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Understanding End-Users' Acceptance of Enterprise Resource Planning (ERP)

System in Project-Based Sectors

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DOI: 10.1109/TEM.2011.2111456 · Source: IEEE Xplore

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IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT
Understanding End-Users’ Acceptance of Enterprise
Resource Planning (ERP) System
in Project-Based Sectors
Young Hoon Kwak, Jane Park, Boo Young Chung, and Saumyendu Ghosh, Senior Member, IEEE
Abstract—This study aims at providing an alternative view of
users’ enterprise resource planning (ERP) acceptance. Despite the
large body of literature, there are still empirical inquiries to investi-
gate the ERP system implementation from end-users’ perspectives
as well as from different organizational contexts. To address these
issues, we set a project-based sector as our population of inter-
est and seek to understand how project management practices are
interrelated with end-users’ cognitive perception, and in the end,
with their behavioral intention of using the ERP system. In do-
ing so, this study incorporates the best practices of ERP system
implementation projects, internal support, external (consultant)
support, and functionality selection, into the extended technology
acceptance model (TAM) that includes belief constructs and so-
cioenvironmental construct (subjective norm). The empirical anal-
yses show that managerial practices and socioenvironmental factor
are significantly related to the original TAM variables in the con-
text of ERP system. One of the interesting findings is the negative
effect of consultant support on perceived usefulness, but positive
effect on the perceived ease of use, suggesting a useful reference
for future research. This study extends the existing literature by
investigating potential managerial and socioenvironmental factors
affecting user adoption behavior in a different organizational con-
text. This study would also benefit project-based sectors by offering
valuable managerial insights that enable them to appreciate and
improve end-users’ ERP system acceptance and utilization.
Index Terms—Enterprise resource planning (ERP) system,
project-based sector, project management practices, technology
acceptance model (TAM).
I. INTRODUCTION
A. ERP, Project-Based Sectors, and Users’ Acceptance
REVIOUS research has suggested that information tech-
P nology (IT) can promote organizational performance by
enhancing operational efficiency and innovation [23]. Among
various technologies, ERP systems are described as “the most
Manuscript received January 15, 2010; revised August 9, 2010 and
November 23, 2010; accepted January 14, 2011. Review of this manuscript
was arranged by Department Editor J. K. Pinto.
Y. H. Kwak and J. Park are with the Department of Decision Sciences,
School of Business, The George Washington University, Washington, DC 20052
(e-mail: kwak@gwu.edu; janepark@gwmail.gwu.edu).
B.Y. Chung is with the Smart City Development Group, Samsung SDS Co.,
Ltd., Seoul, Korea (e-mail: constopia@gmail.com).
S. Ghosh is with the A. J. Clark School of Engineering, University of
Maryland, College Park, MD 20742 USA (e-mail: sghosh12@umd.edu).
Color versions of one or more of the figures in this paper are available online
at http://ieeexplore.ieee.org.
Digital Object Identifier 10.1109/TEM.2011.2111456
0018-9391/$26.00 © 2011 IEEE
1
important development in the corporate use of IT in the 1990s”
[19]. ERP systems enable firms to achieve better performance
by standardizing information and integrating various business
functions including finance, human resource, manufacturing,
sales, marketing, etc. [39], [83]. For this reason, ERP systems
have become a pervasive feature of dynamic business condi-
tions. Ko et al. [44] reported that more than 60% of firms in the
United States are in some stage of implementing ERP systems.
Skibniewski and Ghosh [62] also reported that globally the ex-
pected revenue of ERP software was approximately $31 billion
in 2006. Given such widespread demand and the magnitude of
the expenditure, academic researchers as well as practitioners
have paid a great attention to the mechanism of successful ERP
system implementation.
A global phenomenon of the ERP system implementation
has also brought about changes in project-based sectors, which
is noteworthy in the field of organizational innovation. Unlike
manufacturing or other process-oriented sectors, project-based
sectors such as engineering and construction, shipbuilding, me-
dia and entertainment, and others have different challenges as-
sociated with their business processes [70]. Every project that
they engage in is unique and involves multiple stakeholders
working together to meet its goals and objectives that deals with
unique set of complex data and information. The abundance
of disintegrated information and its time sensitiveness in activ-
ities often make projects difficult to manage, suggesting that
the obsolete legacy systems need to be replaced to cope with
highly fragmented, less standardized, and geographically dis-
persed business processes [17]. Recently, a number of project-
based firms started to regard the ERP system implementation
as an inevitable process of innovation [51]. Some are already
done with the implementation, and others are in the process
of, or seriously considering the ERP system [17], [70]. Major
ERP systems’ vendors such as systems applications and prod-
ucts (SAP) and Oracle also started to provide specific solutions
for project-based organizations [17].
It is important to note that decisions associated with the ERP
system implementation are owned by senior level managers
without looking at the “big picture” [30] and that most of the
end users are involved merely at the later phases of the project
such as training phase [82]. This leads us to a question; do
end users share the same vision with senior managers in the
ERP system implementation? Several case studies report that
this is not always the case [4], [51]. According to them, due to
the inadequate involvement in the projects, end users usually
have different perspectives about the necessity of the system.
2 IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT
Moreover, it is reported that end users are generally more skep-
tical about the newly implemented complex system, which is
reflected in the rejection or under-utilization [4]. Researchers
have identified those user-related factors as critical risk factors
for the ERP implementation projects, let alone the complex na-
ture of the projects [14], [53], [55]. That is, even if a system
is installed on time and within budget, it is undesirable if users
perceive the system useless for their work processes or need to
spend a long time in figuring out how to use it.
