The Financial Appraisal Profile (FAP) Model for Evaluation of Enterprise-Wide Information Technology

Enterprise-wide information systems adoption by organizations has become common place. Even with the benefits offered by such systems, there have also been many failures. One of the important reasons for these failures is inappropriate project evaluation and selection. In order to reduce the level of project failures, we introduce an innovative methodology, the financial appraisal profile (FAP) model, which seeks to address some of the issues and limitations posed by standard appraisal and evaluation approaches for strategic technologies and programs. By making the right decision in the first place and involving senior managers in the appraisal process, the organization will be better placed to achieve project success. The adoption of a management team approach to investment appraisals will not only enhance the information base but will also result in greater managerial commitment to a project. We believe by adopting the FAP model greater awareness to strategic issues and goals will also be achieved, which should lead to a more focused top management team—with all members pulling in the same direction.

Planning and Designing an Enterprise-Wide Database System for E-Business

The planning and development of an enterprise-wide electronic database system for e-business usually calls for the re-engineering of information processes coupled with a push toward data content standardization across the entire organization. In this chapter, the case study involves a multi-national conglomerate that is in the process of integrating and Web-enabling their enterprise database systems. The objective of the system was to help engineers sift through millions of components offered by various suppliers and component manufacturers, where the end-result was to improved the integration and efficiency of the product development, engineering design, e-sourcing, and e-procurement processes. This research is a qualitative action research study on how different organizational, social, political, and technical forces influenced the social construction of an enterprise-wide information system. Understanding the dynamics and power of these socio-technical forces in shaping the development environment and change process of enterprise systems is the focal point of this chapter’s discussion.

Vertical Application Service Provision

Against a background of the low engagement of small to medium-sized enterprises (SMEs) in e-business, this chapter investigates the impact of e-aggregation applications, provided by emerging vertical application service providers (VSP), and defined as “an e-business application, promoted by a trusted third party, which engages a significant number of SMEs by addressing an important shared business concern within an aggregation”. By conducting quantitative surveys of four aggregations of SMEs using these applications (users) and comparing these results with similar enterprises who are not (non-users) the research takes a deliberate SME perspective.

Unleashing the Potential of SCM

This chapter argues that with the present state of enterprise resource planning (ERP) adoption by the companies, the potential benefits of supply chain management (SCM) and integration is about to be unleashed. This chapter presents the results and the implications of a survey on ERP adoption in the 500 largest Danish enterprises. The study is based on telephone interviews with ERP managers in 88.4% of the “top 500” enterprises in Denmark. Based on the survey, the chapter suggests the following four propositions: (1) ERP has become the pervasive infra-structure; (2) ERP has become a contemporary technology; (3) ERP adoption has matured; and (4) ERP adoption is converging towards a dominant design. Finally, the chapter discusses the general implications of the surveyed state of practice on the SCM research challenges. Consequently, we argue that research needs to adjust its conceptions of the ERP concept towards ERP II in order to accommodate to the emerging practices.

Using Simulation to Evaluate Electronic Data Interchange

Reluctance of organizations to invest in electronic data interchange (EDI, Internet based EDI, and XML/EDI) is largely due to their inability to assess the return on these investments. We identify prescriptive and evaluative methodologies for analyzing investment in EDI: non-financial methods, purely financial methods, and financial and strategic consideration methods. We also show how computer simulation can be used as a tool for assessing EDI. Evaluating the benefits resulting from EDI implementation were illustrated through the well-known Beer Game. Our analysis and review also identifies difficulties involved in assessing the benefits of EDI in supply chains.

Implementation of Enterprise Resource Planning (ERP) Systems

Enterprise resource planning (ERP) systems are a growing area of research in business information systems. The primary purpose of this research is to review the literature on ERP implementation and to present results of a case study on ERP implementation. An exploratory case study was conducted to study these research issues. The case study consisted of a survey and interview of 25 employees at one organization. The results provide data analysis findings from the survey and qualitative findings from the interview. Using this case study, the chapter indicates the presence of four phases in ERP implementation through the support from qualitative interviews. Using t-tests, the results confirm the presence of a positive feeling of users toward the four ERP implementation phases.

