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International Journal of Computer Trends and Technology (IJCTT) volume 6 number 2 Dec 2013

ISSN: 2231-2803 http://www.ijcttjournal.org Page99



Change Management for Human in Enterprise Resource Planning
System

Abdullah AL-Malaise AL-Ghamdi
1
, Khulood Salem Albeladi
2
, Afnan Atiah
Alsolamy
3

Department of Information Systems
Faculty of Computing and Information Technology
King Abdulaziz University, Jeddah
Kingdom of Saudi Arabia



Abstract - In recent years, there are more enterprises that
use Enterprise Resource Planning (ERP) to gain significant
advantages through allowing for An organization to control
its business processes and gaining benefits of enhanced
process flow, improved data analysis, better profit margins ,
reduced inventories, and better customer service. ERP
considers strong tool for getting competitive advantage for
any organization. Although many enterprises chose ERP
system, the ratio of the success was low. In this paper, the
authors analysis some critical success factors and
challenges which influence the implementation of ERP
system to contribute in increasing the ERP implementation
success rate. The most significant issues during ERP
implementation process is employees' resistance to accept
the new system and dealing with it. Therefore, this paper
mainly focuses on how to use change management
approaches and strategies to improve the individuals'
acceptance rate which lead to successful ERP
implementation.


Index Terms - ERP, change, management, resistance.
I. INTRODUCTION
In today competitive and complex world there is a huge
need for enterprise system to manage business effectively.
ERP is a cross-functional information system with modular
design and one centralized database. It integrates
organization internal core business processes like
manufacturing, production, accounting, financial, human
resource, sales and etc. In addition, it manages outside
relationship of the organization. It administrates company
relationship and partnership with supply chain management.
In addition, customer's relationship management is big
module of any ERP system. It provides seamless data flow
information within entire organization through ERP modular
integration [1] [2].
One of most important parts of a successful ERP
implementation is managing the changes which help
employees to smoothly transition from the way that they do
different business processes before ERP implementation to
the way that they will do them under the new ERP system.
ERP change management is the process for the first time
new system implementation or changing from one system to
another which can be internally or externally. Internal
change management is done through shifting particular
employees from their daily job activities to be members of
change management team. Business managers will select
employees who have particular experience of the ERP
system or business processes of departments that will
receive the new system. External change management means
an organization requires hiring a management consultant or
other change management team who have a special expertise
with the change management process [3].
This paper is organized into six sections. Next section
presents some benefits of ERP. Second section shows a
summary of CSFs of ERP implementation. Third section
explains the challenges that face most enterprises during
implementation process. In fourth and fifth sections, change
management approaches and strategies are explained. In the
Final part, a conclusion and future work is proposed.

II. BENEFITS OF ERP
A successful implemented ERP system integrates both
external and internal flow of information which used by the
organization within a central, comprehensive solution. One
of the most useful benefits of implementing ERP is easier
daily management of an organization. With ability to real
time access to information, employees are better able to
make decisions accurately and quickly.
Benefits of ERP can be classified into operational,
managerial, and strategic[4][5][6].Operational benefits
include automating business processes which offer benefits
in term of productivity improvement , improved customer
service, cost reduction, and quality improvement. ERP can
help organization to achieve managerial benefits by
providing one central database and effective data analysis
process which helps an enterprise to improve decision
making and planning, achieve better resource management,
and performance improvement. Through large scale business
involvement and integration capabilities, organization will
get strategic benefits which mean ability of assist business
growth, innovation ,alliance, cost, and differentiation [4] [6].


