Int. J. Management and Enterprise Development, Vol. 4, No.

5, 2007 533
Enterprise resource planning: an integrated
strategic framework
Sumit Chakraborty
Indian Institute of Management Calcutta
Joka, Diamond Harbour Road
Kolkata 700104, West Bengal, India
E-mail: sumitrty@iimcal.ac.in
Sushil K. Sharma*
Miller College of Business
Ball State University
Muncie, IN 47306, USA
E-mail: ssharma@bsu.edu
*Corresponding author
Abstract: The implementation of ERP systems is a complex undertaking with
wide-reaching impact on key stakeholders including staff and customers. As
many as 90% of all initiated ERP implementation projects can be regarded as
failures as a result of changes in scope, prolongation of the project time or
simply budget overruns. This paper presents an integrated strategic framework
that could be useful for identifying parameters which may help the ERP
implementation process become successful. The integrated strategic framework
is developed through a real case study implementation.
Keywords: Enterprise Resource Planning; ERP; enterprise systems; ERP
implementation; technology management; strategic framework.
Reference to this paper should be made as follows: Chakraborty, S. and
Sharma, S.K. (2007) Enterprise resource planning: an integrated strategic
framework, Int. J. Management and Enterprise Development, Vol. 4, No. 5,
pp.533551.
Biographical notes: Sumit Chakraborty graduated with a degree in Electrical
Engineering from Jadavpur University, India in 1994. He has working
experience in an ERP environment. Presently, he is pursuing his Fellow
Programme in Management Information System at the Indian Institute of
Management Calcutta. His research interests include ERP, EAI and artificial
neural networks in finance.
Dr. Sushil K. Sharma is Associate Professor of Information Systems and
Operations Management at Ball State University, Muncie, Indiana, USA. He is
co-author of two textbooks and co-editor of four books, Dr. Sharmas research
contributions have appeared in many peer-reviewed national and international
journals, conferences and seminars proceedings. His primary teaching and
research interests are in e-commerce, information systems security, ERP
systems, database management systems, and knowledge management. He has
a wide consulting experience in information systems and e-commerce and
has served as an advisor and consultant to several government and private
organisations including projects funded by the World Bank.

Copyright 2007 Inderscience Enterprises Ltd.






















534 S. Chakraborty and S.K. Sharma
1 Introduction
Enterprise Resource Planning (ERP) systems may well count as the most important
development in the corporate use of information technology in the 1990s (Davenport,
1998). ERP is now being hailed as a foundation for the integration of organisation-wide
information systems. ERP systems link together entire organisations operations such as
accounting, finance, human resources, manufacturing and distribution, etc. Moreover,
they also connect the organisation to its customers and suppliers through the different
stages of the product or the process life cycle (Gulledge and Sommer, 2004; Adam and
Sammon, 2004). ERP implementations are usually large, complex projects, involving
numerous people working together under considerable time pressure and facing many
unforeseen developments. Not surprisingly, many of these implementations turn out to be
less successful than originally intended (Davenport, 1998; Adam and Sammon, 2004).
Over the past few years, considerable research has been conducted on identifying Critical
Success Factors (CSFs) for ERP implementations and IT implementations in general
(Tsai et al., 2005; Akkermans and Helden, 2002; Hong and Kim, 2002; Sumner, 1999;
Umble et al., 2003). Such factors typically include top management support, sound
planning, end user training, vendor relations, project champions, interdepartmental
collaboration and communication (Somers and Nelson, 2001; Davenport, 2000; Hillman
et al., 2001; Parr and Shanks, 2000; Zrimsek et al., 2001). ERP systems implementations
are regarded as costly, time and resource consuming and at times its return on investment
is debatable. Despite technologically best software, the implementation may not
necessarily yield the desired and expected results (Sharma et al., 2006; Whyte and
Fortune, 2002). Several ERP systems researchers have pointed out that as many as 90%
of all ERP implementations are either late or over budget (Akkermans and Helden, 2002;
Hong and Kim, 2002; Sumner, 1999; Umble et al., 2003). Although, few researchers
argue that metrics for measuring success itself may not be an appropriate since success is
a difficult construct to identify because it is multidimensional, dynamic and relative
(Aladwani, 2001; Al-Mashari et al., 2003; Staehr et al., 2004).
While many studies have identified CSFs for ERP implementation or identified
the metrics for measuring the success of ERP implementation, this paper presents an
integrated strategic framework to identify a few parameters which may help the ERP
implementation process become successful (Lee et al., 2006). The integrated strategic
framework is developed through a real life case study implementation. Our strategic
framework is based on process research that helps us understand successful ERP
implementation efforts. In this paper, we describe our integrated strategic framework
that is developed as a perfect combination or fit of four sets of factors critical for
the success of any ERP project internal enabling conditions, enterprise application
domain, technology schema and external enabling conditions. Most ERP initiatives
fail due to the inability of the entrepreneurs to recognise the importance of the fit and
their tendency to concentrate only on a few of these factors and ignore the others
(Allen and Kern, 2001).



























