Technological improvements attained in the past decade have transformed the global business by influencing almost all aspects of working life. People can communicate with each other within a very short time, while business costs are becoming insignificant. Workers can communicate efficiently with their clients staying at home or distant offices across the world, rather than visiting the client physically. Regardless of the variety of opportunities and services offered by new technologies, they appear united by a single factor, which is improved productivity and efficiency. In fact, firms have been very quick in the adoption of these technologies, and they show considerable improvements in business performance. Besides the benefits employees can get from technology , the management aspect of business has also had a reasonable share of influences. One of the benefits is the invention of Enterprise Resource Planning systems (ERPs), which are packaged business software capable of automating the data integration across an organization and imposing homogeneous procedures on the input, utilization and dissemination of information. Despite the overwhelming emphasis of modern literature on ERPs and its implementation process, comparatively little focus has been directed on the continuing effect of these systems on organizations. Latest controversies regarding organizations and technology have focused on the degree to which technologies, such as ERPs, are socially constructed and sought to create frameworks recognizing the social and material structure of technologies. The key focus of this paper will be to analyze Dery, Hall & Wailes’s (2006) work in relation to other theoretical frameworks and to determine why technologies fail to provide the anticipated benefits.
The adoption of ERPs is recognized for its high cost, and scale and likelihood of failing (Dery, Hall & Wailes 2006). It is not surprising that majority of literature regarding ERP implementation emphasizes the crucial success factors perceived to be linked to successful implementation. The most influential recommendation concerning ERP is to make sure that the deployment is business-oriented instead of technology-oriented (Elragal & Al-Serafi 2011). However, it seems that ERP deployment continues failing in the delivery of the promised business and organizational effects regardless of all recommendations. Despite the dominance of literature focusing on ERP implementation, very critical scholars, such as Lecic & Kupusinac (2013) and Elragal & Al-Serafi (2011), have focused on the continuous effect of ERPs on businesses. For instance, Dery, Hall & Wailes’s (2006) investigation emphasizes the constraints resulting from the implementation of ERPs by organization. However, most studies fail to point out the foundations of ERP’s frequent failures in delivery of expected advantages (Dery, Hall & Wailes 2006). The authors of the article, Dery, Hall & Wailes (2006), realized this gap in literature and focused their work on this area.
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Tsai et al. (2011) metaphorically described ERPs as ‘steamroller for managerial politics’ in order to portray the degree to which the anticipated pliability of ERP system is gone even prior to the implementation process. Whereas Wieder et al. (2006) pointed out that both the context of the organization and micro politics can affect the configuration decisions, such as setting parameters and user profiles of business process, Lecic & Kupusinac (2013) argued that beyond the configuration level, the technologies become less pliable than it is frequently argued, and enforce similar combination of logics on organizations. Contrary to the negative perception concerning the use of ERPs, Lecic & Kupusinac’s (2013) work, titled “The Impact of ERP System on Business Decision-Making” examined the effects of ERP on business decision making. According to Lecic & Kupusinac (2013), the fact that ERPs have an impact on the decision-making process implies that they affect the business in general. Lecic & Kupusinac (2013) pointed out that the rationale for automatic business process is the utilization of well-organized information system. Their study concluded that ERP has a positive effect of improving business process in the long-term.
Despite Lecic & Kupusinac’s (2013) positive linkage between ERP and organization, Dery, Hall & Wailes (2006) hypothesized that ERPs result in the delayering and downsizing; skill reorganization and job magnification; control concentration; and the devolution of organizational responsibilities. All these hypothesized the effect of ERPs on organization from a negative perspective. In a continuation research, Tsai et al. (2011) utilized evidence from about five case studies. Based on the five case studies, Tsai et al. (2011) argued that regardless of the variations between businesses, ERP in fact seems to be linked to common changes in work organization, an argument agreeing with Lecic & Kupusinac’s (2013) findings. Despite concurring with Lecic & Kupusinac’s (2013) positive association between ERPs and organization, Tsai et al. (2011) still criticized its effect of improving decision-making and concluded that intensification of job is not an indication of improved organizational performance.