International Journal of Computer Trends and Technology (IJCTT) volume 6 number 2 Dec 2013
ISSN: 2231-2803 http://www.ijcttjournal.org Page100

III. ERP CRITICAL SUCCESS FACTORS
ERP is an a integrated IT system which combine both of
enterprise's strategy and structure to achieve organization
objectives and goals through doing well designed business
processes. Due to many approaches of ERP implementation,
there are a lot of failure and success implementation stories.
The enterprises that successfully implemented ERP system
will get the benefits because it became have an ability of
built in data processing which lead to qualified decision
making process.
Most of research papers defined critical success factors
as the guide lines where processes should done right to
achieve an effective implementation. Below, there are the
most popularized CSFs that have a big contribution in
successful ERP considered implementation.

a. Top Management Support
The support of top management during implementing
ERP system considered as the most significant and vital
success factor [7].There are two main key functions that
must be take into account of top management support. First,
providing leadership; second, providing the necessary
resources. These resources include time, money and
personnel necessary for the ERP implementation.

b. Business Process Reengineering
Business Process Reengineering (BPR) is powerfully
associated with how the ERP modules are selected to
improve current business process [4]. It defined as radical
redesign and rethinking of business processes, structure, and
work flow within enterprise to achieve improvements in
critical areas such as quality, cost, speed and response time
[5]. Enterprises must have a capability to change its business
process to make the new ERP system ability to serve the
company as it expected , managers should kept in their mind
that the new software could not be changed after
implemented successfully.

c. Change Management
Change management going to contribute to make sure
that the readiness and acceptance of the new implemented
ERP software; it is allowing the company to gain the
advantages of using software [8]. An effective change into
organization environment includes change of employees'
behavior, using latest useful technology and redesign of
business processes. This paper will explain in detail the
concept of change managements, its importance, its
strategies and approaches

d. Consultant and Vendor Support
According to the difficulty of ERP implementation
process, there is a strongly need to get benefits of
consultants who have a special knowledge regarding how to
implement ERP system successfully. Those consultants
either can be external or internal [7] who can help
organization employees to overcome all obstacles that facing
them while they are using new ERP system.
Experts can be included during multiple steps of ERP
project implementation, although consultants teams have a
lot of experience regarding ERP installation, But still the
employee of an organization know more and more about
how their business process integrated and combined and
how exactly the result should be, therefore the managers
must be both carefully and accurately while the form the
consultants team [4].

e. Management of Risk
The ERP implementation process is not easy activity;
there is a big a possibility of occurrence of unfortunate
events [5]. Therefore, management of risk is needed to
control as much as possible the occurrence of unexpected
events. Risk management must be applied for operational
and strategic contexts of organization [6]. Risk management
can be defined as an iterative process that focuses on
minimizing risks and their impact.

f. User Involvement
User involvement means users contribution during the
process of ERP implementation. Users participation in the
implementation process can be classified into two main key
areas: First, user involvement in the early stage of specifying
of the organization requirements. Second, user involvement
in the stage of testing new ERP software [6].

g. Organizational Culture
Enterprise should have a powerful ability to accept the
change in its environment. ERP system involving a creative
ways of performing different business processes to create a
competitive advantage. Therefore, it requires that the culture
of organization must be open and has ability to adapt with
rapid change in business environment to facilitate the
implementation process and make it successful [5].

h. User Training and Education
The main goal of training course for implementing ERP
system is to improve employee ability for dealing with new
software and create a comfortable and creative business
environment which enhance employee productivity and
efficiency [4].the training program should not ignored the
specific employees' needs such as how to fix some problem
that may facing them during doing their routine daily work
[6].



International Journal of Computer Trends and Technology (IJCTT) volume 6 number 2 Dec 2013
ISSN: 2231-2803 http://www.ijcttjournal.org Page101

IV. ERP CHALLENGES
Challenges through ERP implementation are quite
normal. Prior planning for receiving new system is very
important to overcome the challenges. These challenges
include: lack of clear requirements, users resistance to
change, customization, and improper testing.
a. Lack of Clear Requirements
If the requirements of new ERP system are not defined
clearly and accurately, that will lead to non availability of
particular important functionalities. The implementation
team will face a lot of obstacles during installation process
if the requirements not clear enough[6].