Enterprise resource planning: an integrated strategic framework 535

2 Literature survey
ERP systems have been defined as enterprise-wide packages that tightly integrate
business functions into a single system with a shared database (Aladwani, 2001; Hall,
2002). They have also been characterised as comprehensive software solutions that
integrate organisational processes through shared information and data flows (Mandal
and Gunasekaran, 2003). Thus, ERP systems are marketed as a vehicle for integrating the
core business activities of an enterprise, such as finance, logistics and human resources,
and as a means of overcoming problems associated with so-called legacy systems. ERP
systems are promoted as systems that will improve organisational efficiency through both
enhanced information capture and organisational redesign around defined best practices
(Gulledge et al., 2005).
A review of literature reveals many different research streams. One stream focuses
on identification of decision-making variables for ERP selection and implementation
(Mabert, 2002; Mabert et al., 2001; Mandal and Gunasekaran, 2003; Markus et al., 2000;
Shakir, 2001).
Another research stream focuses on identifying the metrics for measuring the
successful implementations (Jacobs and Bendoly, 2003). This stream has created further
research agendas because the literature on ERP success and/or failure is inconclusive.
One of the reasons behind these different views lies in the multidimensionality of the
concept of success and the difficulty of developing a single success/failure measurement
(Al-Mashari et al., 2003; Bingi et al., 1999; Davenport, 1998; DeLone and McLean,
2003; Gable et al., 2003; Shang and Seddon, 2002).
The third stream focuses on identification of CSFs for ERP implementations and
risk management in IT implementations in general (Kyung and Kim, 2002; Holland
and Light, 1999; Sumner, 1999; Umble et al., 2003; Somers and Nelson, 2001). Although
powerful explanations and valuable insights and recommendations are presented in CSFs
stream, they seem disjointed and most often one-dimensional. Therefore, we have
developed an integrated strategic framework wherein we identify fit of four sets of
factors critical for success of ERP projects internal enabling conditions, enterprise
application domain, technology scheme and external enabling conditions. A strategic
framework is important for ERP implementations since strategic decisions commit
resources or set precedents. Prior studies suggested that strategic decisions process would
positively contribute to the success of enterprise systems implementations (Sarkis and
Sundarraj, 2000; Parr and Shanks, 2000).
3 Methodology
This research adopts an interpretivist approach and grounded theory approach. The
strengths of the interpretivist paradigm in IS research have been reported in a number of
studies, notably Klein and Myers (1999) and Walsham (1995). Grounded Theory (GT)
method is a general methodology providing guidelines for data collection, analysis and
inductive theory building. The purpose of the GT method is to develop theoretically
comprehensive explanations about a particular phenomenon (Glaser and Strauss, 1967).
According to Haig (1995), grounded theory is one that is inductively derived from data
subjected to theoretical elaboration and judged adequate to its domain with respect to a























