syntheite group erp

8/11/2019 syntheite group erp

1/72

Project work report 2013

FISAT BUSINESS SCHOOL Page1

CHAPTER- ONE

INTRODUCTION


2/72



1.1BRIEF BACKGROUND OF THE PROBLEM UNDER STUDY

Many large organisations have made significant investments of both time and

capital to Implement ERP systems, however not all implementations go as well

as intended (Bingiet al., 1999; Kumar and van Hillegersberg, 2000). Owing to

the complex nature of ERP Systems, many implementations have been difficult,

lengthy and over budget, terminated before completion, and/or failed to achieve

their business objectives even a year after implementation (Volkoff, 1999). ERP

systems are organisation-wide systems their implementation involves multiple

stakeholders, often in geographically disperse locations. Therefore, an ERP

system requires data standardisation, integration of the system with other

information systems and management of consultants and vendors (Soh et al.,

2000). Traditional project management challenges are magnified in such

environments, making the implementation more difficult, expensive and failure-prone (Holland and Light, 1999). This complexity suggests that results obtained

in other simpler technology implementation environments do not automatically

apply to ERP environments (Markus et al., 2000). The significance of a new

ERP system and the inherent risks in implementing such a system make it

essential that organisations focus on ways to improve ERP implementations.

Even though the use of ERP systems is growing and becoming more popular,

these systems are still somewhat unfamiliar in the construction industry. Many

engineering and construction firms know how beneficial ERP systems are, but

they still hesitate to adopt these systems due to their high cost and risk. Without

a doubt, a successful ERP implementation is an essential for the benefits from

such systems, so this issue is always considered top priority in the ERP related

research area. It is obvious that several important factors must be considered for


3/72



successful implementation, but most engineering and construction firms have no

idea what factors should be considered most heavily. Therefore, the main goal

of this project is to help the firm better understand the critical factors that need

to be considered to ensure the success of ERP systems.

Since there have been few studies attempting to validate the factors affecting

both ERP implementation and user adoption, this project focused on identifying

the factors for the ERP success from both implementation project and user

adoption perspectives. Then, identified factors were examined to verify their

relationships with success indicators associated with the redefined ERP success.

Furthermore, the project suggested recommendations for the ERP success

showing how to approach ERP implementation to avoid failure and what we

should do considering the significance of each factor to a given dependent

variable based on the findings of the study. These recommendations can provide

helpful information to construction firms when they consider implementing or

upgrading their ERP systems. This information should help companies reducetremendous ERP implementation risks so that companies can have more

chances to improve their business value with the success of EPR systems

A successful ERP implementation is an essential for the benefits from such

systems, so this issue is always considered top priority in the ERP related

research area. It is obvious that several important factors must be considered for

successful implementation, but most construction firms have no idea whatfactors should be considered most heavily. Therefore, the main goal of this

study is to help these firms better understand the critical factors that need to be

considered to ensure the success of ERP systems. This study formulated the

conceptual ERP success model based on theories and knowledge gained from

several industry practitioners.


4/72



Traditionally, the construction industry has been faced with the problem of

getting and keeping projects on schedule, under budget, and safe with the

quality specified by the owner and/or architect/engineer (A/E). Although the

construction industry is one of the largest contributors to the economy, it is

considered to be one of the most highly fragmented, inefficient, and

geographically dispersed industries in the world. To overcome this inefficiency,

a number of solutions have long been offered.

Modern Enterprise Resource Planning (ERP) systems have their roots in

Materials Requirement Planning (MRP I) systems, which were introduced in the

1960s. MRP I systems are computer-based systems for inventory control and

managing production schedules. As data from the factory floor, warehouse, or

distribution center began to affect more areas of the company, the need to

distribute these data across the entire enterprise demanded that other business

area databases interrelate with the MRP I system. However, MRP I systems had

limitations on this functionality leading to the development of ManufacturingResource Planning (MRP II) systems, which have now given way to ERP. MRP

II systems can evaluate the entire production environment and create or adjust

master schedules based on feedback from current production and purchase

conditions. Finally, companies such as SAP, Oracle, and others are reaping the

rewards of dramatic growth as companies move away from legacy MRP II

systems and begin the process of ERP implementation. Their solutions are morerobust than any host-based MRP system to date (Bedworth and Bailey 1987;

Intermec 1999; Januschkowetz 2001). OLeary (2000) defined ERP systems as

computer-based systems designed to process an organizations transactions and

facilitate integrated and real-time planning, production, and customer response

(O'Leary 2000).


5/72



The process of ERP systems includes data registration, evaluation, and

reporting. Data registration is entering data into a database, data evaluation is

reviewing data quality and consistency, and data reporting is the process of data

output sorted by certain criteria (Januschkowetz 2001). The role of enterprise

resource planning (ERP) does not match its name. It is no longer related to

planning and resources, but is rather related to the enterprise aspect of the name.

ERP attempts to unify all systems of departments together into a single,

integrated software program based on a single database so that various

departments can more easily share information and communicate with each

other. This integrated approach can have a remarkable payback if companies

install the software properly. An increasing number of companies want to obtain

all relevant information about their business processes to control and guide

them in a profitable direction (Koch 2002). Most ERP vendors have suggested

that the best way to obtain the full benefits of their software was to implement

their software packages with minimal changes


6/72



1.2 MACRO DIMENSIONS OF THE ISSUE UNDER STUDY, MICRO

TRENDS AND CONTEMPORARY DEVELOPMENTS IN THE GIVEN

AND RELATED ASPECTS UNDER STUDY.

The study involves the analysis of ERP effectiveness in Synthite Realty. In the

study there involved macro dimensions and micro trends. The macro

dimensions of the issue include the top management support for the ERP

implementation for which they have to provide with the necessary financial

resources and they ensure the presence of an expertise in the project team.

Another macro dimension is the change management which includes the users

resistance to change and their participation for the success of ERP. Another

macro dimension includes the interdepartmental cooperation and

communication as this software is not meant for any particular department as it

is meant for the integration of the entire department.

Enterprise Systems (ES), also called Enterprise Resource Planning (ERP)

systems, are among the most important business information technologies toemerge in the last decade. While no two industries Enterprise Systems are the

same, the basic concept of Enterprise Systems is focused mainly on

standardization, synchronization and improved efficiency. ERP is basically the

successor to material resource planning (MRP) and integrated accounting

systems such as payroll, general ledger, and billing. The benefits of Enterprise

Systems are very significant: coordinating processes and information, reducingcarrying costs, decreasing cycle time and improving responsiveness to customer

needs (Davenport 2000; Elarbi 2001).





7/72







Recently, a significant number of major construction companies embarked on

the implementation of integrated IT solutions such as Enterprise Systems to

better integrate their various business functions, particularly those related to

accounting procedures and practices. However, these integrated systems in

construction present a set of unique challenges, different from those in the

manufacturing or other service sector industries. Each construction project is

characterized by a unique set of site conditions, a unique performance team, and

the temporary nature of the relationships between project participants. This

means a construction business organization needs extensive customization of

pre-integrated business applications from ERP vendors. Unfortunately, such an

extensive customization can lead a construction firm to ERP implementation

failure. Based on a number of consultants comments, the best way to achievethe full benefits from ERP systems is to make minimal changes to the software.

For these reasons, finding the best implementation strategy of integrated

Enterprise Systems is mandatory to maximize the benefits from such integrated

IT solutions in construction companies.


