Managers and end-users... - artigo - 2009

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Managers’ and end-users’ concerns on innovation implementation A case of an ERP implementation in China Frank Lin and C.E. Tapie Rohm Department of Information and Decision Sciences, College of Business and Public Administration, California State University San Bernardino, San Bernardino, California, USA Abstract Purpose – The purpose of this paper is to understand whether differences also exist between managers and end-users regarding critical success factors (CSFs) of enterprise resource planning (ERP) systems implementation in China as well as among the counterparts in US and Chinese companies. Design/methodology/approach – A pharmaceutical company in China that implemented an ERP system recently, similar to the one identified in Amoako-Gyampah’s study, is identified for this paper. A field survey accompanied by interview was used to collect data on seven CSFs that have been identified in the literature on technology acceptance and diffusion and that are consistent with Amoako-Gyampah’s study for comparison purposes. Findings – The results of this paper confirm the results of Amoako-Gyampah’s study, which demonstrates that significant differences of seven CSFs of the implementation of ERP systems do exist in the perception of managers and end-users. It further shows that both managers and end-users of Chinese companies rate all seven factors lower than do their US counterparts. The understanding of these differences reveals the current stage of the progress of ERP implementation in China, namely that ERP implementation is not perceived as positively by Chinese managers and end-users as it is by their counterparts in the USA Research limitations/implications – For researchers, this paper provides a foundation for further investigation of the reasons for such differences among different groups and individuals as well as different cultures. Practical implications – Understanding the differences that exist in the perceptions of different groups within an organization and the nature of these differences can help implementers develop appropriate change management mechanisms – such as training, communication, and others – to improve the chances of successful ERP implementation. Originality/value – This paper confirms the previous CSFs research findings in a Chinese pharmaceutical company setting that there are significant differences of CSFs in ERP implementation between managers and end-users. It further compares the differences of these CSFs with their US counterparts. Keywords Organizational innovation, Manufacturing resource planning, Critical success factors, China Paper type Research paper Introduction Many companies around the world have implemented enterprise resource planning (ERP) systems in the past 20 years or so. During the same period of time, ERP systems implementation and related issues have also generated significant interest (Aladwani, 2001; Amoako-Gyampah and Salam, 2004; Beheshti, 2006; Davison, 2002; The current issue and full text archive of this journal is available at www.emeraldinsight.com/1463-7154.htm A case of an ERP implementation in China 527 Business Process Management Journal Vol. 15 No. 4, 2009 pp. 527-547 q Emerald Group Publishing Limited 1463-7154 DOI 10.1108/14637150910975525

Transcript of Managers and end-users... - artigo - 2009

Managers’ and end-users’concerns on innovation

implementationA case of an ERP implementation in China

Frank Lin and C.E. Tapie RohmDepartment of Information and Decision Sciences,College of Business and Public Administration,

California State University San Bernardino, San Bernardino, California, USA

Abstract

Purpose – The purpose of this paper is to understand whether differences also exist betweenmanagers and end-users regarding critical success factors (CSFs) of enterprise resource planning (ERP)systems implementation in China as well as among the counterparts in US and Chinese companies.

Design/methodology/approach – A pharmaceutical company in China that implemented an ERPsystem recently, similar to the one identified in Amoako-Gyampah’s study, is identified for this paper.A field survey accompanied by interview was used to collect data on seven CSFs that have beenidentified in the literature on technology acceptance and diffusion and that are consistent withAmoako-Gyampah’s study for comparison purposes.

Findings – The results of this paper confirm the results of Amoako-Gyampah’s study, whichdemonstrates that significant differences of seven CSFs of the implementation of ERP systems do existin the perception of managers and end-users. It further shows that both managers and end-users ofChinese companies rate all seven factors lower than do their US counterparts. The understanding ofthese differences reveals the current stage of the progress of ERP implementation in China, namely thatERP implementation is not perceived as positively by Chinese managers and end-users as it is by theircounterparts in the USA

Research limitations/implications – For researchers, this paper provides a foundation for furtherinvestigation of the reasons for such differences among different groups and individuals as well asdifferent cultures.

Practical implications – Understanding the differences that exist in the perceptions of differentgroups within an organization and the nature of these differences can help implementers developappropriate change management mechanisms – such as training, communication, and others – toimprove the chances of successful ERP implementation.

Originality/value – This paper confirms the previous CSFs research findings in a Chinesepharmaceutical company setting that there are significant differences of CSFs in ERP implementationbetween managers and end-users. It further compares the differences of these CSFs with their UScounterparts.

Keywords Organizational innovation, Manufacturing resource planning, Critical success factors, China

Paper type Research paper

IntroductionMany companies around the world have implemented enterprise resource planning(ERP) systems in the past 20 years or so. During the same period of time, ERP systemsimplementation and related issues have also generated significant interest(Aladwani, 2001; Amoako-Gyampah and Salam, 2004; Beheshti, 2006; Davison, 2002;