536 S. Chakraborty and S.K. Sharma
number of evaluation criteria. The main procedures of GT methodology are open coding,
axial coding and selective coding. Open coding is basically labelling concepts that
represent discrete happenings and other instances of the phenomena. After open coding,
data are put back together in new ways through axial coding, by making connections
between categories. Selective coding is the process of selecting the core category,
systematically relating it to other categories, validating those relationships, and filling in
categories that need further refinement and development (Haig, 1995). The GT method
has been applied in studies of a number of information systems during the last decade.
First, we reviewed relevant literature and analysed a few exploratory case studies.
The case study approach has been selected to support analytical rather than statistical
generalisation. Case studies capture reality in considerably greater detail and allow for
analysis of a greater number of variables. We also utilised our personal experience with
ERP in some Indian companies.
Our original case data were collected over two years, spanning the entire period from
the early start of the implementation of the ERP system to its operational use. We
collected information on project success and ascribed causes for it from company
representatives in three different instances. The first time, we had interaction with
company executives as business consultants. The second time, we sent independent
interviewers armed with a semi-structured questionnaire just after the ERP system had
gone live. Almost one year later, we returned to discuss our latest insights, based on a
comparison of this case with other ERP implementations (Akkermans and Helden, 2002).
In line with the above philosophical tradition and its implications in IS research,
an interpretivist case study using grounded theory approach (Walsham, 1995) was
conducted between 2001 and 2003 as a means of understanding social actors meanings
and actions related to the implementation and management of ERP systems. The
theoretical integrated strategic framework was developed further to examine success
factors in context of ERP implementation success.
4 Case study background
Company ABC, a major multinational player in the engineering industry, designs
and manufactures standard and custom-built products and provides consulting services
for corporate clients from over 70 countries worldwide. More than 60 000 employees
across the globe generate sales turnover in excess of $8 billion during 2000 alone. The
company ABC was one of the leading electrical and electronics engineering companies
of India. It was a multinational company having a widespread marketing and distribution
network in addition to multiple manufacturing facilities throughout India. The company
was operating in various business segments like power, health care, transportation,
information and communication technology. During 19981999, the market of electrical
products was highly price-sensitive and competitive; brand loyalty was low. The
switching cost was not significant. The company failed to manage the supply chain
efficiently resulting in a low profit margin. The corporate management of the company
tried to identify major bottlenecks in Supply Chain Management (SCM) and finally
defined clear cut business objectives such as improvement in QoS, reduction in lead time
by minimising uncertainty, higher precision in forecasting, standardisation of business
processes and product components and stringent cost control. The major critical success
factors were identified as vendor management, accurate production scheduling, material























Enterprise resource planning: an integrated strategic framework 537

requirement planning, inventory management, strategic purchase, transport management
and financial accounting. Rigorous data analysis was essential for identification of gap in
SCM, purchase to payroll process, receivables management and financial accounting.
The company decided to implement SAPR3 version 4.0B for its panel manufacturing
plant through multiple phases first sales and distribution, logistics and finance modules
and then production planning and maintenance. The general manager of the plant
supervised the project.
The plant already had invested in IT for materials management in 1993 but that
project was not successful and could not satisfy users expectations. Initially, the support
from the general manager of the plant was low past experience and lack of knowledge
in IT solutions played a critical role in this connection. Moreover, he was not convinced
to commit dedicated experienced senior managers for system analysis and business
process reengineering. There was no communication from the leader to general users
regarding the major objectives of ERP implementation. Most of the people in the ERP
implementation team were young executives with a fair knowledge in IT but their overall
knowledge of business process operation was not promising. The project team was
trying to maintain the project schedule but failed to configure a master database in
time. Moreover, the gap analysis between as-is and to-be process could not produce
any innovative concept. Online display of dynamic production scheduling was essential
for improving process delays but the ERP implementation team failed to customise the
system accordingly. The time constraints, lack of in-depth knowledge and proper support
from the consultants were the major bottlenecks.
After one year, when the initial phase of implementation was completed, people
started to use Material Management (MM), Financial Accounting (FI) and Sales
Distribution (SD) modules. Initially, the users did not understand the strategic benefits
of ERP; they only used the system for transaction processing. In fact, they were not
properly trained and motivated to handle data and software applications. They made
serious mistakes in order processing and warehouse management which had cascading
effects in the integrated environment of ERP.
Initially, the users faced various types of technical problems such as satellite link
failure and network jamming. Their productivity was hampered due to a long back-up
process (34 days). The personnel department was using the HR module from a
Peoplesoft package with better features. The resulting use of two different ERP packages
for the same plant was a costly option. Users were not allowed to use the internet which
affected the global sourcing operation significantly. The master database was not
standardised as the task involved massive intelligent coding of data; most of the users
were busy in execution of day-to-day activities. The top management of the plant did
not commit adequate resources to complete the project successfully. The result was
not however, totally negative. Gradually, the plant executives learned to use ERP for
business process analysis. The ERP solutions acted as catalysts to improve the business
operation in terms of fast transaction processing, accurate MRP and reduction in
inventory (about 4%) and lead-time (approximately three weeks). The logistics
department could save substantial amounts of money through strategic purchases using
ERP. The corporate management of the company could identify the points of inefficiency
and financial corruption because of the transparency in information flow. They had a
better view of the whole process chain and the goal in cost control and formulation of
effective business strategy was achieved within three years.