8/72



1.3 OBJECTIVES OF THE STUDY

Usually, ERP vendors show off their successful implementation stories on their

websites. However, there are also many failures behind their implementation

experiences. ERP projects are notorious for requiring a long time and a lot of

money. Large IT projects such as ERP implementations have more chance to be

failures than most people expect. In the last decades, many studies have

identified that the success rate is approximately 25%, the failure rate is also

about 25%, and partial successes and failures exist around 50% (Kozak-Holland

2007). Obviously, it is very important to identify and understand the factors that

impact heavily on the success or failure of ERP implementation.

The main objective of the completed project is to present guidelines for

ensuring successful ERP implementation, providing factors associated with the

success of ERP systems in engineering and construction firms. To do so, the

project identifies the factors affecting the success or failure of ERP

implementation, and analyzes these factors according to the level ofsignificance in affecting the success of ERP systems.

To achieve the goal of the study, the following research questions

1) What are the factors affecting the success or failure of ERP implementation?

2) How can we define the success of ERP implementation?

3) How do we approach implementation to avoid failure?

The research objectives are

1) Exploring the factors affecting success or failure of ERP implementation.

2) Studying the conditions necessary for achieving success of ERP

implementation.

3) Finding out methods to failsafe ERP implementation.


9/72



1.4 SCOPE OF THE RESEARCH

The study was conducted in Synthite Realty during the period of June July.

These benefits mostly come from the integration of all the necessary business

functions across the organization, with which the organization can make its

business processes more efficient and effective. However, the complex nature of

ERP systems has required many organizations to commit significant

organizational and financial resources to their ERP initiatives, which in turn

have encountered unexpected challenges associated with system

implementation. For this reason, ERP implementation is generally considered a

high cost and high risk activity that consumes a significant portion of a

companys capital budget and is filled with a high level of risk and uncertainty.

There have been many failure cases reported in the literature, which shows

mostly abandoned implementation projects with significant financial damage.

Many companies have suffered from partial failures which resulted in tenuous

adjustment processes for their business functions and created some disruption intheir regular operations. To overcome these problems, more extensive studies

with respect to the factors affecting ERP success or failure are required to

minimize ERP implementation risks.


10/72



1.5 NEED AND RELEVANCE OF THE STUDY








There have been few studies attempting to validate empirically the factors

affecting both ERP implementation and user adoption, this study focused on

identifying the factors for the ERP success from both implementation project

and user adoption perspectives. Then, identified factors were examined to verify

their relationships with success indicators associated with the redefined ERP

success. Furthermore, the research suggested recommendations for the ERPsuccess showing how to approach ERP implementation to avoid failure and

what we should do considering the significance of each factor to a given

dependent variable based on the findings of the study. These recommendations

can provide helpful information to construction firm when they consider

implementing or upgrading their ERP systems. This information should help

company reduce tremendous ERP implementation risks so that companies canhave more chances to improve their business value with the success of EPR

systems.


11/72



Each construction project is characterized by a unique set of site conditions, a

unique performance team, and the temporary nature of the relationships

between project participants. This means a construction business organization

needs extensive customization of pre-integrated business applications from ERP

vendors. Unfortunately, such an extensive customization can lead a construction

firm to ERP implementation failure. Based on a number of consultants

comments, the best way to achieve the full benefits from ERP systems is to

make minimal changes to the software. For these reasons, finding the best

implementation strategy of integrated Enterprise Systems is mandatory to

maximize the benefits from such integrated IT solutions in construction

companies.

It is widely accepted from empirical evidence to date that the benefits from ERP

systems are very significant (Gefen and Ragowsky 2005; Murphy and Simon

2002; Shang and Seddon 2000; Stensrud and Myrtveit 2003). These benefitsmostly come from the integration of all the necessary business functions across

the organization, with which the organization can make its business processes

more efficient and effective. However, the complex nature of ERP systems has

required many organizations to commit significant organizational and financial

resources to their ERP initiatives, which in turn have encountered unexpected

challenges associated with system implementation. For this reason, ERPimplementation is generally considered a high cost and high risk activity that

consumes a significant portion of a companys capital budget and is filled with

a high level of risk and uncertainty. There have been many failure cases

reported in the literature, which shows mostly abandoned implementation

projects with significant financial damage. Many companies have suffered from


12/72



partial failures which resulted in tenuous adjustment processes for their business

functions and created some disruption in their regular operations (Gargeya and

Brady 2005). To overcome these problems, more extensive studies with respect

to the factors affecting ERP success or failure are required to minimize ERP

implementation risks.

The results of this research can provide helpful information to engineering and

construction firms when they consider implementing or upgrading their

Enterprise Systems. Clearly, it is critical to identify and understand the factors

that largely determine the success or failure of ERP implementation. This study

will identify the causes of failure and analyze them according to their

significance. If these causes are addressed properly, the contribution to the

knowledge about ERP success will be huge. This is one of the key issues related

to Enterprise Systems in the business domain, and can reduce tremendous ERP

implementation risks. Furthermore, the research provides holistic understanding

about the concept of integrated Enterprise Systems, including structure andrepresentative modules for engineering and construction firms. This approach

should allow construction firms considering the implementation of integrated

Enterprise Systems to make informed decisions in the early stages of strategic

planning in regard to the existing alternatives.


13/72



1.6METHODOLOGY

Data collection method

The ERP implementation at the organisation saw a variety of change

management activities implemented. Various departments were recipients of a

range of change management activities according to the assessed impact that the

change would have and the readiness of users in those departments. Various

forms of data collection were employed.

PRIMARY DATA

Interviews. A range of interviewees was sought, representing a cross-section of

the users of the ERP system. The interviews were designed to be semi-

structured with open-ended questions covering implementation effectiveness,

implementation climate (awareness response, feelings response and adoption

intention).the interviewers include selected mangers, workers and the vendorswho provide us the technical support .the survey was conducted with a sample

size of 40 of which 15nos are managers and 25 are workers.

SECONDARY DATA

Review of organisational documents. Surveys, reports and other documentsthat were generated as part of the ABC implementation were reviewed.

Surveys.Triangulation was achieved through the collection of survey data from

a small set of respondents in the departments. The strength of the respondents

agreement with a range of statements (Table I) was measured on a five-point

Likert scale, ranging from 1strongly disagree to 5strongly agree.


14/72



FIGURE 1: Implementation effectiveness process cycle


15/72



1.7TOOLS OF DATA COLLECTION

The main survey was conducted through a questionnaire distribution among

employees, and a total of 40 responses were received of which 70% have three

or more than three years of experience in working with ERP. Among the

respondents, about 50% of them are managers or higher level. The average of

use hours of the ERP system was 11.3 hours per week, and 75% of the

employees they spend 10hours or more with ERP/week.

0 TO 20%, 10%

20 TO 40%, 15%

40 TO 60%, 27%

60 TO 80%, 40%

80 TO 100%, 8%

HOW MUCH DID ERP FULFILL YOUR

BUSINESS STRATEGY

0 TO 20%

20 TO 40%

40 TO 60%

60 TO 80%

80 TO 100%


16/72



1.8TOOLS AND METHODS OF STATISTICAL ANALYSIS

The main analysis done in this project was a comparison of samples using chi-

square tests. Again the use of percentage analysis is also employed.

1.9HYPOTHESIS

H0: There is a no relationship between motivation behind implementing ERP in

the organization and the number of years of working experience in ERP

H0: There is no relationship between motivation behind implementing ERP in

the organization and the number of hours an employee dealing with ERP/ week.


