Linking the Impact of IT Investments to Productivity and Profitability

2013 ◽  
pp. 214-229
Author(s):  
Mohan P. Rao ◽  
Purnendu Mandal
Keyword(s):  
Organizational Performance ◽  
Enterprise Resource Planning ◽  
Measurement Techniques ◽  
Resource Planning ◽  
Measurement Model ◽  
Business Managers ◽  
Organizational Productivity ◽  
It Investments ◽  
Period Data ◽  
The Impact

Implementing IT (information technology) systems such as ERP (enterprise resource planning) requires huge investments. Measuring the impact of these investments on productivity and profitability is extremely important for business managers. Many studies have failed to show the direct relationship between IT investments, organizational productivity and profitability, a phenomenon known as productivity paradox. The failure might relate to problems with the measurement techniques. This paper describes a measurement model, known as the PPP model (“Profitability = Productivity + Price Recovery”), that can fill the gap and show a link between IT investments, productivity, and profitability. The spreadsheet-based implementation of the PPP model, using multi-period data, generates performance trend charts of productivity, price recovery, and profitability. These performance charts provide a multi-period perspective to managers in identifying and understanding the impact of IT investments. This model is useful to managers considering heavy investments in IT as well as for managers interested in assessing their organizational performance and taking corrective actions in a timely manner.

Linking the Impact of IT Investments to Productivity and Profitability

2011 ◽  
Vol 7 (2) ◽  
pp. 34-49 ◽  
Author(s):  
Mohan P. Rao ◽  
Purnendu Mandal
Keyword(s):  
Organizational Performance ◽  
Enterprise Resource Planning ◽  
Measurement Techniques ◽  
Resource Planning ◽  
Measurement Model ◽  
Business Managers ◽  
Organizational Productivity ◽  
It Investments ◽  
Period Data ◽  
The Impact

Implementing IT (information technology) systems such as ERP (enterprise resource planning) requires huge investments. Measuring the impact of these investments on productivity and profitability is extremely important for business managers. Many studies have failed to show the direct relationship between IT investments, organizational productivity and profitability, a phenomenon known as productivity paradox. The failure might relate to problems with the measurement techniques. This paper describes a measurement model, known as the PPP model (“Profitability = Productivity + Price Recovery”), that can fill the gap and show a link between IT investments, productivity, and profitability. The spreadsheet-based implementation of the PPP model, using multi-period data, generates performance trend charts of productivity, price recovery, and profitability. These performance charts provide a multi-period perspective to managers in identifying and understanding the impact of IT investments. This model is useful to managers considering heavy investments in IT as well as for managers interested in assessing their organizational performance and taking corrective actions in a timely manner.

The Impact of Strategic Performance Measurement System on Organizational Performance in Saudi Universities

2013 ◽  
Vol 1 (2) ◽  
pp. 64-71
Author(s):  
Naser Zouri ◽  
Zahra Abdolkarimi ◽  
Seyed A. Payambarpour
Keyword(s):  
Performance Measurement ◽  
Organizational Performance ◽  
Performance Management ◽  
Enterprise Resource Planning ◽  
Measurement System ◽  
Resource Planning ◽  
Planning System ◽  
Performance Measurement System ◽  
Strategic Performance ◽  
The Impact

Objective- The aim of the study is to enhance the mechanism of strategic performance measurement system goals base of four research questions: (i) to what association between the MCS and enterprise resource planning system (ERPS) intention to strategy performance management system (SPMS)? (ii) To what association between the performance management system (PMS) and ERPS intention to SPMS? (iii) To what relationship between the resource–based view/capabilities and ERPS intention to SPMS? (iv)To do comprehensiveness of organizational performance factors affected on ERPS intention to SPMS? Methodology/Technique A survey questionnaire was used to collect the data in Madinah, Reyaz, and Jeddah. Data was collected during the last section of 2013 of which 160 successful questionnaires were gathered for further analysis. Findings The result shows the impact of evaluation SPMS to solve the market place error and also ability of executives' level of management to solve the behaviours issue in business organization. Novelty - The significance of study contribute executive branch in Saudi universities for the safety of strategic performance measurement system implementation to be modified or changed, taking into account the financial metrics and non-financial when designing a control system. Type of Paper Empirical paper Keywords: , Strategic performance measurement system, Enterprise resource planning system, Strategic management category, Market place error.

scholarly journals The Impact of ERP System's Usability on Enterprise Resource Planning Project Implementation Success via the Mediating Role of User Satisfaction