Other researchers, such as Dery, Hall & Wailes (2006) and Lecic & Kupusinac (2013), have also investigated the impact of ERP system implementation on business performance. According to Dery, Hall & Wailes (2006), there is a mixed association between business performance and ERP implementation. Lecic & Kupusinac (2013) criticized the mixed association between ERP and business performance claiming that quantitative research methods that do not avail significant insightful details and knowledge are the driving force behind these inconclusive results. Using a case study research method, Tsai et al. (2011) investigated the effects of ERP on business performance of an Egyptian SME subsidiary of an international organization. The study findings showed that the implementation of ERPs results in several benefits linked to performance, but also that ERP failed to attain some anticipated benefits. This showed that the contribution of ERP to business is limited to a certain extent.
In his study Wieder et al. (2006), aimed at offering additional insights into the implementation of enterprise relationship planning by examining its effects on organizational performance. Precisely, the study aimed at criticizing the present claims of ERP promoters that ERP improves business performance. They conducted a study by gathering data on various organizational performance aspects from firms that use ERPs. According to Wieder et al. (2006), financial key performance indicators can assist in measuring and comparing the performance of firms that use ERPs and those that do not. As a result, Wieder et al. (2006) utilized financial key performance indicators to evaluate the performance, and supply-chain operations reference model to operationalize business process performance. The outcomes of the study showed contradiction with Lecic & Kupusinac (2013) claims that ERPs result in improved business process. However, Wieder et al.’s (2006) study was the subject to one limitation: they analyzed the effect of ERP from the financial perspective, and therefore they rejected other business performance domains, such as human resource management.
According to Tsai et al. (2011), the contextual factors of an organization implementing an ERP are the driving factor behind the low success rate of ERP implementation. In their study, Tsai et al. (2011) focused on examining the degree to which the organizational contextual factors influence the business performance. Using 600 Taiwanese companies as an example, Tsai et al. (2011) classified the post-adoption process into data maintenance and system maintenance. Through statistical analysis (regression analysis), Tsai et al.( 2011) revealed that the post-adoption maintenance of an ERP system has remarkable effect on business performance.
Based on a case study, Dery, Hall & Wailes (2006) used Orlikowski’s framework, referred to as technology-in-practice to evaluate the effect of enterprise resource planning. The technology-in-practice approach is an excellent example of the latest attempts to transcend the materialism-agency. According to Dery, Hall & Wailes (2006), Orlikowski considered technology-in-practice as the structure enacted by users of technology in their process of using the technology in recurring ways. However, the approach retains the concept of technological artefact in describing the evidently material object, which is viewed to be a component of certain materials and to be included in certain presumptions linked to its design. The bottom line is that technology can structure the actions of the users only if it is used in recurring social behaviors. Based on this view, technologies might have an impartial reality that is independent of their social construction, though it is only via their representation in practice, how their impact can be comprehended.
Dery, Hall & Wailes (2006) viewed technology-in-practice as rules and resources instantiated by users of technology as they utilize the technology in recurrent fashion. The procedure for using technology engrosses users in interacting with facilities, such as the characteristics of technology artefact, and norm, such as protocols for utilizing the technology. Technology-in-practice is a direct outcome of this interaction. In relation to the notion of structuration, technology-in-practice (structures) is not completely stabilized; whereas they might be reinforced via recurrent use of technology in specific ways.
The technology-in-practice depicts a complex attempt to syndicate the understanding of social constructivism with credit for both the resonance of structures and materiality of technological artefacts, which continue to influence organizational behavior and social action (Dery, Hall & Wailes 2006). Consequently, it appears to offer an appropriate model of evaluating the effect of ERPs on organizations, and the emphasizes how users enact technology so that it could offer insights into why the system frequently fails to deliver organizational benefits.
Dery, Hall & Wailes (2006) used the case study research approach. Dery, Hall & Wailes (2006) defined a case study as a research methodology that enables the research to perform an exhaustive analysis of a phenomenon, or other observations within a real-life context for the purposes of theory development, investigation, theory testing, and/or as a learning tool. The researcher’s analysis of technology-in-practice focused on various ways in which respective branch managers in well-established companies comprehend and perceive their interaction with a newly adopted ERP (Dery, Hall & Wailes 2006). A New Zealand organization, which is a subsidiary of Australian Bank, was used as a case study. To guarantee confidentiality, the researcher named the organization as BankCo. BankCo provides a wide spectrum of financial services, such as wealth management, business banking, and institutional banking. The company has about 4700 full-time employees.