17/72



1.10 TECHNICAL TERMS USED IN THE STUDY

Manufacturing resource planning (MRP)

Enterprise Resource Planning Systems

Critical Success Factors (CSF)

Legacy Systems

Business Process Re-engineering (BPR)

1.11 LIMITATIONS

1. IT related research in the area of construction business management

proposes research models without theories. So these surveys have been

developed without sound theoretical models.

2. Lack of knowledge in the civil engineering aspects was a constraint in thisproject.

3. Lack of availability of adequate data was a constraint for this project.

4. Busy schedule of the top level executives were also a constraint for this

project.

5. Employees resistance to change was also a constraint in the project.


18/72



CHAPTERTWO

REVIEW OF LITERATURE


19/72



2.1ERP innovation implementation model incorporating change

management.

This article provides a preliminary validation of a model for how change

management during an ERP implementation affects the effectiveness of that

ERP implementation. ERP systems are an example of an innovation a idea,

practice, or object that is perceived as new by an individual or other unit of

adoption (Rogers, 1995). Implementation of aninnovation is described as the

process of gaining targeted employees appropriate and committed use of an

innovation (Klein and Sorra, 1996).When introducing an innovation such as an

ERP system to an organisation, the implementation process needs to be

managed so that the expected benefits are achieved. Users require ongoing

support from the organisation such as training, maintenance and equipment

upgrades in order to achieve effectiveness. It has been suggested that many new

systems fail due to implementation failure, rather than innovation failure (Kleinet al., 2001). The factors leading to implementation effectiveness can be

described using the model proposed by Klein et al. (2001), Figure 1. Change

management is not explicitly included in this model, although its effect would

be expected to influence implementation climate.

The implemented change management activities also affected different areas ofthe organisation in different ways. Each department within the organisation

received a very different range of change management activities based on the

identified needs, and it is evident that the range and types of change

management received impact upon the effectiveness of the ERP

implementation. The general attitude to the system by those in the department


20/72



that received less change management was less positive than for those who were

the recipients of more targeted activities. This indicates that change

management is required throughout an organisation implementing an ERP

system, even if the changes in one particular area of the organisation are not

particularly great.


21/72



2.2A Critical Success Factors Model for Enterprise Resource Planning

Implementation.

In this paper we apply the concept of CSFs, those factors that need to be

considered and managed to ensure the success of a project, to explain

differences in project outcomes. CSF models have been applied to both general

project management problems (Slevin andPinto 1987), manufacturing system

implementation (Lockett et al 1991) and the area of reengineering (Basheinet al

1994). The approach is particularly suitable for the analysis of ERP projects

because it provides a framework for including the influence of tactical factors

such as technical software configuration and project management variables

together with broader strategic influences such as the overall implementation

strategy. The contribution of the paper is twofold. It provides a framework for

practising managers to aid their decision making and guide them in the

development of an implementation strategy, and it identifies the role andinfluence of individual factors on each other and on the project outcome.

Organisations need to understand their current business structure and business

processes associated with the existing IT system, and relate their existing

situation to the business processes contained within the ERP system (Osterle

1995). There are process modelling tools which help organisations to alignbusiness processes with the standard package. For every core and support

process in their generic business process model there are several alternative

processes relating to best practices in different types of operations and business

environments.


22/72



ERP systems are now the most common IT strategy for all organisations, and

this paper has presented a CSFs model that can aid management thinking in this

difficult and complex problem. In addition to the identification of the role of

legacy systems in the implementation of ERP systems, it has also been shown

that there are different approaches to ERP strategy ranging from skeleton

implementations to full functionality. There are also important differences in

how organisations manage the gap between their legacy systems and the ERP

business processes. It appears that it is easier to mould the organisation to the

ERP software than vice versa. Looking ahead, it is clear that organisations will

continue to develop their ERP systems by upgrading their systems and

continuing to enhance their business processes. The next stage in the research

will be to develop the framework, specifically focussing upon creating a set of

quantitative measures for assessing the impact of each factor on their

implementation outcome for a large sample of companies.ERP Implementation

Process consist of two factors Strategic and Tactical.


23/72



2.3An analysis of success and failure factors for erp systems in engineering

and construction firms

This research formulated the conceptual ERP success model based on strong

background theories and knowledge gained from several industry practitioners.

The survey instrument was designed based on the conceptual ERP success

model, and was tested before conducting the main survey. The ERP success

model and its variables were finally fixed after completing a series of data

analyses with the main survey. This research conducted Structural Equation

Modeling (SEM) to examine the validity of the proposed research model as a

complementary analysis.

In most cases, the cost of a full-scale ERP implementation in a large

organization can easily exceed $100 million, and the implementation usually

takes at least 2 years to complete. Not only do ERP systems need plenty of timeand money to implement, even successful implementations can disrupt a

companys culture, create extensive training requirements, and lead to

productivity losses. Furthermore, many experts say that over 50 percent of U.S.

firms experience some degree of failure when implementing advanced

manufacturing or information technology. Unfortunately, many companies have

already experienced significant troubles trying to implement ERP systems, andthese poorly executed implementations have had serious consequences. One

recent survey revealed that 65 percent of executives believe ERP

implementation has at least a moderate chance of damaging their business.


24/72



The main objective of the completed research is to present guidelines for

ensuring successful ERP implementation, providing factors associated with the

success of ERP systems in engineering and construction firms. To do so, the

research identifies the factors affecting the success or failure of ERP

implementation, and analyzes these factors according to the level of

significance in affecting the success of ERP systems. This study focuses on

analyzing the ERP success from the combined point of view of implementation

project and user adoption. Based on this concept, new success factors will be

postulated with the redefined ERP success, and then will be validated

empirically through data analysis. This study will identify the causes of failure

and analyze them according to their significance. If these causes are addressed

properly, the contribution to the knowledge about ERP success will be huge.

Furthermore, the research provides holistic understanding about the concept of

integrated Enterprise Systems, including structure and representative modules

for engineering and construction firms. This approach should allow constructionfirms considering the implementation of integrated Enterprise Systems to make

informed decisions in the early stages of strategic planning in regard to the

existing alternatives.


25/72



CHAPTERTHREE

CONCEPTUAL OVERVIEW OF THE STUDY


26/72



3.1CONCEPT INTRODUCTION

Enterprise Resource Planning (ERP) systems are highly integrated enterprise-

wide information systems that automate core business processes. The ERP

packages of vendors such as SAP, Baan, J.D. Edwards, Peoplesoft and Intentia

represent more than a standard business platform; they prescribe information

blueprints of how an organisations business processes should operate. In this

paper the scale and strategic importance of ERP systems are identified and the

problem of ERP implementation is defined. A Critical Success Factors (CSFs)

framework is proposed to aid managers develop an ERP implementation

strategy. Companies are radically changing their information technology (IT)

strategies by moving away from developing IT systems in-house and purchasing

standard package software. More specifically, Deloitte and Touche state that

ERP systems are now the preferred method by which businesses replace legacy

systems. This shift is very clear in the ERP market. AMR Research state that the1997 market for ERP systems was worth $15.68 billion and that this is likely to

increase at a compound rate of 36% to $72.63 billion by the year 2002

Enterprise Systems (ES), also called Enterprise Resource Planning (ERP)

systems, are among the most important business information technologies to

emerge in the last decade. While no two industries Enterprise Systems are thesame, the basic concept of Enterprise Systems is focused mainly on

standardization, synchronization and improved efficiency. ERP is basically the

successor to material resource planning (MRP) and integrated accounting

systems such as payroll, general ledger, and billing. The benefits of Enterprise

Systems are very significant: coordinating processes and information, reducing


27/72



carrying costs, decreasing cycle time and improving responsiveness to customer

needs (Davenport 2000; Elarbi 2001).







a number of solutions have long been offered. This means a construction

business organization needs extensive customization of pre-integrated business

applications from ERP vendors. Unfortunately, such an extensive customization

can lead a construction firm to ERP implementation failure. Based on a number

of consultants comments, the best way to achieve the full benefits from ERP

systems is to make minimal changes to the software. For these reasons, finding

the best implementation strategy of integrated Enterprise Systems is mandatoryto maximize the benefits from such integrated IT solutions in construction

companies.