2017 ◽  
Vol 9 (3) ◽  
pp. 49 ◽  
Author(s):  
Eman Yassien ◽  
Raja'a Masa'deh ◽  
Monira Mufleh ◽  
Ala'aldin Alrowwad ◽  
Ra'ed Masa'deh
Keyword(s):  
Organizational Performance ◽  
Enterprise Resource Planning ◽  
User Satisfaction ◽  
Resource Planning ◽  
Project Implementation ◽  
Erp Systems ◽  
Implementation Success ◽  
Mediating Role ◽  
The Impact

Organizations in the current environment need to create and sustain their competitive advantages. ERP (Enterprise Resource Planning) solutions are considered a strong tool that helps organizations to succeed and arise. But ERP projects’ implementation has relatively low success rates in which it may affect and shake the whole organizational performance. This study searches the power of software usability to achieve ERP Project Implementation Success (ERP-PIS) considering the mediating role of user information satisfaction (UIS). A set of research's hypotheses have been constructed. This study adapts a positivism view, using the survey strategy. The questionnaires were filled by 106 managers who use ERP systems or affected by ERP systems in different organizations. The findings of the research ensure the fitness of the model, and that mediation role of user information satisfaction (UIS) in Jordan is highly visible. Also, the research shows up the strong power of usability to achieve ERP-PIS. Based on the findings, development of ERP applications would be improved by software organizations in terms of usability, and organizations need to acquire ERP applications would also improve their decisions in choosing an ERP solution.

Enterprise resource planning and business model innovation: process, evolution and outcome

2019 ◽  
Vol 23 (4) ◽  
pp. 728-752
Author(s):  
Rocio Rodriguez ◽  
Francisco-Jose Molina-Castillo ◽  
Göran Svensson
Keyword(s):  
Organizational Performance ◽  
Business Model ◽  
Enterprise Resource Planning ◽  
Structural Equation ◽  
Resource Planning ◽  
Business Model Innovation ◽  
Erp Implementation ◽  
Content Type ◽  
Organizational Outcome ◽  
The Impact

Purpose The purpose of this paper is to focus on the implementation process of enterprise resource planning (ERP), the evolution of business model innovation (BMI) and the organizational outcome. This research analyses how ERP and BMI are related and, in turn, what is the final the impact on organizational performance. Design/methodology/approach The sample consisted on 104 organizations from different industries, all of which used an ERP software. A structural equation model was used to test the six hypotheses. Findings The results indicate that the BMI constructs considered (i.e. value-generation and organizational complexity) mediate the impact of the ERP constructs (organizational adaptation and organizational resistance), in organizational performance. Successful ERP implementation is not an end itself for this companies, but merely a path and a process for improving the business model with the aim improving performance in the marketplace. Research limitations/implications This study offers a new outlook on how a company should leverage the ERP adaptation, and any resistance in the organization to innovating in the business model. This study is rooted in the evolutionary perspective of BMI, but it also integrates into an overall model other points of view such as the rational positioning view and cognitive view. Practical implications Organizations must understand the ERP flows in depth, each ERP flow is the work result of a multitude of companies over several years. All departments, and in particular the research and development department must participate actively in the ERP implementation. Organised complexity means opportunities for success in the market. Organizations must train their departments in ERP and not just teach them how the ERP works. ERP implementation needs consider improvements to the business model and ultimately the performance, but not separately. Originality/value BMI has received contributions from several domains such as entrepreneurship, management organization and strategic management among others. Nonetheless, the role of ERP in BMI is far from being understood and the few contributions focus only on technology per se. To the best of our knowledge this is the first study that has explored the connections of ERP and BMI and in turn the final outcome in organizational performance.

scholarly journals The effect of enterprise resource planning on the organizational performance of organizations through HRM practices An Applied Study on the Reinforcing Steel Sector Companies in Egypt

2021 ◽  
Vol 12 (01) ◽  
Author(s):  
Ahmed Atries ◽  
◽  
Aiman A. Ragab ◽  
Mohamed A. Ragheb ◽  
Mohamed Wahba ◽  
...  
Keyword(s):  
Organizational Performance ◽  
Enterprise Resource Planning ◽  
Balanced Scorecard ◽  
Resource Planning ◽  
Reinforcing Steel ◽  
System Quality ◽  
The Balanced Scorecard ◽  
Hrm Practices ◽  
Steel Sector ◽  
The Impact