An Investigation of the Existence of Levels of Enterprise Integration

A primary objective of ERP is to integrate the various parts of a company. The chapter discusses six levels of enterprise integration and the ability of ERP to satisfy each of them. We analyzed six case studies that included IBM, Cisco, Tecktronic, Vandelay, China Holdings, and APD Manufacturing. We found evidence to support the existence of the six levels of integration. APD and China Holding did not exhibit evidence of global integration while the others did. System-User (Level–II) integration was missing from all except APD. Islands-of-Technology integration is no longer the dominant integration issue it was in the 80’s. The dominant integration issues are functional integration, customer relationship management, and supply chain management.

Enterprise Information Systems and B2B E-Commerce

While the overall investment in information technology (IT) decreased somewhat during the first several years of the 21st century, B2B e-commerce technologies have expanded at an increasing rate (Lim & Wen, 2002). The expansion of B2B e-commerce has been technologically based on enterprise-wide information systems (EISs) that allow electronic data transmission and execution of transactions in a secure and efficient manner. Since B2B e-commerce is Internet-based, the EISs used to support B2B e-commerce must be Internet capable. The primary language of the Internet, Hypertext Mark-up Language (HTML), is not well-suited for transmitting data and executing transactions. Consequently, Extensible Mark-up Language (XML) was developed to facilitate electronic information exchange applications, including many applications related to B2B e-commerce. As initially conceived, XML had a number of constraints, particularly in the area of data integrity and security, however, these constraints have gradually been overcome. This chapter reviews the objectives of using XML in B2B e-commerce, reviews the technical structure of XML, and discusses ways that security and privacy can be enhanced while engaging in B2B e-commerce.

Research Issues of the IT Productivity Paradox

Although corporations in the western world, especially those in the United States, have spent generously on information technology (IT) and information systems (IS) in recent decades, many empirical studies have found limited evidence for the payoffs of surging IT expenditures. In some cases, measures of IT spending were found to be either uncorrelated, or negatively associated, with the productivity or financial performance of the sample firms. To the dismay of the researchers and business executives, the phenomenon of the IT productivity paradox lingers on to this day. A review of the literature on this subject has pointed out several possible reasons underlying such inconsistencies, which include data and methodological problems and limitations of research models. Moreover, many of these studies have been criticized as weak in theoretical underpinning when they simply fed data into statistical models for the independent (IT spending), and dependent (productivity or financial performance) measures in order to empirically ascertain the relationships that might exist. In this chapter, a research model is proposed. With expectation to mitigate the shortcomings of some of the prior studies, this model incorporates improvements in business process as an independent construct in parallel to the capabilities of IT and enterprise systems. Competitive capabilities are included as an intermediate construct to help conceptualize the linkage between the independent constructs and the dependent construct of organizational performance. Theories and empirical evidence are drawn from associated management disciplines such as operations management and from a resources-based view of the firm to illustrate and explain that investment in IT and business processes will eventually contribute to organizational performance through the creation and enhancement of competitive capabilities. Finally, the theoretical and managerial implications of this research model are highlighted.

Toward Always-On Enterprise Information Systems

Significant changes in information technology (IT), the Internet, and e-business technology have increased the need for continuous and agile data access, in particular for mission-critical applications. Modern business computing has evolved into an organizational engine that drives business and provides a powerful source for competitive advantage. IT has been integrated into organizational operations and activities in a way that application downtime is not an option since each hour, even minute of downtime may generate negative financial effects. In order to achieve higher levels of competitiveness, business has to be continuous from data availability perspective and agile with regard to data access. An enterprise information system (EIS) can be qualified as “high-quality” in terms of its architecture, application platform, and information it can provide to users but if that information is unavailable when it is needed by customer, manager, or any other end user, the value of that EIS simply becomes “zeroed” from end-users’ point of view. The chapter presents a framework for implementation of continuous computing technologies for improving business continuity. The framework is presented within a systemic view of developing an “always-on” enterprise information system.