ERP software automates core corporate activities such as manufacturing, human

resource, finance and supply chain management. The systems are sold on the

basis of incorporating 'best practice' that facilitates rapid decision-making, costreductions and greater managerial control. The concept of ERP software being

integrated makes it complex. Enterprise consensus is required to reengineer an

organisation's core business processes and to take advantage of the software

(Davenport 1998). If the system is to be implemented globally then global

consensus is required (Holland and Light 1999). Software configuration is also


28/72



more complex and intricate than is typical of a bespoke system. This is because

bespoke systems are designed for individual companies leading to an emphasis

upon systems analysis and design. With standard software, and especially ERP

software, the focus of the development effort shifts from systems analysis and

design to software configuration. It is clear that ERP implementation is a

complex and difficult process that can potentially reap enormous benefits for

successful companies and be disastrous for those organisations that fail to

manage the implementation process.

Although the ERP software is standard, there are different strategic approaches

to implementation, which differ in terms of the technical and business scope of

the project. There are two main technical options the implementation of the

standard package with minimum deviation from the standard settings provided

by the supplier and the bespoke adaptation of the system to suit particular local

requirements. The main business options revolve around the issue ofcompromise over fitting the system to the organisation or vice versa. ERP

implementation therefore involves a mix of BPC and software configuration in

order to align the software with the business processes. From a management

perspective, the nature of the ERP implementation problem includes strategic,

organisation and technical dimensions. In this paper we apply the concept of

CSFs, those factors that need to be considered and managed to ensure thesuccess of a project, to explain differences in project outcomes. CSF models

have been applied to general project management problems (Slevin and Pinto

1987), manufacturing system implementation (Lockett et al 1991) and the area

of reengineering (Basheinet al 1994). The approach is particularly suitable for

the analysis of ERP projects because it provides a framework for including the

influence of tactical factors such as technical software configuration and project


29/72



management variables together with broader strategic influences such as the

overall implementation strategy. The contribution of the paper is twofold. It

provides a framework for practising managers to aid their decision making and

guide them in the development of an implementation strategy, and it identifies

the role and influence of individual factors on each other and on the project

outcome.

Based on the review of literature (Grover et. al. 1998, Kotter 1995, Benjamin

and Levinson 1993, Hall et. al.1993, Slevin and Pinto 1987) and the experiences

of the organisations in the study, a CSF research framework is presented. The

structure of the model is based on grouping the CSFs into strategic and tactical

factors. Each group of factors is discussed in turn with an emphasis on the

factors that are specific to ERP projects.

Figure :2 A Critical Success Factors Model for ERP System

Implementation


30/72



Strategic Factors

The strategic factors business vision, top management support and project

schedules/plans are based on Slevin and Pinto (1987). In addition, we have

identified the importance of ERP strategy, and the role of legacy systems which

is similar to what Roberts and Barrar (1992) refer to as antecedents. A brief

definition of Slevin and Pintos factors are given before describing the role of

legacy systems and ERP strategy in more detail. Business vision is the clarity of

the business model behind the implementation of the project. Is there a clear

model of how the organisation should work? Are there goals / benefits that can

be identified and tracked? Top management support is the level of commitment

by the senior management in the organisation to the project in terms of their

own involvement and the willingness to allocate valuable organisational

resources. Project schedule/plans is the formal definition of the project in terms

of milestones, critical paths and a clear view of the boundary of the project.

Legacy Systems

Legacy systems are the business and IT systems that encapsulate the existing

business processes, organisation structure, culture and information technology

(Adolph 1996, Bennett 1994, Roberts and Barrar 1992). It determines the

amount of IT and organisational change that is required to successfully

implement an ERP system. Business and IT legacy are not separate problems

since many components of a business (e.g. work flow and processes) are bound

up in the design and operation of the existing IT systems.


31/72



Tactical Factors

Client consultation, personnel, client acceptance, monitoring and feedback and

communication are based on Slevin and Pinto (1987). Client consultation is theinvolvement of the users in the design and implementation of business process

that includes formal education and training. Client acceptance is the user

acceptance of the system and represents 'buy-in' from the owners of the business

processes. Monitoring and feedback is the exchange of information amongst

members of the project team and the analysis of feedback from organisation

users. Communication is the formal promotion and advertisement of theproject's progress from the project management team to the rest of the

organisation. Troubleshooting is ability to manage crises and deviations

from the plan. The additional factor BPC and software configuration recognises

the critical role of aligning business process to the ERP software in

implementation. Although the standard project management factors are still

important, they play a supporting role to the BPC and software configuration.

Business Process Change and Software Configuration

Organisations need to understand their current business structure and business

processes associated with the existing IT system, and relate their existing

situation to the business processes contained within the ERP system (Osterle

1995). There are process modelling tools which help organisations to align

business processes with the standard package. For example, the ERP vendor

Intentia offers a tool that models business processes and automatically

configures their software. This tool is referred to as the Movex Visual

Enterprise (www.intentia.com). The tool has a repository of business processes


32/72



that can be used as a reference when reengineering current processes and

designing new ones. For every core and support process in their generic

business process model there are several alternative processes relating to best

practices in different types of operations and business environments. These

processes can be modified, for example unwanted activities and sub-processes

can be deleted online and others can be added from different reference

processes. Therefore business processes can be customised to a certain extent

without making bespoke changes to the code. This tool can be used at any stage

after the initial implementation process to enable continuous business process

improvement.

Figure 3: workflow of project implementation


33/72



3.2HISTORICAL BACKGROUND

ERP systems are now ubiquitous in large businesses and the current move by

vendors is to repackage them for small to medium enterprises (SMEs). This

migration has many consequences that have to be addressed through

understanding the history and evolution of ERP systems and their current

architectures. The advantages and disadvantages of the ERP systems will

impact their penetration in this new market. The market position and general

strategy of the major systems providers in preparation for this push are

described. The chapter concludes that the growth and success of ERP adoption

and development in the new millennium will depend on the legacy ERP

systems capability of extending to CustomerRelationship Management

(CRM), Supply Chain Management (SCM) and other extended modules, and

integration with the Internet-enabled applications.

The unprecedented growth of information and communication technologies(ICT) driven by microelectronics, computer hardware and software systems has

influenced all facets of computing applications across organizations.

Simultaneously the business environment is becoming increasingly complex

with functional units requiring more and more inter-functional data flow for

decision making, timely and efficient procurement of product parts,

management of inventory, accounting, human resources and distribution ofgoods and services. In this context, management of organizations needs

efficient information systems to improve competitiveness by cost reduction and

better logistics. It is universally recognized by large and small-to medium- size


34/72



enterprises (SME) that the capability of providing the right information at the

right time brings tremendous rewards to organizations in a global competitive

world of complex business practices. Starting in the late 1980s and the

beginning of the 1990s new software systems known in the industry as

enterprise resource planning (ERP) systems have surfaced in the market

targeting mainly large complex business organizations. These complex,

expensive, powerful, proprietary systems are offthe- shelf solutions requiring

consultants to tailor and implement them based on the companys requirements.

