation over knowledge sharing inhibits experiential learningoutside members own groups (Leonard and Sensiper 1998; ODell and Grayson 1998). A culture that rewards expertise, but doesnot reward assisting others in developing expertise, creates an environment where people are reluctant to share what they know(Leonard and Sensiper 1998).However, ERP requires organizational members to come to grips with the fact that theyre not working in silos anymore....Nomatter what you do now, it impacts somebody else (Stedman 1998, pg. 2).  Entire departments must be retrained, jobs redefined,and procedures redesigned with this in mind (Bingi, et al. 1999). Thus, a culture that fosters and rewards communication andinteraction is more likely to be conducive to successful ERP implementation (Brown and Vessey 1999; McNurlin 2001). Incentives, power, and motivational systems are ultimately responsible for differences in the quality of the (organizationallearning) process from one organization to another (Andreu and Ciborra 1996, pg. 116). A culture that encourages and rewardsexperimentation and thinking about whether things are being done the best way, rather than focusing attention largely on meetingdeadlines (favors process over product) is deemed to be the most conducive to knowledge sharing (Stein and Vandenbosch 1996).In an environment where product is favored over process, and deadlines drive the implementation, adaptation may occur, but thedevelopment of a core knowledge competency to support ERP in the long run may be inhibited (Ross 1998; Stein andVandenbosch 1996). Therefore, we expect the way a firm explores opportunities provided by ERP and the processes they use toincorporate ERP into the organization are affected by its corporate culture.Proposition 1a:  Firms in which organizational culture rewards cross-functional or group achievementswill pursue ERP implementation that is process and outcome driven to a greater extent than firms inwhich culture does not. Proposition 1b:  Firms in which organizational culture rewards individual over group achievements willpursue ERP implementation that is driven by meeting deadlines and that may ignore process andoutcomes. Proposition 2a:  Firms in which organizational culture rewards cross-functional or group achievementswill seek to exploit existing knowledge competencies during ERP implementation to a greater extent thanfirms in which organizational culture does not.Proposition 2b:  Firms in which organizational culture rewards cross-functional or group achievementswill seek to explore and incorporate new opportunities provided by ERP into core knowledge com-petencies to a greater extent than firms in which organizational culture does not.Proposition 3:  In firms in which organization culture rewards individual over group achievements therewill be changes in the knowledge of individuals or groups because of ERP, but these will not beincorporated into the organizations core knowledge competencies (i.e., individuals will engage in silobehavior).Organizational structure is another factor that influences the flow of knowledge in an organization and the rate of learning towhich an organization is exposed (Stein 1992). Some firms fail to realize ERP potential because they do not consider theirorganizational structure when they choose an ERP software package (Brown and Vessey 1999; Welti 1999). Organizationalstructures with "fluid job descriptions, loose organizational charts, high communication and few rules" are more conducive toinnovation because they promote flexibility and the exchange of knowledge and ideas (Brown and Eisenhardt 1997, pg. 7). Firmsthat have been the most successful in implementing innovative technology have a structure in place that defines priorities thatallow organizational members to focus on critical issues, facilitates extensive communication across units to allow members toshare knowledge, and allows enough flexibility in the design process itself so that members can freely exchange ideas, andJones & Price/Organizational Knowledge Sharing in ERP2001  Twenty-Second International Conference on Information Systems 553implement changes where appropriate as the process proceeds (Brown and Eisenhardt 1997). Although deadlines are important,they must be realistic enough to accommodate changes, and to thereby facilitate the free exchange of ideas and knowledge as theERP implementation process evolves (Brown and Eisenhardt 1997; Welti 1999). Organizational members need to be able tocreate and catalog the corporate memory of an organizations expertise and abilities so others can build networks and newsolutions together (ODell and Grayson 1998, pg. 157). Highly centralized, hierarchical structures tend to inhibit the type ofknowledge sharing required for organizational learning during periods of extensive change, whereas more decentralized structuresfacilitate such learning (Barley 1990; Leonard and Sensiper 1998; Pelled 1996). Structures that combine clear responsibilities andpriorities with extensive communication seem to be the most successful in promoting the exchange of innovative ideas (Willcocksand Smith 1995).  