The current issue and full text archive of this journal is available at

www.emeraldinsight.com/1463-7154.htm

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in China

527

Business Process ManagementJournal

Vol. 15 No. 4, 2009pp. 527-547

q Emerald Group Publishing Limited1463-7154

DOI 10.1108/14637150910975525

Esteves and Pastor, 2001; Gargeya and Brady, 2005; Gattiker and Goodhue, 2004;Ho et al., 2004; Kamal, 2006; Kim et al., 2005; Koh et al., 2006; Liang et al., 2007; Lu et al.,2006; Markus and Tanis, 2000; Nah and Delgado, 2006; Nandhakumar et al., 2005; Parket al., 2007; Rajagopal, 2002; Remus, 2007; Soh and Sia, 2005; Soliman et al., 2001;Somers and Nelson, 2004; Velcu, 2007; Wu and Wang, 2006; Xu et al., 2002). Much ofthe existing research identifies factors that are important for successfulimplementation of ERP systems (Ang et al., 2002, 1995; Bingi et al., 1999; Bradfordand Florin, 2003; Hong and Kim, 2002; Huang and Palvia, 2001; Kamhawi, 2008; Lawand Ngai, 2007; Lu et al., 2006; Motwani et al., 2005; Nah and Delgado, 2006; Nah et al.,2003, 2001; Shehab et al., 2004; Soja, 2006; Vathanophas, 2007; Verville et al., 2005;Voordijk et al., 2005). The identification of these factors or critical success factors(CSFs) is primarily based on the perception of senior managers or ERP implementationteam leader in organizations (Ang et al., 2002, 1995; Bingi et al., 1999; Bradford andFlorin, 2003; Esteves and Pastor, 2001; Finny and Corbett, 2007; Law and Ngai, 2007;Motwani et al., 2005; Nah and Delgado, 2006; Nah et al., 2003, 2001; Soja, 2006; Woo,2007) with very few exception such as Amoako-Gyampah’s (2004) study which lookedinto the perceptions of both managers and end-users on these CSFs.

This study is largely inspired by earlier work done by Amoako-Gyampah (2004) andintends to extend his earlier work by comparing the perception of different user groupsin an ERP implementation effort and comparing the perception of selected factorsinvolving successful ERP implementation by counterparts in the USA and China.

The results of this paper confirm the findings of Amoako-Gyampah’s (2004) study,which demonstrates that significant differences of seven CSFs of the implementation ofERP systems do exist in the perception of managers and end-users. It further shows thatboth managers and end-users of Chinese companies rate all seven factors lower than dotheir US counterparts. The understanding of these differences reveals the current stageof the progress of ERP implementation in China, namely that ERP implementation is notperceived as positively by Chinese managers and end-users as it is by their counterpartsin the USA.

The organization of this paper is as follows. First, literature relevant to the inclusionof end-user in successful innovation introduction in organization is reviewed and thepurpose of the study is addressed. Second, the research model and research hypothesesalong with survey instruments are presented. Then, research findings with respect toeach of the seven CSFs in an ERP implementation adopted from Amoako-Gyampah(2004) and the comparison of the perceptions of these seven CSFs of the US and Chinacounterparts are discussed in detail. Finally, this study concludes with a summary alongwith limitation of this study, implications for practitioners and an outlook of futureresearch directions.

Literature and purpose of the studyAn introduction of innovation such as ERP implementation induces uncertainty andinsecurity in an organization because of the potential need for change and the possibleneed to comply with new performance standards. When it comes to implementinginnovation in an organization – implementing the six sigma program, optimizingbusiness processes, and/or implementing an ERP system – there is indeed potential tochange process, responsibility and performance requirements. Such changes requireproper management to ensure a successful introduction of the innovation (Kotter, 1996;

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Lewis and Seibold, 1996). The outcome of innovation implementation efforts dependson the reactions of the managers and end-users to the innovation (Lewis and Seibold,1993). The reason so many change initiatives fail is that they rely too heavily on “datagathering, analysis, report writing, and presentations.” Instead, a more creativeapproach should be employed, aimed at grabbing the “feelings that motivate usefulaction” (Kotter, 2002). The managers and end-users in an innovation transformationmust, in the words of one useful metaphor, combine frenetic activity on the dance floorwith composed observation and reflection from the balcony above (Heifietz, 1994).Unfortunately, corporate leaders currently caught up in an innovation transformationtend to stay on the floor and dance ever faster rather than removing themselves fromthe action enough to understand and manage the full cognitive and emotionalcomplexities of the innovation transformation process. In the long run, everyone withsignificant involvement in the company’s innovation transformation has to make a tripto the balcony (Day and Jung, 2000). As Day and Jung (2000) have stated:

[. . .] three things must be absolutely clear to employees for a successful innovationtransformation. First, the ‘why’ of the innovation transformation program, as well as the ‘whynow,’ must persuade them; the benefits of success and the penalties of failing to act must beequally obvious. Second, the company’s new future – the ‘where to’ – must be clear andexciting to everyone. Third, each employee must understand the personal benefits of theprogram: the leadership must have credible answers to that natural question, ‘What’s in it forme?’ To inspire genuine conviction, the program’s rationale and goal must withstand thetoughest scrutiny from the most cynical observer right from the start.

Most of the studies involving responses to transformation associated with technologyinnovation have concentrated on the perspectives and responses of managers, decisionmakers, leaders, and implementers to the exclusion of end-users (Lewis and Seibold,1996). In the domain of ERP implementation, CSFs have generated much interestamong researchers, yet few researchers have attempted to ascertain whether there aredifferences between how managers and end-users perceive the effectiveness of thefactors of successful ERP implementation; the lone exception is Amoako-Gyampah(2004), whose study used a US healthcare product company as its sample. Our studyintends to contribute to the knowledge of ERP implementation by presenting results ofresearch, which replicate the Amoako-Gyampah study (2004). In addition, our studyintends to extend the earlier work of Amoako-Gyampah (2004) by comparing theperception of managers and end-users of the effectiveness of the selected factorsinvolving successful ERP implementation and comparing the perception of theseselected factors of respective counterparts in the USA and China.

