Enterprise Resource Planning (ERP) Software Package Recommendation

And assessing the Readiness for Change within a Privately Own Company in

/

Monrovia, Liberia, West Africa

By

James Edward Ledlum, Jr.

A Research Paper

Submitted in Partial Fulfillment of the

Requirements for the

Master of Science Degree

In

Technology Management

Approved: Three (3) Semester Credits

Dr. Renee Surdick

Research Advisor

The Graduate School

University of Wisconsin-Stout

April 5, 2010

. Author:

The Graduate School

University of Wisconsin-Stout

Menomonie, WI

Mr. James Edward Ledlum, Jr .

2

Title: Ellterprise Resource Planning (ERP) Software Package Recommendation

ami Assessing the Readilless for Challge withill a Privately Own Company ill

Monrovia, Liberia, West Africa

Graduate Degree/ Major: MS Technology Management

Research Advisor: Renee Surdick, Ph.D.

Month/ Year: April, 2010

Number of Pages: 104

Style Manual Used: American Psychological Association, 6th edition

Abstract

With modem technology and software utilization, industries are implementing ERP

Software. With the rapid changes in technology, organizations need to keep up with those

changes, to maintain a competitive edge over their competitors. ERP implementation has

presented change for some businesses; however, it is not an easy process to select the right ERP

system for implementation.

The process of selecting an ERP system begins with assessing an organization's readiness

for the change. Once the readiness for change is determined, understanding the ERP system

usage is impOliant; the type of ERP software that would work within the organization must be

determined. Therefore, early planning and understanding of the system usage and the

organization's readiness to change, is critical. This needs to occur prior to making the

recommendation for implementation due to the cost of implementing such system.

3

This research will attempt to assess the readiness for change within a small and privately

owned company in Liberia, West Africa, and analyze available ERP software, and select, for

recommendation, "The One" that would be "Ideal" to work within the said company. The

readiness for change and the ideal ERP Software Package equates to a system that would be

accepted and implemented successfully.

The Graduate School

University of Wisconsin-Stout

Menomonie, WI

Acknowledgments

4

In all things, it is important to give thanks and praises to God for His continuous

guidance and life's provision. If it had not been for Him on my side, I would not have made it

thus far. He has been my strength and protector. When everyone said that I will not make it, He

believed in me. He provided me with the knowledge, wisdom and understanding to excel in

ways I could not imagine. To God is the Glory, for great things He has done in my life.

This research paper is dedicated to my beautiful, supportive and caring wife (Mrs.

Blossom Anastasia Thomas-Ledlum). She has always provided me with love and support in all

my efforts, while giving me the necessary encouragement to always challenge and better myself

in every possible way. She has always kept me focus on my life's purpose, which is to seek

every opportunity to better myself, as I continuously strive to climb the success ladder in life. To

my son (Robert), thanks for your patience during days when I had too much school work to do.

To my family and friends in the United States of America, Europe, Asia and Africa, my

heartfelt gratitude goes out to you for the support in everyway to help me successful in life. To

my research advisor (Dr. Surdick), thanks for the continuous help in guiding me tlu"ough this

process and ensuring that I successfully complete this project. It was not an easy ride, but it is

great to know that I have made it, with your help. I am proud to know that this project presented

successful results, in that an ideal ERP system was recommended; the Company involved has

committed to Implementation. Thanks to Company XYZ for allowing me the opportunity to use

their company for this research. Thank to the folks who worked with me to gather information

5

needed to make this project a success. Lastly, thanks to all of my graduate school professors,

most especially Mr. James Keyes, for the knowledge shared with me on ERP; and Mr. Thomas

Lacksonen, as the Program Director for encouraging me to be successful. THANKS A LOT!

6

Table of Contents

Abstract ... ...... ......... ........................................................................................................................ 2

List of Tables ............................................................................................... .................................... 8

Chapter I: Introduction .................................................................................................................... 9

Company Background ..................................................................... ....... ....... .................... l 0

Statement of the Problem ................................................................................................... 11

Purpose of the Research .................................................................. ..... .. ..... ..................... . 11

Assumptions of the Research ............................................................. ................................ 13

Definition of Terms ............................................................................................................ 14

Limitations of the Research ............................................................................................... 15

Methodology .... .................................................................................................................. 15

Chapter II: Literature Review ........................................................................................................ 17

The Development of ERP ................................................................................................. 17

Why Implement an ERP System .................................................................................. 22

Why ERP Implementation Fails ....................................................................................... 23

Readiness for Change ...................................................................................................... 24

A Future Outlook of ERP .................................................................... .......... .................. 28

Why ERP Adoption is so Low Amongst Developing Countries ............................ ... 29

Factors that have led to the low adoption of ERP in developing countries ......... 30

Lessons learned from existing ERP adoptions in developing countries ............. 30

Critical Success Factors (CSFs) ........................................................................................ 31

Understanding CSFs in Implementing an ERP System ............................................. 32

Some ERP CSFs ..... .................................................................................................... 33

7

Summary ofERP CSFs ..... ..... .. ... ........ ........................................................................ 35

Chapter III: Methodology ...................... ... ..................................................................................... 36

Subject Selection and Description ..................................................................................... 36

Instrumentation and Data Collection Procedures ... ................... ............ .... ............. .... ... .... 37

Data Analysis ......................... ............................................ .. ... ....... .............................. ...... 40

Limitations ................................. .... .................................................................................... 42

Summary ..................................... ...... ................................................................ ............. .... 42

Chapter IV: Result, Conclusions and Recommendations ................. ...... ..... ............................ .. .. .44

Chapter V: Summary .................................................................................................. ........ ... ........ 51

References .. .. .............. .. ............................ ... .. .... ... ..................... .................... ................................ 53

Appendix A: The Evolution of ERP ............................................................................................. 57

Appendix B: ERP Sophistication Hierarchy .................................................................................. 58

Appendix C: Factors Leading to the Low Adoption of ERP ......................................................... 59

Appendix D: Lessons Learned from ERP Adoption ............... .. ... .... ... ....... .................................... 61

Appendix E: Significant Consequences of an ERP Implementation .. ........................................... 63

Appendix F: Readiness for Change Questionnaire ........................................................................ 64

Appendix G: Strategic Executive Questionnaire ........................................... .. ............................. 82

Appendix H: Strategic Requirements Management Questionnaire ............................................... 90

Appendix I: First Set of Five ERP Software Packages - (Cost Threshold US 20K to 50K) ......... 92

Appendix J: Second Set of Five ERP Software Packages - (Cost Threshold US 50K to lOOK) .. 94

Appendix K: Change Readiness Questionnaire Analysis Results ................................................. 96

Appendix L: Future Change and Transition Strategies ................................. , ................................ 98

Appendix M: The two sets of five (10) ERP Software Packages - Vendors Information .......... 100

8

List of Tables

Table 1: Evolution ofERP from "1960s" to "1990s to Present" ........................................ 19

Table 2: Definitions of the Five Prospective ................................................................ 21

Table 3: Number of Persons in each Category ...... ....................................................... 44

Table 4: Five ERP Packages Comparison ................................................................. 48

9

Chapter I: Introduction

An Enterprise Resource Planning (ERP) system is an integrated set of programs that

supp0l1S the core organizational activities such as manufacturing, logistics, finance, accounting,

sales, marketing, and human resources . An ERP system can be used by different departments in

an organization to share data and knowledge, reduce costs, and improve the management of the

business processes. An ERP system makes information sharing easier and provides an electronic

medium for the information sharing within an organization and amongst various departments

and/or business units. When information is manually transferred from one depm1ment to another

and/or business units, the information could be misplaced, lost, or incon'ectly entered into

another system. When organizations have multiple systems the chance of elTors increases.

The use of an ERP system could enable personnel within an organization to share

information across the entire organization and update the information when necessary. Whether

the organization is in a developing country and/or a developed country, the ERP system could

make information sharing easier and available electronically. The researcher, after visiting a few

developing countries, hypothesized that most organizations in those countries are not technically

advanced compared to organizations in developed countries like the United States and Europe;

however, those developing countries organizations seems to want to continue in doing business

and stay competitive. With the changes in technology today, it seems to be hard for these

developing countries organizations to keep up with the technological changes around them as a

way to stay competitive. With the rapidly advancing of technology, it appears to be very critical

that every organization seek to adapt the ongoing changes within this technological world, in

order to stay competitive. Utilization of an ERP system seems to be a positive step in seeking to

potentially keep up with the technological changes in today's business. Most companies today,

10

if not all, seems to be seeking after the use of some kind of ERP system to meet the specific

needs of their organization, which is a reason why Company XYZ is seeking after such system.

Company Background

A small and privately owned manufacturing company in Liberia, West Africa, Company

XYZ, has been in business successfully for over 10 years, and hopes to continue to be in

business for more years and be more competitive in the business market. This company is

seeking to venture in business outside of Liberia and build a genuine reputation for a high

standard of efficiency in its product manufacturing. The company has about 35 to 40 employees

and currently manufactures two product families.

Company XYZ cUlTently has various types of manual documentation systems that have

been developed oveliime and used within the different departments within the company. Each

department of the business has its own manual system, which makes it difficult to gather proper

information to be shared within the organization and with cllstomers, when necessary. The

company operates its daily business activities using each of the manual systems. The following

activities and/or paperwork within the organization are manual: Order Identification Record

(OlD Record), Bill of Material (BOM), Pack List, and Shop Floor Control. When there is a need

to gather some requested information, there are stacks of paperwork that seems to not be well

organized, which makes it difficult to gather such information for sharing amongst the different

functions and/or customers. Information such as inventory records is in disal1'ay and there seems

to be no defined reorder point, which leads to customer orders not being met and sometimes lost.

In addition, inventory levels, Bill of Material (BOM) routing, shop floor controls, costing, and

accounting (accounts receivable and accollnts payable) are not structured . CUl1'ently, there is no

11

control limit set to manage the work in progress (WIP) and the company does not use material

requirement planning (MRP) within their manufacturing and scheduling process.

After discussing this situation with the owners of Company XYZ, it has been decided to

think about switching from the arcade manual systems to an electronic system (An ERP System)

that could help with increased efficiency and effectiveness in their business operation. Since

each depaItment has its own system, it is important that the ERP system have celtain features,

which includes following: 1. The ability of accurate costing and automatic updating of

customers' records; 2. Better control of inventory and customer orders, while maintaining the

BOM; 3. Link between the different database in each depaltment; and 4. Better managing of

field services. Due to some critical features, the company would like a system that includes the

listed features and other functional capabilities that could lead to an overall organizational

improvement. This new system is expected to make a significant change within the company.

Statement of the Problem

Company XYZ has multiple manual documentation systems which are arcade and seems

to have created a certain level of chaos within their business. These manual systems make it

difficult to maintain an adequate control over documentation relating to quality, production, cost,

inventory levels, customer delivery, etc. This company is seeking to switch from the arcade

manual systems to an electronic system, which could help in maintaining the expected adequate

control over defined documentations. Being a small company, cost is a significant factor in

switching from the manual system to an electronic and more centralized system.

Purpose of the Research

How can this research reveal an ideal ERP software package that would fall within a

limited range of cost and capabilities for a defined number of users that would best meet the

12

needs of Company XYZ? There is a need for the selection and recommendation of an ERP

software package that falls within a limited range of software cost for a defined number of users

that would best meet the needs of this company. Therefore, this research will attempt to

investigate a variety of ERP systems and recommend the ideal system that would fit the selection

criteria of Company XYZ for use within their organization. This research hopes to accomplish

both the selection and recommendation of the software that would best meet the needs of this

small and privately owned company. The recommendation would take into consideration the

elements of the following: 1) cultural aspect, 2) technological aspect and 3) location of this

company. Also this research will assess the readiness for change by the people within the

company. Once the readiness for change is assessed within the various facets of the organization

and the ideal ERP software package is selected, a recommendation and framework would be

made for the adoption and possible implementation of the system within this company, to create

the necessary flow of information across all departments, electronically and in one centralize

location and system.

The expected result of this research is the selection and recommendation of an ideal ERP

software package, for possible implementation by Company XYZ management team, provided

the people within the organization are receptive and committed to the change. The software

implementation will be the responsibility ofthe company's owners and management, which

means that implementation, is out of scope for this research. Even though the implementation is

out of scope for this research, the company owners and management team will be encouraged to

implement the recommended ideal ERP software package. An independent agency will be

recommended to consult and help Company XYZ with the implementation. Company XYZ may

13

choose not to hire this independent agency to help and consult them with the implementation

process; however, they are highly encouraged to used the said agency.

Assumptions of the Research

This research is in response to a need of a small organization in a developing country. As with

every business, there are few factors that impact the business. Considering factors such as the

location, culture, people and cost involve, the following are assumptions of the research:

1. The company will share the needed information (infOlmation pe11aining to the input and

output of the process) with the researcher, upon request.

2. The company owner will make available personnel to help in gathering the needed

information and communicate the intent of the research to the organization, prior to the

start of the research, so as to prevent surprises for the employees.

3. The researcher will select and recommend the optimal and ideal ERP software package

that would meet the defined company's capability and functional requirements.

4. The company will accept the recommended ideal ERP software package.

5. The company will shoulder pat1 of the expense required for the research as agreed upon

by the researcher and the company owners, prior to the start of the research.

6. The researcher is not expected to be compensated for the work done within the scope of

this research. Any work done outside of the scope of this research will be based upon an

agreement between the researcher and the company owners and management team.

7. The researcher will not disclose the name of this company and local companies that were

interviewed; the company and customers information will be kept confidential.

14

Definition of Terms

Bill of Material (BOM). It is a listing of all the materials, components and quantities

used to manufacture an item (Kremzar & Wallace, 2001).

Critical Success Factor (CSF). It is the term for an element which is necessary for any

organization or research to achieve its mission and expected results.

Enterprise Resource Planning (ERP). It is a combination of different legacy systems

into one system (Ferrando, 2001). It is a system that is shared amongst all departments and

provides real time data for all aspects of the business.

Just in Time (JIT). It is an inventory strategy that seeks to improve return on

investment by striving to reduce the in-process inventory and associated carrying costs.

Material Requirement Planning (MRP). It is using BOMs, inventory data, and master

schedule to plan material ordering and replenislunent (Kremzar & Wallace, 2001).

Order Identification Record (OlD Record). It is a record that identifies the options

and specific manufacturing information associated and specific to an order and/or item.

Pack List. It is a shop floor paperwork that has a list of items needed to be picked and

packed for a pa11icular order to be shipped to a particular customer. The pack list is very critical

and needs to be precise so as to meet customer order.

Shop Floor Control. It is a system used for handling order information, tracking work

in process (WIP) and inputting control data at the manufacturing or material handling point of

operation (Kremzar & Wallace, 2001).

Work in Progress (WIP). It is work that is waiting to be process at a particular process

step. The output from a process could be an input to another; in such case, it is called a WIP.

15

Limitations of the Research

With this research being conducted for a small organization in a developing country and

considering the location, culture, people and cost involve in this research, and as the research

begins, the following are limitations of the research to be expected:

1. The limited knowledge of the processes performed by and the capability of any ERP

software and the benefits and limitations within Company XYZ.

2. The limited technological knowledge on ERP implementation by personnel at company

XYZ as well as individuals within the country of operation.

3. There is limited company resources that have been allocated by the company owners

that are not 100% dedicated to the research; they still have to do their daily job duties.

4. The current manufacturing space is limited but it would be difficult and expensive to

move the plant at the present time; the company can not afford to move to a new

facility and seek to implement a new ERP software package at the same time.

5. The research is limited to the current product families and manufacturing process.

6. There is limited amount available to be used, due to a budget constraint at the company.

Methodology

This research begins with gathering detailed and specific information about the CUlTent

manual systems within the company; also collecting important data from the shop floor that are

necessary for determining which ERP software package would suffice for meeting the needs of

the company. The information collected is used to develop a list of functional requirements

and/or capabilities that the selected and recommended system must have. The developed list is

analyzed to identify potential areas for improvement that needs to be added to the list; based

upon the analysis, a final requirements list is made available and approved by the company

16

owners and management team. The final requirements list is used in the selection process to

ensure that the recommended package do suffice for meeting the needs of the company. This

new system should help to potentially reduce lead-time and allow for better planning, production

scheduling, pricing, and maintain inventory, cost control and robust processes thus improving the

efficiency of manufacturing.

The recommended software package is simulated with management and the plant/shop

floor employees to obtain feedback to determine how receptive people are pertaining to the

change. The feedback is used to make necessary improvements and suggestions that could be

added to the final recommended software package. Once the software package has been finally

determined, a formal presentation to the company owners and management team is made. After

the researcher had made the presentation, and company XYZ owners and management team

accepts the results and the recommended ERP software package, implementation is highly

encouraged. Once the package has been officially accepted, this research is then considered

closed and no fUlther activity is required for this research.