In many cases they force companies to reengineer their business processes to

accommodate the logic of the software modules for streamlining data flow

throughout the organization.

These software solutions, unlike the old, traditional in-house-designed company

specific systems, are integrated multi-module commercial packages suitable for

tailoring and adding add-ons as and when required.The phenomenal growth

of computing power and the Internet is bringing ever more challenges for the

ERP vendors and the customers to redesign ERP products, breaking the barrierof proprietorship and customization, and embracing the collaborative business

over the intranet, extranet and the Internet in a seamless manner. The vendors

already promise many add-on modules, some of which are already in the

market as a sign of acceptance of these challenges by the ERP vendors. It is a

never-ending process of reengineering and development bringing new products

and solutions to the ERP market. ERP vendors and customers have recognizedthe need for packages that follow open architecture, provide interchangeable

modules and allow easy customization and user interfacing.


35/72



3.3 EVOLUTION OF ERP SYSTEMS

1960s most organizations designed, developed and implemented centralized

computing systems, mostly automating their inventory control systems using

inventory control packages (IC). These were legacy systems based on

programming languages such as COBOL, ALGOL and FORTRAN. Material

requirements planning (MRP) systems were developed in the 1970s which

involved mainly planning the product or parts requirements according to the

master production schedule. Following this route new software systems called

manufacturing resources planning (MRP II) were introduced in the 1980s with

an emphasis on optimizing manufacturing processes by synchronizing the

materials with production requirements. MRP II included areas such as shop

floor and distribution management, project management,finance, human

resource and engineering. ERP systems first appeared in the late 1980s and the

beginning of the 1990s with the power of enterprise-wide inter-functional

coordination and integration. Based on the technological foundations of MRPand MRP II, ERP systems integrate business processes including

manufacturing, distribution, accounting, financial, human resource

management, project management, inventory management, service and

maintenance, and transportation, providing accessibility, visibility and

consistency across the enterprise.


36/72



Figure:4ERP systems concept

During the 1990s ERP vendors added more modules and functions asadd -onsto the core modules giving birth to the extended ERPs. These ERP extensions

include advanced planning and scheduling (APS), e-business solutions such as

customer relationship management (CRM) and supply chain management

(SCM). Figure 2 summarizes the historical events related with ERP.


37/72



Figure:5 ERP evolution


38/72



ADVANTAGES AND DISDAVANTAGES OF ERP SYSYTEM

FIGURE:6 ADVANTGES OF ERP SYSYTEM


39/72



FIGURE:7 DISADVANTGES OF ERP SYSYTEM

COMMERCIAL ERP SYSTEMS

The five dominating ERP software suppliers are SAP, Oracle, PeopleSoft, Baan

and J.D. Edwards. Together they control more than 60% of the multibillion

dollar global market.

SAP AGFlagship Products R/3, mySAP.COM

SAP AG (Systeme, Anwendungen, und Produkte in Datenverarbeitung),or

Systems, Applications and Products in Data Processing, was started by five

former IBM engineers in Germany in 1972 for producing integrated business


40/72



application software for the manufacturing enterprise (SAP, 2001). Its first ERP

product, R/2, was launched in 1979 using a mainframe-based centralized

database that was then redesigned as client/server software R/3 in 1992.

Oracle CorporationFlagship Product Oracle Appli cations

Oracle (Oracle, 2001), founded in 1977 in the USA, is best-known for its

database software and related applications and is the second largest software

company in the world after Microsoft. Oracles enterprise software applications

started to work with its database in 1987. It accounts for $2.5 billion out of the

companys $9.3 billion in 1999, which places Oracle second to SAP in the

enterprise systems category with over 5,000 customers in 140 countries

PeopleSoft Inc.Flagship Product PeopleSoft8

PeopleSoft is one of the newest ERP software firms started in 1987 in

Pleasanton, California, with specialization in human resource management andfinancial services modules. PeopleSoft quickly managed to offer other corporate

functions and attained a revenue of $32 million in 1992. One of the strengths of

PeopleSoft is the recognition by its customers that it is flexible and

collaborative. The flagship application PeopleSoft8 with scores of

applications was developed by PeopleSoft with an expenditure of $500 million

and 2,000 developers over 2 years as a pure Internet-based collaborativeenterprise system.

The Baan CompanyFlagship Product BaanERP

Founded in 1978 in The Netherlands, Baan (Baan, 2001) started with expertise

in software for the manufacturing industry and by 1997 claimed an ERP market

share of roughly 5%. Banns revenue in 1998 was roughly $750 million and


41/72



while facing a slight slowdown in 1999 started growing again in 2001 with sales

up 12% at 7,231million and operating profit of 926 million.

J.D. Edwards & Co.Flagship Product OneWorld

J.D. Edwards was founded in 1977 in Denver (cofounded by Jack Thompson,

Dan Gregory and C. Edward McVaney) with long experience of supplying

software for the AS/400 market. J.D. Edwards flagship ERP product called

OneWorld is capable of running on multiple platforms and with multiple

databases and revolutionizes enterprise software by liberating users from

inflexible, static technologies (JD Edwards, 2001).


42/72



3.4 ABOUT US

Synthite Realty is the housing division of Synthite Industries Ltd., the worlds

largest exporter of spice oleoresins, having diversified interests in bio-

ingredients, spices, farm tech, hospitality and wind energy. Synthite Realty

made its first foray into real estate in 1992 with Riviera Retreat on the Thevara

waterfront in Cochin. This landmark project offering fully air conditioned

apartments was the first of its kind in the state, setting new standards in luxury

and offering an array of amenities. It is one of the finestproperties in Cochinand Synthite Realty has a proven track record as premiumbuilders in Kerala.

Spice Villas in Kolenchery, Synthites next offering, was highly acclaimed as a

topKerala property.With the completion of this project, Synthites philosophy

of focusing primarily on semi-urban projects took shape.

Synthites core values are commitment to quality and keen customer focus.Since its clientele consists of the well-travelled, design conscious elite, Synthite

homes reflect their taste and aspirations forluxurious homes in Kerala.Prime

importance is given to functionality and ambience, both within the home and its

surroundings. Serene and pollution-free locations are preferred.

Ongoing Projects

Ginger County

Nestled in the comforting environs of Kolenchery, Ginger County is a

residential enclave that blends the comforts of a modern lifestyle with the

charms of easy, peaceful living. Ginger County features thoughtfully planned

and tastefully designed luxury villas, along with exclusive lifestyle amenities.
http://www.synthiterealty.com/http://www.synthiterealty.com/http://www.synthiterealty.com/builders-at-kochi-synthite/villas-in-kochi/http://www.synthiterealty.com/builders-at-kochi-synthite/villas-in-kochi/http://www.synthiterealty.com/contact-builders-in-kerala/luxury-villas-cochin/http://www.synthiterealty.com/contact-builders-in-kerala/luxury-villas-cochin/http://www.synthiterealty.com/builders-at-kochi-synthite/villas-in-kochi/http://www.synthiterealty.com/http://www.synthiterealty.com/


43/72



Completed projects

Vanilla Grove

One of the finest properties in Kerala from the finest builder in Kerala, Vanilla

Grove is nestled in estate-like environs in the heart of prosperous Kolenchery.

easy access to all the amenities this thriving business town offers from your

luxury home in verdant Kerala Bustling Cochin and its numerous opportunities

Spice Villla

One of Keralas best properties. Upmarket villas in the verdant and peaceful

environs of Kolenchery, Kerala; Spice Villa is an ideal retreat. A project

offering from Synthite Realty, one of the best builders in Kerala Spice Villa

promises all the luxurious features of a classic home.