BankCo began implementing SAP in March 2002 after the launch of SAP’s primary HR modules (Dery, Hall & Wailes 2006). In relation to the objective of improving organizational performance, the adoption of SAP at BankCo involved the launch of a centralized e-procurement system. The implementation ended in 2003 when BankCo’s Business Warehousing reporting went active. At the end of 2003, the organization had triumphantly adopted an extremely featured form of SAP as its main engine of business transaction. The inconsistent nature of the deployment of ERP at the company did not allow to reach the similar participant level observation evident in the research of technology in organizations.
There are three popular research designs: quantitative, qualitative and mixed. Drawing from both secondary and primary data sources, Dery, Hall & Wailes’s (2006) study used various qualitative research techniques in an effort to capture the emerging dynamics and changes as the systems are deployed on regular work basis. With regard to primary sources of data, the research used semi-structured interviews as a research instrument. According to Dery, Hall & Wailes (2006), the widespread use of semi-structured interviews at various levels of management at the BankCo, coupled with site visits and secondary information, offered an understanding into the experiences, habits, beliefs, power structures and norms influencing the behavior and involvement of technology.
For this investigation, data were collected in two stages (Dery, Hall & Wailes 2006). The first stage happened in late 2004, and it involved visiting the physical sites and administering the semi-structured interviews. The interviews offered the comprehension of the organizational objectives for implementing SAP, and viewpoints concerning the adoption process. In addition, the interviews also offered the understanding of the nature of technological aspect. The second stage of the data gathering used interviews designed to offer the understanding of technology-in-practice model, and it took place during mid-2005. The interviewing process involved asking the managers to reflect on the history of employment and their general experiences with information systems.
This study used qualitative approaches, which implies that it was significantly reliant on the respective individual skills of the research, and more easily shaped by personal viewpoints of the researcher.
As mentioned above, the implementation of SAP involved the deployment of a centralized e-procurement system. Before this, BankCo’s procurement system had been decentralized, and respective management had implemented several procurement strategies. Therefore, the launching of e-procurement was a considerable organizational transformation linked to the adoption of SAP at BankCo. The data from the interview showed that SAP had considerable impact on the association between centralized finance, human resource, procurement functions, and the managers. These findings showed congruence with Dery, Hall & Wailes (2006) findings claiming that technology has a significant impact on the organizational performance. According to Tsai et al. (2011), organizational performance depends on human resource, procurement, finance and management, and this study evaluated the relationship between these factors and the implementation of SAP. In general, one can conclude that technology at the workplace has an impact on organizational performance.
The study found out that the implementation of SAP has several significant effects for the company (Dery, Hall & Wailes 2006). The majority of organizational benefits were linked to how users used the SAP. Many of the responses to the interview conducted at the second stage, showed strong reverberation with the technology-in-practice model. Specifically, the study found evidence that the majority of bank managers endorsed SAP via limited use. Consequently, the operational benefits linked to organizational benefits which were anticipated from SAP, were also likely to be limited.
The restricted use of SAP (technology) was endorsed by managers looking at the monthly figures in order to acquire additional understanding concerning abnormalities that had been detected in the paper-based approach. The interviews revealed that some employees used SAP (technology) once a month in order to scan reports. According to Dery, Hall & Wailes (2006), the ability to use the new technologies at the workplace seemed to be linked to operational, organizational and individual level factors. Speaking about organizational dimension, Dery, Hall & Wailes’s (2006) findings revealed that there were alternatives to the systems, which implied that there was no dependence on technological processes as necessitated. As for operational dimension, the amount of time available to explore functionalities of new technology at the workplace had a direct effect on their continued use of the system.
Technologies, especially ERPs, are very sophisticated information systems having dramatic effects on several aspects of the organization. In relation to the complexity and glitches in the process of technology adoption,, the literature on information system continues emphasizing the process of implementation. Nevertheless, the study suggests that technologies frequently fail to deliver organizational benefit as expected. This paper investigates why this scenario was created in an attempt to gain the understanding of ERPs. Based on technology-in-practice, the study showed that various users decide to endorse the same technological artefact in different ways. Consequently, the users potentially limit the capability of the technology to achieve the anticipated benefits.
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