Essay On Factors Contributing To Benefit Realisation Of SAP's ERP System

Many companies around the world have implemented SAP's ERP System. Although these companies are using the same ERP system they often achieve different levels of value and benefits.  Discuss this statement and identify the factors which could contribute to benefit realisation.

Discuss the statement above and identify the factors contribution to benefit realisation such as people factors, process and technology. The benefits realised may include operations excellence, competitive advantage, customer convenience etc.  You should use case study examples (from literature searches) to demonstrate different company’s experiences.

Your task is to produce a research paper which discusses the issues relating to the above.The paper should demonstrate a depth and breadth of reading and should be appropriately referenced. The paper should be referenced using the Harvard referencing standards and formatted according to the approved style guide.

The ERP or “Enterprise Resource Planning” is the software of business process management. This permits the organizations to utilize any integrated application system. The purpose is to manage the business with automating back office functions in association with human resources, services and technologies (Lawrence Norton et al. 2013). Various organizations across the globe have used the ERP system of SAP. They have been using the similar ERP system. However, they have been often achieving distinct levels of benefits and values.

There have been several drawbacks with factors influencing the system if not managed properly. The realization of benefit from the system could only be achieved as particular factors make contribution on the process. Moreover, the importance of ERP system could not be sidelined. Hence this report is developed to recognize the significance and characteristics of ERP systems. This also includes the factors contributing to identification if benefit.

The purpose of this study is supported by various perspectives and arguments. This is done with comparing or contrasting various ERP systems and factors influencing them. It also addresses the MIT University as the case study to illustrate the system relating to significant considerations.

The customization of packages is one of the suggested approach through which the improvisation of ERP systems is possible. So it is also useful to realize the advantages but achieving an effective system catering to the expectation is gained hardly (Ahmer et al. 2016). The degree of customization has been important to influence the understanding of benefit levels from ERP system. A more strategic fir might be delivered by a developed tailoring system. This is aligning with the organization’s process. Hence it tends to raise the probability to realize the benefits. The report is intended to add to the literature gap with the help from the present framework on the benefit management. This would explicitly examine the role of customization of ERP projects.

There has been no doubt that the different benefits have been there as the ERP systems get implemented. However, for maximum organizations the implementation has been useful to solve the different technology related problems. This includes the crediting the frameworks with the decreasing inventories, to develop administration hones for the inventory work and cut down the process duration (Nwankpa 2015). However the organizations have been going away from this simple implementing of the second wave like managing relationship with clients, optimizing via continuous planning and warehousing data. The expense of the IT and the decrease of personnel are the two distinct problems leading towards the desired versus real-life challenges for attaining the benefit recognition. This has been with the problems to manage the inadequacy of change management with low quality team performance. Though the organizations experienced from particular implementation in relation to ERP, they has been still facing issues. This includes the change management persisting to govern the organizations from achieving realization of benefits (Dezdar 2017). The central of the SAP R/3 and the implementation gradation has been including the widely building-in the process of the change management.

Factors Contributing to Benefit Realisation

For developing the facilitation of the efficient process to implement, the business process engineering began. This has been particularly to make sense of the gaps to find what modifications have been needed in the ERP systems. The previous researches of the ERP focused primarily over the concerning sectors (Lange, Mendling and Recker 2016). This has been including the ERP tools, managing of supply chain with the ERP systems and marketing of ERP and the industry. The requirement of accounting process coordination, integration of the business process and maintaining of the comprehensive process relevant to a specific company was the crucial obstacle faced by them while implementing the system.

Moreover, the system is credited with the helping organizations for enhancing their esteem through including activities within the form. This is done by making that actualize the proper practices for every business methodology. This also includes the making of the single data source and the understanding standard techniques leading to lesser diversion. It has been seen that there has been seen that the present companies have been preferring to acknowledge the significance of convenient and the proper data (Love et al. 2014). This is because it has been permitting the work force to efficiently manage their role while choosing their viable options during the practices. It is also noticed that because of the implementing of this venturous system of information has lead in the quality creation. However few organizations have confirmed equal profits than maximum of other companies.