Riveria suites

A luxury apartment hotel set on the calm waterfront of Cochin city. A novel

concept in its time, these waterfront apartments provide a home away from

home to visitors in Kerala. It is a landmark and one of the finest properties in

Kerala.


44/72



Synthite Industries Ltd.

Synthite Realty is backed by one of Keralas most reputed corporates, Synthite.

A food and fragrance ingredient major, the company first made its mark in spice

oleoresin extraction, starting with oleoresin black pepper. Today, the Rs. 650

crore Synthite accounts for 40% of the global market share in botanical extracts.

Synthite has a portfolio of 500 products, manufactured from its 6 state-of-the-art

processing units across South India. It employs over 1500 people directly andhas a presence in over 75 countries. Over the years, the company has also given

back to the community through its various CSR initiatives under the aegis of the

CVJ Foundation.

Other than Ingredients, Synthite has strategically diversified into Spices,

Hospitality, Wind Energy and Realty. Synthite Realty offers luxurious homes in

Kerala, villas and apartments and it one of the best builders in Kerala and

Cochin.. In all its ventures, Synthite is distinguished by its single-minded

dedication to customer needs.

Corporate Information

When they need an ingredient, the worlds leading food companies shop at

Synthite Industries Ltd (Synthite). They choose from a portfolio of over 500

products, made from the finest raw materials with complete traceability.

Innovations at Synthite ensure that customers get the right material, whatever

their range of application, however complex the process may be. In short,

Synthite sets the benchmark for the industry. Synthite was among the first in

India to enter spice oleoresin manufacturing. From that pioneering start in 1972,

the company has grown to become the worlds most trusted spice ingredient

provider today, with a turnover of over USD 125 million and commanding over


45/72



30 per cent of the global market share. Synthite supplies spices in ground,

extracts and value added forms. Synthites quest for quality makes it the

preferred choice of its clientele in over 75 countries. Synthite is a diversified

group now, with interests in fields as diverse as bio ingredients, spice, natural

specialties, farm tech, hospitality, and realty and wind energy.

Vision

By consistently delivering the Ingredients of Success for the most exciting

Food, Health and Fragrance Solutions, we will be the partner of choice to our

clients worldwide.

Mission

Sustainable Growth: Grow Smart, Grow Fast, Grow Together.

Innovation: Operational Excellence Powered by Innovation.

Customer Service: Cultivate Customers, Care More.

Enhance Value: For all Stakeholders.

Making it a Great Place to Work: Winning People through Collaboration.


46/72



1972 Year of establishment.

1980 Ministry of Commerce and Industry, Government of India,recognises Synthite as an Export House.

1984 Launches Herbal Isolates (P) Ltd for the manufacture ofdehydrated green pepper, pepper in brine, sterilised spices andessential oils.

1986 Launches Fragrance division, at Maradur, Coimbatore for the

production of floral concretes and absolutes of jasmine, tuberoseand mimosa with technical collaboration with Cal-Pfizer, France.

1991 The Department of Science and Technology, Government of India,recognises the in-house research laboratory.

1992 Acquires Sijmak Oils Ltd., Calicut. It is now Synthite Calicut, anexclusive export-oriented unit, specialising in herbal extracts.

1993 Upgrades the research lab, and rechristens it the CU VarkeyCentre for Research and Quality Assurance.

1993 Diversifies into realty, with the launch of Synthite Properties &Investments Ltd and then into hospitality, starting Riviera Suites,Keralas first apartment hotel.

1994 Becomes the first Indian company in the food sector to obtain ISO9002 certification from BSI UK.

1997 Bags ISO 9001: 1994 from by BSI, UK

2000 Launches Synthite Exports Ltd.

2001 Launches Natural Colour Division at Harihar.

2003 Sets up wind mills at Udumalpettu, Tamil Nadu

2006 Launches the Spice division, AromcoFlavour India (P) Ltd ., ajoint venture with Aromco, UK and Symega Savory Technology(P) Ltd ., a joint venture with Omega, Austria


47/72



2007 Sets up CO2 extraction plant.

Sets up CVJ Foundation, the corporate social responsibility arm

2008 Bags ISO 22000:2005 certification

2010 Goes global, sets up establishments in the US and in China.

Strengthens presence in India, sets up sales offices in Mumbai,

Delhi and Bangalore.


48/72



CHAPTER

FOUR

Results Discussion (Analysis & Interpretation)


49/72



I started my survey with the questions about no of hours the employees spend

for ERP and the result obtained can be interpreted as almost 35% of the

employees spend ten to fifteen in ERP/Week which implies they spend one and

a half day per week. Again 75% of the employees they spend 10hours or more

with ERP. This can be interpreted as of the total sample size of 40; almost 30

employees spend 10 or more hours with ERP. But there are employees who

spend less than 10hours working with ERP they account about 10nos

Thus it can be concluded that the majority of the employees they have sufficient

exposure in ERP and they spend almost a day working in ERP per week .More

employees using ERP implies they have a positive attitude towards the system.

LESS THAN 5

HOUR, 10%

FIVE TO TEN

HOUR, 15%

TEN TO FIFTEEN,

35%

FIFTEEN TO

TWENTY, 30%

MORE THAN

TWENTY 10%

NO OF HOURS RESPONDENT DEALING WITH

ERP/WEEK

LESS THAN 5 HOUR

FIVE TO TEN HOUR

TEN TO FIFTEEN

FIFTEEN TO TWENTY

MORE THAN 20


50/72



Employees working experience in ERP is asked to know if there is any relation

between the number of hours they spend and the experience they have in ERP.

But after the careful analysis of the data I found it is difficult to establish a

correlation between experncise and the hours one spend. From this we can

analyze majority of the employees they belongs to the category of more than

seven years of experiences in construction or three to five years of experiences

in construction and together they contribute about 52%. Almost 18% of the

employees they have less than one years of experience in ERP, it means either

they are new employees of the organizations or they show a lack of interest in

ERP.

LESS THAN ONE,

18%

ONE TO THREE,

10%

THREE TO FIVE,

26%

FIVE TO SEVEN,

20%

MORE THAN

SEVEN, 26%

NO OF YEARS OF WORKING EXPERENCISE

WITH ERP

LESS THAN ONE

ONE TO THREE

THREE TO FIVE

FIVE TO SEVEN

MORE THAN SEVEN


51/72



This question is asked to measure the implementation effectiveness directly as

respondents who believe ERP fulfill their business strategy can be generally

considered as employees who have a positive attitude towards ERP. So 8% of

the employees they believed ERP fulfill 80 to 100% of their business strategy.

Were as majority they believed ERP helps them to fulfill 60 to 80 % of their

business strategy and they account for about 40%.

Thus the organization is successful enough to automate more than half of its

activity with ERP. Thus on the context of fulfilling the business strategies, we

can say the implementation is effective.

0 TO 20%, 10%

20 TO 40%, 15%

40 TO 60%, 27%

60 TO 80%, 40%

80 TO 100%, 8%

HOW MUCH DID ERP FULFILL YOUR

BUSINESS STRATEGY

0 TO 20%

20 TO 40%

40 TO 60%

60 TO 80%

80 TO 100%


52/72



Every organization while they bring in some change there will be some strong

motives behind the changes. For the ERP implementation also there are some

reasons which are identified and asked to find out which is predominant

The result obtained can be interpreted as employees doesnt feel there is a

predominant factor because of which ERP is implemented in the organization or

different people , especially people in different they have different reasons for

the implementation.