The implementation of the ERP package is the responsibility of Company XYZ owners

and management team to complete. Some consultation would be needed by the company as they

work on the implementation, but the implementation and consulting aspect is out of scope for

this research. Therefore an independent agency is recommended to the company's owners and

management team, to help with the implementation. The researcher is available to provide some

consultation for a fee that is negotiated by the company owners, with a formal written agreement

with the researcher. The agency and Company XYZ is to work on the implementation.

17

Chapter II: Literature Review

This chapter provides an in-depth overview of literatures reviewed on ERP, the Adoption

of ERP in developing countries, and Readiness for Change, and Critical Success Factors (CSFs)

in implementing an ERP system. The literature also broadened the extent of research on ERP

systems strengthening the extent of recommendations for company XYZ. Understanding an

ERP system and the receptiveness of change by the people who are expected to use the system, is

essential in selecting and recommending the precise and ideal package for the specific need of a

particular company and situation, as in the case of Company XYZ.

The Development of ERP

The development of ERP can not be discussed without understanding what the term

"ERP" stands for; it is the acronym for Enterprise Resource Planning. It is an information

system that was developed in the 1990s as a result of the various business decision support

systems incorporated in to the Manufacturing Resource Planning (MRP II) system (Kapp,

Latham & Ford-Latham, 200 1). ERP combines different legacy systems in an organization into

one system (FelTando, 2001). ERP is an enterprise-wide set of management tools that balances

demand and supply within the business needs. It multifunction supports the ability to link

customers and suppliers into a complete supply chain, employs proven business processes for

decision-making, provides high degrees of cross-functional integration among sales, marketing,

manufacturing, operations, logistics, purchasing, finance, new product development, and human

resources. This enables people to run their business with high levels of efficiency in customer

service and productivity, and simultaneously lowering all necessary inventories and costs; while

providing a foundation for an effective e-commerce within business (Kremzar & Wallace, 2001).

18

Kapp, et al. (2001) defines ERP as "a system of integrated procedures, rules and

algorithms that is designed to function consistently time and time again" (p. 85). However,

many people interpret the value ofERP differently, but the key point to understand is that an

ERP system is about the integration of essential business information. The purpose of ERP is to

create a single, centralized electronic system that can perform the functions of every department

within an organization by linking the depaliments into a single, centralized database. With the

integration of a single, centralized database, it enables everyone within the organization to share

the same information and communicate with one another more effectively. "What ERP really

does is organize, codify, and standardize an enterprise's business processes and data. The

software transforms transactional data into useful information and collates the data so that it can

be analyzed" (Norris, Hurley, Hartley, Dunleavy & Balis, 2000, p. 13). There may be many

different ways people could think of an ERP system, but, "the easiest way to think of ERP is as a

big information system that everybody has access to" (Jacobs & Whybark, 2000, p. 9).

In order to further explore the topic ofERP, the evolution of an ERP system needs to be

examined in depth. According to Kremzar and Wallace (2001), the evolution ofERP dates back

to the 1960s, when the concept of Inventory Management & Control (IMC) was first developed

and then Material Requirements Planning (MRP) in the 1970s. The MRP covered what is called

the universal manufacturing equation, which included the following four questions: a) What are

we going to make? b) What does it take to make it? c) What do we have? d) What do we have to

get? ERP is the evolution of Manufacturing Requirements Planning (MRP) II. From a business

perspective, ERP has expanded from the coordination of manufacturing processes to the robust

integration of enterprise-wide backend processes. From a technological prospective, ERP has

evolved from legacy implementation to more flexible tiered client-server architecture. The

19

following table was generated based upon infonnation leverage from Kremzar & Wallace

(2001), and it seeks to summarize the evolution of ERP from 1960s to 1990s to Present.

Table 1

Evolution of ERP from "1960s" to "1990s to Present"

Timeline

1960s

1970s

1980s

1990s to

Present

System

Inventory

Description

IMC is the combination of infonnation technology and business

Management processes of maintaining the appropriate level of stock in a

& Control warehouse. The activities of inventory management includes

(IMC) identifying inventory requirements, setting targets, providing

replenishment techniques and options, monitoring item usages,

reconciling the inventory balances, and reporting inventory status,

as necessary.

Material MRP utilizes software applications for scheduling production

Requirement processes. MRP generates schedules for the operations and raw

Planning material purchases based on the production requirements of

(MRP) finished goods, the structure of the production system, the current

inventories levels and the lot sizing procedure for each operation.

Manufacturing Manufacturing Requirements Planning or MRP II utilizes

Requirements

Planning

(MRP II)

Enterprise

Resource

Planning

(ERP)

software applications for coordinating manufacturing processes,

from product planning, palts purchasing, inventory control to

product distribution.

ERP uses multi-module application software for improving the

performance of the internal business processes. ERP systems

often integrate business activities across functional departments,

from product planning, palts purchasing, inventory control,

product distribution, fulfillment, to order tracking. ERP software

systems may include application modules for supporting

marketing, finance, accounting and human resources.

20

Although the tel111S MRP, MRP II and ERP are used throughout many organizations, often

people are confused and can not seem to distinguish the differences between them. In addition to

Table 1 above, the below figure shows the evolution of ERP with the latest evolution on the

outer most circle and the earliest on the inner most circle. The below figure shows the ERP

evolution, which started from the inception of Inventory Management and Control (IMC) in the

1960s and ending with Enterprise Resource Planning, which was birth in the 1990s and is a

commonly used system in most businesses today (Kapp, et al. 2001) and (Kremzar & Wallace,

2001). The figure in Appendix A, taken from the book called ERP: Making It Happen by

Thomas F. Wallace and Michael H. Kremzar, shows the evolution of ERP with the latest

evolution on the outer most circle and the earliest on the inner most circle.

According to Boyle (2000), MRP is an inventory control and production planning system

designed for ordering and scheduling dependent demand of inventory, which includes: Master

Schedule, Bill of Material and Inventory record file. MRP II is just an expansion of the MRP

system with three new capabilities including financial analysis, feed back loops, and marketing

plans. Finally, ERP is an extension ofMRP II with additional capabilities, such as better

graphical user interface, the use of relational database, fourth language generation, open system

portability, and is much more integrated than MRPII. In addition, Kapp, et al. (2001), stated that

the differences between ERP and MRP II is the inclusion of a variety of manufacturing processes

within ERP, which allows modern ERP software to handle discrete work orders, flow orders,

lIT, MRP and hand-entered orders. According to Wainewright (2002), MRP was used for

tracking suppliers, work-in progress and the output of finished goods, while ERP is used for all

type of business with additional functions including financials, payroll and human resources

management. Kremzar and Wallace (2001) stated that ERP is far better than MRP II for three

21

reasons: (1). ERP applies a single set of resource planning tools across the entire enterprise, (2).

ERP provides real-time integration of sales, operating, and financial data, and (3). ERP connects

resource planning approaches to the extended supply chain of customers and suppliers.

To better understand the ERP concept, it can be viewed from five perspectives: (1) Data

Management, (2) Software modules sharing one database, (3) Knowledge Management, (4)

Manufacturing philosophy, and (5) Business philosophy, (Kapp, et al. 2001). The "Integrated

Learningfor ERP Success" by Kapp, et al. (2001), shows the ERP sophistication hierarchy of

the five perspectives of an ERP system. These five prospective is important to the successful

implementation and maintenance of the ERP system. The five prospective needs to be fully

understood by ERP users and implementers. It is critical that implementers and users understand

an ERP System and how advantageous it is. The figure in Appendix B, taken from the book

"Integrated Learningfor ERP Success" by Kapp, et al. (2001), shows a bottom-up approach

with the least sophisticated view at the bottom and the most complex and strategically

advantageous at the top.

According to Kapp, et al. (2001), in order to implement an ERP system successfully, an

organization must fully understand each of the five perspectives mentioned above. Kapp, et al.

(2001), defines the five prospective as in the table below:

Table 2

Definitions of the Five Prospective

Prospective Defini tion( s)

First

Second

The ERP system was defined as a large database that stores a large

quantity of data. (Kapp, et al. 200 1, p. 14-16)

The ERP system was defined as a group of modules all connected onto a

central database. (Kapp, et a1. 2001, p. 14-16)

Third The ERP system was to view information contained in the system as

knowledge that can be used by everyone. (Kapp, et a1. 2001, p. 14-16)

Fourth To view ERP as a manufacturing philosophy rather than as a software

program. (Kapp, et al. 200 1, p. 14-16)

Fifth The fifth perspective was to view the ERP system as a business

philosophy communication tool. (Kapp, et a1. 2001, p. 14-16)

22

Everything done within an ERP system affects the success of the entire organization

(Gale, 2002). If the ERP system is set up correctly and all items in the system are structured

properly, there is a greater chance for success verses when the system is set up incorrectly and

the items in the system are not properly structured. Basically, ERP systems are shared business

systems that can be utilized to share information amongst all facets of the organization and allow

for a centralized information database that could be utilized to make key business decisions.

Why Implement an ERP System

Within every business today, it is important to seek the implementation of an ERP

system. According to Koch (2002), there are reasons why companies should implement an ERP

system. Five of those reasons for implementing an ERP system are: (1). Integration of financial

information, (2). Integration of customer order information, (3). Standardization of and the

speeding up of manufacturing processes, (4). Reduction of inventory level, and (5).

Standardization of Human Resource information. According to Kremzar and Wallace (2001),

operating a business in a rapidly changing and highly competitive environment is a primary

purpose of implementing an ERP system.

23

Although ERP implementation may be costly and time consuming, the benefits are wOlih

the investment. With careful planning and selection of the ideal ERP system, a company may

expect to gain significant benefits including dramatic increases in responsiveness, productivity,

on-time shipments and sales, decrease in lead times, purchase costs, quality, and inventories

(Kremzar & Wallace, 2001, p. 15). Indeed careful planning and selection is important, but

success is only achieved when the organization takes the time to develop a training and

education plan prior to beginning the ERP implementation" (Kapp, et a1. 2001). According to

the Meta Group, the median annual saving by a company for a fully implemented ERP system

was $1.6 million per year (Mello, 2002).

Why ERP Implementation Fails

Implementing a new ERP system does not guarantee successful results. Very few ERP

implementation research could result in success the very first time, while others could be total

failures. According to Kapp, et a1. 2001, ERP implementations do fail because employees resist

the new system rather than embracing it. Also, the success and failure of implementing a new

ERP system does not depend on the quality of hardware and software of the system

implemented, but rather in the education and training of the people who are expected to use the

system. "Success is achieved when organizations take the time to develop a training program

and education plan prior to beginning the ERP implementation" (Kapp, et a1. 2001, p. 8). Jacobs

and Whybark (2000) stated that an organization must solve the management problems and get

the relationships between functions sorted out before it can implement the new system.

Clearly the issue in dealing with a new ERP system is not solely the technology involved,

but the proper planning and commitment of everyone from top management to the bottom

employee within the organization. Often organizations overlook their planning when they decide

24

to implement an ERP system. Without much thought on what the ERP system is supposed to do

and what the company wants to get out of the system, the implementation process is already

underway. Without proper planning, commitment, education and training, the implementation is

of no benefit to the organization. Many Enterprise Resource Planning (ERP) training plans are

haphazard, ill conceived, and focused on the wrong topics (Kapp, et al. 2001).

According to Kapp, et al. (2001), during the implementation process, training is often

treated like a poor little second cousin. Training classes are isolated events not relevant to

employee jobs. The training offered by the ERP vendor fails to help employees understand the

integrated nature of the ERP system. The focus is more on technical training and not integration.

Training for the system is conducted too early, other times it's too late. The timing needs to take

place at the right time. Most often, no one knows who attended which training class and the

education sessions are missed because of more priorities on the plates of employees. Employees

sometime do not understand their new roles and responsibilities, as a result of the

implementation of the new system. Most organizations spend more time planning the company

picnic than they do devising an ERP training plan that would get employees trained to

successfully use the system. Furthermore, according to Kapp, et al. (2001), a company spends

most of its money investing in technology rather than employee training. Whenever the focus is

on the system only, it most often leads to a failure. Training is very essential to being successful.

Readiness for Change

In addition to prior planning, change is probably the most frightening issue that an

organization has to deal with. Implementing an ERP system requires major changes to the

organizational, cultural, and business processes within the organization (Norris, et al. 2000, p.

13). Kremzar and Wallace (2001) state that "Most companies implementing ERP must undergo

25

massive behavior change to be successful." They continue by saying that "Many things must be

done differently, and this kind of transfOimation is never easy to achieve" (p. 25). Almost

always people are unwilling to change the way they do business or perform their jobs, simply

because they are afraid of change. Although change may greatly benefit the company and make

life easier for the employees, there are still many people who prefer the old way of doing

business rather than the new way. It is often said, things have always be done this way, why

must there be any change now? For most people, the fear behind change is that it will bring

more work and allow less time for completion. Some feel that the change may lead to job losses.

For others, they just don ' t want to learn new ways of doing things, once they are already used to

doing it a particular way. The key to success, when change in an organization is expected, is the

willingness of everyone in the enterprise to adopt not only the new technology but new ways of

working" (NolTis, et al. 2000, p. 13). Everyone at every level within the organization ought to be

ready for the change in order to have a system that would be utilized fully and be successful.

The readiness for change and behavioral intentions regarding the implementation of an

enterprise resource planning system (ERP) ought to be examined. The perceived ERP benefits

are related to people within an organization readiness for change, and readiness for change is a

. significant predictor of the people's attitude toward usage of the ERP system. In order to get

everyone to understand that the implementation of ERP will result in significant operational,

structural, cultural and paradigmatic changes across the company, change implementation and

technology acceptance ought to be done by examining individual factors that affects the people

acceptance of the component of an ERP system that would affect them. People readiness toward

change, usage attitudes, and behavioral intentions to use the ERP system will determine if a

system should be recommended. It is believed that when people perceive that using the ERP

26

system will have implications on their performance and make their work easier, they would show

greater readiness for change. Without change readiness, implementing an ERP system could

lead to a failure. It is important to ensure that change readiness is the norm of the company.

It seems that organizations are changing at amazing speeds. The time their leaders need

to assess the readiness for change, planning, implementing and evaluating said change is

becoming shorter and shorter. As leaders are planning for future organizational changes, they

are also preparing personally for the transition ahead, while employees rarely have this type of

0ppOliunity. The sooner employees are brought into the planning stages, the sooner they are able

to prepare for change and transition. This will allow them to be more productive and better able

to provide the feedback necessary for the changes ahead. Committing to involving employees

sooner and more frequently throughout this process will not only increase their readiness for

change and transition, but also decrease the innately human resistance to change, and hopefully

create a more creative change process that "sticks."

According to Fullan and Stiegelbauer (1991), there are several reasons that cause

individuals in an organization to have a low readiness for change; the purpose is not made clear,

participants are not involved in planning, the habit patterns of the individuals are ignored,

excessive work pressure is involved, and/or the CUl1'ent condition seems satisfactory. Because

many of these reasons could potentially relate to the members within the organization, it is

important to assess the level of readiness that the individuals possessed. Neufeld (1998) reflects

on the thought that getting stakeholders involved early in the implementation process leads to

higher levels of readiness for change. He also states that individuals that are fully informed

about the reasons and benefits of the change are more likely to be supportive of the change.

27

The genesis of change readiness lies in Lewin's (1947) concept of unfreezing or getting

organizational members to let go, both physically and psychologically, of the current ways of

doing things within the organization. Management must provide evidence that the CUlTent ways

are no longer acceptable or appropriate if the organization is to remain successful or regain

success. The key to change readiness is detelmining whether the people are ready to do their

jobs in the new envirorunent? When people (the most intangible component of change

readiness) aren't ready, the company usually sees the most tangible negative results. The reason

is that the people who aren't ready are the same ones that interact with the customers. They are

the individuals that must react in the heat of the moment in a difficult envirorunent. And when

they don't react well, people will notice. Sometimes the people that notice are the business press

or a member of the board of directors. Seldom is the real value of a change initiative realized

with only technology. Without the people being ready, the change could lead to a disaster.