Specifically, the paper aims to understand whether differences also exist betweenmanagers and end-users regarding their opinions about the reasons for implementingthe ERP system, the extent of its benefits, the extent of the personal relevance of theERP system, the effectiveness of the training that was provided, the effectiveness of thecommunication mechanisms used, the perceived ease of use of the ERP system, andthe extent of the satisfaction with the ERP system among the counterparts in the USand Chinese companies (Amoako-Gyampah, 2004).

Research model and hypothesesThe existing literature has identified numerous factors important to thesuccessful implementation of ERP systems (Ang et al., 2002, 1995; Bingi et al., 1999;

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Bradford and Florin, 2003; Hong and Kim, 2002; Huang and Palvia, 2001; Kamhawi,2008; Law and Ngai, 2007; Lu et al., 2006; Motwani et al., 2005; Nah and Delgado, 2006;Nah et al., 2003, 2001; Shehab et al., 2004; Soja, 2006; Vathanophas, 2007; Verville et al.,2005; Voordijk et al., 2005). A comprehensive review of this literature can be found inEsteves and Pastor (2001), Finny and Corbett (2007) and Moon (2007). We selected thefollowing factors for study, factors that have been identified in the literature ontechnology acceptance and diffusion and that are consistent with Amoako-Gyampah’sstudy (2004):

. the argument for changing the technology;

. the perceived personal relevance of the technology;

. the perceived ease of use of the technology;

. satisfaction with the technology;

. project communication;

. training; and

. shared beliefs about the benefits of the technology.

An argument for change represents the business justification for the new technology.It measures the respondents’ perception of whether the ERP technology is world-class,able to enhance the ability of the company to handle new business opportunities, ableto allow various functional units in the organization to work better with each other, andable to facilitate better customer service compared to the system it will replace.

Perceived ease of use of an information system as identified by the TechnologyAcceptance Model (Davis, 1989; Davis et al., 1989) is one of the important factors thatinfluence the actual use of information technology. Ease of use measures respondents’confidence in their ability to get the ERP system to do what they want it to do and inthe ease of learning how to use the ERP system.

Personal relevance of technology is a significant expectation when users evaluatewhether utilization of ERP systems will lead to improved productivity and operationperformance or not (Lim et al., 2005). It measures the extent to which the respondentsbelieve the ERP system will be useful in their jobs, increase their productivity, and beresponsive to their changing job demands (Amoako-Gyampah, 2004).

User satisfaction with technology has been one of the most widely used indicators ofsuccess of information systems research (Delone and McLean, 2003; Petter et al., 2008).The higher the level of user’s belief of information quality will also have direct impact onuser satisfaction with the technology (Doll and Torkzadeh, 1988; Seddon and Yip, 1992).Satisfaction with technology measures the respondents’ belief that the ERP system isable to provide integrated, accurate, timely, and reliable information to the respondentsand whether they believe that the new system is better than the one it is replacing.

Training has been widely recognized as one of the most important CSFs forsuccessful ERP implementation (Al-Mashari et al., 2003; Nah et al., 2001). Trainingmeasures the respondents’ satisfaction with their training and the timing,appropriateness, and effectiveness of the ERP training program. Specifically, thefollowing items are measured:

. whether the training is long enough;

. if the training is detailed enough;

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. whether trainees feel confident about using the system after going through thetraining program;

. their level of satisfaction with the trainer’s knowledge of the system;

. the helpfulness of the trainers while respondents were learning to use the ERPsystem;

. the increase of the respondents’ level of understanding of the system after thetraining program;

. the respondents’ opinion of the timing of the training; and

. the helpfulness of the timing of training with respect to the respondent’sperception of training effectiveness.

Communication has been identified as one of the important CSFs for successful ERPimplementation (Al-Mashari et al., 2003; Nah et al., 2003). Employees at various levels inan organization all need to be notified and/or communicated in advance or in time onERP project plan, scope, objectives, benefits, expectations, process changes, changemanagement strategies, and conversions approach and progress in ERP implementation(Nah et al., 2003). Communication measures the respondents’ perception of the timelinessand effectiveness in communication of explaining the benefits of the ERP system,informing the progress and changes of the ERP project, and demonstrating theconversion process.

Lack of shared information technology vision and understanding between businessmanagers and information technology managers contributes to difficulties of aninnovation implementation in organizations and limits its contribution to organizationalcompetitive advantage (Dong, 2001). ERP implementation requires the inclusion of usersfrom various levels, departments and divisions of the organization. Naturally, a sense oftrust, commitment, and belief in the benefits of the ERP system is pertinent to successfulimplementation. Shared beliefs refer to a belief about the overall impact of the ERPsystem on the organization with respect to the system’s benefits.

The research model relevant to the national/environmental (country) andorganizational/internal (user group) contexts of selected seven CSFs in an ERPimplementation of this study is presented in Figure 1.

Based on the discussion above, we formulate the first group of seven research nullhypotheses as follows:

H1. There is no difference in the perception of argument for change adoption of anERP system between managers and end-users.

