ERP- A Brief Structure and Discussion of its Success and Failure


Enterprise resource planning (ERP) systems are increasingly being adopted by organizations in developed countries, this adoption seems beset by significant rates of faliure, leading to a large waste of investment and other resources. This paper seeks to understand why ERP failure occurs. In doing this, it moves beyond the factor lists that have so far dominated analysis. Instead, it makes use of the "design—reality gap" model. This conceptual framework aims to be comprehensive but also contingent; sensitive to the specific conditions of any individual client organization. The design—reality gap model is applied to a case study of partial ERP failure in a Vishal mega mart manufacturing to retailing firm. The model analyses the situation both before and during ERP implementation. It finds sizeable gaps between the assumptions and requirements built into the ERP system design, and the actual realities of the client organization. It is these gaps — and the failure to close them during implementation that underlies project failure. The paper draws conclusions about good practice in ERP impiejneniation relating to both risk identification and risk mitigation. But it also notes challenges existing in some developing countries contexts that may continue toconstrain the effective use of enterprise resource planning systems.

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