The people and their readiness to embrace the change are critical and the lack of

readiness can cost the organization to lose a lot of money that has already been invested. The

people need guidance and it is the change leader's responsibility to guide the organizational

member to embrace the change rather than resist it. It is impOliant to conduct a readiness

assessment review to determine whether the organization is ready to implement the Enterprise

Resource Planning program. The assessment is a measurement of the state of the cutTent

processes before recommending an ERP package for implementation. The results will help

ensure that an ERP package recommended meets or exceeds the established goals that have been

set for the initiative. If the people aren't ready, should the organization go forward? Would

anyone notice a year from now if everything works well but it was delivered two months late?

Conversely, if rollout is a disaster, would anyone be given credit a year from now for getting

28

done on time? More likely, what is remembered when reviewing the financials a year later is that

the expected benefits just aren't there, which is not a benefit to the organization.

As mentioned, implementing an ERP system is a process that is very costly. Besides the

ERP software cost, there are other hidden costs which most organizations fail to realize and

because of that, the implementation leads to a complete disaster. These other hidden costs are:

integration, data conversion, testing, documentation, training, and consulting fees (Mello, 2002).

According to Kapp, et al. (2001), the cost of implementing an ERP system may range from three

to ten (3-10) times the actual cost of the software (p. 3). The Meta Group conducted a survey of

6 different companies and found that the average total cost of ownership for an ERP system was

$15 million, which includes software cost, staff time, consulting, and hardware cost (Mello,

2002). Organizations need to understand the cost involve in an ERP system implementation

before seeking to implement such system. If all of the cost involved is not adequately

determined and understood, and the organization and it's people are not ready for the change,

when the system is implemented, it would most likely lead to a failure.

A Future Outlook of ERP

For over a decade, the use of an ERP system has had major impact in the manufacturing

industry. The ERP system has gone from serving manufacturing companies to serving other

industries, such as health care, financial services, aerospace industry, and the consumer goods

sector (Mello, 2002). According to Boyle (2000), the ERP system continues to grow and is

cUlTentiy linked with the web and e-commerce applications, as well as beginning to use web

browsers as the graphical user interface. Furthermore, the future of ERP is being shaped by four

trends: (1). Improving integration and flexibility, (2). Inclusion of e-business applications, (3).

Wider range of customers, and (4). Adaptation to the Internet (Mello, 2002). According to Mello

29

(2002), the idea behind integration and flexibility was to create an application that would easily

interact with other applications of different vendors. People in the past did not realize the

importance of sharing information, but now it has become valuable to many organizations.

According to Mello (2002), the task of integrating two or more applications of the same

or different vendors is not easy. Most often, organizations ends up having more than one system,

simply because those systems could not be easily integrated with one another. According to

Mello (2002), ERP is now targeting a broader range of users such as self-service users, mobile

users and other companies. Therefore, ERP vendors are always seeking new ways to make

integration a much easier process for the users. In addition, the following e-business applications

and modules are being added to the new ERP system (Mello, 2002):

• Sales Force Automation (SF A) - handles regular sales tasks and appointment scheduling.

• Customer Relationship Management (CRM) - collects and organizes customer data. E­

procurement, which focuses on increasing the efficiency of purchasing operations.

• Supply Chain Management (SCM) - automates the planning, coordination, and refinement

of a company's supply chain.

• Business intelligence - provides assistance for decision-making.

Why ERP Adoption is Low Amongst Developing Countries

There are many reasons leading to the low adoption of ERP systems in developing countries.

Some of those reasons are:

1. ERP systems are expensive compared to the small size of organizations in developing

countries (Huang & Pal via 2001). For example, out of 240 listed companies in Sri Lanka

(which, of course, excludes subsidiaries of Multinational Corporations (MNCs)), only two

companies had an annual turnover above US $200 million (Source: Colombo Stock

30

Exchange). Therefore, the usual market for ERP products, which is for large organizations,

is not available in developing countries.

2. Cultural issues may inhibit adoption (Krumbholz, Galliers, Coulianos & Maiden, 2000;

Heeks 2002). Soh, Kien and Tay-Yap (2000) question the universal applicability of ERP

packages in developing countries.

3. After visiting some developing countries, it was learned that the lack ofERP experience

and low IT maturity in developing countries may inhibit adoption.

Factors that have led to low adoption 0/ ERP in developing countries. After visiting

some developing countries, the researcher has learned that there are many factors, not just one

single factor, which has been combined to influence the low rate of adoption of ERP systems in

developing countries. Most of these developing countries lack the technological knowledge

related to the implementation of an ERP system and/or any other type of electronic system.

Because of the many factors, these countries have struggled to successfully implement an

electronic system. Appendix C provides a list of some important factors, ranked by order of

importance, that explain why ERP systems adoption in developing countries has been very low.

Lessons learned/rom existing ERP adoptions in developing countries. In developing

countries, the problems appear to be related to determining which processes the software should

be configured to supp0l1 (Bancroft, Seip & Sprengel, 1998), overcoming knowledge barriers

(Robey et al. 2002), and change management (Davenport, Harris & Cantrell 2004). Studies

suggests that the key problems are related to cost, culture, incompatible process models, change

management, limited national IT infrastructure and lack of knowledge of ERP system concepts

(Davison 2002; Huang & Palvia 2001; Liang, et al. 2004; and Reimers 2002).

31

After visiting some developing countries, it has been concluded by the researcher that

there are lessons to be learned from companies that have adopted an ERP system. Even though

the factors stated above do explain why many organizations in developing countries have not

adopted ERP systems, there are some imp0l1ant lessons to be learned from two firms, in which

the senior management was interviewed, that have adopted an ERP system. Many of the lessons

echo the same underlying cost, culture, and stage of developmental issues as the factors

identified earlier. ERP adoption is at a minimum within the country in which company XYZ is

located, because companies in the country can not afford to implement such system. There are

lots of important lessons to be learned from ERP adoption by some firms within developing

countries. Appendix D shows a list of some of the important lessons to be learned from ERP

adoption by two firms in developing countries.

Critical Success Factors (CSFs)

Enterprise resource planning (ERP) systems could provide organizations with an

opportunity to integrate individual, functionally oriented information systems; however, the

organization may not gain the benefits and results expected unless the system is implemented

successfully. As part of recommending the adoption of an ideal ERP system within the Liberian

based company, there are critical factors that could influence the ERP adoption. The CSFs in

implementing an ERP system must be understood prior to the implementation process. Gaining

understanding of an ERP system enables an organization to adequately integrate all the primary

business processes as a means to enhance efficiency and maintain a competitive position in their

specific business market. Without a successful implementation of the system, the expected

benefits of improved productivity and competitive advantage would not be forthcoming. The

proposed CSFs can be used as a decision-making tool to support management strategic decisions

32

regarding the adoption of the recommended ERP system; it can be used by researcher to analyze

necessary critical information, and understand CSFs that could impact the ERP adoption.

Understanding CSFs in Implementing an ERP System

Based upon interviews conducted with leaders from successful companies in both

developed and developing countries, it has been noted that understanding the CSFs in

implementing an ERP system has been a challenging process for many organizations in

developing countries. Indeed an ERP system enables an organization to integrate all the primary

business processes into one centralized database as a means to enhance efficiency and maintain a

competitive position; however, without the successful implementation of the system, the benefits

of improved productivity and competitive advantage would not be forthcoming.

In its basic definition, ERP is an enterprise-wide information system that integrates and

controls all the business processes in the entire organization. According to Nah and Lau (2001),

ERP is "a packaged business software system that enables a company to manage the efficient

and effective use of it's' resources (materials, human resources, finance, etc.) by providing a

total, integrated solution for the organization's information-processing needs". ERP initially

covered all routine transactions of an organization only. However, it was later expanded to cover

external customers and suppliers (Turban, Leidner, Mclean, & Wetherbe, 2006). Nah and Lau

(2001) stated that most ERP systems now have the functionality and the capability to facilitate

the flow of information across all business processes internally and externally. ERP systems

have the capability to reach beyond their own corporate walls to better connect with suppliers,

distributors and cllstomers to engage in e-business. Today, many organizations worldwide are

implementing ERP systems in place of the functional legacy systems that are not anymore well­

compatible with modern business environment. However, according to Kroenke (2008), the

33

process of moving from functional applications to an ERP system is a difficult and challenging

process. Additionally, the switch to ERP system is expensive and requires the development of

new procedures, training and data conveliing (Zhang, Lee, Huang, Zhang, & Huang, 2005).

Most organizations are multi-functional , complex, information intensive and require

sophisticated integrated business management information systems. However, the emergence of

the ERP software radically transformed the computing platform of most organizations (Klaus,

Rosemann, & Gable, 2000). The implementation of ERP and system integration into one

centralized database has provided impOliant benefits to organizations worldwide. However,

there are still many problems relating to their adoption. The cost of the development of the

integration standards is high (Stefanou & Revanoglou, 2006). Moreover, the integration ofERP

system is needed to support various issues such as: administrative tasks, data security, process

integration, and utilization of valuable legacy systems and new technologies. ERP can provide

celiain benefits and present an organization with strategic operational and technical advantages,

and a set of tangible and intangible financial benefits (Kenneth, Leal, & Wiggins, 2002).

Some ERP CSFs

ERP systems are huge and complex; therefore, it warrants careful planning and execution

for successful implementation (O'Leary 2000). Moreover, they are not purely a software system,

and neither is their implementation merely an IT research. An ERP system strategically affects

how a business conducts itself and affects an organization's business processes, people's jobs,

and information flows (Somer & Nelson 2001). Therefore, due to the complex and integrated

nature of ERP package, the large investments involved (time and money), and relatively very

high implementation failure rates (Holland & Light 1999), organizations needs to be very

proactive in their implementation approach. It is imperative that organizations study and learn

34

from the experiences of others; learn from their practices and successful factors. In essence,

organizations have to learn how to identify the critical issues of ERP implementation to realize

the promised benefits and avoid the potential of failure (Somers & Nelson, 2001).

The identification of CSFs before the stalt of the research is rather critical for the

successful implementation. A number of empirical and non-empirical studies have addressed a

variety of CSFs for ERP implementation. The results of some major research on ERP

implementation success factors have shown that ERP, if implemented correctly, most always

leads to success. Holland and Light (1999) presented a number of success factors in ERP

implementation and suggested their division into strategic and tactical factors. The model was

illustrated on a sample of two ERP implementation research. Amongst 12 factors, they

highlighted the critical impact of legacy systems upon the implementation process and the

impOltance of selecting an appropriate ERP strategy. Somers & Nelson (2001) described the

impOltance of CSFs across all stages of the ERP implementations, using the responses from 86

organizations implementing ERP. From the list of 22 CSFs for ERP implementation, the most

important are: management SUppOlt; research team competence; interdepartmental cooperation;

clear goals and objectives; research management; and interdepartmental communication.

Al-Mashari (2004) presented taxonomy ofERP critical factors where 12 factors were

divided into three dimensions related to the stages of ERP research, which are: setting-up,

deployment and evaluation. The taxonomy presented emphasizes that a clear vision and business

director is fundamental to the success of any ERP system implementation. Chen (2001)

analyzed several critical planning issues prior to the ERP adoption decision, including needs

assessment and choosing a right ERP system, matching business process with ERP system,

understanding the organizational requirements, and economic and strategic justification. The

35

ERP adoption, as with any electronic system implementation, has some significant consequences

as a result of the implementation. A list of significant consequences as a result of an ERP system

implementation was laid out by the researcher, in the form of the figure in Appendix E, which

shows the ERP system in the middle with the significant consequences sUlTounding it.

Summary of ERP CSFs

ERP research is a complex Information Technology (IT) business initiative that should be

grounded on strategic infrastructure decision, adding value to a firms ' IT infrastructure

capability. Not every ERP research is seen in this sense and research has focused on a more

technical viewpoint ofERP. Articles have provided analysis based on studies of strategically

driven ERP decision with emphasis on the organizational fit ofERP. Each company can not use

the same ERP system, due to the diversity in businesses. The organizational impact of an ERP

research, especially pel1aining to costs and utility, in comparison with the common practice

situation in terms of the stages of ERP implementation and operation, is very important. Results

have shown that successful ERP research is grounded on the decision making quality observed,

in terms of team building and the positive consequences for ERP implementation and operation.

With understanding ofERP, the adoption ofERP in developing countries, Readiness for Change,

and Critical Success Factors (CSFs) in implementing an ERP system, it is expected that an

organization can make a wise decision as to which system would be ideal for their organization.

36

Chapter III: Methodology

Selecting and Recommending an ERP software package, or any software package, to an

organization could be a daunting task; it requires commitment and change readiness by an entire

organization. For this research, in order to select and recommend an ideal ERP software package

to company XYZ, a phase approach was used. The researcher worked with key representatives

from the said company, to investigate some ERP software packages and determine an ideal

package which would meet the company needs; also to assess the readiness of the people within

the said company to embrace and accept the proposed change from a manual system to an

electronic system. To accomplished the purpose of the research, a thorough investigation was

conducted, to determine what precisely needed to be addressed by the proposed ERP system;

what the company can live without in this new system and how ready are the people within the

company for this change in system. This chapter includes: Subject Selection and Description,

Instrumentation and Data Collection Procedures, Data Analysis, Limitations, and a Summary.

Subject Selection and Description

In gathering the information needed for this research, a team consisting of five persons

from company XYZ was selected to participate in answering specific questions about the

company's current needs and how the research would help to suffice those needs. The five

persons chosen from strategic functions within the company included the Production Manager,

Senior Quality Engineer, Sales Manager, Chief Executive Officer, and Vice President of Quality

Assurance and Operations. In addition, the researcher was used to gather the infOimation needed

to generate a list of the potential software packages that could potentially meet the needs of this

company. Also, the direct and in-direct labor workers within various functions within the said

company were targeted to gather unanimous data in assessing the company readiness for change.

37

Instrumentation and Data Collection Procedures

The research activities were divided into four distinct phases. Each phase involved the

selected five persons and/or the employees from Company XYZ, as needed; and the researcher.

Phase I: In detennining which ERP software package would work best for the company,

it was important to first determine the actual needs of the company. The conversations held

initially with company XYZ was revisited and formally documented to ensure that nothing had

changed. A formal meeting with the company representatives was scheduled and held to further

discuss the company' s needs and to determine whether the leadership team was still committed.

Phase II: In parallel to "Phase I", this phase attempt to assess the readiness for change

within company XYZ. In this phase, every employee within the company was targeted and

asked to unanimously complete a "Readiness for Change Questionnaire". The questions within

the questionnaire makes an employee to reflect on and give answers to questions on a number of

issues that have been found to affect an organization'S response(s) to and abilities to cope with

any change. The said questionnaire was leveraged from a "Readiness for Change Questionnaire"

(Change POlifolio, Version March 18,2008), which is a part of a longer work by Roger Harrison

(2008), Humanizing Change: Matching Interventions to Organizational Realities, 1993, HalTison

Associates. The created questionnaire (Appendix F) was mailed to a designated person at the

company to be shared with the employees. Categories covered in the said questionnaire are:

A. Information about the employee level within the organization

B. The Need for Change

C. The Approach to Change

D. The Urgency of Change

E. Magnitude of Change Required

F. Criteria of Successful Change

O. Resources Available for the Change

H. CU11'ent Organization Performance

I. Preparedness to Supp0l1 the Change

J. Dealing with the Stress, Loss and Trauma of Change

K. Change History of the Organization

L. CU11'ent Stress Levels in the Organization

M. Assessing the Level of Pain

N. Picking the Right Place to Start Change

O. Identifying Parts of the Organization Crucial to the Change

P. Looking at the Downside of Change

38

After employees had completed answering the questionnaire, the completed questionnaires were

mailed to the researcher, by the designated person at Company XYZ, for analysis.

Phase III: In determining the ideal ERP software package, the researcher sought to

select the top five software packages that would suffice for meeting the needs of company XYZ.

In a pursuit to do so, two sets of strategic questionnaires were generated and distributed to each

of the five key representatives from the company mentioned above. These two sets of

questionnaires were used to gather pertinent information relevant to making the final decision of

the ideal ERP package. The first set of questions called "Strategic Executive Questionnaire" was

generated, with the help of a representative from an ERP Consulting and Implementation

Company called "SoftSelect", utilizing information gathered from meetings held with the

company leadership, about company XYZ, its annual sales, the type of manufacturing they do

and the data from the "Readiness for Change Questionnaire", shown in Appendix O. These

39

specific questions were preliminary questions comprised of a total of 150 questions. The 150

questions are noted in 95 sets (sets 1-95).