The business intelligence maturity model has been effectively guiding and developing the administrative process of the corporate information. This is done with amplifying the profits that the organizations have been gaining from their usage of business intelligence. The various systems of information discussed possess a huge use in various fields. They have been improving the activities of enterprises with efficient improvisation. The implementing of the ERP systems has been also challenging the organizations (Teo, Singh and Cooper 2014). However the realizing the actual instead of the expected advantages of the process could be helpful in catering to the limitations.

For identifying the advantages of ERP implementation the people need to know that the ERP systems have been complicated packages of programming providing support to maximum of the authorities exercises carried out in any organization. Hence, it is stated the various components have been influencing the relationship between the hierarchical gainfulness and interest in the ERP.

Customisation of ERP Projects

For acquiring the complete benefit of any product, the merchants of ERP proposed that the companies must execute the product bundles with minor changes (Badewi and Shehab 2016). This is reason why most of the organizations have tried to adopt the approach nest-of-breed allowing them to distinguish the programming bundles for each capacity or procedure which is chosen. Stating in other words, they have using a coordination method of corporate network. This has permitted to sort every crucial business capacities for the organizations.

The factors that has been allowing the organizations for calcifying the organizational consideration has been including the project management and control, organization fit, technology planning, skill mix, user training and involvement and software system design. For researching the risk factors that has been deteriorating the benefit realization, one multileveled plan was adopted (Hughes et al. 2016). This is to collect data using the basic levels of exploration previous to start a more in-detail significant investigation of a case study selected. The adopting of this approach has been justified as the attempts have been made to operationalize the research questions. Thus, next, various practical issues could be developed that could show a strong argument case for few exploratory research conducting.

The Cranfield process model for benefit realization is the most popular and broadly used model within the literature of the benefit management. The primary benefit of the model to realize the benefits has been lying in the beneficial dependency network (Teo, Singh and Cooper 2014). The BDN framework is been designed to allow the investment objectives and to acknowledge the benefits leading from linking that in a structured manner to the business operations as per as the organizational requirements.

The realization of benefits has been inclusive to the barriers related to the insufficient functionality of software. Maximum of the problems possessed the relation to the people’s problems in the companies (Pillai 2015). However, the change management has been a vital obstacle that needed proper management. This has been noticed by various researchers that the programs establishing the positive behaviors towards the introduction of information system have been the important factors of the success to the successful implementation. This made the organizations to concentrate in a developed way over the strategies to manage the changes. This has been denoted as the re-engineering process of the organizations. It could be argued that a vital precedent for strategies regarding the managing of change is the cultural one (Norton 2015). This has to be fostered at the very first. The methodology to quickly implement SAP concentrated considerably over the strategies to manage the change and the inclusive of numerous resources giving support to the process. The enhanced research has been required in the complex issues involving the management to change and the resource evaluation to assist in the change process (Kanellou and Spathis 2013).

Issues with ERP Systems

In the starting era of the twentieth century the popular Cambridge University referred to as the MIT or Massachusetts Institute of Technology has been reaching towards the success. This has been with the complete faculty members of around eight thousand and more than a ten thousand pupils (Melão and Loureiro 2017). The faculties and the students have been facing pressure from the people who have been living outside.

This is a crucial challenge to the operational management of budget that came in front of that Institute. May,  Dhillon and Caldeira (2013) analyzes that because of the federal growth and the expenditure in the United States, there has been a decline in this expenditure for research as a rise in the tuition fee for MIT. This has been leading to the blockade of admission for many students. These kinds of problems have been responsible for the increment gap eventually rising the hardships faced by the MIT to attract the stakeholders.

For this cause, MIT has intended to change their present financial process and system by developing the system of the financial information in main-time, Stanciu and Tinca (2013) states. Hence MIT came around two scopes. One is the developing of one improved system. The other is to purchase that kind of system from the market. MIT took a decision to purchase an ERP system because of the complicacies arising from the developing of a system revolving across the financial cost of development. The purchased system has been simply on the basis of the practices that are carried out under the corporate industry.

Ha and Ahn (2014) points that the sought profit has been coming out as one of the popular and primary findings in the study. This has allowed the enhancement of choosing to make a process. It has been seen that the organizations considered to maintain the extreme performance have been using the data and examination forcefully for enhancing the choice making. This kind of discoveries has been discussed by (Koch and Mitteregger 2016) which have been considered to be one of the most efficient business examiner organizations. They have been conducting a complete review of over fifteen thousand primary information officers. They also stated that the BI or Business Intelligence turned to be the one of the essential and obvious need as followed by the ERP systems.