In the context of project-based sectors, the notion of improv-
ing user acceptance becomes more challenging. One reason for
this can be attributed to the conservative nature of them, regard-
less of the industry, implying that the obsolete legacy systems
are not easily given up unless users are strongly convinced of
the necessity of new systems [41], [51]. In addition, the fact
that a majority of users are not IT experts could make them
remain at the very fundamental level of applications in the work
processes [17]. Lack of understanding of their technological ca-
pacity and little exposure to the best practices provided by the
ERP systems also make them difficult to invest in such a sys-
tem [70]. In a highly fragmented project-based setting, multiple
stakeholders from various disciplines come and go, and take
different ownership as project proceeds [66]. It is suggested that
a high level of interdepartmental collaboration is required to
reengineer the flow of information and communication. Thus,
there has to be a different paradigm that incorporates input from
end users who value their acceptance to address varying degrees
of acceptance across end -users especially in project-based sec-
tors [8].
B. Research Objectives and Questions
So far, very limited empirical research has been done to in-
vestigate the technology acceptance from users’ perspectives,
let alone project-based sectors’ ERP system implementation.
By neglecting users’ perspectives of the system, it is likely to
bring about their perfunctory utilization of the system and, con-
sequently, may hinder organizations from achieving what they
expected from the expensive ERP system. Also, by looking
merely at conventional process-based sectors, it is hard to es-
tablish empirical validation across a variety of organizational
context. Given the large body of knowledge on the ERP system
projects, we think that this is a significant void in the exist-
ing literature. Therefore, we set a project-based sector as our
population of interest and seek to understand how project man-
agement practices are interrelated with end-users’ cognitive per-
ception, and in the end, with their behavioral intention to use
in the context of ERP system. At the same time, we include a
socioenvironmental factor (subjective norm) to model the real-
ity better where multiple stakeholders interact when using the
organization-wide systems.
In doing so, we are extending the technology acceptance
model (TAM) proposed by Davis [20] to seek the relationships
because it is the most relevant to this research as well as the
most reliable from a theoretical point of view. TAM regards
perceived usefulness and perceived ease of use (EOU) as ma-
jor determinants of information systems (IS) usage. Based on
TAM, numerous studies have attempted to identify external fac-
tors that affected core TAM variables. Most of the studies, how-
ever, have been mainly focused on relatively simple systems
such as email or office automation [5], [36], [38], [50], [52].
Recent studies dealing with the ERP system have focused on
the internal managerial practices such as training [5], or have
incorporated cultural (uncertainty avoidance) and cognitive (en-
joyment) factors to TAM [37]. There has also been an attempt to
relate product quality and organizational characteristics to ERP
users’ cognitive responses [74]. But still, few have investigated
different organizational contexts or considered the impact of
socioenvironmental factor and external (consultant) support on
users’ intention to accept the ERP system. With the increased
complexity of IS associated with cross-functional business pro-
cesses and multiple types of users involved, we expect that
research on successful IS implementation would benefit from
extending TAM in a complex business application such as ERP
system.
We address the following three issues for this research. First,
based on the literature review, we identify potential explanatory
factors associated with successful ERP system implementation.
Second, we develop a set of hypotheses to investigate the re-
lationship between those factors and core TAM variables, that
is, the perception and behavioral intention among users. Third,
we test the hypotheses using multiple regression analyses and
discuss the implications. This study extends the existing ERP-
related literature by integrating the context of project manage-
ment with TAM in project-based sectors. This could be a step-
ping stone to validate the ERP success model across various
organizational contexts. At the same time, practitioners would
benefit from this study by obtaining valuable insights into their
managerial practices which enable them to improve users’ ERP
system acceptance and utilization, and in the long run, to gain a
competitive advantage in a fast-changing business environment.
II. THEORETICAL BACKGROUND AND HYPOTHESES
A. Users’ Acceptance and Utilization: Technology Acceptance
Model
One of the key indicators determining information systems
success is the level of system usage which is reflected in the
technology acceptance by users [5], [22]. When investigating
users’ acceptance and utilization of information systems, it is
important to consider the work of Davis et al. [21]. Based on
the theory of reasoned action [2], David et al. [21] proposed
TAM which explains the relationship among users’ perception,
attitudes, and behavioral intention to use new information sys-
tems. Specifically, TAM describes that users’ perception affects
their behavioral intention to use, and in the end, the behavioral
intention leads individuals to the actual use of new information
systems [21].
There are two fundamental propositions pertaining to TAM.
First, behavioral intention to use information systems can be
determined by two particular beliefs about the technology: per-
ceived usefulness (PU) and perceived EOU. According to David
et al. [21], PU refers to “the prospective users’ subjective prob-
ability that using a specific application system will increase
KWAK et al.: UNDERSTANDING END-USERS ACCEPTANCE OF ERP SYSTEM IN PROJECT-BASED SECTORS
his or her job performance within an organizational context.”
Since improved performance is associated with various rewards
such as incentives and promotions, PU serves as the trigger of
technology acceptance behaviors [81]. Perceived EOU, defined
as “the degree to which the prospective user expects the target
system to be free of effort,” is also theorized to have an explana-
tory power of behavioral intention through the attitude toward
using. The greater a user’s sense of efficacy, the more he/she
is intrinsically motivated to use the system [10], [49]. Because
EOU increases people’s level of self-efficacy [10], it can also
be linked to the behavioral intention to use. The robustness of
these relationships has been receiving empirical supports by
numerous subsequent studies [79].