H2. There is no difference in the perception of ease of use of an adopted ERPsystem between managers and end-users.

H3. There is no difference in the perception of personal relevance of an adoptedERP system between managers and end-users.

H4. There is no difference in the perception of satisfaction with an adopted ERPsystem between managers and end-users.

H5. There is no difference in the perception of training regarding an ERPimplementation between managers and end-users.

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H6. There is no difference in the perception of communication in an ERP systemadoption between managers and end-users.

H7. There is no difference in the perception of shared beliefs about the benefits inadoption of an ERP system between managers and end-users.

As one of the most popular information technology use in organizations in recent years(Davenport, 1998), ERP system has great potential benefits such as process flowimprovement, inventory reduction, higher quality data for decision making, bettercustomer service, higher profit margin, and even competitive advantage or survival foran organization if it’s successfully implemented (Fan et al., 2000; Gattiker andGoodhue, 2005; Gupta, 2000; Lengnick-Hall et al., 2004; Markus et al., 2000). Yetliterature has shown that ERP implementation faces additional challenges indeveloping countries in Asia and Latin America compared to developed countries suchas the USA, Canada, and the UK (Huang and Palvia, 2001). Fierce competition andpressures from Western corporations force firms in developing countries to vigorouslypursue information technology. However, due to economic growth and in its earlystages of ERP adoption, developing countries in Asia and Latin America are becomingmajor targets of ERP vendors.

Due to inadequate information technology (IT), lack of IT/ERP experience and lowIT maturity among others, companies in developing countries are less likely to succeedin ERP implementation. Consequently, managers and end-users’ perceptions

Figure 1.Research model

Country: US vs China

Managers vs End-Users

Successful ERPimplementation

Critical success factors

• Argument for changing the technology• Ease of Use• Personal relevance of the technology• Satisfaction with the technology• Project communication• Training• Shared beliefs about the benefits of the technology

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of adoption can be different in China as compared with their counterparts in the USA.Based on the discussion above, the second and third sets of seven null hypotheses arepresented as follows:

H8a. There is no difference in the perception of argument for change in adoption ofan ERP system between US managers and their counterparts in China.

H8b. There is no difference in the perception of ease of use of an adopted ERPsystem between US managers and their counterparts in China.

H8c. There is no difference in the perception of personal relevance of an adoptedERP system between US managers and their counterparts in China.

H8d. There is no difference in the perception of satisfaction with an adopted ERPsystem between US managers and their counterparts in China.

H8e. There is no difference in the perception of training regarding an ERPimplementation between US managers and their counterparts in China.

H8f. There is no difference in the perception of communication in an ERP systemadoption between US managers and their counterparts in China.

H8g. There is no difference in the perception of shared beliefs about the benefits inadoption of an ERP system between US managers and their counterparts inChina.

H9a. There is no difference in the perception of argument for change in adoption ofan ERP system between US end-users and their counterparts in China.

H9b. There is no difference in the perception of ease of use of an adopted ERPsystem between US end-users and their counterparts in China.

H9c. There is no difference in the perception of personal relevance of an adoptedERP system between US end-users and their counterparts in China.

H9d. There is no difference in the perception of satisfaction with an adopted ERPsystem between US end-users and their counterparts in China.

H9e. There is no difference in the perception of training regarding an ERPimplementation between US end-users and their counterparts in China.

H9f. There is no difference in the perception of communication in an ERP systemadoption between US end-users and their counterparts in China.

H9g. There is no difference in the perception of shared beliefs about the benefits inadoption of an ERP system between US end-users and their counterparts inChina.

The survey questions utilized previously validated seven-point Likert-type scales(Amoako-Gyampah’s, 2004; Jackson et al., 1997). A typical question asks respondentsto indicate their agreement or disagreement on the question posed with “one”representing disagreement and “seven” representing agreement. The surveyinstrument is provided in Appendix.

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Research methodologyThe case that was identified for this study involves a pharmaceutical company in Chinasimilar to the one identified in Amoako-Gyampah’s study (2004). This is a publiclytraded pharmaceutical company with more than 20,000 employees. It is the top companyin sales revenues for sales of its numerous products in China and overseas. The companyis a full-service pharmaceutical company with multiple research and development,manufacturing, and distribution facilities throughout China. The ERP system that thecompany has recently implemented includes purchasing, inventory, production, sales,order management, finance, and accounting modules provided by a domestic ChineseERP system company. The decision for a “package” solution implementation was theresult of carefully determined make/buy decisions, and the timing of implementationwas partly controlled because a portion of the implementation was subsidized by theChinese government.

The company’s headquarters, located in Beijing, China, with more than 1,700employees, was selected as the sample site. The same data gathering method (i.e. surveysand interviews with selected employees including managers and end-users) was used asthat used in Amoako-Gyampah’s study (2004). For this study, end-users consisted ofnon-managerial employees who worked in purchasing, production, sales, finance,marketing, human resources, and information system support departments. Managerswere those employees who spent at least 80 percent of their time in managerial functionsand who were team leaders, sponsors, department heads, managers, and champions.

A total of 511 questionnaires were collected from various departments of thecompany’s headquarters. The final and usable data set consists of only 458 completedquestionnaires since a large portion of the questionnaires were returned incomplete.