Therefore, we expect firms with highly centralized structures to exhibit less knowledge sharing than those withmore decentralized structures.Proposition 4a:  Firms with highly decentralized structures will be more likely to fundamentally changetheir core knowledge competencies to take advantage of opportunities provided by ERP than those withmore highly centralized structures.Proposition 4b:  Firms with highly centralized structures will be more likely to exhibit changes inbehavior (adaptation) that are not accompanied by changes in how they interpret their environment(learning) than firms with highly decentralized structures.METHODOLOGYSemi-structured interviews were conducted with six firms in the petroleum industry. Because some ERP systems are more suitedto some industries than others, firms from the same industry were chosen. In addition, to minimize any bias due to type of ERPused, only firms using the same ERP were chosen. SAP was chosen because it is the most widely used in this industry.  Othercriteria for choice of firm include firm size and primary business. The sample includes large, medium, and small organizationsand a variety of primary business focuses. Because of the large number of people on an SAP team (ranging from 150 to 700), we selected a sample of key people thatprovided representative perspectives on the project team. These included IS and business staff, original members of the team andmembers who came on to the team later, people who are now working to make the process changes SAP affords, as well as peoplewho were pleased with SAP and those who were not. In addition some were managers and some were not, some were workingas support staff for SAP operations, and some had gone back to their functional jobs after implementation. A series of in-person and telephone interviews with 54 people were conducted that lasted between one and two hours each overa period of eight months.  E-mail and telephone calls were also used to get information not covered in the interviews and to clarifypoints or fill in missing data during interview transcription. Tapes and interview notes were transcribed by a third party, andreviewed by the primary researcher as well as another third party for accuracy. To enhance internal reliability, pattern matchingtechniques that consist of within and cross-case analysis of data were used for data analysis. Because of the number of casesexamined, both theoretical and literal replications are possible so that firms that are similar on the constructs of interest can becompared, and firms that are dissimilar on those constructs can be compared.  These constructs are organizational culture and structure, organizational knowledge sharing, and the extent to which newknowledge was being incorporated into core knowledge competencies. Specific aspects of culture examined were the degree ofteam collaboration and the focus on deadlines and getting the job done versus focusing on how the job was being done. Thespecific aspect of structure was degree of decentralization. Knowledge sharing was assessed in terms of how it was facilitatedon the SAP team, how conflicts were resolved, change management (including training), how team members were transitionedon and off the team,  and the knowledge transfer from integration partners to the organization when they left. Change in coreknowledge is assessed as the extent to which processes either have changed or are being changed as a result of SAP.ReferencesAl-Mashari, M., and Zairi, M.   The Effective Application of SAP R/3:  A Proposed Model of Best Practice, Logistics Infor-mation Management (13:3), 2000, pp. 156-166.Andreu, R., and Ciborra, C.  Organizational Learning and Core Capabilities Development:  The Role of IT, Journal of StrategicInformation Systems (5), 1999, pp. 111-127.Jones & Price/Organizational Knowledge Sharing in ERP554 2001  Twenty-Second International Conference on Information SystemsBarley, S. R.  The Alignment of Technology and Structure through Roles and Networks, Administrative Science Quarterly (35),1990, pp. 61-103.Bingi, P., Sharma, M. K., and Jayanth, G. K. Critical Issues Affecting an ERP Implementation, Information SystemsManagement (16:3), Summer, 1999, pp.7-17. Boudreau, M. 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H.  Demographic Diversity, Conflict, and Work Group Outcomes:  An Intervening Process Theory, OrganizationScience (7:6),  1996, pp. 615-631.Ross, J.  Dow Corning Corporation:  Reengineering Global Processes, Proceedings of the Nineteenth Annual InternationalConference on Information Systems, R. Hirschheim, M. Newman, and J. I. DeGross (eds.), Helsinki, Finland, 1998,December 12-14, 1998, pp. 384-386.Scheer, W., and Habermann, F.  Making ERP a Success, Communications of the ACM (43:4), April, 2000, pp. 57-61.Stedman, C.  ERP Can Magnify Errors, October 19,  1998 (http://www.computerworld.com/cwi/story/0,1199,NAV47_STO33077,00.html, accessed on March 1, 2001).Stedman, C.  Update:  Failed ERP Gamble Haunts Hershey, Computerworld, October 29, 1999  (http://www.computerworld.com/cwi/story/0,1199, NAV47_STO37464,00.html, accessed on March 1, 2001).Stein, E. 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Organizational Knowledge Sharing in ERP Implementation: A Multiple Case Study Analysis

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Organizational Knowledge Sharing in ERP Implementation: A Multiple Case Study Analysis

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