The other proposition is that these two beliefs mediate the re-
lationship between the intention to use information systems and
external variables. David et al. [21] suggested system features,
training, documentation, and user support consultants as poten-
tial explanatory variables of EOU. Additionally, factors such
as general computer self-efficacy [75], [76], level of education,
job roles, and prior similar experiences [1], game-based train-
ing [78], shared belief and project communication [5], etc., had
been proposed to influence on PU or EOU [54]. As David et al.
[21] stated, identifying external variables would make a contri-
bution to the literature as they may have significant implications
of managerial interventions as well as individual differences.
In addition to the original TAM variables, this study puts
emphasis on a socioenvironmental factor as a potential deter-
minant of PU and EOU because ERP is an organization-wide
system that requires reengineering of current business processes
involving multiple stakeholders. Therefore, we additionally in-
clude subjective norm as a determinant of technology accep-
tance on the basis of Venkatesh and Davis’s [77] extended
model. Subjective norm refers to “a person’s perception that
most people who are important to him think he should or should
not perform the behavior in question” [27], [77]. While pre-
vious studies have reported inconsistent findings on the role
of social influence process in the context of technology accep-
tance [21], [33], [40], [50], [52], [56], [71], [72], [79], Venkatesh
et al. [77] empirically validated the significant effect of subjec-
tive norm on PU and intention to use. Especially, subjective
norm was found to be directly related to intention to use for
mandatory usage context. Given the unique characteristics of
ERP system of which organizations mandate the usage, it is rea-
sonable to expect subjective norm to be significantly related to
the intention to use as well as PU. Note that we do not specify
the direction of the relationship. The reason is that this relation-
ship can be negative when negative social norm is prevalent in
a group or an organization [67].
Subjective norm indicates the support and encouragement
received by the end users from the peer community. The hy-
pothesis related to subjective norm is based on social normative
influence and role of group norms. Social normative influence
is defined by Kelman [42] to be the influence that is a species of
compliance and is based on the need for approval, acceptance,
or fear of reprisal, while group norm works in group context.
Another social process important to technology acceptance that
must be considered is identification and association with the
3
group. Kelman [42] defined identification as self-defining re-
lationship a person has with another person or group. The in-
fluence of this social identity on the decision maker must be
considered. Bagozzi [8] indicated that decisions with regard to
technology acceptance and actual usage are often made collab-
oratively or with an aim to how they fit in with, or affect, other
people or group requirements.
The following are five hypotheses proposing the relationships
among behavioral intention, PU, perceived EOU, and subjective
norm.
Hypothesis 1a: PU will be positively associated with behavioral
intention to use ERP system.
Hypothesis 1b: Perceived EOU will be positively associated with
behavioral intention to use ERP system.
Hypothesis 1c: Subjective norm will be significantly associated with
behavioral intention to use ERP system.
Hypothesis 1d: Perceived EOU will be positively associated with
PU.
Hypothesis 1e: Subjective norm will be significantly associated with
PU.
B. External Variables: Critical Success Factors
for ERP Projects
1) Internal Support: In this study, internal support en-
compasses three kinds of organizational intervention: 1) top-
management support; 2) training; and 3) project planning. Top-
management support has been identified as the most critical fac-
tor for achieving better project performance. The effect of top-
management support on IS implementation success, however,
has not been fully validated in the empirical analyses in terms of
its significance as well as its predictive power [29], [32], [45],
[59]. Sharma and Yetton [61] explain the inconsistency using
task interdependence which refers to the degree to which two or
more activities interact to determine an outcome jointly. Accord-
ing to Sharma and Yetton [61], the effect of top-management
support on user satisfaction is moderated by the level of task in-
terdependence such that top-management support can be more
effective in the context of higher task interdependence. As noted
earlier, ERP system implementation increases the level of task
dependence through coordinating all the resources, information,
and functions of a business from shared data stores [24]. Fur-
thermore, individuals receiving higher level of internal support
while adopting ERP system would have stronger impression of
the relevance of the system which is closely linked to PU [13].
Thus, it is reasonable to expect that management support would
have a positive effect on PU.
Amoako-Gyampah and Salam [5] and Marler et al. [54] also
suggested that training is another form of organizational in-
tervention which can facilitate technology acceptance among
users. Since ERP system implementation involves consider-
able changes in organization-wide technology and business pro-
cesses, supervisors as well as subordinates must be trained in
order to fully utilize the system. The mediated relationship be-
tween training and intention to use is well explained by the
work of Venkatesh and Davis [76]. Their analysis revealed that
4 IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT
direct experience with a new system has a significant effect on
perceived EOU by changing users’ perceived self-efficacy [76].
For most of the users, training would be the first experience
with an ERP system. Thus, it is possible that training designed
to improve users’ self-efficacy affects intention to use through
changing their perceived EOU of the system. Training may also
explain intention to use via PU [1], [43], [54]. Since training
conveys information on the new system, it would be the first ex-
perience and opportunity for users to compare the new system to
currently used one, and to learn the value of the new system [1].
Thus, it is expected that training enables users to form the PU
of the new system in relation to job relevance. That is to say, it
is possible that training is positively related to PU.
We can also argue the positive relationship between PU and
project planning works in a similar manner as to the relation-
ship between PU and top-management support. That is, when
an ERP implementation project is well planned and progressed
as originally planned, it is expected that users would have higher
level of PU based on their perceived relevance of the system.