The five representatives were tasked with responding to, completing and providing the

data for this first set of questions. A meeting was held and each person provided a copy of the

questions to go through so as to ascertain whether the questions do apply to the company or not;

also to provide formal instructions to the representatives on how to complete the questiormaire

conectly. Also, a weighted factor (Critical, Major or Minor), which is described on the cover

page of the questiormaire, were discuss with the representatives. Each person completing the

first set of questions was given a week to complete the entire questiormaire. Upon completion of

the "Strategic Executive Questiormaire", the second set of questions was generated, with help

from a representative of the above mentioned company (SoftSelect), by utilizing the responses

received from the completed "Strategic Executive Questiormaire" and "Readiness for Change

Questiormaire". These second set of questions called "Strategic Requirements Management

Questiormaire", consisted of 40 distinct modules, with a total of 575 questions. These sets of

questions were more detailed and specific; they relate to the activities going on within company

XYZ and about its functional needs. Each module included questions relating to specific

functions within the company. The 40 distinct modules within the "Strategic Requirement

Management Questiormaire" and the number of questions in each module are shown in

Appendix H. The key representatives mentioned above and their respective teams were critical

in completing the questionnaire, and were key contributors in answering this second set of

questions for the purpose of data collection. Each person was given specific module(s) based on

their functional area and was tasked with answering the specified module(s) questions. Again,

the questions were weighted on a Critical, Major and Minor scale. Because there were more

40

questions in this second set of questions than that of the first set, everyone was given two weeks

to completely answer the questions within the assigned module(s). They were encouraged to

complete the questionnaire with their respective teams, as necessary. After the completion of the

"Strategic Requirement Management Questionnaire", the data was sent to the researcher for

analysis, which was critical to ensure that the data needed was received and adequately analyzed.

Phase IV: This phase was an attempt to nalTOW down the choices from five to the one

ideal ERP software package that would suffice for meeting both the functional requirements and

budgetary needs of the company. The process of nalTowing down the lists to an ideal ERP

software package was challenging in that each of the five packages were somewhat comparable

to each other. It was critical in this phase to ensure that the one ideal software package that is

selected definitely meets both the functional requirements and budgetary needs of the company.

Data Analysis

Data analysis was completed for the questionnaire mentioned in phase II and the 2

questionnaires mentioned in phase III above. After meeting with the key representatives and the

completed Readiness for Change Questionnaire was received by the researcher, the questionnaire

data was analyzed. To determine the change readiness at various levels within the company, the

responses were divided into five (5) sub-categories within a pie chart: Top Management, Middle

Management, First-line Supervision, Direct Labor Worker, Indirect Labor Worker, including

Internal Consultant, and Other. After the completion of the analyses, a meeting was held with

the company's representatives to review the pie chart with the completed questionnaire results,

which provided a true assessment of the company readiness for the said new system.

With the conclusion of the analysis from Phase II, the work necessary to select the ideal

ERP package begun with the analysis results from the additional two sets of questionnaires

41

mentioned in Phase III. The researcher worked with a representative from the company

mentioned above (SoftSelect) to conduct the needed analysis on the two sets of questionnaires

mentioned in Phase III. A data and questionnaire analysis tool used by SoftSelect for similar

analysis was used to conduct the analysis for this research. This tool takes the response to each

question and put them into distinct categories based on the level of criticality of the requirements

extracted from the responses. Based upon the analysis, the tool generates few reports. The first

two repOlis indicate two distinct categories of the top five ERP software packages and vendors

that would suffice for meeting the need of the company, based on certain cost thresholds. A

third repOli generated shows the unmet critical requirements. Each of the first two repOlis is

similar in nature, except for a price range difference and few capabilities in one set of the top

five ERP software packages and vendors verses the other set.

The top five ERP software packages and vendors in each of the reports is ranked based

on the percent matches of the functional requirements gathered from the answers to the questions

sought from company XYZ, in comparison to the software capabilities listed in the software

product portfolio and database. These vendors are categorized or ranked as A to E, A being the

highest ranked and E being the least ranked. This ranking makes the process easier for selecting

and recommending the ideal package and vendor that would meet the company's defined

functional requirements and budgetary needs. The ideal candidate selected and recommended is

based on the company's expected software feature and functional requirements and the estimated

cost threshold for a specific number of defined users that is within the company's budget.

Once the analysis was completed and the reports were generated, they were made

available to Company XYZ representatives within ten working days. Appendix I shows the top

five ERP software packages and vendors with a cost threshold between $20K and $50K (U.S.)

42

and their percent match with each of the functional requirements of company XYZ for about 25

to 50 users. Appendix J shows the second set of ERP software packages with a cost threshold

ranging from US$50K to US$l OOK, and their percent match with each of the functional

requirements of company XYZ for the same number of users, but with few additional

capabilities not requested but could potentially be of benefit to the company in the future.

A meeting was scheduled in phase IV and held to meet with the key representatives from

company XYZ to go through the three reports generated in phase III; the first two of which list

the two categories of the top five software packages and the one rep0l1 with the unmet

requirements. The report with the unmet critical requirements was a key factor in eliminating

many of the other packages. Once the company decided that the unmet critical requirements

were low level critical requirements and they could live without them in the packaged to be

selected, the next step was to determine which budget range the company is comfortable with.

Once the cost threshold was revisited and was determined, one of the two sets of five

packages was dropped. From the selected set of five, four of the five packages were eliminated

from the list within which the company budget range is, because those four packages would not

support many of the key critical functional requirements of company XYZ. The remaining one

from the list of the top five packages has the acceptable capabilities needed in the package to

meet a high percentage of each functional requirement of company XYZ.

Limitations

The limitation ofthis methodology was related to the main focus of the research being

the selection and recommendation of a system that would work in the current environment of

company XYZ; also the readiness for change, within the current environment, by the people

within the company. The search for a system that would work in the future, when the company

43

expands, was technically out of scope, however if the selected system does have the potential to

be upgraded, if the company expands, and would also work well in the current environment, it

would be a great investment for the company. Though there were other requirements considered,

the research focused on meeting the functional requirements to address the intent of the problem

statement and results from the questions answered by the representatives and/or employees.

Another limitation was that the owners, the key representatives and people of company

XYZ were not totally knowledgeable on the topic of ERP selection and/or implementations. A

little upfront training was needed to get them somewhat familiar with ERP, what it can and can

not do, and how it could be utilize by their company. Even though the researcher provided an

ERP overview to the owners and couple of the representatives mentioned above, during an initial

visit to the company, there was a need to conduct an inclusive knowledge based training, which

was conducted to include each of the five representatives and the company owners. This training

was conducted by the researcher and took place prior to the st311 of the research.

Summary

This chapter sought to outline the methodologies used, the phases that were extensively

involved and tools and/or questionnaires utilized in assessing the readiness for change within

Company XYZ, and the selection and recommendation process of the one ideal ERP software

package that would suffice for meeting the functional requirements and budgetary needs of the

company for 25 to 50 users. As a result of full utilization of the methodologies, phases, tools and

questionnaires discussed in this chapter, the underlining intent of the research problem statement

and the results of the questionnaires used in this research, were adequately addressed and the one

ideal ERP software package to suffice for meeting the functional requirements and budgetary

needs of the said company, was selected and recommended as planned.

44

Chapter IV: Results, Recommendation and Conclusion

The primary goal of this research was to assess the readiness for change within Company

XYZ and to select and recommend an ideal ERP software package that could suffice for meeting

the needs of the company. Based upon the first question within the readiness for change

questionnaire, responses were divided into 5 categories: Top Management, Middle Management,

First-line Supervision, Direct Labor Worker, Indirect Labor Worker, including Internal

Consultant, and Other. There following table shows the number of persons in each category:

Table 3

Number of Persons in each Category

Categories Top Management Middle Management First-line Supervision Direct Labor Worker Indirect Labor Worker, including Internal Consultant Other

Total number in each category 5 7 9 15 10 5

As a result of the readiness for change questionnaire, it was determined that indeed, the

people within Company XYZ were excited about the change and is looking forward to receiving

a system that could help them make a difference in the way they currently do business; everyone

unanimously agreed that the change was overdue. Based upon the table above, the following

were noted, which is graphically structured in a pie chait in Appendix K (based on the categories

of the readiness for change results): Top Management (5 Persons) was 10 %, Middle

Management (7 Persons) was 14%, First-Line Supervision (9 Persons) was 18%, Direct Labor

Worker (15 Persons) was 28%, Indirect Labor Worker (10 Persons) was 20%, and Other (5

Persons) was 10%; all of the sated percentage summed up to a 100% of the organization. Within

Appendix K are the results (answers) to each set of questions (Categories A through P). Even

though the readiness for change appears to be at a highest level amongst everyone with the

45

organization, a "Future Change and Transition Strategies", shown in Appendix L, was provided

to the company leadership to help in future change efforts.

Faced with the expected change, the organizational members did not seem to assume a

defensive stance toward the change that was proposed. The employees looked forward with

great anticipation, believing that the change is necessary and has been long overdue. Based upon

the readiness for change questionnaire results and based upon the information shared with the

people at Company XYZ about the ERP system and the benefits to the organization, it was

concluded that the people at Company XYZ did not present an appearance of being fearful or

uncertain of what the future holds for them as a result of the proposed change of a new system.

The senior management team shared with the researcher that they continuously have sought to

have conversations with the employees in group sessions and individually about the proposed

change. It is not an incident that the employees were not surprised at all when they were asked

by the researcher, to respond to the questionnaire. The results from the questionnaire noted that

the employees are in high anticipation for this ERP System.

In the researcher's experience, most often when change is expected, some may seem to

be very ambivalent about the forthcoming change, recognizing on the one hand that the change

may be the right thing to do, concerned about what they may be called on to do, or lose as the

change is implemented, but the people at company XYZ did not seem to be ambivalent at all.

They seem to fully understand and ready for what the outcome truly mean for each person. The

results showed that the change leaders did a great job to clarify how the said change would

impact everyone at the various levels within the company. The change leaders shared with the

researcher that they sought to provide help to those that thought they may be discharged from the

46

company because of the change. Every employee was made aware that the new system is not

intended to cause an employer work force reduction.

It was evident that the change was justified and appropriate, in that the key people seems

to be very supportive of it and the organization leadership and its members seems to be fully

capable of successfully changing. By recognizing that each member will be concerned about the

outcomes for them as individuals, the change leaders have taken great strides in creating and

managing the readiness and have committed to using the "Future Change and Transition

Strategies" which was provided to them by the researcher. The leadership team was educated to

know that, as momentum grows as a result ofthe change leader's actions, the likelihood of

resistance leading to a failed change will be avoided or minimized; therefore, the leaders ought to

keep the momentum alive. Company XYZ leadership team was also educated to understand that

it is the change leader's responsibility to guide the organizational member to embrace a change

rather than resist it; they have committed to continually guide the organization in adequately

ensuring that the people understand every change and are ready to embrace the said change.

Also based upon the results from the research, the researcher was able to select and

recommend the ideal package that could suffice for meeting the needs of the company. There

were a total of two sets of five ERP packages that could work, but company XYZ only need a

system that would meet certain requirements and budgetary needs of the company. Therefore,

from the list of the five top ERP Software packages within the budget of the company, the

researcher was able to select the ideal candidate. Each of the two sets of five ERP software

packages was determined based on a targeted software cost threshold specified by the company

before the research begun. After the research had begun, the company made the researcher

aware that the cost threshold initially communicated could not be met by them, therefore the

47

researcher factored that into the determination of the package recommended. Information on the

overall percent matches of the software packages capabilities to the functional requirements of

the company for a cost threshold, and the software names and vendors was provided to the

company leadership. Since the percent match of the one ideal ERP software package was higher

than the others, the researcher recommended the highest percentage match to meeting the

company requirements and budgetary needs.

With hundreds of enterprise resource planning (ERP) systems designed for businesses of

all sizes and for all industries, making the right choice can be a daunting task. In concert with

the analysis from the two Executive Questions mentioned earlier in this research, a report

comparing the top systems for a specific company needs, was quickly and easily generated using

the latest vendor data tool from Technology Evaluation Center (TEC). This report included the

critical information needed to compare ERP systems in an easy-to-understand format. It allows

for choosing from over 100 different solutions and gets a head-to-head comparison based on the

special needs of the organization, including its size, cost, industry, business model, geographical

markets, etc. The researcher, in order to find out which ERP is best for company XYZ, used

TEC's ERP Comparison Reports 2009 to select the vendors for comparison. The report ranked

the selected solutions on how well they fit with the organization's requirements, which makes it

easier to have a much clearer idea of which ERP system is the best for the organization.

Below are some ERP Packages that are great and deliver the attributes of modern ERP:

• Upper market: SAP (SAP ERP) and Oracle (e-Business Suite and JD Edwards)

• Mid Market: Epicor (Epicor9), Infor (Syteiine), Microsoft Business Solutions (Dynamics

AX), SAP (mid-market configuration), Oracle (mid-market configuration).

48

The ERP Packages that are great and deliver the attributes of modern ERP are mostly packages

sold by companies in the upper and mid market, and is too advanced for company XYZ and

outside their current budgetary needs. Apart from the upper and mid market, there are some

companies with lower market solutions that are not listed here. These lower market companies

are not capable of delivering ori all the attributes of modern ERP, which for smaller companies

really does not matter so much. There are few companies within the lower market that are trying

to keep up with the mid and upper markets, but are not going to be able to long term, in my view.

from the researcher's prospective there are 95% of the companies within the lower market that

are not keeping up; even though many would try and disagree to some level, but the few

companies within the lower market has the potential and could potentially do great in the near

future in delivering on all the attributes of modern ERP. Those 95%, from the researcher's

prospective, does not seem to have a foreseeable future in competing within the ERP Market.

However, the 5% seems to stand a better chance, even though it would be a difficult process.

The following, table, is a comparison of the list of five ERP companies based on software cost

threshold and the percent matches of the software package capabilities to meeting the functional

requirements of company XYZ.

Table 4

Five ERP Packages Comparison

Cost Threshold Percentage Match Company Name Cost Range

Manufacturing Action Group Inc. (MAGI) $20K-$50K (U.S.)

Sage North America $20K-$50K (U.S.)

Meta Systems, Inc. $20K-$50K (U.S.)

Rover Data Systems, Inc. $20K-$50K (U.S.)

Made2Manage ERP Software Solution $20K-$50K (U.S.)

%Match

97.50%

95 .00%

92.50%

90.00%

87.50%

49

Based upon the comparison table above, it is evident that the cost threshold percentage

match of ::::; 97.50% is the ideal ERP package that would suffice for meeting the needs of the

company, based upon the defined functional requirements and the budgetary needs. Therefore

the cost threshold of US$20K to US$50K, percentage match of 97.50%, is the ideal software

package candidate that appears to have the highest match to meeting the functional requirements

and within the budget of the company. Appendix M shows the distinct vendors ' information of

each of the 10 software packages. The packages were ranked in order by the percent matches of

their capability to the functional requirements of company XYZ, which indicates that the highest

percentage match is the recommended and considered the number one ranked to effectively meet

the company's needs. The next in line could be used, if the top ranked fails in other areas.

After analyzing the report from the analysis conducted on the questionnaires results, it

was found that the package, which was the cost threshold percentage match of 97.50%, did fit

with company XYZ needs, simply because they do support most of the critical functional

requirements. Based upon the company match, a study was done on the vendor to be

recommended; the study assessed the financial condition of the vendor in which the ideal ERP

package is to be received, the quality of support they provide once the system is implemented,

and scalability of the package, to ensure that the choice is indeed the right one for company

XYZ, before the final recommendation was made by the researcher to Company XYZ owners

and management team. Based upon the study, it was concluded that the recommended vendor

does have good financials and provides quality support to companies in which they service.

The highest ranked ERP software candidate company was "Manufacturing Action Group

Inc. (MAGI)" with a cost threshold percentage match of97.50%. Therefore, the final

recommendation of the top one ERP software package is from MAGI. The recommended

50

software was chosen with strong consideration of the financial condition of the vendors. Even

though this package and vendor is amongst those in the lower to mid market, it is concluded that

this software, with the cost threshold, will provide a better-suited ERP software package for

company XYZ. The companies within the Upper and Mid Markets, would be better, however,

that is beyond the focus of this study, in that the price of the software must be reasonable enough

for company XYZ to acquire the product. Therefore the recommended ERP software package

from MAGI is their premier product called "The WinMAGI", within which the manufacturing,

inventory and supplier management, distribution and financials modules are seamlessly

integrated. This recommendation was made to, and accepted by Company XYZ owners and

management; they have committed to seeking full implementation.

After it had been determined that the people within the company are ready for this change

and the ERP package had been selected and recommended to, and accepted by Company XYZ

owners and management team, any additional services needed by the company (eg. ERP

Implementation) is made available at an agreed upon costs and with a signed agreement between

the researcher and company XYZ leadership. The researcher is available to provide minimum

guidance within the comfolis of his expertise. For more help beyond the expertise of the

researcher, a consulting company is recommended, preferably a company called SoftSelect.