Research findings and discussionThe final 458 usable questionnaires are divided into two groups: one group of79 managers and a second group of 379 end-users. Table I shows respondents’demographic data. An analysis of the demographic data shows that variability exists inthe data with regard to gender, education background, age and number of years spent atthe company with the exception of job function. This large variation should providesome confidence to the generalization of the findings to similar environment.Nevertheless, the interpretation of the results in this study should be cautions since thereare 45 percent of the respondents were from production department.

A t-test was employed to check the differences between how managers and end-usersperceived pertinent implementation factors that would ensure a successful ERPimplementation, and Table II summarizes the results. The results show that all sevennull hypotheses (H1-H7 ) all are rejected and there are significant differences betweenmanagers and end-users’ perception on all seven pertinent CSFs on ERPimplementation. The largest differences in perception concern ease of use, personalrelevance, and shared beliefs. The smallest differences in perception involve training,communication, and personal concern with the organization. Nevertheless, thedifferences in perception on all factors – argument for change, ease of use, personalrelevance of technology, satisfaction with technology, training, communication, andshared belief – are significant. When comparing the responses from correspondingcounterparts in the USA, as described in the Amoako-Gyampah’s study (2004) shown inTable III, we found the means of responses among all seven factors in this study to be

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lower for both the managers and end-users with one exception: that of personalrelevance of technology perceived by managers, a topic that will be further discussed inthe next section. Some detailed discussion on implementation factors will be discussedlater in this section.

Argument for changeAn argument for change represents the business justification for the new technology.The results show that managers perceive the implementation of the ERP system to be

Frequency Percentile Average SD

Gender of respondentFemale 227 49.6Male 224 48.9No indication 7 1.5

Educational backgroundElementary School 1 0.2Junior high school 48 10.5High school 141 30.8Associate 137 29.9Bachelor 93 20.3Masters 23 5.0Doctorate 6 1.3No indication 9 2.0

Job functionSales 2 0.4Production 206 45.0Purchasing 10 2.2Marketing 3 0.7Human resources 21 4.6Finance 8 1.7Information support 7 1.5Other 194 42.4No indication 6 1.3

Age bracket18-29 104 22.730-39 183 40.040-49 134 29.350-59 32 7.060 or over 0 0No indication 5 1.1

Job typeFull-time 447 97.6Part-time 7 1.5No indication 4 0.9

Other variablesYears of work experience 15.59 10.232Years at present company 11.84 9.169Years at present position 8.06 7.663No. of previous implementations 1.31 0.665

Notes: Managers – 79; end-users – 379

Table I.Demographic data

on respondents

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more justified than end-users perceive it; nevertheless, a closer examination shows thatthe least agreed-upon item among the four is the perception of the ERP technology asbeing world-class, particularly as perceived by end-users. The biggest difference inperception between managers and end-users is whether the ERP system is able toallow various functional units in the organization to work better with each other.Managers much more often tend to rate highly the potential of various functional unitsin the organization to work together. Further, review of the interview reveals that themanager respondents have had more exposure to ERP systems, have gone to trainingmore frequently, and have toured more companies that have implemented ERPsystems than have end-users. Consequently, one can conjecture that mangers tend tounderstand the potential benefits of an ERP system implementation with respect tovarious functional units to work together in the organization much better than do theend-users.

Ease of useEase of use measures respondents’ confidence in their ability to get the ERP system todo what they want it to do and in the ease of learning how to use the ERP system. Theresults show that managers perceive the ERP system to be much easier to use than

Variable

Responsefrom

managersa

Responsefrom

end-users Difference t-value P . jtjb

Argument for change 3.70 (1.67) 2.91 (2.04) 20.79 23.195 ,0.001Ease of use 3.32 (1.65) 2.04 (1.92) 21.28 25.503 ,0.001Personal relevance of technology 4.33 (1.67) 3.17 (2.03) 21.16 24.724 ,0.001Satisfaction with technology 3.90 (1.50) 3.07 (2.09) 20.83 24.187 ,0.001Training 2.35 (1.42) 1.72 (1.51) 20.63 23.423 ,0.001Communication 2.70 (1.54) 2.06 (1.69) 20.64 23.142 ,0.002Shared beliefs 2.64 (1.26) 1.72 (1.39) 20.92 25.456 ,0.001

Notes: aA Likert-type scale was used, with one representing disagreement and seven representingagreement; ban equal variances assumed (two-tailed)

Table II.Comparison of responseson variables (mean scores)

Variable

Responsefrom

managersa

Responsefrom

end-users Difference t-value P . jtjb

Argument for change 3.84 (1.00) 3.01 (1.23) 20.88 28.86 ,0.001Ease of use 3.65 (1.30) 3.05 (1.48) 20.60 23.87 ,0.001Personal relevance of technology 4.83 (1.28) 3.18 (1.41) 20.65 24.39 ,0.001Satisfaction with technology 4.15 (1.04) 3.17 (1.36) 20.98 29.28 ,0.001Training 3.49 (1.43) 2.95 (1.67) 20.54 23.34 ,0.001Communication 3.91 (1.70) 2.99 (1.98) 20.92 25.53 ,0.001Shared beliefs 4.10 (1.88) 2.99 (1.39) 21.12 26.60 ,0.001

Notes: aA Likert-type scale was used, with one representing disagreement and seven representingagreement; ba equal variances assumed (two-tailed); ctotal usable responses: 571: 167 are managersand 408 are end-users; dAmoako-Gyampah, 2004

Table III.Comparison of responseson variables (meanscores) – US counterpart

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end-users perceive it. A closer examination shows that end-users, in fact, perceive thesystem as not easy to use at all. Again, the end-users’ lack of exposure to IT in generaland ERP system in particular before the ERP in China may partly explain theirperception of not easy to use the system at all.