Actually, Ferratt et al. [25] grouped top-management support,
training, and project planning into internal support using fac-
tor analysis on the best practices (Cronbach α = 0.89). More-
over, they reported that internal support is a strong determinant
of project efficiency which consists of change in information-
integration capabilities, change in information quality, change
in process and product quality, change in competitive business
performance, and overall satisfaction with the project outcome.
Based on the previous discussion, we suggest that internal
supports, as a whole, will be significantly associated with ERP
system implementation success. More specifically, these rela-
tionship supports affect an individual’s PU and perceived EOU,
and subsequently, the perception determines an individual’s in-
tention to use. The following hypotheses test these relationships.
Hypothesis 2a: Internal support will have a positive relationship with
PU.
Hypothesis 2b: Internal support will have a positive relationship with
perceived EOU.
2) Function: We define function as the perceived degree of
ERP system’s functionality and its matching with an organiza-
tion’s necessary business processes [17], [25]. The importance
of function in achieving ERP system implementation success
has been well noted in the existing project management liter-
ature [15], [25], [34], [57], [65], [68], [73]. Generally, generic
functionality of the ERP system cannot perfectly cover a spe-
cific organizational requirement. Thus, organizational adaption
to the ERP system is indispensible in any case. Severe orga-
nizational misfit, however, can be a critical failure factor as it
is accompanied with great changes in business processes that
result in implementation failure through users’ increased resis-
tance against a new system [35]. Since the main target of this
revolutionary process is end users, we thought that it was neces-
sary to dispel users’ resistance and to increase their acceptance
of a new system in order to achieve implementation success.
Therefore, we developed the hypothesis that test the relation-
ship between levels of function with users’ acceptance of the
ERP system via PU.
When people make judgment about the technology accep-
tance, their decision is usually based on whether or not the tech-
nology has relevance to their job or a set of tasks [77]. According
to the image theory proposed by Beach and Mitchell [11], [12],
this judgment engages in a compatibility test and a profitabil-
ity test. A compatibility test involves screening process that
eliminates incompatible options from further consideration. For
example, if an individual judged the ERP system irrelevant to
the tasks, he/she would eliminate the system from the accep-
tance. A profitability test is the process of selecting the best
option for better performance gains. In this context, an indi-
vidual would accept the ERP system only when the system is
judged to improve his/her performance most. Following these
judgment processes, users cognitively assess whether or not
the system would be useful for their tasks [77]. The judgment
is important in the process of accepting ERP system because
actual behaviors (system utilization) stem from the judgment
about the fit between the functionality of ERP system and orga-
nizational requirements. Various theories such as action theory,
work motivation theory, and behavioral decision theory support
this reasoning [77].
With respect to the relevance, many scholars have suggested
similar concepts such as job-determined importance [48], task-
technology fit [31], cognitive fit [80], job relevance [77], etc.
Among them, the work of Venkatesh and Davis [77] is notewor-
thy. Drawing on image theory, Venkatesh and Davis [77] concep-
tualized a compatibility and profitability test as the perception
of job relevance and of output quality, respectively. According
to them, job relevance refers to “an individual’s perception re-
garding the degree to which the target system is applicable to
his or her jobs” and output quality represents “how well the
system performs those jobs.” Using these concepts, they em-
pirically tested and validated the meditational effect of PU on
the relationship between each of the perceptions and behavioral
intention to use. Following the discussion so far, we posit that
function will be positively associated with behavioral intention
to use ERP system in a way that function positively affects PU
which is a major determinant of behavioral intention to use as
the following.
Hypothesis 3a: Function will be positively associated with PU.
3) Consultant Support: Final external variable employed in
this study is consultant support which has also been identified
as one of the critical factors for ERP implementation projects
in previous studies [3], [17], [25], [28], [65]. Typically, ERP is
classified into the most demanding type of innovations due to
its complex and knowledge-intensive characteristics [44], [69].
With these characteristics, ERP implementation projects can be
easily jeopardized due to severe knowledge asymmetry [58] and
high knowledge barrier [7]. And the problem can be more seri-
ous when accompanied by the lack of in-house expertise [63].
For these reasons, scholars have argued that transfer of knowl-
edge is important especially in the context of ERP [44], [64].
Indeed, it is known that firms spend a large portion of bud-
get on using consultants (external experts) when implementing
the ERP system [16]. Also, the SAP annual report states that
the consulting service explains about 26% of its revenue [60].
KWAK et al.: UNDERSTANDING END-USERS ACCEPTANCE OF ERP SYSTEM IN PROJECT-BASED SECTORS
Hence, it seems that determining whether or not consultant sup-
port is significant is especially relevant in the context of ERP
system implementation.
We define consultant support as the perceived degree to which
consultant support helps to make ERP implementation success-
ful [17], [25]. This variable is different from training in terms
of sustainability. That is, the goal of consultant support goes
beyond the implementation success of a new system and en-
compasses ongoing operation, keeping up with changing tech-
nologies, etc. [44], whereas the purpose of training is enabling
users to acquire basic skills at the initial stage [26]. As noted
earlier, ERP system is a complex and knowledge-intensive sys-
tem. Moreover, most of the users are non-IS specialists who lack
technical knowledge [9]. Therefore, we can expect that consul-
tant support enables these users to increase ability to adopt a
new system [18] by lowering the knowledge barrier involved in
the acceptance of a complex information system [7]. And in a
similar vein to training which is expected to increase the per-
ception of usefulness and to decrease the perception of efforts,
it is possible to argue that consultant support would influence
those two constructs.