SoftSelect is a consultant company that provides services to aid manufacturer and business in

implementing their ERP system and other enterprise software. Using SoftSelect would make the

relationship easier, since the researcher utilized ERP experts at SoftSelect in conducting this

research. Company XYZ is strongly encouraged to leverage and make the best use of the

experience of SoftSelect for the implementation, so as to ensure that the recommended package

is implemented adequately, in order to get the expected promising and desirable results.

51

Chapter V: Summary

As stated earlier, this research was to assess the readiness for change at Company XYZ

and to recommend the one ideal ERP software packages that fall within a limited range of

software cost for a specific number of users that would best meet the needs of the company.

Within this research, there were few limitations: First, the software candidates are limited to

only those that were included in the SoftSelect System product database; Second, since company

XYZ is a small manufacturing company with a very limited annual income, the software cost

threshold was limited to the specific targeted cost threshold range of US$20K to US$50K; and

Third, the number of llsers is limited to 25 to 50 persons. Upon completion of this research, it

was determined that there is one particular ERP software candidate from within the list provided

by SoftSelect System that fit closely to 100 percent with the needs of company XYZ. The best

matching candidate was among those that were in the cost threshold with the high percentage

match for a specific software product which guarantees that the product includes most of the

high requirements of the company. The recommended product includes most of the critical

functions needed by the company; bottom line, the highest percentage match was the best.

The repOli generated by SoftSelect System indicates that the more money a company is

willing to pay for the software, the greater the chance the company will find a better match. The

match could be within the middle to upper market that most likely meets the requirements of

Modern day ERP. So to get better ERP software packages match for company XYZ other than

what was recommended, the software cost threshold would need to be increased. Company

XYZ, at this time, does not have the financial backing to venture the higher cost packages. The

type of software does not present success nor does it come from the best hardware or software;

it's the people and their commitment that make the difference. In today's business world,

52

individualism is a diminishing concept, and the group concept has becoming a part of everyday

life. Nowadays projects have to be done through groups, and very few are done by individuals.

A company may have the most advanced technology, but may not be successful in

implementing any change (including an ERP system), without the readiness for change and

employees' commitment. There are companies with moderate technology and employees that

are ready and committed to proposed changes, which make implementation easier. With that in

mind, it's not necessary that a company should get the most expensive software, but the software

that will perform all the necessary functions within the company, which makes the recommended

package to be one that should work well within company XYZ. In the future, the company can

decide to upgrade, if necessary.

As a result of this research, there were some things that could have been done and are

worth noting for consideration in future research to be conducted. Future research should not

only focus on the needs of the current internal stakeholders, but also the external stakeholders, by

determining which groups are most likely to use the ERP system in the future and how the

system could be used by customers (eg. A structure to allow the customer to place their orders

electronically, rather than calling the company customer service department). Also, it is

imperative to have more face time with the employees, rather than a limited face to face

interaction. Being physically onsite for the majority of the research and interacting with the

employees could be a great support way to assess change readiness. The Questionnaires created

for this research could be modified, as necessary, to meet the needs of future research. This

research could also help in determining potential change leaders from different functions within

the organization, who could become strong members of the change steering committee to

provide further guidance as to the needs of continuous improvement within the organization.

53

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Appendix A: The Evolution of ERP

The figure below was taken from the book called ERP: Making It Happen by Thomas F.

Wallace and Michael H. Kremzar; it shows the evolution of ERP with the latest evolution on the

outer most circle and the earliest on the inner most circle.

MRPII

i I

Y I I

I

~

f I

58

Appendix B: ERP Sophistication Hierarchy

The figure below, was taken from the book "Integrated Learningfor ERP Success " by

Kapp, et a\. (200 1), shows a bottom-up approach with the least sophisticated view at the bottom

and the most complex and strategically advantageous at the top.

~ Knowledge Management 7'"

Software Modules Shared Database

'~ Data Management 7'-~.=====================~~. ~

59

Appendix C: Factors Leading to the Low Adoption of ERP

The table below provides a list of some important factors, ranked by order of importance, that

explain why ERP systems adoption in developing countries has been very low.

Factor(s) Description Explanation

First The initial cost of Organizations in developing economies, most often, ERP adoption is not cannot afford the high investments for an ERP system within the reach of implementation. Liang, Xue, Boulton and Byrd, (2004) most organizations identified cost as one problem related to lack of ERP

adoption in developing countries. Most of the organizations do not have the level of knowledge to seek after an affordable system that could be successfully implemented.

Second National culture at Most developing countries have a centralized labor-organizational level intensive system of management where managers rely on is not geared to various types of paper-based reports, unstructured accept the cui ture decision making, changing roles, and manual imposed by the ERP authorization procedures, etc. By contrast, ERP systems software. inscribe modern management concepts and values using

online services and highly-structured processes, data, and roles. In a country like Liberia, promotions are mostly based on seniority. Hence, most of the working populations are accustomed to being employed by one organization for a long period of time, and often to working within a particular function within that organization. With experience, they become managers and owners of departments, but never become team players. Again, this goes against ERP culture, which promotes shared environments. In the case of national culture, technology-enabled change initiatives may not fit with cultural values relative to social change (Heeks 2002; Krumbholz, et a1. 2000; and Robey, Ross & Boudreau 2002).

Third The reduction of Most organizations in developing countries have a low-staff that is wage work force. Hence, one key benefits ofERP, cost facilitated by ERP reduction through workforce reduction, is not a great adoption clashes advantage. Savings achieved through staff reductions are with cultural norms negligibly compared to the cost of purchasing and within the job implementing the ERP software. ERP research is market. therefore viewed with some concern, because cheap

labor can produce similar outputs for much less cost and in a more socially friendly manner. In most cases, no staff reduction has resulted from ERP adoption.

60

Fourth The growth of ERP In general, awareness of ERP software is very low in adoption in developing countries. Speaking to folks from some developing countries organizations in developing countries in West Africa is severely affected confirmed this view. Cunently, and for good reasons as by lack of suggested by the points above, very few ERP products information, are available in the technological market within some awareness and ERP- developing countries. Very few local organizations have trained human adopted ERP solutions with sufficient number of resources, modules that leads to an integrated environment and unsuccessful achievement of success. research, and uncertainty concerning agents appointed by the vendors.

61

Appendix D: Lessons Learned from ERP Adoption

There are lots of important lessons to be learned from ERP adoption by some firms

within developing countries. The table below shows a list of some of the impOliant lessons to be

learned from ERP adoption by two firms in developing countries.

Lesson(s) Description Explanation

First The on-going cost of Two organizations in Liberia are amongst the first ERP adoption is not group ofERP adopters in the country. Thus, they within the reach of most received some pricing concessions initially, with organizations. limited user licenses. However, subsequent additional

license fee and hardware upgrades, which are essential for smooth operation of the package, were not affordable for them. In the case of these organizations, the license issue was a reason to look for another solution. Discussion with the two firms clearly demonstrates that the on-going cost of ERP exceeds their budgets.

Second The cost of the number Discussion with both organizations emphasized that the of staff to be trained is lack of training made change management extremely higher compared to the hard. They have a very high IT literacy level as they US or Europe. have been using IT for years. According to Robey, et

al. (2002), organizations have to overcome knowledge barriers of two types: those associated with the configuration of the ERP, and those associated with the assimilation of new work processes. Both types of knowledge barrier were even more pronounced within these organizations.

Third The lack of structured Most firms in developing countries have not developed

and disciplined business environments in

a uniform level of business norms and practices like

developing countries those in the US and Europe. Speaking with the leaders in business in Liberian, it was mentioned that most

creates severe organizations use unstructured management practices,

operational level yet ERP systems cannot be implemented in isolation.

problems in ERP They need inputs from outside the implementing firm

implementations. such as from customers, suppliers, government, etc. If the implementing firm does not receive information on time, and in the desired format, ERP systems are bound to fail. These points were clear from discussions with both organizations. Each of the two organizations has stated that they are looking into the direction of maybe changing their current ERP system.

62

FOUlih Requirement of Discussion with both organizations concluded that customization to ERP there is a need to modify their ERP. Both firms software leadership team is seeking after a system that would

work for their growing business.

Fifth Vendor support and There is limited support by ERP vendors in most

knowledge of ERP products are low in most

developing countries. Other vendors are operating

developing countries. tlu'ough local agents and there are not lots of them available. When they can be found, the staff at the local agents lacks adequate knowledge on ERP products. There are few vendors who conduct training programs on their ERP packages in developing countries. It is therefore hard to find trained personal to support ERP products. This problem has been clearly illustrated in the case of the two firms. One of the firms has decided to build its own support team; while the other firm, even though not satisfied with the support they receives, is still not sure what to do.

Sixth The level of integration In the case of the two organizations, users are provided by ERP is too comfortable with loosely coupled software modules high compared to rather than the tightly coupled modules within an ERP expectations of system. Sometimes integration assumptions embedded individuals and in the software are not valid due to non-availability of organizations. data or delays in receiving necessary data. These two

firms have taken the risk of ERP adoption and are aware of the benefits and drawbacks of the integration. Management of these firms is pushing for better integration, which have led other to follow the same path, but with much caution. Being cautious would only help them to not make the same mistakes other companies have made in the past. Integration is sometime difficult for most firms but once it is done conectly, there are great benefits. Integration is the most important factor for realizing benefits from ERP adoption (Davenport et al. 2004). On a cautious note, Robey et al. (2002) comments on the difficulties arising from integration; for example an established work culture based on functional specialties may oppose new work practices based on process integration. These discussions are consistent with both films' views: the two firms are not getting benefits because integration is hard to achieve. Software driven integration is hard to achieve in developing countries where integrated processes, within and between organizations, are not the business norm.

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Appendix E: Significant Consequences of an ERP Implementation

Below is a list of significant consequences as a result of an ERP system implementation

laid out by the researcher, in the form of a figure, which shows the ERP system in the middle

with the significant consequences surrounding it.

People are unifying around a company

research

People may loose their reference points

Breaking down of barriers

New professions may arise

Professions which are disappearing

Professions may disappear

Relational changes between customers, suppliers, partners and intermediaries

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Appendix F: Readiness for Change Questionnaire

This questionnaire is used to assess the readiness of an organization to undel1ake an expected

change effectively. It asks the company personnel to reflect on and give answers to questions on

a number of issues that have been found to affect the organizations' responses to and abilities to

cope with change. The questionnaire is comprehensive and intended to provide a way for people

within the company who are involved in the change to scan and evaluate the many factors that

may influence any organization's change readiness. It can be used to identify factors that will

support and facilitate any given change, as well as to flag possible pitfalls and difficulties. Some

of the questions may not apply to the specific change situation: leave them blank. Some may

seem to apply, but they may seem "off' in some way, not phrased just right for the expected

change situation. Please answer these questions, but make a note as to how the question should

be rephrased to apply to the expected change situation. That will help the company in future

revisions of this questionnaire.

Here is a list of the areas covered by this questionnaire:

A. Some Information about Your level within the Organization

B. The Need for Change

C. The Approach to Change

D. The Urgency of Change

E. Magnitude of Change Required

F. Criteria of Successful Change

G. Resources Available for the Change

H. Current Organization Performance

1. Preparedness to Support the Change

1. Dealing with the Stress, Loss and Trauma of Change

K. Change History of the Organization

L. CUiTent Stress Levels in the Organization

M. Assessing the Level of Pain

N. Picking the Right Place to Start Change

O. Identifying Parts of the Organization Crucial to the Change

P. Looking at the Downside of Change

A. Some Information about Your level within the Organization:

Which below most accurately describes your current position in the organization?

a. __ Top Management.

b. __ Middle Management.

c. __ First-line Supervision.

d. Direct Labor Worker.

e. __ Indirect Labor Worker, including internal consultant.

f. Others

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This questionnaire assumes that the employee(s) either sees a need for change in the company, or that someone has proposed a change which will affect the company, or that a change is already going on in the organization. Whichever is the case, take a moment to define what change you have in mind as you go through this questionnaire, and describe it very briefly below.

1. What is your likely relationship to the change? Check as many items as apply to you.

a. __ I am an initiator of this change.

b. __ I have responsibility for managing or directing the change process.

c. __ I am responsible for the performance of the unites) undergoing the change.

d. __ I expect my own job responsibilities or activities to be affected by the change.

e. __ I have influence over whether the change take place, or how it will be implemented.

2. How much information do you have about the proposed change?

4) __ I am fully informed.

3) __ I have some information.

2) __ I have little information.

1) _ _ I have no information.

0) __ No change has yet been proposed.

B. The need for change:

1. Is there a need for change in your organization?

4) __ Yes, definitely.

3) __ Probably; I think so.

2) __ I'm not sure; I don't know.

1) __ No, not at this time.

The next two questions ask you to specify what pressures there are on your organization to change. Please answer them whether or not you believe there is a need for change.

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2. What external events, processes and pressures are experienced from the organization's

environment which stimulates a felt need for change. Give attention to factors such as the

pace of change in technology and markets, the need to process large amounts of

information quickly, demands for improved quality, lower costs, shorter cycle times, etc.

3. What internal events, processes and pressures are felt within your organization which

stimulates a felt need for change?

4. In relationship to the needed or proposed change, which statement best reflects the

current situation? We:

4) _ _ know what to do and/or have a plan for it; we are currently implementing the plan.

3) __ know what to do and/or have a plan for it, but we haven't begun to implement the plan.

2) __ know what to do, but we don't yet have a plan for doing it.

1) __ don't yet know what to do.

C. The Approach to Change

1. How do you think the organization should go about making the needed changes?

D. The Urgency of Change

1. How urgent is the need for change?

4) __ It is imperative that we change now.

3) __ We need to change soon.

2) __ We will need to change in the foreseeable future.

1) __ The need is not urgent.

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2. How long can the implementation of the change be put off before the current situation

unfavorably impacts the motivation and commitment of people at the working level?

4) __ The current situation already has seriously impacted the motivation and commitment of

people at the working level.

3) __ Weeks.

2) __ Months.

1) __ A year or more.

3. How long can the implementation of the change be put off before the current situation

unfavorably impacts the competitive position of the organization?

4) __ The current situation already has seriously impacted the competitive position of the

organization.

3) __ Weeks.

2) __ Months.

1) __ . A year or more.

4. How long can the implementation of the change be put off before the current situation

unfavorably impacts the organization's credibility with its customers?

4) __ The current situation has seriously impacted organization's credibility with customers.

3) __ Weeks.

2) __ Months.

1) __ A year or more.

5. How long can the change be put off before the current situation brings on serious

pressure and unfavorable attention from higher management?

4) __ The cunent situation is already attracting such pressure and unfavorable attention.

3) __ Weeks.

2) __ Months.

1) __ A year or more.

6. How long can the change be put off before the current situation brings on serious

pressure and unfavorable attention from investors?

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4) _ _ The cunent situation is already attracting such pressure and unfavorable attention.

3) __ Weeks.

2) __ Months.

1) __ A year or more.

7. How long can the change be put off before the current situation brings on serious

pressure and unfavorable attention from bankers and other debt-holders?

4) _ _ The CUlTent situation is already attracting such pressure and unfavorable attention.

3) __ Weeks.

2) __ Months.

1) __ A year or more.

E. Magnitude of Change Required:

1. What is the magnitude of change needed to make a substantial improvement in the

current situation? (Check as many as apply.)

a. __ A substantial change in the distribution of power between levels of the hierarchy.

b. __ A substantial change in power between groups or functions on roughly the same level.

c. __ A substantial change in attitudes and motivation on the part of the workforce.

d. __ A substantial change in budgets and resource availability.

e. __ A substantial change in work methods, rule and procedures.

f. A substantial change in the size of the organization.

g. __ A change in key personnel.

h. Other ______________________ (Please specify)

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F. Criteria of Successful Change

1. How will you know that the change has occurred? (Please give as concrete examples)

G. Resources Available for the Change

Change processes require extra resources, over and above those needed to maintain the steady state of the organization. How available are the following resources for carrying out the change?

1. People:

4) __ Readily available.

3) _ _ Available if you can make a good case.

2) __ Very tight.

1) __ No additional people can be had.

2. Money:

4) __ Readily available.

3) __ Available if you can make a good case.

2) __ Very tight.

1) __ No additional money can be had.

H. Current Organization Performance

Since change usually involves a temporary decrement in performance, the extent to which the organization is currently performing effectively is another indicator of its ability to weather change. If the organization is doing badly now, the strain of the change on its capability to perform may cause an unacceptable decrease in performance.

Please rate the performance of your organization in the following areas.