538 S. Chakraborty and S.K. Sharma
5 Integrated strategic framework
The conceptual framework is, as previously stated, a framework comprised of a number
of un-weighted factors focusing on ERP implementation. This highlights the link
between the factors and positive outcomes to enhance utility, we developed a perfect
combination or fit of four sets of factors critical for success of ERP projects internal
enabling conditions, enterprise application domain, technology scheme and external
enabling conditions. The risk in ERP implementation can be classified into two
categories technical risk and business risk. The technical risk should be managed
through a well-defined technology scheme whereas the other three factors are useful to
manage the business risk, which is associated with high investment, time and cost
overrun and organisational environment.
5.1 The internal enabling conditions
Over the past two decades, the resource-based view of firms has become very important
for the study of firms, their processes and their performances. This has been an important
development in strategic management, since it produces potential answers to defining
question of this field why do some organisations perform better than others? (Adam and
Sammon, 2004). Resources can be distinguished as tangible and intangible. Tangible
resources include financial resources and physical resources whereas intangible resources
include assets such as skills, knowledge, managerial capabilities and firms reputation.
Over the past few years, considerable research has been conducted on CSFs related to
internal enabling conditions for ERP implementation. Somers and Nelson (2001) have
published a ranked list of CSFs and determined that internal enabling conditions are most
important factors in managing risk of ERP projects. Efficient change management is one
of the most critical success factors in ERP implementation. It ensures that an organisation
and its workforce are ready, willing and able to embrace the new business processes and
systems. The change management is a complex process (Figure 1). The change should
occur at various levels system, process, people and organisation.
Figure 1 Change management process
Explore the
need
or desire for
change in an
enterprise
Analysis of
empathy
probable
reaction of
workforce, i.e.,
resistive,
neutral or
acceptance
Tentative
planning
Implement
change through
efficient project
management
Time
scheduling, cost
budget and
project team
formation
Communication
of change
thereby creating
understanding
throughout the
organisation
Final decision
making through
group
discussion
Users
expectation
management
and review of
change through
participation
Source: Adapted from Kirkpatrick (2001)























Enterprise resource planning: an integrated strategic framework 539

Communication is the oil that ensures that everything works properly in any ERP
implementation since the primary objective of ERP is to integrate various business
functions (Akkermans and Helden, 2002). Managements honest determination to exert
and maintain its right to decide within a policy of fairness and openness is essential for
successful change management. An efficient leader creates understanding among his
workforce through proper communication. The most successful communication strategies
can be implemented by a network of project representatives throughout the enterprise.
The literature suggests that for many ERP roll-outs, top management support was low
at the initial stage and only limited to IT management or mid-level technical specialists
(Butler, 2004). After an initial crisis, senior management became actively involved
in decision-making process on those projects. However, if the corporate leaders
continuously intervenes in the activities of technical experts, the risk of ERP failure may
be high (Akkermans and Helden, 2002). Top management can tackle the complexity of
ERP implementation by developing a strong project team, which should be a right mix of
dedicated resources like technical and business experts.
Failure in change management may be the cause of delay in an ERP project. For
instance, Indian Renewable Energy Development Agency (IREDA) faced various types
of organisational problems in the implementation of as IFS package, which included
attitude of the employees and lack of sufficient IT knowledge (Garg and Venkatkrishnan,
2002). Lack of users knowledge created different types of operational problems during
the post implementation phase of ERP projects and ultimately affected business results.
What should be the ideal organisation model for enterprise resource planning? A
traditional functionally centred organisation model may not be suitable for ERP because
ERP is a tool for supporting end-to-end business processes. Such process management
is more than a way to improve the performance of individual processes; it is a way
to operate and manage a business. An enterprise that has institutionalised process
management and aligned management systems to support is a process enterprise
(Hall, 2002). Hammer (2002) defined various aspects of a process enterprise. It is centred
on its customers, managed around its processes and is aligned around a common,
customer-oriented goal. IT systems are integrated to support end-to-end processes. In
the case of Dell Computer Corporation, Ash and Burn (2003) emphasised the role of
change management and cultural readiness when adopting web-based ERP solutions. The
interrelationship among various CSFs related to internal enabling conditions is shown
in Figure 2.
Figure 2 Interrelationship among various factors related to internal enabling conditions
Communication
Management of
expectation
Participation
Change
management
Empathy
Project team
competence
Top management
support
Organisation
model























