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    Be Involved: Implementing SaaS ERP Systems for SMEs
    Be Involved: Implementing SaaS ERP Systems for SMEs
    Be Involved: Implementing SaaS ERP Systems for SMEs
    Ebook64 pages47 minutes

    Be Involved: Implementing SaaS ERP Systems for SMEs

    By Robert Sammut

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    About this ebook

    In recent years delivering information services over the internet – cloud computing - quickly became a new trend to attract the low-cost markets. ERP vendors targeting SMEs saw an opportunity to exploit the software-as-a-service (SaaS) model to deliver ERP solutions. SaaS became an attractive solution for small businesses as it reduced the initial hardware and software licensing expenses that had scared most small enterprises away. Some researchers even refer to SaaS-Based ERP systems as a new third generation of ERP following the client-server and mainframes architectures. Although SaaS provided these intuitive advantages over previous architectures the challenges of implementing ERP systems in SMEs still remain. Indeed the adoption rate of SaaS-Based ERP systems has remained low compared to other information systems delivered on the cloud in the past years.

    LanguageEnglish
    PublisherRobert Sammut
    Release dateJun 16, 2013
    ISBN9781301771042
    Be Involved: Implementing SaaS ERP Systems for SMEs

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      Book preview

      Be Involved - Robert Sammut

      Be Involved - Implementing SaaS ERP Systems for SMEs

      Robert Sammut

      Published by Robert Sammut at Smashwords

      Copyright 2013 Robert Sammut

      Contents

      1 Abstract

      2 ICT and SME overview

      2.1 Micro, small and medium-sized enterprises (SMEs)

      2.2 Key characteristics of SMEs

      2.3 Adoption and implementation explained

      2.4 ICT adoption by SMEs

      3 Enterprise Resource Planning (ERP) systems

      3.1 ERP definition

      3.2 Brief evolution of ERP systems

      3.3 Challenges of ERP adoption by SMEs

      3.4 Can SaaS address the ERP adoption challenges for SMEs?

      4 ERP implementation in SMEs

      4.1 Critical Success Factors

      4.2 Evaluation and assessment of existing ERP implementation strategies

      5 Recommendations

      6 References

      Abstract

      Implementing an enterprise system in SMEs has never been any easy task. SMEs account for the majority of enterprises in today’s economy (Ghobakhloo et al. 2010) making them an attracting sector for ERP vendors. But due to the complexity of the system, an ERP was initially considered too expensive for small businesses (Johansson and Bjørn-Andersen 2007). The saturation of the high-end market following the Y2K problem and Euro currency changeover (Deep et al. 2008) increased the necessity to research ERP adoption by SMEs. Cheaper hardware and Government programmes to help the SME sector have facilitated the IT adoption by SMEs, but the less visible challenges to successfully adopt and implement an ERP system still remain (Buonanno et al. 2005). For this reason, ERP vendors and research centres are investigating new methods to deliver their enterprise systems to smaller businesses at an affordable price.

      In recent years delivering information services over the internet – cloud computing - quickly became a new trend to attract the low-cost markets (Torbacki 2008). ERP vendors targeting SMEs saw an opportunity to exploit the software-as-a-service (SaaS) model to deliver ERP solutions (Benlian et al. 2009). SaaS became an attractive solution for small businesses as it reduced the initial hardware and software licensing expenses that had scared most small enterprises away (Barot et al. 2010). Some researchers even refer to SaaS-Based ERP systems as a new third generation of ERP following the client-server and mainframes architectures (Johansson and Bjørn-Andersen 2007). Although SaaS provided these intuitive advantages over previous architectures the challenges of implementing ERP systems in SMEs still remain (Benlian et al. 2009). Indeed the adoption rate of SaaS-Based ERP systems has remained low compared to other information systems delivered on the cloud in the past years (Gartner 2010).

      Implementing an ERP system can be complicated due to the business alignment required. This alignment is generally done by software customizations or business process re-engineering. Both options require extensive efforts from the customer and vendors which often involve external consultants (Holland and Light 1999). Delivering ERP over a SaaS architecture still has to overcome implementation challenges. Although the implementation difficulties in a small business can be smaller when compared to a large enterprise, there are different challenges due to lower financial resources and lack of business alignment awareness from business owners (Levy and Powell 2005). The risk with the SaaS model is that small businesses subscribe to a SaaS ERP provider but fail to implement the ERP successfully. Although SaaS subscriptions can be high due to affordable rates, customer conversions can remain low. In essence providing an ERP as a software service might require a different implementation strategy than that of selling an ERP as a software product.

      ICT and SME overview

      Micro, small and medium-sized enterprises (SMEs)

      It is not a surprise that the global economy relies heavily on SMEs, the largest segment of

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