1. Financial performance.

4) __ Comfortably exceeds requirements.

3) __ Meets requirements without great difficulty.

2) __ Struggles to meet requirements.

1) __ Frequently fails to meet requirements.

0) __ Always fails to meet requirements.

2. Service quality.

4) _ _ Comfortably exceeds requirements.

3) __ Meets requirements without great difficulty.

2) __ Struggles to meet requirements.

1) __ Frequently fails to meet requirements.

0) __ Always fails to meet requirements.

3. Product quality.

4) __ Comfortably exceeds requirements.

3) __ Meets requirements without great difficulty.

2) __ Struggles to meet requirements.

1) __ Frequently fails to meet requirements.

0) __ Always fails to meet requirements.

4. Meeting production and delivery schedules.

4) __ ComfOliably exceeds requirements.

3) __ Meets requirements without great difficulty.

2) __ Struggles to meet requirements.

1) __ Frequently fails to meet requirements.

0) __ Always fails to meet requirements.

5. Overall success in meeting customer demands.

4) __ Comfortably exceeds requirements.

3) __ Meets requirements without great difficulty.

2) __ Struggles to meet requirements.

1) __ Frequently fails to meet requirements.

0) __ Always fails to meet requirements.

6. Success in meeting objective measures applied to your unit.

4) __ Comfortably exceeds requirements.

3) __ Meets requirements without great difficulty.

2) __ Struggles to meet requirements.

1) __ Frequently fails to meet requirements.

0) __ Always fails to meet requirements.

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I. Preparedness to Support the Change

Change requires time commit and energy above and beyond the demands of maintaining the "steady state" in the organization. What has been the response to change in the past?

1. Has it bothered you if the way you did your work had to change (e.g., changing from

manual bookkeeping to computerized bookkeeping)?

4) __ No, not at all.

3) __ Only a little

2) __ Moderately_

I) __ Yes, a lot.

0) __ I have not experienced such a change.

2. Has it bothered you when your role has had to change (e.g., going from a job to

another)?

4) __ No, not at all.

3) __ Only a little

2) __ Moderately_

1) Yes, a lot.

0) __ I have not experienced such a change.

3. Have you experienced any changes which normally would have bothered you, but which

did not disturb you on that occasion because of other factors? Describe what the change

was, and what factors made it worth-while for you to change.

4. Rate your own readiness to support the change.

4) __ Prepared to give the time and energy it takes to succeed.

3) __ Prepared to take a significant overload to support the change.

2) __ Prepared to commit a modest amount of time and energy to support the change.

1) __ Prepared to support the change, but don't have time to give.

0) __ Not prepared to actively suppOli the change.

5. Rate top management's readiness to support the change.

4) __ Prepared to give the time and energy it takes to succeed.

3) __ Prepared to take a significant overload to suppOli the change.

2) __ Prepared to commit a modest amount of time and energy to support the change.

1) __ Prepared to suppOli the change, but don't have time to give.

0) __ Not prepared to actively support the change.

6. Rate middle management's readiness to support the change.

4) __ Prepared to give the time and energy it takes to succeed.

3) __ Prepared to take a significant overload to support the change.

2) __ Prepared to commit a modest amount of time and energy to support the change.

1) __ Prepared to suppOli the change, but don't have time to give.

0) __ Not prepared to actively support the change.

7. Rate the first-line supervisors' readiness to support the change.

4) __ Prepared to give the time and energy it takes to succeed.

3) __ Prepared to take a significant overload to suppOli the change.

2) __ Prepared to commit a modest amount of time and energy to suppori the change.

1) __ Prepared to support the change, but don't have time to give.

0) __ Not prepared to actively support the change.

8. Rate the readiness of the work force to support the change.

4) __ Prepared to give the time and energy it takes to succeed.

3) __ Prepared to take a significant overload to suppori the change.

2) __ Prepared to commit a modest amount of time and energy to support the change.

1) __ Prepared to suppori the change, but don't have time to give.

0) __ Not prepared to actively suppOli the change.

9. Other group or entity (Please specify)

4) __ Prepared to give the time and energy it takes to succeed.

3) __ Prepared to take a significant overload to suppOli the change.

2) __ Prepared to commit a modest amount of time and energy to suppori the change.

1) __ Prepared to suppOli the change, but don't have time to give.

0) _ _ Not prepared to actively suppOli the change.

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10. Other group or entity (Please specify)

4) __ Prepared to give the time and energy it takes to succeed.

3) __ Prepared to take a significant overload to support the change.

2) __ Prepared to commit a modest amount of time and energy to support the change.

1) __ Prepared to support the change, but don't have time to give.

0) __ Not prepared to actively supp0i1 the change.

J. Dealing with the Stress, Loss and Trauma of Change

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People, groups and companies go through a predictable sequence of stages in dealing with the loss and trauma of change. By assessing where a group is in this sequence, it can be determined how best to help to move through the change with least pain, and can also predict how attitudes are likely to shift as the change continues. (The model is derived from the work of Elizabeth Kubler-Ross on stages of death and dying, as developed by John Adams and Sabina Spencer.)

The stages of coping with unacceptable loss and trauma are:

Denial: Individuals or groups are unable to acknowledge the reality of the change, either denying the facts outright, or accepting the bare facts of the change, while acting as though it will not have significant consequences for them. For example, it is common in organizations for people to have advance notice of change (reorganizations, mergers, plant closings, plant stm1ups) and either to fail to take steps to prepare for it, or to procrastinate to the point where they are woefully unprepared when the change comes. Signs of denial are rejecting facts and reason; maintaining inconsistencies (affirming two mutually contradictory points of view); and searching for any shred of wish fulfilling information or rumor.

Fighting the change: Individuals or groups either actively resist the change, or, if resistance is futile, they express rage at anything or anyone who is associated in their mind with the change. Such anger is distinguished from "appropriate" anger by not being directed in a way that would tend to alleviate the problem or bring compensatory satisfactions to the individual; it is more expressive than instrumental. The anger may have a random quality, changing its target without apparent reason.

In the pit: acknowledging the inevitability ofthe change and being hit emotionally by it. Defenses against the pain of loss collapse; the individual or group gives way to the awareness of loss and goes into a period of mourning. Listlessness and apathy ensue, along with such other signs of grief as sadness and loss of appetite. Individuals may become ill.

Coming to terms with the change: accepting the change emotionally, including the losses involved. Individuals or groups come to terms with the loss and alters their perception of the world to include the circumstances which have changed. They begin to make the best of the altered situation. Individuals look for alternate ways of meeting their needs and becoming involved in life again. Acceptance is the first stage at which rational problem solving help is likely to be very effective (suggesting alternatives, providing information).

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Adapting and coping with the change: a stage of learning, growing, and active problem­solving. People or groups mobilize energy and commitment to deal with their changed circumstances, to overcome what problems and barriers are amenable to effort, and develop the skills, attitudes, beliefs and perceptions appropriate to dealing with their changed circumstances.

1. Where are you in the change sequence?

a. Denial.

b. __ Fighting the change.

c. The Pit.

d. __ Coming to terms with the proposed change

e. __ Actively adapting and coping with the proposed change.

2. Where is senior management in the change sequence?

a. Denial.

b. __ Fighting the change.

c. The Pit.

d. __ Coming to terms with the proposed change

e. __ Actively adapting and coping with the proposed change.

3. Where is middle management in the change sequence?

a. Denial.

b. __ Fighting the change.

c. The Pit.

d. __ Coming to terms with the proposed change

e. __ Actively adapting and coping with the proposed change.

4. Where is first line supervision in the change sequence?

a. Denial.

b. __ Fighting the change.

c. The Pit.

d. __ Coming to telms with the proposed change

e. __ Actively adapting and coping with the proposed change.

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5. Where is the work force in the change sequence?

a. Denial.

b. __ Fighting the change.

c. The Pit.

d. __ Coming to terms with the proposed change

e. __ Actively adapting and coping with the proposed change.

Indicate where other groups significant to the success of the change are in the change sequence.

6. Other group or entity ___________________ (Please specify)

a. Denial.

b. __ Fighting the change.

c. The Pit.

d. __ Coming to terms with the change

e. __ Actively adapting and coping with the change.

7. Other group or entity (Please specifY)

a. Denial.

b. __ Fighting the change.

c. The Pit.

d. __ Coming to terms with the change

e. __ Actively adapting and coping with the change.

K. Change History of the Organization

The change history of the organization gives valuable clues to how it is likely to respond during

the next change. If the organization frequently undergoes major as a normal aspect of its way of

life, it will probably deal with change more easily than organizations that have been stable for a

long time. On the other hand, if the organization has suffered a number of traumatic changes in

the recent past, e.g., downsizing, it may be especially vulnerable to trauma and loss. Questions

on the next page explore the change history of the organization.

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1. How frequently has the organization undergone significant change during the past five

years?

4) __ Change is a way of life in the organization.

3) __ Several major changes.

2) __ One or two major changes.

1) __ No major changes.

2. What has been the dominant effect of these changes on members of the organization?

4) __ changes have been energizing and stimulating.

3) __ changes have been coped with without ovelt effects on the people.

2) __ changes have been stressful, physically and/or emotionally, but we have recovered.

1) __ changes have left people debilitated or disaffected; they are less able to cope effectively

with change now.

3. What lessons can you draw from the organization's response to past change efforts? Give

attention to such areas as the:

• way the change is introduced, the kind and amount of information given about the change.

• degree of palticipation and involvement of the work force in planning and implementing the change.

• timing and pacing of the change. • involvement of top management in leading the change.

L. Current Stress Levels in the Organization

1. The Organization Stresstionnaire

Here is another way to assess the effects of the organization's changes on the level of stress. Anything that happens in organizations can be a potential cause of stress. The amount of perceived stress will vary depending on what the stressor is, and the person experiencing the stress. This question is designed to help identify the significant stressors in the organization and the relative level of stress they are causing. The items are in no particular order, and some of these items, while they can cause stress, will be perceived as positive for the organization. Positive as well as negative changes have been included, because any change can cause stress.

77

Instructions: For each of the changes listed below, rate the degree of stress it may cause.

a - Change has not occurred in the organization in the recent past (the last five years).

1 - Change has occurred or is occurring, and is currently causing no stress in the organization.

2 - Change has occurred or is occurring, and is currently causing a little stress in the

organization.

3 - Change has occurred or is occurring, and is currently causing moderate stress in the

organization.

4 - Change has occurred or is occurring, and is cun'ently causing quite a lot of stress in the

organization.

5 - Change has occurred or is occurring, and is currently causing great deal of stress in the

organization.

1. __ Merger

CHANGE CATEGORIES

2. Take-over

3. __ Acquisition

5. New chief executive

7. Diversification

9. __ Changes in work methods

11. Loss of market share

13. __ Pressure from environmental groups

15. __ Shrinking market

17. __ High labor turnover

19. __ Unexpectedly high demand for

products or services

21. __ Loss of monopoly

23. __ Major change in work processes

4. Joint-venture

6. __ Change in management

8. __ Changes to the main

Products and/or services

10. __ Restructuring of the

products and/or services

12. __ Bad press publicity

14. __ Fall in stock price

16. __ Shortage of skilled labor

18. __ Influx of temporary and/or

contract staff

20. Strikes

22. Introduction of new

Information Technology and/or

new systems development

Subtotal of ratings on this page ________ _

24. __ Cash flow problems

26. __ Entering new market

28. Nationalization

30. __ Cheaper foreign imports

32. __ New technology means our product

is becoming redundant

34. __ Rapid growth

36. __ Problems in relationship with

parent company, especially if non-domestic

38. __ Loss of subsidies/grants

40. __ Absent directorship

42. __ Image change

44. __ New plant start-up

46. __ Rapid ramp-up of production

48. __ High noise level

50. Other

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25. __ Achieving demanding goals

27. __ Management buyout

29.

31.

Privatization

New location

33. __ Scandal involving Senior

Management

35. _ _ Legislation affecting the

organization

37. __ Downsizing (job-losses)

39. __ High interest rates

41. __ Going public

43. __ Increased volume of quality

and service complaints

45. _ _ Inter-group political struggle

47. __ Crowded working conditions

49.

51.

Other

Other

Subtotal of ratings on this page: _______ _

Subtotal of ratings on previous page: ________ _

Total stress score: -------

Note that there are as yet no nOlIDS for this stress questionnaire, and therefore your own judgment, and comparison with others' scores, is the best guides to making sense of your score. It is suggested that you work with one or two others to analyze your results. Look back over the Stresstionnaire, noting those items to which you have given ratings of 4 or 5. Make a list, grouping items together which seem to you to be linked in some way, perhaps stemming from the same underlying cause. Compare your lists in the group, and discuss similarities and differences. Are the causes of stress in your organizations the same or different? Are there hidden or unnoticed causes of stress which are brought out be the Stresstionnaire? Are there ways some of your organizations deal with some of their stressors which help them handle more change with less stress than do the other organizations? How does the culture of each organization facilitate or impede its being able to manage change with a minimum of stress? How will CUlTent stressors in the organizations impact and be impacted by your change projects?

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M. Assessing the Level of Pain

Optimum pain for change exists when people recognize that significant aspects of the way the organization operates are not working; they believe that if they knew a better way to operate they could adopt it successfully; and the organization is able to provide the resources of time, money, and personnel to invest in making improvements while at the same time continuing to meet current operating demands.

The level of pain is sUboptimal for change when people generally feel things are working well enough. They perceive the costs of change to outweigh the gains. When the organization is in continual crisis, and is using all its resources just to meet current operating demands, it is probably in too much pain to undertake substantial change. Since change requires learning, nearly every significant change results in an initial decrement in organization performance while people are "on the learning curve." In such cases, diversion of resources to manage the change process may well reduce the organization's current performance below the level required for survival. The organization can only afford to adopt "quick fix" improvements which require little basic change. It "can't win for losing."

1. Rate the degree of pain in the organization.

4) _ _ Little or none: the organization is relatively "fat and happy."

3) __ Some: low level unease and disquiet.

2) __ Substantial: definite unhappiness with the way things are.

1) __ Overwhelming: the organization is in crisis and can barely cope.

N. Picking the Right Place to Start Change

Many changes have failed because they got bogged down in the first place they were tried . It is important to choose the part of the organization where the change is initiated carefully. Here are some factors to consider in making this choice.

• It is not normally a good idea to institute change "across the board." Not only does it place great stress on the organization and its members, but the change resources in the organization are then spread too thin, and since everyone is changing at the same time, you lose the advantage of trying a change in one place, learning from your mistakes, and revising your approach the next time.

• Look for optimum pain (see above), sufficient autonomy, and free energy in the places where you initiate the change. Sufficient autonomy means that the people in charge can make the decisions necessary to carry out the change. In general, then, the higher in the organization you start the change, the more autonomy there is.

• Look for where the "free energy" is. One finds free energy in parts of the organization that are not overwhelmed by current demands and that have the resources necessary to take on the overload required by the change.

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1. Given these considerations plus any other criteria that seem valid to you, what places in

the organization seem like good candidates for beginning the change? Give your criteria

for choosing them.

O. Identifying Parts of the Organization Crucial to the Change.

Regardless of where you start a change process, there are some parts of the organization whose cooperation and/or active support will be crucial to the success of the change.

1. Indicate below what are the key individuals, groups, functions or levels that will be

crucial to the success of the change. (Be sure to include any groups to whom you may not

be looking for help, but whose opposition would be detrimental to success.) For each,

indicate what its contribution must be, and what level of commitment (permission, verbal

support, active involvement) is needed.

P. Looking at the Downside of Change

Even though the change may be desirable, there are inevitable losses and possible negative consequences to any change. It is important to be aware of these, so they may be planned for.

1. What do you personally stand to lose if the change takes place as proposed?

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2. How would you deal with these losses?

3. What do you personally stand to lose if the change does not take place as proposed?

4. How would you deal with these losses?

5. What does the organization stand to lose if the change takes place as proposed?

6. What does the organization stand to lose if the change does not take place as proposed?

Based on the result, the original formulation of the change plan will be reviewed, and updated, if necessary, to reflect the organization's readiness for change. If necessary, the change goal will be re-examined and possibly revised. This survey results will be bucketed into six (6) categories (Top Management, Middle Management, First-line Supervision, Direct Labor Worker, Indirect Labor Worker, including internal consultant and Others (Contractors and External Consultants).