540 S. Chakraborty and S.K. Sharma
5.2 Enterprise application domain
The process of distributing funds for IT demands a vision of how the system will support
its core business processes. IT investment is determined by two critical factors strategic
objectives and technology scope. Strategic objectives highlight the trade-offs between
short-term profitability and long-term growth. Technology scope is categorised as shared
infrastructure and business solutions. There are four distinct types of investments on IT
transformation, renewal, process improvements and experiments (Ross and Beath,
2002). ERP is one of the most popular IT initiatives for transformation. Transformation
investments are necessary when an organisations core infrastructure limits its ability
to develop applications critical to long-term success. Funding transformation creates a
basis for long-term growth, but the payoff is not easily and quickly achieved. The value
does not come from installing the technology; it comes from changing operations,
management processes and cultures. Consequently, investments in ERP demand
significant commitment from top management on the basis of cost-benefit analysis. ERP
has the potential to be a strategic weapon. It is useful for gaining competitive advantages
to disturb, enhance or limit the competitive forces in a specific industry sector. It also
improves productivity and performances of an organisation and enables business process
management in an innovative, systematic way (Mashari et al., 2006).
It is now well understood and widely accepted that the web-enabled ERP
technologies a combination of internet, intranet, extranet and ERP solutions have the
potential to strategically impact traditional business models and processes by aiding
generation, storage, processing and distribution of information (Ray and Chakraborty,
2003). Keens (1991) differentiation of reach and range for IT platforms provides an
adequate framework for integration. Reach ranges from within location to all over
the world; range extends from single local support to cooperative transactions.
Organisational integration spans organisational boundaries from internal to external
process and organisational processes from internal team to external partners. The
complexity of ERP implementation is highly influenced by scope of enterprises and
organisation boundaries. There are important differences in how modern enterprises
have approached ERP technology. Researchers have identified four distinct approaches
to ERP local best of breed, global best of breed, local ERP, and global ERP.
1
Understanding these vastly different approaches is very crucial because they
determine what the business ultimately can and cannot accomplish with its back-office
operations. While a local best-of-breed approach may be fastest to implement, it
precludes an organisation from having real-time data on a worldwide basis. It may
be suitable for a niche player. In contrast, it is difficult for a global firm like Siemens
to manage the global supply chain as a single entity, or to coordinate raw materials
and production schedules across plants in different countries. For example, the
Bio-pharmaceutical companies that are finding big benefits just around the corner are
those that took a global ERP approach. Companies like Glaxo Welcome and Novo
Nordisk are creating manufacturing, distribution, procurement, and financial operations
that serve not just one or a few countries but rather an entire continent or even the world.
They are using ERP software for global supply chain management and are undertaking
massive consolidations in distribution, manufacturing MRP and inventory control, and
information processing operations for financial accounting and cost control. If the high

