This research aims to study the impact of Enterprise Resource Planning (ERP) (information quality, system quality and system use) and human resource management (HRM) practices (training and development, information exchange, recruitment and testing, compensation and benefits, safety and health and employee relations) on organizational performance. Through the Balanced scorecard (financial performance, customer performance, supplier performance and employee performance) in the rebar sector companies within the Arab Republic of Egypt. Therefore, the researcher used the positivism philosophy in this study and the deductive approach because they are more compatible with the nature of the research and with what the researcher wants to reach. He also followed a quantitative method in collecting data, as he prepared a questionnaire and distributed it to 260 individuals working in the reinforcing steel sector. The data is analyzed using some statistical methods such as: correlation, and the structural equation model. The results fully accept the study hypotheses that there is a statistically significant relationship between ERP and organizational performance through the balanced scorecard. In addition to, relationship between ERP and HRM practices, moreover, relationship between HRM practices and organizational performance through the balanced scorecard. While it partially accepts that here is a statistically significant role for HRM practices, in the relationship between ERP and organizational performance through the Balanced Scorecard.

scholarly journals THE INFLUENCE OF KNOWLEDGE MANAGEMENT ON ORGANIZATIONAL PERFORMANCE WITH ERP IMPLEMENTATION AS MEDIATOR

2020 ◽  
Vol 1 (4) ◽  
pp. 455-462
Author(s):  
Derri Muhammad Ramdani ◽  
Hady Siti Hadijah
Keyword(s):  
Knowledge Sharing ◽  
Organizational Performance ◽  
Enterprise Resource Planning ◽  
Resource Planning ◽  
Integrated System ◽  
Organizational Productivity ◽  
Erp Implementation ◽  
Erp System ◽  
Performance Effectiveness ◽  
Relationship Of

This study examines whether knowledge sharing has influence on organizational performance, where Enterprise Resource Planning (ERP) is used as a mediator connecting these two variables. ERP system is unique because it requires users who have more knowledge and have special skills, in contrast to usual users who usually do their job manually. In corporation world, an integrated system like ERP should be well-socialized at maximum rate to reach performance effectiveness and efficiency that will surely result in organizational productivity. Nonetheless, in many organizational cases there are still numerous employees who decline to share knowledge in regeneration process due to their fears of being replaced by younger ones and this keeps the knowledge sharing process on hold. With total of 500 employees in a textile company in Bandung County, the writer takes 250 samples as the population representation. Data analysis is undergone through Structure Equating Model (SEM) with assistance of SPSS application, the writer can see the relationship of knowledge sharing and its influence on organizational performance.

An Integrated Approach to Performance Evaluation of Enterprise Resource Planning (ERP) System Implementation

2019 ◽  
Vol 17 (3) ◽  
pp. 1-15 ◽  
Author(s):  
Paweena Wanchai
Keyword(s):  
Organizational Performance ◽  
Enterprise Resource Planning ◽  
Resource Planning ◽  
Integrated Approach ◽  
Erp Implementation ◽  
Erp System ◽  
Stock Market Valuation ◽  
Long Term Performance ◽  
Term Performance ◽  
The Impact

In spite of the immense expenses related with enterprise resource planning (ERP) systems execution and use, its effect on organizational performance stays vague. The goal of this study was to empirically examine the impact of ERP implementation and use on the long-term performance of organizations. This research leverages three fundamental specifications for the examination of impacts as follows: performance ratios (ROA, ROE, ROI, ROS), labor productivity (production function), and stock market valuation (Tobin's Q). This research used a total of six years of financial data from 47 organizations in Thailand that implement and use ERP system. The findings reveal that a post-adoption period of more than four years may be needed in order to observe a significant impact from ERP investments on organizational performance.

Perceptions of the Impact of Chief Executive Leadership Style on Organizational Performance Through Successful Enterprise Resource Planning

2011 ◽  
Vol 39 (7) ◽  
pp. 865-878 ◽  
Author(s):  
Chen-Mei Huang ◽  
Ping-Yu Hsu ◽  
Wen-Lung Chiau
Keyword(s):  
Organizational Performance ◽  
Leadership Style ◽  
Enterprise Resource Planning ◽  
Project Success ◽  
Chief Executive ◽  
Resource Planning ◽  
Charismatic Leadership ◽  
Successful Implementation ◽  
Intellectual Stimulation ◽  
The Impact

Leadership has been recognized as a major factor in project success and this has been empirically validated throughout many fields. However, chief executive officer leadership style has seldom been discussed in depth in the context of enterprise resource planning (ERP) project success. In this study a survey was carried out with 368 Taiwanese companies that had previously implemented ERP systems over a 1-year period. Three transformational leadership styles – charisma, individual consideration, and intellectual stimulation – are discussed. The results indicate that only a charismatic leadership style has a substantially positive effect on organizational performance, especially through the successful implementation of ERP. Managerial implications and suggestions are discussed based on findings.

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