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Appendix G: Strategic Executive Questionnaire

This set of questionnaire is to gather pertinent information about the company, to help the

researcher in determining the needs of the company. There are three distinct classifications to be

used in this questionnaire (Critical, Major and Minor). A Critical means that the question is

highly applicable and is very important to the company, which means, it is a significant function

that the company must have. A Major means that the question applies to the company but it is

not as significant; however the company sees it as having current or future potential value, but

not a top priority at this time. A Minor means that the function is not of necessity now, but

would be nice to have now or in the future as the company seeks to continuously improve and

could be used as part of their continuous improvement objective.

Each person participating in the first set of questions is given a week to go through the

questions and complete the entire questionnaire. It is important that the questions need to be

answered individually and independently from each other. Once completed, the answers must be

sent to the researcher for review and the results will be compared to see how close the answers

were. Upon receiving, reviewing and analyzing the results, the researcher will meet with each of

the representatives (individually and collectively as a group) and constructively discuss the

questionnaire answers, patticularly answer to questions that were different. No change to the

answers will be allowed, except with a genuine consensus, during the collective group session.

The questionnaire results will be used to make critical decisions in determining the ideal ERP

package, therefore, accurate information is expected.

If for any reason, there are any questions about any specific question, please seek not to

ask your colleagues; please contact the researcher by using any of the following contact

infonnation: Phone: 763-957-0820; Email: jammieoneinc@msn.com

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QUESTIONNAIRE

1. Does your business or organization consist of more than one company or division?

1.1 If yes to Question 1, do any of these companies or divisions operate more than one plant?

1.2 Are raw materials or semi-finished product transfened between these branch companies or divisions?

1.3 Are customer orders for your product entered at a central location and then disbursed or transmitted to the company/division responsible for their manufacture or shipment?

1.4 Do your purchasing activities occur at one central location?

1.5 Are any of your facilities in another country?

1.6 Do your financial rep0l1s require rep0l1ing in both local and international currencies?

2. Does your company, or any of its divisions, operate more than one warehouse/distribution center where product or raw material is stored?

2.1 Are customer orders for your product entered at a central location and then disbursed or transmitted to the warehouse responsible for their shipment?

2.2 Do these warehouses provide you with forecasts of their demand?

2.3 Is product shipped to or transfelTed between these locations?

2.4 Do you require the ability to plan truck/delivery schedules for your product?

2.5 Does your company know when order needs to be pull from the warehouse/distribution center?

3. Do you sell products directly to businesses in the retail or wholesale industries?

4. Do you sell products to other manufacturers?

5. Do you buy suppliers from a certain type of suppliers?

5.1 Do you purchase from any supplier?

6. Do you sell products to any governmental agency or to customers in the aerospace and defense industry?

7. Do you sell any of your products via cash or credit card?

8. Do your products or services you offer normally require the development of a cost estimate?

8.1 Are any of the line items on the estimate a combination of a number of independently estimated items?

84

9. Do you prepare quotes for your customers?

10. Do you process purchase orders and/or generate work orders for specific customers?

11. Do your customers tend to order the same set of products from you each time?

12. Do you ship products to customers on consignment?

13. Do you drop ship purchased material from vendors to your customers?

14. During the order entry process, are special instructions entered on the order that may be required on the shop floor?

15. Do you enter into contractual agreements for pricing purposes with your customers?

15.1 Do you bill your customers for progress payments?

15.2 Do you have sales promotions where special pricing is offered?

16. At the time of order entry, do you further discount the standard, quoted, contract or promotional price?

16.1 Are sales order discounts a function of the quantity a customer may order?

16.1.1 Does any line on your sales orders have a discount associated with it?

16.2 Are sales order discounts a function of the dollar amount ordered?

16.2.1 Does any line on your sales orders have a discount associated with it?

17. Do you pay sales commission?

17.1 Do you split commissions between two or more salespersons?

18. Do you export finished product or import raw materials or component pmis?

18.1 Do you sell and/or invoice in foreign currencies?

18.2 Do you buy and/or pay for materials in foreign currencies?

18.3 Do you install your product in the field once it is sold?

18.4 Are your products warranted?

18.5 Do your customers return rejected product to you?

18.6 If you pay sales commissions, do you wish to have the commissions reversed when customers return product to you?

18.7 Do you service or repair your product after it has been sold?

19. Are you now, or will you be, accepting customer orders and releases with ED!?

85

20. Are you now or will you transmit purchase orders and change notices to your vendors?

21. Do you purchase materials in one unit of measure and use or sell them in another?

22. Do you purchase any materials based on historical usage or a predetermined reorder point?

23 . Do you solicit price quotations from vendors?

24. Are any of your purchases of raw materials/component parts specific to a particular customer order?

25. Do you purchase and resell products that are not normally stocked?

26. Do any of the products you sell or purchase have a shelf life?

27. In costing your product, do you assign an overhead rate to material?

28 . Do you allocate overhead on a direct labor basis?

29. Do you assign an overhead rate to various machines/work centers?

30. Are your products valued at actual cost?

31 . Are your products valued at standard cost?

32. Do you require the software to provide support with General Accounting (i.e., Payables, Receivables and General Ledger)?

32.1 Do you charge your customers a finance charge for late payments?

32.2 Do you return rejected materials to your vendors?

32.3 Do you require the system to track the costs and/or depreciation associated with land, buildings and equipment?

33. Do you track time and attendance information for your hourly employees?

34. Do you track time and attendance information for your salaried personnel?

35. Do you track your employees' skill level, job performance and other human resource­related factors?

36. Do you require the ability to print payroll checks?

36.1 Do you need payroll to accommodate operating more than one company, division or plant?

36.2 Do you offer your employees a retirement program?

36.3 Do you offer your employees bonuses?

36.4 Are you a union shop?

86

36.5 Are your factory workers paid on a piece rate or incentive basis?

37. Do you manufacture assembles and/or package product for shipment to customers?

38. Do you have any special celtification or will you be seeking some type of celtification?

39. Do you manufacture pharmaceuticals, food, or medical products?

40. Does the manufacture of your product involve mixing or blending chemicals, chemical compounds, basic raw materials or food products?

40.1 Is your manufacturing activity a continuous flow process?

41. Do secondary products or by-products result from the manufacture of your primary product?

42. Do you have a proprietary or a standard set of products that you manufacture on a repeat basis?

42.1 Do you require software tools that can assist you with the development of a sales forecast?

42.2 During the order entry process, is it common for you to substitute for items out of stock?

42.3 Do you schedule the production of your products in the same sequence each time?

43. Do you develop and maintain part drawings and/or bills of material, formulas, or recipes?

43.1 Do you track as-designed versus as-built/shipped configurations of your product?

43.2 Do you wish to maintain revision level and/or date effectivity control of your shop routings/process sheets?

44. On the average, do your finished products contain more than one raw material, component part, or sub-assembly?

44.1 Are common sub-assemblies shared by several products?

44.2 Does your product contain any large or costly components or sub-assemblies that are not required until late in the production process?

44.3 Does your product contain small C-level items that can be stocked at their point of use?

45. Are your products a combination of a base unit with standard features and options that vary from order to order?

45.1 For anyone unit you sell, can the customer buy more than a quantity of one for a particular feature or option?

45.2 During the order entry process, are you required to add dimensional information when a given feature or option is selected?

87

45.3 Do certain features/options that you choose also require the entry of special lettering, labeling, etc?

46. Is it necessary for you to know the length, width and/or height of your finished product?

47. Is it necessary for you to know the weight of your finished product?

48. Do your customers require that you maintain traceability of the finished item down to the raw materials or component parts that were used to produce it?

49. Are serial numbers assigned to your finished products?

50. Do your finished products have lot numbers assigned to them?

51. Does your work orders/shop paperwork normally calTY the name of the customer for whom the product is being manufactured?

52. Do you ship product to customers via common carrier (Fed ExfUPS)?

53. Do you use or stock fractional quantities of raw material/components?

54. Are you required to maintain Material Safety Data Sheets (MSDS)?

55. Do you inspect incoming component parts/raw materials?

56. Do you rework rejected purchased material received from vendors?

57. Do you drop ship purchased material from vendor to vendor?

58. Do you furnish any raw materials or semi-finished product to outside sources that perform operations on them?

59. Do you have a stockroom that is used to store component parts used in the production process?

60. Do you perform a physical inventory?

61. Do you produce finished product only after a customer order has been received?

62. Are any of your manufacturing processes organized into production lines or work cells?

62.1 Do you have any production equipment that is grouped into departments or functional areas?

62.1.2 Do you schedule the production of your products in the same sequence each time?

88

63. Are any of your manufacturing processes organized along depal1mentallines or functional areas rather than production lines or work cells?

63.1 Do you have any of your production areas organized into work cells or small assembly/production lines?

64. Do you assign crews to various production lines, work centers, etc?

65. Do you have shop personnel, other than direct labor, who are responsible for machine set­up or changeover?

66. Do you use molds/dies to produce your product?

66.1 Do these molds/dies produce more than one pal1?

67. Do you wish to report labor and/or production output via data collection devices located on the shop floor?

68. Is it necessary for you to track end-item yield/scrap during the production process?

69. Do you wish to track raw material yield/scrap by operation?

70. Does your production process utilize operations whose run times are fixed?

71. Does your production process have any bottleneck operations?

72. Do you need software to plan and schedule periodic/preventive maintenance activities for your production machines/equipment?

72.1 Are your production machines/equipment scheduled to a level that prior planning and notice for maintenance is helpful?

73. Does the production or assembly of your product require your operators to use drawings that have balloon/reference numbers for pal1 placement?

74. Do you stock gloves, rags, and other such supplies, in a central location for distribution to various departments?

75. Can your firm's staff and sales and distribution functions benefit from sharing data electronically about customers, markets, products and services, competitors, etc?

76. Does your firm require e-business, business-to-consumer (B2C) functionality?

77. Does your firm require e-business, business to business (B2B) functionality?

78. Does your firm require Web-based customer service?

79. Does your firm benefit from real-time or comprehensive feedback from customers/distributors for product improvement?

80. Does your firm require mobile sales tools for its sales force?

89

81. Does your firm require functionality to conduct online auctions?

82. Does your firm require its e-business site to personalize interaction with customers?

83. Does your firm require e-business supply chain functionality?

84. Does your firm require a field service management system?

85. Does your firm require an external firm to host your application?

86. Do you require automated manufacturing workflow functionality?

86.1 Do you require automated workflow functionality to be customizable?

87. Does periodic maintenance require spare parts that are similar to many machines or pieces of equipment?

88. Do you require product data management (PDM) functionality?

89. Do you require customer relationship management (CRM) functionality?

89.1 Do you require telesales functionality?

90. Do you remanufacture products?

90.1 Do you need to track specific parts/assemblies that were replaced or refurbished on remanufactured items?

90.2 Do you track and control inventory?

91. Do you require manufacturing execution system (MES) functionality?

92. Do you require warehouse management system (WMS) functionality?

93. Have you or are you considering integrating lean manufacturing practices in your firm?

94. Does the company intend to add more products to their cunent portfolio?

95. Does the company hope to acquire other companies smaller than they are?

90

Appendix H: Strategic Requirements Management Questionnaire

Modules

1. Accounting - Management

2. Automated Workflow

3. Bar Code / Data Collection Techniques

4. Customer Relationship Management (CRM)

5. Customer Service

6. Electronic Business

7. Field Service

8. Fixed Assets

9. Manufacturing Execution System (MES)

10. Product Data Management (PDM)

11. Quality Control / SPC

12. Sales Force Automation

13. Warehouse Management

14. Accounts Payable

15. Accounts Receivable

16. Capacity Planning, Shop Scheduling & Reporting

17. Contract / Project Management

18. Distribution Planning

19. Estimating & Quoting

20. General Ledger

21. General Questions

22. Human Resources, Time & Attendance and Payroll

23. International Business

24. Inventory Management

25. Item / Part Master Data

26. Lot & Serial Number Control

27. Master Scheduling

28. Material Planning

No. of Questions

02

04

02

02

04

16

02

02

02

02

07

02

02

33

24

36

06

10

13

20

09

30

04

21

32

05

28

22

91

29. Multi-Company / Multi-Plant 12

30. Order Entry / Pricing 45

31. Physical Inventory & Cycle Count 11

32. Preventative Maintenance 09

33. Product Configuration 12

34. Product Costing 25

35. Product Structure / Bills Of Material 29

36. Purchasing & Receiving 34

37. Remanufacturing 04

38. Sales Forecasting 23

39. WalTanty Tracking/Service 03

40. Work centers and Routings 26

Total 575

92

Appendix I: First Set of Five ERP Software Packages - (Cost Threshold US $20K to $50K)

Category 1 2 3 4 5

I. Accounting - Management 100.00% 97.50% 95.00% 92.50% 90.00%

2. Automated Workflow 97.50% 95.00% 90.00% 90.00% 87.50%

3. Bar Code / Data Collection Techniques 100.00% 95.00% 90.00% 90.00% 85.00%

4. Customer Relationship Management (CRM) 100.00% 97.50% 97.50% 95.00% 90.00%

5. Customer Service 95.00% 95.00% 95.00% 92.50% 90.00%

6. Electronic Business 95.00% 90.00% 85.00% 85 .00% 82.50%

7. Field Service 97.50% 97.50% 90.00% 90.00% 90.00%

8. Fixed Assets 100.00% 90.00% 95.00% 90.00% 87.50%

9. Manufacturing Execution System (MES) 100.00% 97.50% 95.00% 92.50% 85.00%

10. Product Data Management (PDM) 100.00% 95.00% 90.00% 90.00% 85.00%

II. Quality Control / SPC 97.50% 95.00% 92.50% 90.00% 87.50%

12. Sales Force Automation 95.00% 97.50% 90.00% 90.00% 87.50%

13. Warehouse Management 97.50% 97.00% 95.00% 95.00% 92.50%

14. Accounts Payable 97.50% 90.00% 85.00% 87.50% 87.00%

15. Accounts Receivable ]00.00% 95.00% 90.00% 95.00% 92.50%

16. Capacity Planning, Shop Scheduling & Reporting 97.50% 90.00% 90.00% 95.00% 92.50%

17. Contract / Project Management 100.00% 90.00% 90.00% 85.00% 82.50%

18. Distribution Planning 97.50% 97.00% 95.00% 92.50% 92.50%

19. Estimating & Quoting 95.00% 95.00% 92.50% 90.00% 90.00%

20. General Ledger 95.00% 92.50% 90.00% 87.50% 87.50%

21. General Questions 95.00% 97.50% 95.00% 92.00% 90.00%

22. Human Resources, Time & Attendance and Payroll 100.00% 95.00% 90.00% 87.50% 87.50%

23. International Business 95.00% 97.50% 95.00% 92.00% 90.00%

24. Inventory Management 97.50% 95.00% 95.00% 92.00% 90.00%

25. Hem / Part Master Data 95.00% 92.50% 90.00% 85 .00% 85 .00%

26. Lot & Serial Number Control 100.00% 97.00% 95.50% 92.00% 90.00%

27. Master Scheduling 95.00% 97.50% 95.00% 92.00% 85.00%

28. Material Planning 100.00% 97.50% 95.00% 90.00% 80.00%

29. Multi-Company / Multi-Plant 95.00% 90.00% 85.00% 80.00% 82.50%

30. Order Entry / Pricing 100.00% 97.00% 97.50% 90.00% 87.50%

31. Physical Inventory & Cycle Count 100.00% 97.50% 95.00% 90.00% 90.00%

32. Preventative Maintenance 100.00% 97.50% 90.00% 85.00% 80.00%

33. Product Configuration 95.00% 95.00% 95.00% 90.00% 95 .00%

34. Product Costing 95.00% 95.00% 95.00% 90.00% 87.50%

93

35. Product Structure / Bi lis Of Material 97.50% 97.50% 95.00% 90.00% 90.00%

36. Purchasing & Receiving 95.00% 95.00% 95.00% 90.00% 90.00%

37. Remanufacturing 95.00% 95.00% 90.00% 85.00% 80.00%

38. Sales Forecasting 95.00% 90.00% 92.00% 90.00% 85.00%

39. Warranty Tracking/Service 100.00% 97.50% 95.00% 90.00% 85.00%

40. Work centers and Routings 97.00% 92.50% 92.00% 90.00% 85.00%

Overall Product Diagnostics (ratio of YeslNo): 97.49% 94.95% 92.49% 89.94% 87.49%

Company Key:

Company Name

1 Manufacturing Action Group Inc. (MAGI)

2 Sage North America

3 MetaSystems, Inc.

4 Rover Data Systems, Inc.

S Made2Manage ERP Software Solution

94

Appendix J: Second Set of Five ERP Software Packages - (Cost Threshold US $50K to $100K)