Top management should make sure that the requirements
are carefully defined because one of the critical
customization drivers is missing of clear and accurate
business requirements. In case that the business
requirements are not correctly defined and controlled, that
will produce more likely probability of creating unnecessary
system customizations[6] [9].

b. User Resistance to Change
If the users are not realized the benefits of ERP system
they will resist it. Employees' resistance is the normal
reaction of human in times of change this resistance increase
the importance of effective change management which can
control and mitigate much of this resistance [9].

c. Customization
Customization is the process of fitting the selected ERP
module to the needs of an organization. Nowadays, most
companies understand that customizing their ERP system
adds time, cost, and risk to the project. This will suggest that
the business may need to invest more in organizational
change management to help both employees and key
stakeholders adapt to new ways of doing business
processes[6][9].

There is a little difference between ERP system
configuration and customization which may create some
confuse to managers. Configuration process does not need
any modification into source code, it is normal set up of the
system while customization process requires modifications
into both source code and into technical aspects of software
[4].

d. Improper Testing
The main goal of testing in an ERP implementation
process is not to ensure whether the system works or not.
But, to make sure that the new system meets organization
business requirements and produces the expected results.
Testing process must be serious and regularly repeated to
remove possibility occurrence of problem at ERP go live
stage [9].

V. CHANGE MANAGEMENT
Change management is type of management that deals
with how to adopt and control the effect change inside the
organization. It ensures smooth transformation from existing
current status of system and processes to new and different
ones that affect organization business process, individuals
and groups.
Change management is the planning process to assist
organization in managing people and their way of doing
jobs, business processes that may need to altered, in a way
that reach the goals of technological change. It involves
effective communication with end users of a system and
stakeholders about impact of expected range of change of
implement new system. It includes formulae and develops
special techniques and mechanisms to prepare the whole
parties in organization to be ready to adapt new technology.
In a way is that will achieve goals of changing and take
advantages of proposed ERP [10] [11]. In [12] said that
change managing people emotional and passionate that
happen during and after huge change in organization.
As mentioned in [13] that the percentage of failure ERP
implementation is very high. It can be estimated between 60-
90%. In other hand, 90% of successful implementation
companies report that change management has significant
effect on their effective ERP implementation [10].
To reach an effective and successful change
management, there are many prerequisites. First of all,
develop clear vision and mission for the reasons of change.
It means to characterize how the organization future shapes
after change and setting goals to reach it. In addition, ensure
that change vision is distributed from top to down through
structure hierarchy of organization. Moreover, a third
prerequisite is preparing culture and environment of
organization to accept expected change. Also, strong
leadership of top management that committed to success
change management is a great factor to success of change
management [10].
Resistances of employees to any new system as ERP
come from many reasons. In [8] said that risk and habit are
the main cause their resistance and rejection. Risk related to
as human being neutral to fear from any new innovation as
implement ERP. The second reason is routine activities and
daily habit in their doing work. They fear that if new system
adapted, they may lose their control of work and disrupt
them. Moreover, in [1] state four reasons for employees'
resistance for ERP. First one is employee self-interest which
may adopt ERP system lead to threaten their current position
and interest. Secondly, lack of trust and misunderstanding of
how could ERP will improve business. Also, different
assessment and views to ERP is a third reason. The final
reason is that with implement ERP will increase the effort
and stress.
International Journal of Computer Trends and Technology (IJCTT) volume 6 number 2 Dec 2013
ISSN: 2231-2803 http://www.ijcttjournal.org Page102