Personal relevance of technologyPersonal relevance of technology measures the extent to which the respondents believethe ERP system will be useful in their jobs, increase their productivity, and beresponsive to their changing job demands. Again, the results show that managersare much more positive in their belief that the ERP system will excel in these threeareas, possibly for the three reasons already hypothesized (managers have beenexposed to the ERP system more frequently, have gone to more training programs, andhave toured more companies that have implemented ERP systems than haveend-users). Naturally, managers would understand the benefits of the ERP systemmore than end-users after such increased exposure.

Satisfaction with technologySatisfaction with technology is measured in the respondents’ belief that the ERP systemis able to provide integrated, accurate, timely, and reliable information to therespondents and whether they believe that the new system is better than the one it isreplacing. The results show that managers are more satisfied with the ERP system thanare the end-users. End-users are both less convinced that the ERP system will be betterthan the one it is replacing and more attached to the existing system being replaced.

TrainingTraining measures the respondents’ satisfaction with their training and the timing,appropriateness, and effectiveness of the ERP training program. Although there aresignificant differences in responses regarding the satisfaction, timing, appropriatenessand effectiveness of the training program, managers and end-users overall do notbelieve that the training program is appropriate, timely, effective, and in general, theyare not satisfied with it. This finding is particularly interesting because it is consistentwith the findings of Amoako-Gyampah’s study (2004). Why are respondents sonegative about the training program in which they have just participated? One possibleexplanation is that an individual’s concern at a particular point in time could varygreatly from the concern of another individual at that same point in time (Hall et al.,1998). This result shows that selection of an appropriate plan for user training in ERPimplementation is particularly challenging. Studies that investigate the difference inconcerns of an individual when an organization implements an innovation will beparticularly useful in explaining such a difference.

CommunicationCommunication measures the respondents’ perception of the timeliness andeffectiveness in communication of explaining the benefits of the ERP system,informing the progress and changes of the ERP project, and demonstrating theconversion process. Although the importance of communication has been welldocumented in literature as one of the CSFs for ERP implementation ( Jackson et al., 1997;Nah et al., 2001, 2003), examination shows that, in fact, both managers and end-users rate

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all six items that measure communication as very low. Given that both managers andend-users perceive that these aspects are not communicated well. A natural question,then, is how to communicate the project benefits, progress and changes, and conversionprocess to managers and end-users effectively. Furthermore, as discussed earlier,literature emphasizes the importance of three aspects: “why and why now,” “where to,”and “personal benefits – what’s in it for me” must be absolutely clear to employees fora successful innovation transformation (Day and Jung, 2000). The six items that are usedfor measuring the communication in this study do not include the personal benefits,i.e. what’s in it for me? Such an individual concern need to be addressed (Hall et al., 1998,1986; Schaafsma and Athanasou, 1994; Strebel, 1996; Wagner, 2006), otherwise, it can beone of the important factors that lead to resistance and/or dissatisfaction of theinnovation implementation (Aladwani, 2001; Bresnen et al., 2005; Cooper and Zmud,1990; Fidler and Johnson, 1984; Keen, 1981; Klein and Sorra, 1996). Knowing whatmanager and end-user concerns are as well as how and what to communicate willimprove the possibility of successfully implementing an ERP system.

Shared beliefsERP implementation requires the inclusion of users from various levels, departmentsand divisions of the organization. Naturally, a sense of trust, commitment, and belief inthe benefits of the ERP system is pertinent to successful implementation. Sharedbeliefs refer to a belief about the overall impact of the ERP system on the organizationwith respect to the system’s benefits. The results show that the shared beliefs are ratedvery low by both managers and end-users; nevertheless, there is still a significantdifference between managers’ and end-users’ ratings with the ratings of end-usersbeing much lower than those assigned by the managers. This research indicates thatthe improvement of the respondents’ trust, commitment, and belief in the benefits ofthe ERP system is a pertinent task for ERP implementation.

Comparision of corresponding counterparts – USA and ChinaResults of t-test on differences on seven pertinent critical factors of US managers and theircounterparts in China (H8a-H8g) as well as US end-users and their counterparts in China(H9a-H9g) are summarized in Tables IV and V, respectively. It fails to accept all 14 nullhypotheses with the exception of H8a (argument for change between US managers

VariableManagers

– USAManager– China

Difference(USA vsChina)

t-value of thedifference P . jtja

Argument for change 3.84 (1.00) 3.70 (1.67) 0.14 0.818 ,0.414Ease of use 3.65 (1.30) 3.32 (1.65) 0.33 1.824 ,0.069Personal relevance oftechnology 3.83 (1.28) 4.33 (1.67) 20.50 22.758 ,0.006Satisfaction with technology 4.15 (1.04) 3.90 (1.50) 0.25 1.533 ,0.126Training 3.49 (1.43) 2.35 (1.42) 1.14 6.564 ,0.000Communication 3.91 (1.70) 2.70 (1.54) 1.21 6.404 ,0.000Shared beliefs 4.10 (1.88) 2.64 (1.26) 1.46 7.999 ,0.000

Note: aAn equal variances assumed (two-tailed)

Table IV.Comparison of USmanagers and Chinesemanagers on variables(mean scores)

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and Chinese managers), H8d (satisfaction with technology between US managersand Chinese managers), H9a (argument for change between US end-users and Chineseend-users), H9c (personal relevance of technology between US end-users andChinese end-users), and H9d (satisfaction with technology between US end-users andChinese end-users).