We can find the evidence supporting the relationship between
consultant supports and IT implementation success in the work
of Lacity and Willcocks [46] and Soh et al. [64]. In the study on
the adoption of structured systems analysis (SSA) by individual
system developers, Leonard-Barton [47] argued that perceived
accessibility of consulting moderately discriminated adopters
from nonadopters. Soh et al. [64] also reported that knowledge
transfer from consultants to business users is a critical success
factor for ERP implementation projects. These studies allow
us to argue that consultant supports may facilitate the user ac-
ceptance of the ERP system. Compared to training, however,
relatively less attention has been paid to consultant supports in
the ERP-related literature as well as technology acceptance lit-
erature. Based on the discussion, we posit that PU and perceived
EOU will have meditational effects on the positive relationship
between consultant supports and the success of ERP system im-
plementation. More specifically, consultant supports will posi-
tively affect PU and perceived EOU, respectively. Based on the
discussion, we developed the hypotheses as follows.
Hypothesis 4a: Consultant support will be positively associated with
PU.
Hypothesis 4b: Consultant support will be positively associated with
perceived EOU.
III. RESEARCH MODEL AND APPROACH
A. Research Setting, Sample, and Data Collection
For this study, we set the Engineering and Construction
(E&C) industry as a representative of project-based sectors.
Thus, the population of interest is stakeholders of E&C com-
panies who are currently using ERP systems in their working
environment. To test the hypotheses, the target respondents were
drawn from various construction-related sources such as trade
magazines, E&C-related websites, ERP vendors’ website, etc.
The data had been collected by both online and off-line sur-
5
Fig. 1. Sample description.
veys during the period between May 14, 2007 and June 24,
2007 [16]. Initially, the questionnaires were emailed to a total
of 2100 individuals; they were sent to 3000 individuals and 30%
of them were bounced back. Subsequently, about 750 question-
naires were additionally distributed by 100 of top managements;
vice presidents, senior managers, and IT managers had been con-
tacted and requested to distribute the questionnaires from 5 to 10
subordinates in their organizations. Out of 2850 questionnaires
distributed, 281 were returned with about 10% of response rate.
We removed the respondents who had not provided the answers
for the survey items measuring the seven variables of interest. As
a result, a total of 254 responses had been used in the regression
analyses.
The characteristics of the respondents are as follows. 123
(48.4%) respondents were from the U.S., 122 (48.0%) were
from South Korea, and the rest 9 (3.6%) came from countries
other than those two. 107 (42.1%) respondents were using Or-
acle, 52 (20.5%) were using SAP, and 87 (34.3%) respondents
were using a different system other than Oracle and SAP. 8
(3.1%) respondents did not answer to this question. As shown
in Fig. 1, respondents are well distributed in terms of the year
of experience in the construction industry. The average years of
work experience in E&C industry was 13.9 years. Finally, re-
spondents’ average hours of using ERP system was 13.5 h/week,
and about 50% of respondents answered that they were using
the system more than 6 h/week.
B. Key Measures
All the survey items were based on well-validated instruments
in the existing studies. The items were also validated by the in-
terviews with field experts. All the items, which were developed
by Chung [16], were measured using seven-point Likert scale
ranging from 1 (strongly disagree) to 7 (strongly agree). The de-
scriptive statistics and correlations of variables are presented in
Table I and detailed information on the survey items is provided
in Table II.
1) Intention to Use: To assess intention to use, a total of
three items suggested by Venkatesh and Davis [77] were used.
6 IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT
TABLE I
MEAN, STANDARD DEVIATION, AND CORRELATIONS
OF ALL SCALED VARIABLES
The items include “assuming I have access to the ERP system,
I intend to use it.” Cronbach’s alpha of this measure is 0.85.
2) PU: This measure was assessed using four kinds of items
based on the works of Davis [20] and Venkatesh and Davis
[77]. One of the items is “using the ERP system improves my
performance.” These items show the highest reliability with
Cronbach’s alpha of 0.96.
3) Perceived EOU: A total of three items, derived from
Davis [20] and Venkatesh and Davis [77], measured perceived
EOU. An example item is “my interaction with the ERP system
is clear and understandable.” These items are also recorded high
reliability with the alpha statistics of 0.93.
4) Subjective Norm: Lucas and Spitler’s [52] four items
were employed in order to assess subjective norm. The items
include “I would like very much to use the ERP system because
senior management thinks I should use it” and “I would like
very much to use the ERP system because others in my work
group think I should use it.” Cronbach’s alpha of this scale is
0.83.
5) Internal Support: This external variable was measured
based on three items that were derived from the work of Ferratt
et al. [25]. One of the items is “Training for the ERP system
was very helpful for me to understand and use it.” This scale
has relatively low reliability with Cronbach’s alpha of 0.69.
6) Consultant Support: Two items that were also derived
from Ferratt et al. [25] assessed this scale. They are “I think
consultants led us to a right direction during ERP implementa-
tion” and “I think consultants can help us to have a successful
ERP implementation.” Cronbach’s alpha reliability is 0.75.
7) Function: Based on the work of Ferratt et al. [25], four
items were developed to assess function. The items include “the
functionality of the ERP software our company is using is very
good,” “the ERP system covers our necessary business functions
very well,” etc. The internal consistency of this scale is 0.90.