VI. CHANGE MANAGEMENT APPROACHES
Aladwani in [8] suggest an integrated, process- oriented
approach to limit employee resistance to ERP. It consists
from three phases based on time of ERP life cycle
implementation. The first phase is knowledge formulation,
then strategy formulation, and finally status evaluation.
In first phase, top management has to prepare and measure
employee acceptance to ERP. They have to answer many
questions like what are needs and interests of resisting
employees, which their beliefs and values, and why they
resistance. From these answers can build start point to
successful change management. Some user may say that
they doing excellent jobs for many years without ERP. Also,
other may say that new system will threaten her/his work
position in the organization.
Second phase is to implement real strategy of change
management. The first strategy is communication. The
effective communication with employees will reduce
resistance because they will be aware of ERP benefits.
Knowing about how ERP improve their work can build
anticipation to system. Also, they are more acceptable if they
know how ERP work. The second strategy in this phase is
cost minimization strategy. It means that when employees
believe that ERP system will improve their work and
decrease cost and effort in doing job, thus lead to build their
interest in ERP. Also, differentiation strategy is related to
quality of implemented ERP. If it is high quality with
functional and friendly user interface will help in
acceptance. In addition, training has a great impact on
reducing resistance.
Third phase is status evaluation phase. It is concluded to
check if change management strategies are implemented in
an effective way. These results and feedback are presented
to top management in dynamic and timely manner.
Another model proposed by Kerimoglu and BaUogluI in
[14] about optimizing change management to implementing
ERP successfully. This approach based on minimizing gaps
between three necessary parties to successfully implement
ERP. The first goal is to minimizing the gap between the
technology and human. Also, minimizing gab between
human and organization and between technology and
organization. Reducing the distance between them will
guarantee success of change management. In addition,
reaching optimal point will maximize ERP system. ERP best
fit with business process, customization, and business
process reengineering (BPR) all of them used to reduce the
range between technology and organization to reach the
optimal point for both. As known no ERP system fit exactly
with certain business process. However, chosen one that is
most compatible with them will reduce employees'
resistance and enhance change management. Admittedly,
even most compatible need either BPR of business process
to match ERP standards or customization it to acceptable
level that improve change management. On the other hand,
proper training, effective communication, hire consultants
and fire very aggressive resistance employees will help to
enhance both technology- human compatibility and
organization-human compatibility.

VII. CHANGE MANAGEMENT STRATEGIES
To make changes in organization in effective and
dynamic way, managers have to get advantages of change
management strategies. Then, apply them in organization
environment to reach all goals of this change in most
smoothly ways and with minimal risks. In [15] authors
studies twelve case studies of companies that have been
implement ERP successfully. The aim of that is to
investigate most functional change management strategies to
implement them in most efficient way and with less user
resistance. They are top management support, project
champion, dynamic communication, clear planning to all
stages, and training that enable knowledge transfer. Top
management mention early as one of success factors of ERP,
it also 91.6% of successful strategies for change
management for surveyed project. In addition, the presence
of project champion has a great influence as 58.3% of
successful case studies of change management. In addition,
symmetric planning strategy is with 50%, communication
with 100%, effective training strategy with 75% of
successful projects implement change management
strategies successfully.
VIII. CONCLUSION
ERP implementation is influenced by set of challenges
and this could partially explain a large failure rate of
implementation. As this paper has presented, a resistance to
change is considered to be the most important challenge of
successful ERP implementation. While employees'
resistance is the normal reaction of human in times of
change, effective change management can control and
mitigate much of this resistance. Change management is not
just an approach for managing resistance in case it occurs,
but it is most effective as a tool for activating and engaging
employees in a change. This will reduce the probability of
employees' resistance that which improve the likelihood of a
implementing ERP system successfully.

IX. FUTURE WORK
Further research should use a quantitative method to find
which factor is most essential in ERP system successful and
failure.
X. ACKNOWLEDGMENT
First and foremost, all thanks to Allah for help us to
complete this research. Special thankful is to our supervisor
Dr. Abdullah. He supported us until completion of this
paper.


International Journal of Computer Trends and Technology (IJCTT) volume 6 number 2 Dec 2013
ISSN: 2231-2803 http://www.ijcttjournal.org Page103

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