According to a report by (Amani et al. 2016) seventy percent of the respondents have been found to use the activities involving the business warehouse and intelligence of information. This is done while reviewing over 140 organizations. The significance of BI has been reflected by the income of about 7.7 billion dollars by the BI merchants in the year 2012.

Case Studies

The implementation of the ERP system known as the SAP has been initiated by the MIT at the starting phase of the year 1995. The aim at first has been to release the changing system of the estate engagement at MIT with the regard to the central finances of SAP. The aim of next implementation has been on the rising the DCLCS around the university as mentioned by Egdair, Rajemi and Nadarajan (2015). Then they needed to apply the relevant steps of the ERP system at there. The team dwelt over the skilled and important expertise from the staffs of the index consultation and the organizations from the IT department. The administration under the MIT institute has been established by the MIT to measure the ERP systems from the view point of various product sellers to select the most proper one for the organization.

At last it was decided by MIT that the Oracle and SAP have been the vendors that suited exactly to the perquisites of the providers of ERP systems. This has been particularly for the present problems that have been faced by the organization. A lion share in the market has been grabbed by the MIT. This company has more knowledge in the community of the business with the most effective suitability. Thus Jagoda et al. (2017) implied that the organization has been aware of the largely technological SAP. They were able to use the latest facilities of the current nature. The SAP R/3 has been selected by the MIT after considering every review available for every selected vendor. This has been in regard to select the implementation of ERP.

Various challenges have been faced by the organizations operating in corporate sector. This has been generally delivering operations in the larger competitive scenarios related to the financing. This has been comparing in with various other sectors of non-profit that managed to achieve advantage from the ERP systems around the last decade (Blick 2014). The high education institutions have been motivated by the stories of success. They have generated the urge for implementing the ERP systems properly with the similar aims helping to raise the adoption of corporate sector. For instance, the rise in the operational efficiency with decreasing the prices could be taken. Thus MIT took the decision to adopt and implement the ERP. Mangin, Hovelaque and Bironneau (2015) argued that MIT properly invested to implement ERP at 2009. This is to raise the business process of institution.

Business Intelligence Maturity Model

Various researches has shown that over a five billion dollars is been invested by MIT in implementing the ERP in the last few years. As per the article by Pabst, Casas and Chinta (2016) at present the ERP vendors have continued to raise the scope of their product through increasing the amount of products in the market. This has been in the response of the modern and increased necessity of the marketplace. Various instances of these products are the ORACLE and SAP software. These are the software of management for developing the lifecycle of a student. Despite this, the ERP implementation has been referred to and noticed to be hazardous at MIT. According to Bazhair and Sandhu (2015), the ERP implementation has become unsuccessful in about sixty to eighty percent of the contexts of education. It failed to satisfy the necessities of MIT and the outcome were not enough met.

 Hence the ERP was originally intended for the corporate business organizations are further emphasized. However ERO acquires the ability to deliver various customization scopes. These options have been responsible to advent the failing risk via enhancement of implementation cist and increment in work scope. This in turn delayed the scheduling of implementation. Moreover, (Eden, Sedera and Tan (2014) also states that the implementation has leas to various other tensions and imposed an effect on the universities in other ways too. These new problems have been simply relying upon what the university has perceived them as.

Conclusion:

It is known that the institutes that have been delivering higher education adopted the ERP. This is to achieve integration under the management system for controlling complex operations smoothly. Because of this the ERP turned out to be more and more appealing to the institutes. This is because it permits them to achieve the expected standards satisfactorily. At the corporate sectors the business process reengineering has been much simpler than the universities. This has been explained here by comparing the corporate sector. It is seen that the institutes with higher education tends to gain a very little obstacle provided the capital is equivalent to the time spent. Moreover, the revenue of the universities has been directly connecting the situation of the universities academically while compared to the administration regarding efficiency. This has helped the universities to achieve the rare scope than could change the operational models raising the risks related to operation. This also includes the adoption of various thoughts than in the corporate sector.  The report has simply confirmed that the implementation has resulted in numerous issues in both the corporate business and universities. It has chosen MIT as the primary case study. The structure and culture of MIT has been mostly affected by the phenomenon. The relationship and change management has been playing a crucial role to the implement at MIT.

Conclusion

References:

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