As per the survey results the predominant reason was found to be control over

the resources. Since the project areas is a construction industry there involved a

large amount of resources manually keeping record of all this is practically

5%13%

30%17%

35%

MOTIVATION BEHIND IMPLEMENTING ERP IN

THE ORGANIZATION


53/72



impossible, so 35% of employees felt ERP is needed to keep a track of the

items both incoming and outgoing. The cost involved in ERP software is huge

so the top management commitment and support is essential as the process it

require time and the success and failure cannot be predicted. 30% of employees

felt that its the commitment and support from the top management is the

motive for implementation. whereas some felt it is to avoid the data redundancy

the ERP has to be implemented.

Thus it can be interpreted that respondents believe ERP to avoid data

redundancy and they believe for ERP success top management support and

commitment is needed and it helps to ensure a control over the resources.

erp software misfit,

12%

lack of

interdepartmental

cooperation and

communication,

20%

employees

resistance to

change, 40%

project cost over

run, 25%

use of consultants,

3%

PROBLEM YOU FACED DURING ERP

IMPLEMNTATION


54/72



When an organization implement a new software there will be some ambiguity

related to the software which include the implementation effectiveness and its

success. A question related to the problems employees faced during the

implementation period was asked. So that in future the same can be taken care

of.Majority of the said its the employees resistance to change was the major

problem they observed. 40% of the employees felt so. 25% of the employees

felt its the project cost which is a major problem. Thus it can be interpreted that

there happened a considerable variation from the estimated cost and actual cost

of implementation. the also felt there is a lack of interdepartmental cooperation

and communication which may affect the implementation effectiveness.


55/72



Here we identified factors which employees felt as important to avoid ERP

implementation failure and the obtained result can be interpreted as 44% of the

employees felt its the presence of expertise in the implementation team as most

important. Again 26% of the employees felt there should be standardization in

ERP to avoid failure. As fully customized software heavily rely on the support

of vendors so there is relation between the implementation expertises in team

and avoid customization so there should be a balance between these two factors.

17% of the employees felt there is a functional and technical fit of the software.

Thus if the organization taken care of the three prominent factors employees

executives buy in

and support, 5%functional and

technical fit of

software, 17%

ensure

implemntation

expertise in projectteam, 44%

avoid ERP

customization, 26%

implementation

should meet

expectation, 8%

factors most important to avoid ERP

implementation failure

executives buy in and support

functional and technical fit of

software

ensure implemntation

expertise in project team

avoid ERP customization

implementation should meetexpectation


56/72



mentioned then up to an extend we can avoid the ERP implementation failure .

I will recommend ERP for another organization of my type

This question is asked to measure employees satisfaction with respect to the

software they are using now. The result came out in such a way that 60% of the

employees they somewhat agree to the fact that they will recommend ERP

software to another organization. 11% fully satisfied with the present software.

Where in 8% of the employees the expressed their dissatisfaction regarding the

software.13%of employees told they are neither satisfied nor dissatisfied.

The result can be analyzed as majority of the employees they have a likely

feeling towards the system.

8% 8%

13%

60%

11.00%

0%

10%

20%

30%

40%

50%

60%

70%

strongly disagree somewhat

disagree

neutral somewhat agree fully agree


57/72



Question asked was a 5 point likert scale question and the employees

perception about ERP was analyzed with regard to completion of project on

time. The obtained result can be interpreted as 38% of the employees they felt

ERP helps them to complete project on time. These employees they belongs to

the purchase and finance department where at present ERP is fully

implemented. Whereas 25% of employees felt ERP doesnt make any difference

to their work these employees are mainly from the engineering and marketing

department where the ERP implementation is not yet effective. 22% of the

employees have a neutral opinion regarding the ERPs role in helping the

employees to complete their project on time. This may be because they have

only limited exposure with ERP . the employees work experiences with ERP

may be less.

strongly disagree somewhat

disagree

neutral somewhat agree fully agree

0

25%22%

38%

15%

ERP helps me to complete my project on time


58/72



DIFFERENT DEPARTMENTS ARE INTEGRATED WITH ERP

Majority of the employees they felt integration of different department has

happened with the implementation of ERP. 44 % of the employees somewhatagrees to it. 33% of the employees fully agree that ERP helps in the integration

of the department. Thus 77% of the employees have a positive attitude towards

ERP in the matter it helps in the integration of the different department. At

present with ERP the purchase department can put their purchase order and

intends thru system and after approval from the top management this will be

automatically available to the finance person at the same time it gives data

transparency and avoid data redundancy.

0%

5%

10%

15%

20%

25%30%

35%

40%

45%

5%8%

10%

44%

33%


59/72



This question is asked to know if the employees resistance to change is

predominant or not. 35% of the employees stated they have a favorable attitude

towards the old ERP 35% of the employees state the new ERP is better and 30%

they have neutral attitude which can be interpreted as either both are better or

both doesnt able to satisfy their requirement.

Among the 35% of the employees who prefer the old system 10% fully agree

that old system was better which indicate still there is a resistance from the

employees part to adapt to the new technology or they may felt the task as

tedious. 25% of the employees even though they are using the new system still

they prefer the old one may be resistance to change or easiness or else old

system was much more user friendly.

strongly

disagree,

12%

somewhat

disagree, 23%

neutral, 30%

somewhat agree,

25%

fully

agree,

10%

I PREFER OLD SYSTEM RATER THAN ERP

strongly disagree

somewhat disagreeneutral

somewhat agree

fully agree


60/72



FOR SUCCESSFUL ERP IMPLEMENTATION TOP MANAGEMENT

SUPPORT IS ESSENTIAL

Employees also felt that for the success of ERP the management support is

essential. As there is a cost involved in this matter. 77% of the employees felt

the management support is essential where in 13% doesnt felt the management

support is essential.

Top management support doesnt confine only to the investment part of

software more than that motivating the employees to use the software, legalaspects of the software authentication and guaranteed consultant after sales

support all can be ensured with the management support.

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

strongly

disagree

somewhat

disagree

neutral somewhat

agree

fully agree

5%

8%10%

44%

33%


61/72



Respondents expressed a mixed emotions for this question 33% supported the

view that they should have necessary technical and business knowledge as we

are implementing ERP in a sector where in there happen a lot of technical works

and technical knowledge is prior requirement. At te same time majority ie 35%

of the employees felt technical knowledge is not a prior requirement for ERP as

this itself a new software whether you have technical knowledge or not is

immaterial what matters is the ones ablity to use the software understand the

software and interpret the values as required for the data entry.

0%

10%

20%

30%

40%

50%

STRONGLYY

DISAGREE

SOMEWHAT

DISAGREE

NEURTAL SOMEWHAT

AGREE

FULLY AGREE

2% 3%

35%

20%

33%

THE PERSON DEALING WITH ERP SHOULD

HAVE NECESSARY TECHNICAL AND BUSINESS

KNOWLEDGE


62/72



INTEGRATION OF DIFFERENT DEPARTMENT IS ESSENTIAL FOR

THE SUCCESS AND EFFECTIVENESS OF ERP

This question has the link to the above asked question whether different

department are integrated with the ERP. 44% of the employees felt different

departments are integrated with ERP. And for this question 43% of the

employees felt integration is an essential factor for the success and effectiveness

of the ERP. Thus employees felt there are a need for the integration of the

different and consider ERP as one such tool which can integrate different

module.Different organization have different requirement and depending upon

the requirement one organization have to purchase the ERP module. So the aim

of the question is that whether the organization identified the requirement of

ERP and to know whether the software is worth for the organization. From the

employees response it is found that, 39% of the employees felt the software

using is fit for the organizations requirement and 45% of the employees felt

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

40.00%

45.00%

STRONGLYY

DISAGREE

SOMEWHAT

DISAGREE

NEURTAL SOMEWHAT

AGREE

FULLY AGREE

0

7%

25%

43%

25%


63/72



there is some misfit happened between the software and the organizations

requirement.

