Understanding enterprise systems-enabled integration
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Understanding enterprise systems-enabled integration Olga Volkoff1, Diane M. Strong2 and Michael B. Elmes2 1 Faculty of Business Administration, Simon Fraser University, Burnaby, B.C., Canada; 2Department of Management, Worcester Polytechnic Institute, Worcester, MA, U.S.A.
Correspondence: Diane M. Strong, Department of Management, Worcester Polytechnic Institute, 100 Institute Road, Worcester, MA 01609, U.S.A. Tel: þ 1 508 831 5573; Fax: þ 1 508 831 5720; E-mail: [email protected]
Abstract A key touted benefit of enterprise systems (ES) is organizational integration of both business processes and data, which is expected to reduce processing time and increase control over operations. In our 3-year longitudinal case study of a phased ES implementation, we employed a grounded theory methodology to discover organizational effects of ES. As we coded and analyzed our field data, we observed many integration effects. Further analysis revealed underlying dimensions of ES-enabled integration. ES-enabled integration varied depending on the relationship between the integrated business units (similar plants, stages in a business process, or dissimilar functional areas) and on whether processes or data were integrated. Turning to the literature, we realized that Thompson’s three types of interdependence, pooled, sequential, and reciprocal, captured the business relationships revealed in our data. Thus, we describe the salient characteristics of ES-enabled integration using Thompson’s interdependence types applied to process and data integration. We also identify dimensions of differentiation between business units that contribute to integration problems. Viewing our field data through the lens of these salient characteristics and dimensions of differentiation provided theoretical explanations for observed integration problems. These findings also help managers understand and anticipate ES-enabled integration opportunities and problems. European Journal of Information Systems (2005) 14, 110–120. doi:10.1057/palgrave.ejis.3000528 Keywords: enterprise systems; integration; interdependence; differentiation
Introduction
Received: 1 December 2004 Revised: 9 March 2005 2nd Revision: 3 May 2005 Accepted: 5 May 2005
Enterprise systems (ES) ‘promise the seamless integration of all the information flowing through a company – financial and accounting information, human resource information, supply chain information, customer information’ (Davenport, 1998, p 121). These application software packages had their roots in manufacturing resource planning systems and started as the support for a variety of transaction-based backoffice functions (at which time they were called Enterprise Resource Planning (ERP) systems). Since then they have evolved to include support for front-office and even interorganizational activities including supply chain management, customer resource management, and sales force automation (Davenport, 2000; Markus & Tanis, 2000; Ash & Burn, 2003). The benefits of ES’s can range from operational improvements, such as redu
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