Between US and Chinese managers, there are significant differences of opinion onthe issues of personal relevance of technology, training, communication, and sharedbelief. There are also marginal differences in opinions of ease of use between the two.However, there are no significant differences found between the two in their argumentfor change and satisfaction with technology as shown in Table IV. In ERPimplementation, both US managers and US end-users more often report satisfaction inthe areas of training, communication, and shared belief than do their Chinesecounterparts. US end-users also believe the ERP systems are easier to use thando Chinese end-users. This finding seems to be reasonable since Chinese companies areconsidered latecomers to ERP implementation; further, most end-users in China havenot been exposed to ERP systems previous to the date of ERP introduction at their owncompanies. However, the low ratings of training, communication, and shared values forboth US and Chinese end-users indicate that end-users in general believe thatcompanies are not doing a good job in these three areas.

It is also noteworthy that the mean of responses among all seven factors of the datacollected in this study is lower for both Chinese managers and end-users than it is fortheir US counterparts (with the exception of personal relevance of technology perceivedby Chinese managers; see Tables IV and V). This low rating could be partiallyexplained by the bad reputation of ERP with respect to its implementation in Chinaover the last ten years or so, particularly since 2001. Due to the high failure rate of ERPimplementation in China (Zhang et al., 2002), businesses have been very hesitant toimplement ERP systems despite the benefits that ERP systems can bring tobusinesses, so hesitant that they have been willing to forgo the subsidies the Chinesegovernment offers to businesses choosing to implement ERP systems.

The result is a keen ambivalence in Chinese firms as they consider the subject ofimplementing ERP systems. A common practice among curious businesses is to visitand learn from companies that have implemented ERP systems, and most largecompanies are even willing to visit foreign companies in their respective industries,

VariableEnd-user

– USAEnd-user– China

Difference(USA vsChina)

t-value of thedifference p . jtja

Argument for change 3.01 (1.23) 2.91 (2.04) 0.10 0.862 ,0.389Ease of use 3.05 (1.48) 2.04 (1.92) 1.01 8.879 ,0.000Personal relevance oftechnology 3.18 (1.41) 3.17 (2.03) 0.01 0.085 ,0.932Satisfaction with technology 3.17 (1.36) 3.07 (2.09) 0.10 0.836 ,0.403Training 2.95 (1.67) 1.72 (1.51) 1.23 12.303 ,0.000Communication 2.99 (1.98) 2.06 (1.69) 0.93 8.411 ,0.000Shared beliefs 2.99 (1.39) 1.72 (1.39) 1.27 13.854 ,0.000

Note: aAn equal variances assumed (two-tailed)

Table V.Comparison of US

end-users and Chineseend-users on variables

(mean scores)

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hoping to understand the potential of ERP systems and how best to implement thesystem at home. In the steel industry, for instance, many Chinese steel companies havevisited POSCO in Korea for this very purpose. These visits do not always allay fearsabout implementing the system, but they do drive home the sense that globalcompetitors have already made the switch. Chinese companies are increasingly afraidthat they will become non-competitive if they postpone ERP implementation. Thisperplexing situation has resulted in a famous phase: “invite extinction if youimplement ERP systems; wait for extinction if you do not implement them”.

ConclusionThis study replicates Amoako-Gyampah’s study (2004), which compares theperception of managers and end-users on seven ERP implementation factors. Theresults of this study confirm the results of Amoako-Gyampah’s study (2004), whichdemonstrates that significant differences do exist in the perception of managers andend-users. It further shows that both managers and end-users of Chinese companiesrate all seven factors lower than do their US counterparts. The understanding of thesedifferences reveals the current stage of the progress of ERP implementation in China,namely that ERP implementation is not perceived as positively by Chinese managersand end-users as it is by their counterparts in the USA. These findings are significantin terms of practical implications but also future research implications. Forpractitioners, understanding the differences that exist in the perceptions of differentgroups within an organization and the nature of these differences can helpimplementers develop appropriate change management mechanisms – such astraining, communication, and others – to improve the chances of successful ERPimplementation. Furthermore, it also highlights the importance of developingappropriate change management mechanism based on the information technologymaturity in an organization. For ERP vendors and consulting companies, thesefindings will assist them in addressing issues and concerns while planning for ERPimplementation for companies in developing countries, particularly in China.

For researchers, this study provides a foundation for further investigation of thereasons for such differences among different groups and individuals as well as differentcultures. Based on the result of this study, the authors conjecture that each individual(managers and end-users) may have very different concerns in various stages of an ERPimplementation in an organization. Nevertheless, due to the fact that data of this studywas collected from one pharmaceutical company only in China, the results are hinderedto be generalized to all companies in China. Perceptions of managers and end-users indifferent industries can be different due to organizational/internal factors such as ITmaturity, IT/ERP experience and business process management experience, etc. (Huangand Palvia, 2001). It is suggested that future research can collect data from companiesacross multiple industries to investigate the similarities and dissimilarities across andbetween industries. Since, only seven CSFs are included in this study, future researchshould also look into other CSFs that have been identified in literature for furtherunderstanding of differences of perceptions of managers and end-users across industriesand countries. It would be also interesting and useful to study companies in otherdeveloping countries such as India and Brazil, etc.