Enterprise resource planning: an integrated strategic framework 541

level of perceived benefits from IT integration with ERP is present and the development
of an integrative value chain is a high priority, an organisation is more likely to adopt an
ERP system (Olhager and Selldin, 2003).
5.2.1 New dimensions of the ERP application domain
In this section, we discuss the effectiveness of the existing ERP application domain. Is
the existing domain of commercial ERP products sufficient for successful business
operation of an enterprise? Strategic grid analysis (McFarlan and McKenney, 1983;
adapted from Earl, 1989) is a very useful tool to understand why and how the ERP
application domain is critical to a particular firm. The grid is divided into four segments
along two dimensions strategic impact of existing operating systems and application
development portfolio. In the support segment, IT is considered as a support activity
to improve internal efficiency or productivity of various administrative functions and
requires average or below average investment. In the factory segment, IT is crucial for
reliable and efficient operation management and the IT budget will always be significant.
Also, an IT manager should possess a strong, credible position in the organisational
structure. In the Strategic segment, the business strategy and the future of an
organisation (e.g., the product marketing strategy of a financial service company) are
highly influenced by information technology. Investment in IT dominates the capital
budget structure of the firm. In turnaround segment, IT is essential for the survival and
growth of an organisation (e.g., retail chain management).
Now, the question is which segment is most appropriate to include in the ERP
domain? Traditionally, the application domain of ERP solutions is highly recommended
for strategic growth and turnaround options. In the factory segment, it is also useful for
large-scale complex business operations. For instance, a simple, cheap version of ERP
package may be considered for support option of the strategic grid. The future series of
ERP solutions should target this quadrant in future.
5.2.2 Enterprise Application Integration (EAI)
In the current networked environment, companies are moving their business transactions
to the web to better service their partners, customers, and employees, which requires a
technology infrastructure that connects front-end web servers and (customer relationship
management) CRM applications to back-end production systems like ERP and legacy
systems (Gupta and Iyer, 2003). EAI is the process of integrating multiple applications,
which have been developed and managed independently using incompatible technology.
In todays dynamic business environment, independent applications may not be
sufficiently fast or reliable. EAI is a new strategic option for IT management. The basic
objective of EAI is to automate the movement of data and process flow in intelligent
enterprises. In other words, EAI supports business process integration across the entire
organisation, between enterprises. The free flow of information and the invocation of
reusable services between applications are the essential requirements for enterprise
application integration (Linthicum, 2002).


























542 S. Chakraborty and S.K. Sharma
EAI is playing a critical role for the growth of the new generation, web-enabled and
integrated ERP products (Gable, 2002). To maximise the potential of both supply chain
and demand chain system, customers are now demanding new levels of integration and
interconnection so that ERP providers link their traditional systems with CRM and SCM
software and allow users to access it over the web (Gable, 2002). Customers are now
looking for an end-to-end solution that will move them towards creating a value chain
that ties everything together.
Scope creep is one of the most critical factors for ERP roll-outs. No doubt, clear
goals and objectives form a CSF for ERP implementation. But, it is really difficult in
reality to define the goals and objectives in a clear-cut manner. Hence, ERP initiatives
should be considered as new business ventures rather than as traditional IT projects. The
interrelationship among various factors related to an enterprise application domain has
been shown in following section (Figure 3).
Figure 3 Interrelationship among various factors related to an enterprise application domain
Enterprise application domain
Information content of
products/services
Information intensity
of value chain
Information
dispersion
Organisational
boundaries
Business intelligence
5.3 The technology schema
An ERP implementation effort needs to be positioned and managed primarily in terms of
creating new business process designs and secondarily in terms of installing a software
system to support those designs. Technically, an ERP system is a family of tightly
integrated software modules that share a common database and interface. ERP software
attempts to integrate databases, dataflows and systems even across different companies
and to streamline operations and reporting. So, a sound technological infrastructure is
the heart of any ERP solutions. Technology management involves four different schemas
computing, networking, data and application (Earl, 1989).
5.3.1 Computing schema
Computing schema is basically the principal information processing capability of
an information system. Computing architectural issues are associated with proper
assessment of IT infrastructure against business requirements and a local or global
approach to information flow control. For efficient decision making in an integrated
business model, the ideal IT architecture for ERP should be a Group Decision Support
