Category 1 2 3 4 5

1. Accounting - Management 100.00% 97.50% 95.00% 92.50% 90.00%

2. Automated Workflow 97.50% 95.00% 90.00% 90.00% 87.50%

3. Bar Code / Data Collection Techniques 100.00% 95.00% 90.00% 90.00% 85.00%

4. Customer Relationship Management (CRM) 100.00% 97.50% 97.50% 95 .00% 90.00%

5. Customer Service 97 .50% 95.00% 95.00% 92.50% 90.00%

6. Electronic Business 97.50% 95.00% 92.50% 90.00% 82.50%

7. Field Service 97.50% 97.50% 90.00% 90.00% 90.00%

8. Fixed Assets 100.00% 95.00% 95.00% 90.00% 87.50%

9. Manufacturing Execution System (MES) 100.00% 97.50% 95.00% 92.50% 85.00%

10. Product Data Management (PDM) 100.00% 95.00% 90.00% 90.00% 85.00%

11. Quality Control / SPC 97.50% 95.00% 92.50% 90.00% 87.50%

12. Sales Force Automation 97.50% 97.50% 90.00% 90.00% 87 .50%

13. Warehouse Management 97.50% 97.00% 95.00% 95.00% 92.50%

14. Accounts Payable 97.50% 95.00% 90.00% 87.50% 87.00%

15. Accounts Receivable 100.00% 95.00% 90.00% 95.00% 92.50%

16. Capacity Planning, Shop Scheduling & Reporting 97.50% 97.50% 90.00% 95.00% 92.50%

17. Contract / Project Management 100.00% 97.50% 90.00% 95.00% 82.50%

18. Distribution Planning 97.50% 95.00% 95.00% 92.50% 92.50%

19. Estimating & Quoting 97.50% 95.00% 92.50% 90.00% 90.00%

20. General Ledger 100.00% 97.50% 90.00% 90.00% 87.50%

21. General Questions 100.00% 97.50% 95.00% 92.00% 90.00%

22. Human Resources, Time & Attendance and Payroll 100.00% 95.00% 90.00% 90.00% 87.50%

23. International Business 97.50% 97.50% 95.00% 92.00% 90.00%

24. Inventory Management 97.50% 95.00% 95.00% 92.00% 90.00%

25. Item / Palt Master Data 100.00% 95.00% 90.00% 90.00% 85.00%

26. Lot & Serial Number Control 100.00% 97.50% 95.50% 92.50% 90.00%

27. Master Scheduling 97.50% 97.50% 95.00% 92.50% 85.00%

28. Material Planning 100.00% 97.50% 95.00% 90.00% 80.00%

29. Multi-Company / Multi-Plant 100.00% 95.00% 90.00% 85.00% 82.50%

30. Order Entry / Pricing 100.00% 97 .00% 97.50% 90.00% 87.50%

31. Physical Inventory & Cycle Count 100.00% 97.50% 95.00% 90.00% 90.00%

32. Preventative Maintenance 100.00% 97.50% 90.00% 85.00% 80.00%

33. Product Configuration 97.50% 95.00% 95.00% 90.00% 95.00%

34. Product Costing 97.50% 95.00% 95.00% 90.00% 87.50%

95

35. Product Structure / Bills Of Material 97 .50% 97.50% 95.00% 90.00% 90.00%

36. Purchasing & Receiving 100.00% 95 .00% 95.00% 90.00% 85.00%

37. Remanufacturing 100.00% 95.00% 90.00% 90.00% 80.00%

38. Sales Forecasting 97.50% 95.00% 92.00% 90.00% 85.00%

39. Warranty Tracking/Service 100.00% 97.50% 95.00% 90.00% 85.00%

40. Work centers and Routings 97.50% 97.50% 92.00% 90.00% 80.00%

Overall Product Diagnostics (ratio of Yes /No): 98.81% 96.23% 92.93% 90.84% 87.24%

Company Key:

COUl[JC\Uy Name

1 MAPICS, Inc (Infor)

2 ROI Systems Groups, Inc

3 Epicor Software Corporation

4 IQMS

5 Verticent, Inc.

Appendix K: Change Readiness Questionnaire Analysis Result

Categories

Top Management

Middle Management

First-line Supervision

Direct Labor Worker

Indirect Labor Worker, including Internal Consultant

Others

96

Number of Persons

5

7

9

15

10

5

Change Readiness Questionnaire Analysis Result

10% 10%

20%

28%

o Top Management

• Middle Management

o First-line Supervision

o Direct Labor Worker

• Indirect Labor Worker, including Internal Consultant

o Others

Top Management

Middle Management

Indirect Labor Worker, including Internal Consultant

Worker Indirect Labor

Worker, including Internal

Consultant

Top Management

Middle Management

First-line Supervision

Direct Labor Worker

Indirect Labor Worker, including Internal Consultant

Others

2 3 4

3 "e" 4

3 "e" 4

2 "e" 4

2 "e" 3

2 "e" 3

2 "e" 2

97

D

2 3 4 5 6

2 2 2 2 2

2 2 2 2 2

2 2 2 2

2 2 2 2

2 2 2 2

4 4 3

4 4 3

3 3 3

3 3 3

3 3 3

3 2 2

"e" "e" "e"

He"

"C"

Legend: "C" - indicates "Comment(s)" response(s) to non - multiple choice Questions

98

Appendix L: Future Change and Transition Strategies

Change process simplified:

• Assess the gap in the organization and its need for changes.

• Assess readiness in the organization to implement changes.

• Gather team members and assign leadership roles to implement changes and be clear

about roles and responsibilities. Train members if needed.

• Create the plan to implement changes.

• Communicate, communicate and communicate. Don' t be afraid to over-communicate.

Use different strategies, open forums, e-mail announcements, posting on common

bulletin boards and/or communication notebooks, etc.

• Implement the change.

• Measure and evaluate the change.

• Document gaps in current system and assess for future change strategies.

Employees often respond to change in ways that are similar to the grief reaction, which could be

described in four stages: denial, anger, bargaining and acceptance. Nicholas Rashford and David

Coghlan in the Dynamics of Organization describe the four stages of organization change as:

Denial, Dodging, Doing, and Sustaining. These stages suggest that change moves predictably in

an orderly fashion, in reality, it doesn't. Change is unpredictable and employees reactions will

vary based on many factors, including external stressors. This type of information is helpful for

a leader in order to best prepare for the future and be flexible while also listening to and

responding to employee needs.

The following suggestions are for leaders who work with others during change and transition.

Stage I: The leader needs to communicate, providing as much infotmation as possible. It is

extremely important that the reason for the changes is clearly articulated. Often, employees

don't understand the reason why the changes are occurring. Be honest in all interactions with

employees and explain what employees might expect as their work begins to transition. In

addition, training that shares strategies for self- care and stresses communication with peers and

leaders is helpful at this time. Inform employees as soon as possible of the impending changes,

preferably while still in the planning stages. This helps to make the process go smoothly.

99

Stage II: The leader needs to listen to the employees. Set up frequent open forums where all

employees have access to middle managers, the executive team and the sponsor of the proposed

changes. Encourage all parties to help explain the upcoming changes. Be firm in the plans to

implement change while still allowing employees their feelings and expression of concerns.

Stage III: Know what is most important and be vigilant in regard to focusing on the work at

hand. Before implementing any future change, ensure that an assessment system is created to

evaluate its impact and effectiveness; share these assessment methods with employees and

posted on internal bulletin boards, so that everyone is aware of the ongoing successes and/or

challenges. Involve as many people as possible. Prioritize all communication where follow­

throughs are needed on all commitment dates. Work with the leader to ensure all team members

are accountable to others. Provide training and resources to support the change implementation.

Stage IV: Evaluate the changes that have been made and share this information. Continue to

follow through on other commitments and change work. Focus on building and/or re-building

the teams that is working together and with to complete the said change. Show appreciation for

everyone on the team. Celebrate! Celebrate now, for more change could be around the corner!

100

Appendix M: The Two Sets of Five (10) ERP Software Packages - Vendors Information

Vendor Name: Epicor Software Corporation.

Address: 18200 Von Karman Ave. Suite 1000 Irvine CA 92612 - USA

Phone: Main: 949-585-4000 Fax: 949-585-4091

Web Site: www.epicor.com

About the Company: Epicor Software (NASDAQ: EPIC) is a global leader delivering business software solutions to the manufacturing, distribution, service, retail , and hospitality industries . With 20,000 customers in more than 150 countries, Epicor provides a single point of accountability that drives increased profitability, whether you ' re operating on a local, regional or global scale. Epicor is introducing a new approach to the way enterprise resource planning (ERP) systems and business software solutions are designed, built, and used. They've redefined ERP software to maximize productivity in every area of the organization. More than 400 of the world's leading retailers use Epicor's award-winning retail software solutions to become more profitable and competitive. Epicor delivers comprehensive point-of-sale (POS) and enterprise retail systems to regional chains and multichannel global brands.

Vendor Name: IQMS

Address: 4250 Aerotech Ctr. Way Suite A Paso Robles, CA 93446 - USA

Phone: Main: 805-227-1122 Toll Free: 1866-FOR-ERP2 (367-3772)

Web Site: www.IQMS.com

About the Company: IQMS is committed to providing advanced and a feature-rich manufacturing ERP software system that is designed to be the last ERP software you will ever buy. IQMS, a leader in ERP and Manufacturing Software Systems; IQMS, an innovator in Manufacturing Enterprise Resource Planning (ERP) software and creator of a truly single-source software solution, provides manufacturers with all the functionality to efficiently manage and improve business processes. The company's flagship product, EnterpriseIQ, intuitively combines real-time manufacturing, accounting, and supply chain management into one database. IQMS provides business and plant management software that allows manufacturers to run more effectively and more profitably. IQMS provides complete product development, suppOli, implementation and training without utilizing third party vendors or applications.

Vendor Name: Made2Manage ERP Software Solution

Address: 450 East 96th Street Suite 300 Indianapolis, IN 46240 - USA

Phone: Main: 317-249-1200 Toll free: 1800-626-0220 Fax: 317-249-1999

Web Site: www.made2manage.com

101

About the Company: Made2Manage ERP has a 20-year history of helping companies achieve and sustain productive operations, satisfied customers, and profitable results through technology and services. Made2Manage ERP software and services are matched closely with specific customer needs, incorporating deep industry knowledge and experience. Plus, they are continually enhanced to meet evolving customer requests and suggestions. Notable for ease-of­use, fast navigation, tailored views and tight security, Made2Manage ERP applications deliver the functionality without the fuss, solid applications that make users' jobs easier, not more cumbersome. Made2Manage provides full ERP capabilities for custom manufacturers centered on a "casual" bill-of-material for making complex products, while continuing with design and engineering activity. Active product suppoli and enhancement deliver the capabilities/technologies that customers need in their specific industries.

Vendor Name: Manufacturing Action Group Inc. (MAGI)

Address: 4695 44th Street Suite B-130 Grand Rapids, Michigan 49512 - USA

Phone: Main: 6169565345 Toll Free: 1866 946 6244 Fax: 6169565362

Web Site: www.magierp.com

About the Company: MAGI develop and suppoli high quality ERP business solutions for small to mid-sized manufacturers. MAGI have been developing software solutions since 1985 and have installations worldwide. Their premier product, WinMAGI, is a world class manufacturing ERP system for small to mid-sized manufacturers. It blends solid accounting and manufacturing practices in an easy to use and implement package. Subjected to continuous critiquing and improvement, it is used in industries as diverse as consumer products, aerospace & defense, hazardous chemicals, food and beverage, furniture, computer imaging, plastic molding, electronics, automotive components, fishing tackle and others. WinMAGI is used by small startup companies and divisions of FOliune 100 multi-national organizations.

Vendor Name: MAPICS, Inc (Infor)

Address: 13560 Monis Road Suite 4100 Alpharetta, GA 30004 - USA

Phone: Main: 678-319-8000 Toll free: 1866-244-5479 Fax: 678-319-8682

Web Site: www.made2manage.com

102

About the Company: Infor (MAPIC, Inc.) offers a full range of enterprise business software including customer relationship management, enterprise asset management, enterprise resource planning, financial management, human capital management, perfonnance management, product lifecycle management, supplier relationship management, and supply chain management, including business specific inventory management, transportation logistics and warehouse management software. To meet customers' long-term needs, InfoI' Open SOA provides an evolutionary path to support continuing business and technology innovation.

Vendor Name: MetaSystems, Inc.

Address: 13700 State Road, Suite 1 North Royalton, Ohio 44133 - USA

Phone: Main: 440-526-1454 Toll-free: 1800-788-5258 Fax: 440-526-1406

Web Site: www.metasystems.com

About the Company: MetaSystems, Inc., founded in 1975 specializes in providing a unique blend of packaged software, implementation suppOli, customization services, and consulting services. Their ERP package, the ICIM business systems software, is a true multi­company/multi-facility software package that fully integrates: Engineering, Manufacturing, Order Management, CRM and Financials in a real-time web enabled environment with a proven track record of complete and streamlined implementations. MetaSystems is the author of their own comprehensive ICIM ERP Software for discrete manufacturers. They offer ICIM as a tumkey solution or customize it to provide solution to a client's unique business process. The ICIM ERP software package uses an Oracle database and is written using the latest development technologies. The package is offered in three-tier architecture for browser-based operation. It can run on a wide range of platforms including: Windows, Unix and Linux.

Vendor Name: ROI Systems Groups, Inc.

Address: 64845 Van Dyke Road Suite 2 Washington, MI 48095 - USA

Phone: Main: 248-333-1938 Fax: 248-726-7005

Web Site: www.roisys.net

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About the Company: Since 1992, ROI Systems Group, Inc. has specialized in providing multi-user manufacturing, distribution and accounting systems solutions. These systems include Enterprise Resource Planning Software (ERP software), Just-in-Time (JIT) supply chain management, bar coding, e-commerce, Electronic Data Interchange (ED I), Customer Relationship Management (CRM), and much more. They feel a system should not only allow our clients to better service their customers but also provide the control necessary to manage their resources. Their systems are designed to meet those specific demands. Whether an off-the­shelf solutions software or custom application is used, ROI has a cost effective solution to meet business challenges. Their commitment to providing clients exactly what they demand and . . . reqUIre IS sincere.

Vendor Name: Rover Data Systems, Inc.

Address: 1385C Warner Ave. Tustin, CA 92780 - USA

Phone: Main: 714-258-8444 Fax: 714-258-7961

Web Site: www.roverdata.com

About the Company: Rover Data Systems Inc. has been providing a full-featured MRPIIIERP solution to small and medium sized businesses. With over 25 years of experience in Production Planning/Manufacturing, and with other MRP Software vendors, Rover Data System's founders saw the need for an integrated and complete Manufacturing Business Management System for small and medium sized companies. Rover Data Systems Inc has an ERP package called M3, which addresses a wide range of business problems. The M3 from Rover Data Systems provides the ideal software solution for small to medium sized companies. The system includes every critical component necessary to manage a growing organization, combined with the flexibility and scalability to meet today, and tomorrow's business challenges. They have the ability to work with companies that are in the process of change, whether due to growth or just the way they prefer to run their business, has been the underpinning of their success.

Vendor Name: Sage North America

Address: 888 Executive Center Drive West Suite 100 St. Petersburg, Florida 33702 - USA

Phone: Main: 727-579-1111 Toll-free: 1866-996-SAGE

Web Site: www.sagenorthamerica.com

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About the Company: Sage North America supports the needs and challenges of more than 3.1 million small and mid-sized business customers. Our software and services supp0l1 accounting, operations, customer management, human resources, time tracking, merchant services and the specialized needs of the construction, distribution, healthcare, manufacturing, nonprofit and real estate industries. The parent company, Sage Group, pIc, is a world-leading supplier of accounting and business management software to small and medium-sized businesses. They seek to help customers run their businesses more effectively, helping them to gain greater insight into their business activities and providing them with lasting benefits by automating their business processes.

Vendor Name: Verticent Inc.

Address: 400 North Ashley Drive Suite 2600 Tampa, FL 33602 - USA

Phone: Main: 813-226-2600 Toll-free: 1800-251-8449 Fax: 813-222-0886

Web Site: www.verticent.com

About the Company: Veliicent provides integrated ERP, CRM, e-business and business intelligence solutions that meet the unique business demands of small-to-medium size (Mid-Size =

100-999 employees and Small = <100 employees) manufacturers and distributors. With a commitment to specific vertical industries where it has proven experience and success, Verticent leverages industry-specific knowledge and functionality to deliver a flexible, yet affordable, enterprise business system, without requiring expensive software modifications or extensions. The Verticent enterprise business system helps enhance overall business operations by reducing implementation costs, increasing productivity and delivering a rapid return on investment.