C. Analysis Procedure
The aforementioned hypotheses are tested using multiple re-
gressions. As stated earlier, there are three variables to be ex-
plained in our model. First of all, intention to use was analyzed
with PU, perceived EOU, and subjective norm. Next, we looked
at the relationship between PU and a set of independent vari-
ables, internal support, consultant support, function, and per-
ceived EOU. Finally, we conducted regression analysis between
perceived EOU on internal support and consultant support. By
analyzing each of these variables on the associated independent
variables, we investigated which factor had significant explana-
tory power of the dependent variables, given all the other factors
in the model.
IV. RESULTS
A. Explaining Intention to Use
Table III presents the influence of PU, perceived EOU, and
subjective norm on behavioral intention to use of the respon-
dents. As we hypothesized, the relationships of PU and per-
ceived EOU with behavioral intention to use were significantly
positive, and the effect of subjective norm on behavioral in-
tention to use was significantly different from zero (supporting
hypotheses 1a, 1b, and 1c). Note that we did not hypothesize the
relationship between behavioral intention to use and subjective
norm as a positive one. As discussed earlier, this relationship
can be negative when individuals perceive that top management,
supervisors, or coworkers do not think the system to be useful.
Specifically, PU represented the strongest and positive asso-
ciation with behavioral intention to use (β = 0.53, p < 0.0001),
showing a consistent result with numerous previous studies.
Next determinant of intention to use was perceived EOU (β =
0.19, p < 0.001). It is interesting that subjective norm (β = 0.17,
p < 0.01) also showed significant relationship with behavioral
intention to use because results from existing studies have re-
ported inconsistent supports for this relationship. It reminded us
of what Venkatesh and Davis [76] argued on the mandatory set-
ting. We have elaborated this relationship in Section V. Finally,
the r-square and adjusted r-square were 0.60 and 0.59, respec-
tively, indicating that these three variables explained about 60%
of the variance in intention to use.
B. Explaining PU
With respect to PU, we hypothesized that each of the external
variables (hypotheses 2a, 3a, and 4a) as well as perceived EOU
(Hypothesis 1d) would have unique positive effects on PU. Also,
we theorized a significant relationship between PU and subjec-
tive norm (Hypothesis 1e). Table IV shows the results on these
relationships. All the variables except for consultant support
showed significant positive relationship with PU. Specifically,
we found that perceived EOU positively affect PU (β = 0.21)
with the p-value less than 0.001, and subjective norm was sig-
nificantly related to PU (β = 0.20, p < 0.001). These results
support hypotheses 1c and 1d.
Meanwhile, function was found to have the strongest de-
terministic power of PU (β = 0.44, p < 0.0001; Table IV;
supporting Hypothesis 3a), and the standardized coefficient as-
sociated with internal support was 0.12 with the p-value of 0.05
(Table IV; supporting Hypothesis 2a). However, consultant sup-
port did not show any significant relationship with PU with al-
pha of 0.18. Finally, the r-square and adjusted r-square of this
model were 0.60 and 0.59, respectively. Hence, we can state that
KWAK et al.: UNDERSTANDING END-USERS ACCEPTANCE OF ERP SYSTEM IN PROJECT-BASED SECTORS 7

TABLE II
SURVEY ITEMS GIVEN TO ERP USERS IN THE CONSTRUCTION AND ENGINEERING FIRMS

TABLE III
REGRESSION ANALYSIS ON INTENTION TO USE

TABLE IV
REGRESSION ANALYSIS ON PU
8 IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT
TABLE V
REGRESSION ANALYSIS ON PERCEIVED EOU
Fig. 2. Proposed model for ERP system implementation projects.
external variables with existing TAM variables explained about
60% of variance in PU.
C. Explaining Perceived EOU
We hypothesized that internal support and consultant support
would, respectively, have positive effects on perceived EOU.
According to the results in Table V, these two variables were
having significantly positive association with perceived EOU.
In the case of internal support, it was associated with perceived
EOU with the standardized b coefficient of 0.28 and p-value less
than 0.0001 (supporting Hypothesis 2b). And we also observed
that b coefficient characterizing the relationship between consul-
tant support and perceived EOU was 0.33 with the significance
level less than 0.0001 (supporting Hypothesis 4b). The r-square
and adjusted r-square were 0.28 and 0.27, respectively, implying
the needs for additional variables that can be accounted for EOU
perception in the information system acceptance. Fig. 2 summa-
rizes the proposed model for the ERP system implementation
project.
V. DISCUSSIONS
A. Key Findings and Managerial Implications
The main purpose of this study was to investigate the effects
of project management variables on ERP system implementa-
tion success from the perspective of user acceptance. Our key
findings are as follows.
1) Project-related variables (internal support and function)
and organizational variables (subjective norm) are found
to be potential determinants of user acceptance, while they
were not included in the original technology acceptance
model.
2) This empirical study of a complex and mandated informa-
tion system also provides support for original TAM. The
main constructs theorized in TAM are significant in the
context of ERP system.
3) We could not find any significant positive relationship be-
tween consultant support and PU. However, the result re-
garding consultant support provides us potential for future
research.