Enterprise resource planning: an integrated strategic framework 543

System (GDSS) on a collaborative platform. For instance, the web-enabled ERP system
with three-tiered architecture can work on both the intranet and the internet (Linthicum,
2002). Presentation tier or user interface tier interfaces with the users and consists of
hardware such as a PC or workstation and a web browser. This may consist of any
number of client machines. The functionality or business logic tier provides functionality
to the end users through business logic or application. It links the presentation and data
tiers. Any number of application servers can be put in this tier depending upon the
number of hits and the number of users. The Data tier includes the database holding all
the data of the organisation and this is encapsulated from the end users. Any number of
database servers can be put in this tier depending on the volume of transactions and
the amount of data. Such three-tiered architecture can provide many benefits in terms
of database migration and restructuring without substantially affecting the client
programmes, front-end modifications, isolation of the database from the front-end clients,
reduced database loading, ease in interfacing to other systems or applications, scalability,
platform independence and simplified implementation and customisations of the overall
ERP system.
5.3.2 Networking schema
The communication or networking schema is basically the estimation of wired and
wireless communication infrastructure and related hardware platform. Network managers
focus on three levels of networks. Local Area Networks (LAN) are used to link
local computer configuration whereas national networks often require LAN to link to a
local ERP computing scheme. Within a global ERP computing schema, international
networks are required to link national networks through the web. For instance, SAP
systems are designed as a client-server multi-tier architecture. The networking
architecture of SAP allows various communication protocols (e.g., TCP/IP, LU6.2)
between the elements of the configuration. Distributed satellite systems can also
be used to link individual local systems (e.g., DASS, EIS, LVS) (ASAP World
Consultancy et al., 1998).
It is a challenging task for network managers to build and maintain a robust, reliable
data communication infrastructure that can minimise interruption and downtime. There
are various issues involved in networking management, e.g., selection, monitoring and
maintenance of communication equipments, and proper evaluation of such technologies
on the basis of cost, reliability and accuracy (Donovan, 1988). Reliable system level
connectivity is one of the critical success factors for ERP projects.
Communication and networking technology is now going through an evolution
from a wired to a wireless era. The development of intelligent devices, the internet
and wireless technologies is providing new opportunities for RTEs to seamlessly extend
critical corporate data to mobile stakeholders. In the era of customer relationship
management, ERP should be used to implement process models through proper
utilisation of web and wireless communication infrastructure. Optimal sizing of
hardware, computing and networking schema is one of the critical issues in ERP
implementation, otherwise the cost of ERP project may rise unnecessarily. For
instance, one of the major pitfalls encountered in Jindal Iron And Steel Company
Limited during ERP implementation was inappropriate sizing of hardware (Garg and
Venkatkrishnan, 2002).























544 S. Chakraborty and S.K. Sharma
5.3.3 Data schema
Data are the most critical element of any information system. The Data schema includes
several critical issues like definition and coding of data, data conversion, data loading
and data warehousing mechanisms. ERP solutions are complex, integrated software
packages, which can be used by companies in different industries through proper
configuration. Configuration enables an ERP package to be tailored to support
the specific business processes of a company without modifying the base software
(ASAP World Consultancy et al., 1998).
A master database is the heart of any ERP system. Data on the master record are
stored in the form of different views. Data is also stored at various organisation levels;
these levels represent the legal and internal framework of a company in which all
business transactions are processed. Efficient definition and coding of data is essential for
fast transaction processing, transparency of information and standardisation of business
processes. It also helps to improve accuracy in information flow and elimination of data
overloading (Garg and Venkatkrishnan, 2002).
A master database is divided into different categories material, vendor, customer,
HR and general ledger (G/L) accounts (ASAP World Consultancy et al., 1998). Pressed
for time, many organisations have failed to define data schema appropriately. For
instance, the breaker control switch division of Alstom did not consider some special
product models during the master database design. There was no revision of the product
manual. The information was not known to the customers, they placed orders according
to product manuals and faced problems in timely delivery of products.
5.3.4 Application schema
The Application schema is concerned with proper selection of an ERP package, modules
and Business Application Interface (BAPI) system. An ERP package should be evaluated
with respect to various aspects vendor support, global and local presence in the market,
target market of the package, price, modularity, obsolescence, ease of implementation,
cost of implementation and post implementation support (Garg and Venkatkrishnan,
2002). Consultants should also be selected on the basis of skill set, industry specific
experience, installation base and financial criteria. An Application schema also defines
basic system control in terms of system monitoring, performance measurement and
optimisation, optimising the load distribution in the client server environment, time
controlled distribution of system resources, various types of system services including
backup management, recovery and security of the system. An enterprise may have
knowledgeable users and substantial resources, but lack of focus on such basic issues
may be the cause of ERP failure. The overall objective is to design a simple,
reliable, efficient, secured system with proper customisation and standardisation of the
ERP solutions.
The effectiveness of technology management should be evaluated by two factors
technical quality of existing information system and business value of the system to its
users (Earl, 1989). The technical quality indicates the reliability, scope of maintenance
and cost-efficiency of the system. The business value is basically the impact of the
system on business, the frequency and ease of use. For instance, if the technical quality
and business values are low, the existing information system of an enterprise should be
