The data of this study was collected from one pharmaceutical company in China.Consequently, the external validity can be enhanced by collecting data across

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various industries. Another potential limitation of this study was that only a limitednumber of CSFs was employed. Future research can include other pertinent CSFs inERP implementation to further investigate the potential differences between managersand end-users as well as their counterparts in other developing countries such as Chinaand India (Huang and Palvia, 2001). Finally, this study was inherently hindered by nottreating the ERP implementation as a process model (Markus and Tanis, 2000; Nahet al., 2001) where the importance of various CSFs can be perceived differently. Forinstance, it could be more important to communicate the project plan, scope, andexpectations in the early stage of ERP implementation, namely the charting phase ofthe Markus and Tanis (2000) process-oriented ERP life cycle model (Nah et al., 2001);yet it is important to communicate the progress of the project throughout the wholeERP implementation project. It is most effective to conduct training of the use of ERPsystem right before the system goes live and continuously provide user training afterimplementation yet, it is important to educate the cross-functional benefits ofimplementing ERP system in the early stage of ERP implementation project.

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Appendix. Items for the survey

0 1 2 3 4 5 6 7

0: Not applicable 1: Disagreement 7: Agreement

Argument for change. I perceive that the ERP information technology is world-class.. I perceive that the ERP information system would enhance the ability of the company to

handle new business opportunities.. I perceive that the ERP information system would allow various functional units in the

organization to work better with each other.. I perceive that the ERP information system would facilitate better customer service

compared to the legacy system it was replacing.

Ease of use. I feel confident about my abilities to get the ERP information system to do what they

want.. I feel that learning to use the ERP information system would be easy.

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Personal relevance. I feel that the ERP information system would be useful in my job.. I feel that the ERP information system would increase my productivity on the job.. I feel that the ERP information system would be responsive to my changing job demands.. I would like to develop working relationships with both our colleagues and outside peer

group using the ERP information system.. I am concerned that after the implementation of the ERP information system,

my professional position in the organization would be influenced.. I would like to know who will make the decisions in the new system.. I clearly know about my responsibility in the new the ERP information system.. I think that after the implementation of the ERP information system, I am able to

accommodate various changes following with the new system.

Satisfaction with technology. I feel that the ERP information system would be able to provide the integrated

information.. I feel that the ERP information system would be able to provide the accurate information.. I feel that the ERP information system would be able to provide the timely information.. I feel that the ERP information system would be able to provide the reliable information.. I feel that the ERP information system would be better than the one it is replacing.

Training. I think that the training about the ERP information system is long enough.. I think that the training about the ERP information system is detail enough.. I am confident that I am able to use the ERP information system after going through the

training program.. I am satisfied with the knowledge level of the trainers.. I think that the trainers are very helpful for me to learn how to use the ERP information

system.. I believe that I have increased in my level of understanding the ERP information system

after the training program.. I feel that the timing of training is rational.. I feel that the timing of training is helpful for my perception of training effectiveness.

Communication. I think that the communication aimed at explaining the benefits of the technology is

effective.. I think that the communication aimed at explaining the benefits of the technology is

timely.. I think that the communication to demonstrate aspects of the conversion process is

effective.. I think that the communication to demonstrate aspects of the conversion process is timely.

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. I think that the communication to inform employees about the project’s progress andchanges is effective.

. I think that the communication to inform employees about the project’s progress andchanges is timely.

Shared beliefs. I believe in the benefits of the ERP information system very much.. I think that our management team believes in the benefits of the system.. I think that my peers believe in the benefits of the system.. I feel that the top management supports the implementation of the ERP information

system very much.. I think that the mediation efforts of consultants play a great role during the

implementation of the ERP information system.

About the authorsFrank Lin is the Associate Dean of Graduate and International Programs in the College ofBusiness and Public Administration at California State University, San Bernardino. He is also afull professor of Information and Decision Sciences in the College. He received his PhD inManagement Information Systems with minors in Computer Science and EducationalPsychology and an MBA in Management Information Systems from State University ofNew York at Buffalo (SUNY Buffalo). He has published articles and monographs in books andjournals such as MIS Quarterly and Journal of International Information Management as well asinternational, national, and regional conferences. He has received a number of grants and/or giftsfrom National Science Foundation, Department of Defense, Oracle Corp., GTE and MicrosoftCorp. among others. His current research interests are in information systems and technologyplanning, organizational modeling, enterprise architecture, information security, systemsanalysis and design, innovation and technological implementation, business processreengineering, human-computer interaction, theory development, performance management,entrepreneurship, leadership, global management, online education, and research methodologyin information systems. He is the Associate Editor of the Journal of International Technology andInformation Management. Frank Lin is the corresponding author and can be contacted at:[email protected]

C.E. Tapie Rohm is a Professor and former founding Department Chair of Information andDecision Sciences at California State University, San Bernardino. He holds a doctorate degreefrom Ohio University. He is the Editor-in-Chief of two journals: Journal of InternationalTechnology and Information Management and Communications of the IIMA.

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