This study shows that the process of ERP implementation
project and users’ acceptance should be managed simultane-
ously, not separately. Existing studies that addressed IS adop-
tion have focused either on the implementation processes or
on the user acceptance. For this reason, critical success factors
identified in the literature merely reflected the perspectives of
senior managers or IT professionals involved in the implemen-
tation projects. In addition, organizational factors have received
relatively less attention than cognitive factors in the literature
that attempted to extend TAM. As found in our results, how-
ever, project-related variables that had been selected based on
critical success factors for ERP implementation projects (or
large-scale projects) have significant impacts on users’ PU, per-
ceived EOU, and in the end, the intention to use the system. We
believe that this study would provide a basic mechanism for pre-
dicting successful ERP implementation from multidimensional
perspectives.
In addition, reported key findings provide additional evidence
to the validity of TAM in a complex and mandatory context. In
the existing literature, some scholars argued that TAM is not
valid in mandatory [54] or field [52] settings, whereas others
such as Amoako-Gyampah and Salam [5] provide supports for
TAM even in the ERP context. For these reasons, it was difficult
to reconcile the validity of TAM in terms of the significance or
explanatory power. However, the ERP success model proposed
here validated that the belief constructs (i.e., PU and perceived
EOU) were not only significant but also having similar level
of explanatory power to the original TAM. It implies that how
enthusiastically or willingly users adopt the innovation in their
working processes is still important, even when organizations
mandate the system usage. We recommend senior managers to
KWAK et al.: UNDERSTANDING END-USERS ACCEPTANCE OF ERP SYSTEM IN PROJECT-BASED SECTORS
keep this in mind and to endeavor to comprehend end-users’
expectations for ERP systems.
Other than the original TAM variables, our study also found
that “function” and “subjective norm” had relatively greater im-
pacts on PU which was the strongest determinant of the intention
to use. Hence, decision makers should make their best efforts
to define the companies’ necessary business functions and to
choose the right modules that are well fitted in terms of func-
tionality. Meanwhile, the significant role of subjective norm in
our model revalidated the finding of Venkatesh and Davis [77]
that emphasized this relationship in the context of mandatory
setting. This result says that users pay more attention to organi-
zational atmosphere when new system acceptance is mandated.
This, in turn, implies the possibility that users might be reluctant
to accept ERP systems if negative opinions on ERP systems are
prevalent in the organizations. Our suggestion for practitioners
is that they should encourage every member in their organiza-
tion to use newly implemented ERP system. This might be the
notion where the importance of internal support can come into
play.
Finally, it seems appropriate to address the results associated
with the consultant support. It was originally hypothesized to
have a significantly positive contribution toward users’ behav-
ioral intention to use in ways that it positively affected PU and
perceived EOU, respectively. With respect to perceived EOU,
we could accept our research hypothesis. In the case of PU,
however, the result could not satisfy our hypothesis with the
directionality as well as the significance. One possible implica-
tion is that consultants deliver the knowledge on the mechanics
without convincing potential end users the need to accept the
ERP system. Or, it may imply the unit-of-analysis issue. That is,
the role of consultant support might vary according to groups or
organizations rather than to individuals. Our reasoning is based
on the mechanism of knowledge transfer which starts from out-
side consultants to small number of client representatives and
then, the representatives are serving as trainers for the major-
ity of users [44]. The investigation of its role would be one of
the meaningful topics in future research because it is expected
to have the greatest potential, but it has been earning the least
attention in the ERP literature [25].
B. Research Limitations
Some limitations of this research are also worth noting for
future research. First, low response rate and/or missing values
might prevent us from obtaining hypothesized results. For ex-
ample, the response rate for the variable “consultant support”
was only 82% as noted earlier. One possible reason is that re-
spondents who had not involved in the implementation project
or those who had relatively short working experience in their
current organizations might merely have limited information on
this construct. This might lead respondents reluctant to answer
this question. This study lacks the rigor of distinguishing the
respondents in the sampling process.
Next, there are additional limitations associated with the
way that the data were collected. As stated in methods Section
III-A, most of the questionnaires were distributed via email.
9
Thus, some individuals might consider this type of emails as
spam and delete them without checking [6]. Moreover, there
could be some organizations that originally blocked emails from
an outside server. Since these cases might cause nonresponse
bias that could not fully represent our target population, the
results must be interpreted and applied with caution [84].
Finally, even though we focused on the individual acceptance
of new information system, there is a possibility that individual-
level intentions and perceptions may systematically vary ac-
cording to higher level characteristics such organizational or
national culture. Besides, we did not explicitly measure po-
tential contingency variable(s) such as task interdependency or
computer self-efficacy, while implicitly considered them based
on extensive literature review. We believe that the consideration
of those characteristics would enable us to better understand
the mechanism of successful ERP implementation and to reach
more meaningful conclusion.
VI. FUTURE RESEARCH
One of the key findings from this research is that function de-
fined as “the functionality of ERP system and its matching the
company’s necessary business function,” is the strongest deter-
minant of PU. It implies that users still want systems to be cus-
tomized rather than their business processes to be changed. ERP
vendors, however, suggest that full package implementation as
well as minimal customization is the best way to maximize
the benefits from ERP system. This argument raises various re-
search questions such as: 1) are there real differences associated
with implementation approaches; 2) which are the modules to
be necessarily included and which are not; 3) what is the optimal
degrees of customization; 4) what are the difficulties associated
with customization and how serious are they; and so on.