47% of the employees felt that trouble shooting is easy even if an issue is

reported. Along with that ERP helps employees to avoid the documentation

process which otherwise has to handle manually. Thus there will be minimum

loss of data as data can be stored for a period of 10yrs. Along with that the

backup support of the consultants helps us in trouble shooting even if an issue

has been reported.25% o the employees fully agree that trouble shooting is easywith the presently employed software at the same time 6% disagree on this

statement. Which indicates major issues can be solved with or without the help

of consultants and their still exsist some problem which are not yet solved.

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

DISAGREE SOMEWHAT

DISAGREE

NEUTRAL SOMEWHAT

AGREE

AGREE

3% 3%

22%

47%

25%

TROUBLE SHOOTING IS EASY IN CASE OF AN

ISSUE


64/72



Whatever work we are into cost management is an important factor which we

have to look into. So the question of ERP and effectiveness in cost management

is asked the results obtained are as53% felt ERP can do effective cost

management. 24% of employees felt that ERP cannot do any cost management.

23% of employees dont have any view regarding this.

STRONGLYY

DISAGREE, 9%SOMEWHAT

DISAGREE, 15%

NEURTAL, 23%SOMEWHAT

AGREE, 38%

FULLY AGREE, 15%

ERP IMPLEMNTATION HELPS ORGANIZATION

TO DO EFFECTIVE COST MANAGEMENT

STRONGLYY DISAGREE

SOMEWHAT DISAGREE

NEURTAL

SOMEWHAT AGREE

FULLY AGREE


65/72



Case Processing Summary

Cases

Valid Missing Total

N Percent N Percent N Percent

MOTIVATION BEHIND

IMPLEMENTING ERP IN

THE ORGANIZATION * no

of yrs of working exp in ERP

40 100.0% 0 0.0% 40 100.0%

MOTIVATION BEHIND IMPLEMENTING ERP IN THE ORGANIZATION * no of yrs of working exp in ERP

Cross tabulation

Count

MOTIVATION BEHIND IMPLEMENTING ERP IN

THE ORGANIZATION

no of yrs of working exp in ERP Total

Less

than 1

1 to 3 3 to 5 5 to 7 more than

7

COMPLEXITY OF THE ORGANIZATION 0 1 1 0 0 2

NEED TO REDESIGN THE PROCESS 1 0 1 3 0 5

COMMITMENT AND SUPPORT FROM

TOP MANGEMNT0 2 0 2 5 9

TO AVOID DATA REDUNDENCY 2 0 3 1 2 8

ENSURE CONTROL OVER THE

RESOURCES4 1 5 2 4 16

Total 7 4 10 8 11 40

Chi-Square Tests

Value df Asymp. Sig. (2-

sided)

Pearson Chi-Square 21.987a 16 .044


66/72



The Pearson chi-square value obtained is less than .05 which implies rejects the

null hypothesis and accepts the alternate hypothesis. So there is a significant

relationship between the motivation behind implementing ERP in the

organization and an employees years of working experience in ERP. As the

employees work experience increase he will have more idea and clarity

regarding the issues the company face. and understand the need to automate

system to reduce the work load.


67/72



Case Processing Summary

Cases

Valid Missing Total

N Percent N Percent N Percent

MOTIVATION BEHIND

IMPLEMENTING ERP IN

THE ORGANIZATION * on

an average I am dealing

with ERP for about__hr/

week

40 100.0% 0 0.0% 40 100.0%

MOTIVATION BEHIND IMPLEMENTING ERP IN THE ORGANIZATION * on an average I am dealing

with

ERP for about__hr/ week Cross tabulation

Count

MOTIVATION BEHIND IMPLEMENTING ERP

IN THE ORGANIZATION

on an average I am dealing with ERP for about__hr/

week

Total

less than 5

hours

five to

ten

hours

ten to

fifteen

hours

fifteen to

twenty

hours

more than

20 hours

COMPLEXITY OF THE

ORGANIZATION0 0 1 0 1 2

NEED TO REDESIGN THE PROCESS 0 0 3 2 0 5

COMMITMENT AND SUPPORT FROM

TOP MANGEMNT1 1 2 4 1 9

TO AVOID DATA REDUNDENCY 3 2 3 0 0 8

ENSURE CONTROL OVER THE

RESOURCES0 3 5 6 2 16

Total 4 6 14 12 4 40


68/72



Chi-Square Tests

Value df Asymp. Sig. (2-

sided)

Pearson Chi-

Square20.409a 16 .023

One more chi square test was conducted to know if there is any relationship

between the motivation behind implementing ERP in the organization and the

no of hours a person dealing with ERP. The intention behind this was to know if

the implementation was successful or not. From the result we can analyze that

their is a significant relationship between the no of hours a person dealing with

ERP and motivation behind implementing ERP in an organization.


69/72



CHAPTER- FIVE

FINDINGS, RECOMMENDATIONS &

CONCLUSIONS


70/72



The results obtained from the survey can be interpreted as 35% of employees

they are dealing with ERP for about ten to fifteen hours out of the total sample

size of 40, 30 employees spend 10hours or more with ERP/week thus the

employees they have sufficient exposure regarding the software . 26% of the

employees have more than seven years of experience with ERP, thus majority

of the employees have more than three years of experiences with ERP.

The implementation effectiveness was measured by asking the question how

much ERP fulfilled the business strategy 40% of employees felt ERP fulfil 60 to

80% of the business strategy thus the organization is successful in automating

its activity with ERP. Thus we can say that the implementation is effective. 35%

of the employees felt that the motivation behind implementing ERP is to ensure

control over the resources. Employees faced different problems during the

implementation period the prominent among it was the employeesresistance to

change. 40% felt that the find its the resistance to change which is the major

problem company faced. Again the employees opinion regarding the factors to

avoid ERP implementation failure was asked and 44 % of the employees felt animplementation expert should be there in the team to avoid the failure.

60% of the employees they agree to the fact that they will recommend ERP to

another organization of their own type. 38% of the employees is of the opinion

that ERP helps them to complete their project on time. 44% of the employees

feel integration of different department happened with the ERP

implementation.35% of the employees are of the feeling that the old system wasbetter compared to the newly implemented system. 44% of the employees felt

for the success of ERP the top management support is essential. 33% of the

employees felt the person dealing with ERP should have necessary technical

and business knowledge. 43% feel integration of different department is

essential for the success and effectiveness of ERP


71/72



BIBLIOGRAPHY

1. Agarwal, R., and Prasad, J. (1997). "The Role of Innovation

Characteristics and Perceived Voluntariness in the Acceptance of

Information Technologies." Decision Sciences, the Decision Sciences

Institute, 28(3), 557-582.

2. Barker, T., and Frolick, M. N. (2003). "ERP Implementation Failure: A

Case Study."Information Systems Management, Auerbach, 20(4), 43-49.

3. Burch, J. G., and Grudnitski, G. (1989

Documents

syntheite group erp