Meanwhile, DeLone and McLean [22] suggested that infor-
mation system success should be considered from multidimen-
sional perspectives. Our study focused only on the user ac-
ceptance as a success measure. To extend this study, however,
future research should evaluate ERP project success from vari-
ous perspectives. It is especially relevant in ERP study because
ERP system implementation is associated with complex set of
project outcomes [25]. Other measures such as the efficiency
of information management seem to be interesting. Integrat-
ing qualitative and quantitative measures (i.e., user acceptance
and project cost/schedule performance indices) can be another
interesting option. We should note that the endeavor to assess
various aspects of ERP success must be accompanied with more
sophisticated research designs and analytical methods.
Finally, future research can empirically investigate the rela-
tionship between individuals’ ERP acceptance and changes in
performance. Related research questions would be “is the task
performance of an individual/a group improved after adopting
ERP system,” “did the ERP system add values to an organization
in terms of business performance,” etc. In the cases of address-
ing the group or organization level performance, researchers
would benefit from employing hierarchical or longitudinal anal-
ysis that allows them to capture the influence of individual level
acceptance on higher level outcome over time.
10
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6101.2005.00259.x/full
Young Hoon Kwak received the B.S. degree from
Yonsei University, Seoul, Korea, and the M.S. and
Ph.D. degrees in engineering and project manage-
ment from the University of California, Berkeley.
He is currently an Associate Professor of Project
Management in the Department of Decision Sciences,
The George Washington University’s School of Busi-
ness, Washington, DC. He was a Visiting Engineer at
the Massachusetts Institute of Technology, a Visiting
Assistant Professor at the Florida International Uni-
versity, and a Visiting Scholar at the IPA Institute.
He has consulted worldwide and presented and published more than 80 arti-
cles in journals, books, book chapters, magazines, and conference proceedings.
His scholarly works appear in California Management Review, IEEE TRANS-
ACTIONS ON ENGINEERING MANAGEMENT, IEEE ENGINEERING MANAGEMENT
REVIEW, Technovation: The International Journal of Technological Innova-
tion, Entrepreneurship and Technology Management, International Journal of
Project Management, Project Management Journal, International Journal of
Managing Projects in Business, Risk Management: An International Journal,
Journal of Construction Engineering and Management, Journal of Management
in Engineering, Journal of Computing in Civil Engineering, Korean Manage-
ment Review, and other research outlets. His primary research interests include
strategic issues of project management, project control, project performance
improvement, management of technology, and engineering, construction, and
infrastructure project management.
Dr. Kwak currently serves as a Specialty Editor (Associate Editor) for the case
studies section of the Journal of Construction Engineering and Management
(ASCE) and on the editorial board for the International Journal of Project Man-
agement (Elsevier), the Project Management Journal (Wiley), the Journal of
Management in Engineering (ASCE), and the International Journal of Manag-
ing Projects in Business (Emerald). He is a four-time recipient of research grants
sponsored by the Project Management Institute (PMI), and a two-time recipient
of the IBM Center for The Business of Government’s research stipend. His
research titled “Impact on Project Management of Allied Disciplines” received
the 2008 International Project Management Association (IPMA) Outstanding
Research Contributions Award. He currently serves as a Principal Investigator
of a PMI research grant to conduct a study on “Global Perspectives on Project,
Program, and Portfolio Management in Government.”
Jane Park received the B.S. and M.S. degrees in
urban planning and engineering from Yonsei Univer-
sity, Seoul, Korea. She is currently working toward
the Doctorate degree at The George Washington Uni-
versity’s School of Business, Washington, DC.
During the master’s study, she was a Research As-
sistant and was involved in several research projects
including an exploration of urban spatial structural
change and the strategic development of spatial de-
cision support system. For the doctoral research, she
is investigating the critical success factors for large-
scale infrastructure projects by identifying the explanatory factors that have sig-
nificant effect on their cost, schedule, and performance. Her goal is to develop
a strategic roadmap for the reinvestment of failing infrastructures by incorpo-
rating sustainability issues with project management for successful planning,
implementation, and management of future capital projects.
12
Boo Young Chung received the B.S. and M.S. de-
grees from Seoul National University, Seoul, Korea,
the M.S. degree in construction engineering and man-
agement from Purdue University, West Lafayette, IN,
and the Ph.D. degree in project management from the
University of Maryland, College Park.
He is currently a Principal Engineer at the Smart
City Development Group, Samsung SDS Co., Ltd.,
Seoul, Korea. He had worked for the construction in-
dustry for more than five years before receiving the
M.S. degree from Purdue University. He was a Princi-
pal Researcher at Jeonin, Inc., which is one of the top construction management
companies in Korea before joining Samsung SDS. He has several scholarly
publications in the area of strategic issues in project management, construction
engineering and management, and information systems management. His pub-
lications appear at the IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT,
Automation in Construction, Journal of Construction Engineering and Man-
agement, Journal of Computing in Civil Engineering, and others.
Dr. Chung is an elected member of the Construction Research Council of the
American Society of Civil Engineers.
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IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT
Saumyendu Ghosh (SM’03) received the Bachelor’s
degree from the Calcutta University, Kolkata, India,
the Masters in Statistics degree from the Indian Statis-
tical Institute, Kolkata, India, and the M.Eng. degree
in project management from the University of Mary-
land, College Park.
He has held a number of ERP and CRM project
management positions in the commercial sector and
has implemented ERP applications in 22 different
countries in the world. He also teaches global project
management and project governance at the A. J. Clark
School of Engineering, University of Maryland, College Park, and School of
Business, The George Washington University, Washington, DC, as an Adjunct
Faculty. His research interests include project governance for complex enter-
prise transforming IT projects.
Dr. Ghosh has been the Governor of the IEEE Engineering Management
Society since 2007.