Enterprise resource planning: an integrated strategic framework 545

divested and an ERP may be an optimal solution in selection of technology platform.
Of course, the experts should consider other critical factors such as financial health, cost
structure and major business objectives of the enterprise. The interrelationship among
various CSFs related to the technology schema is shown in Figure 4.
Figure 4 ERP technology schema
Enterprise application
integration
Enterprise application domain
Outsourcing
policy
Computing
schema
Application
schema
Data
schema
Networking
schema
Vendor support Consultant support
Organisation model
ERP benefits cannot be fully realised unless a strong coupling and reconciliation
mechanism is established between technical and organisational imperatives based on
the principles of process orientation. ERP benefits are realised when a tight link is
established between implementation approach and business process performance
measures (Al-Mashari et al., 2003).
5.4 External enabling conditions
Although, an enterprise may be capable of managing both technical and business risk,
there may be a still chance of failure in ERP implementation since the external
environment may be responsible for such failure. External enabling conditions include
environmental factors such as communication infrastructure and quality of people in a
country. The success of ERP is now associated with a collaborative platform among
suppliers, manufacturers and customers through internet. The quality of modern
communication and web infrastructure like bandwidth surely influences the success of
ERP implementation of a firm (Bubak et al., 2006).
The quality of people depends on their education, basic understanding of business
management and information technology and educational policy introduced by
the government of a country. ERP will not be successful for all countries. A global
firm should be highly conscious of external environmental factors when formulating
its ERP implementation plan for its business units in specific countries. The
interrelationship among various CSFs related to external enabling conditions is shown
in Figure 5.

























546 S. Chakraborty and S.K. Sharma
Figure 5 External enabling conditions
External environment
Government support
IT infrastructure Quality of people
Industry competition
6 Discussion
In this section, we reflect our research findings in the form of propositions.
Proposition 1 The list of CSFs as compiled by Somers and Nelson (2001) and
Akkermans and Helden (2002) are not adequate to explain success
and failure of ERP implementation projects.
Nelson et al. have considered only internal organisational factors. But, external enabling
conditions can play a critical role in ERP implementation. Nelson and Sommers have not
considered various issues related to application and networking schema. In this paper, we
have tried to integrate four different schemas computing, networking, data and
application. Combination of such technology schema should be essential for successful
enterprise resource planning.
Proposition 2 ERP is a business process management concept based on technology
deployment to increase efficiency, enhance process transparency and
economic viability and improve communication with the stakeholders
of any enterprise irrespective of size, scale and complexity of
business operations.
According to the traditional concept, ERP is suitable for large and complex business
operations. Actually, ERP is a business strategy, not only a software application. The
new generation of ERP solutions should target small and medium firms to achieve
market leadership. Detailed research on market of ERP products can give more
transparency in this connection.
Proposition 3 EAI is a critical strategic option for ERP in smart,
intelligent enterprises.
Modern intelligent enterprises can explore new application domains of ERP through
smart web-enabled and integrated ERP products and can sense and respond to
fast-changing requirements of customers, business opportunities and turbulent market
conditions resulting in high level of organisational agility and unprecedented business
value. EAI is the basic building block of modular corporations.























Enterprise resource planning: an integrated strategic framework 547

Proposition 4 Outsourcing can offer various strategic, technological and economic
advantages to a smart enterprise for ERP.
Outsourcing can play a critical role in an ERP. The success of outsourcing may
be controlled by various factors quality of service provided by vendors, level of
outsourcing and various organisational factors like quality of partnership, age of
relationship, level of information sharing and product features. The impact of outsourcing
on ERP can be an important research agenda in future.
Proposition 5 Process enterprise is an appropriate organisation model for ERP.
Process managers should follow some critical steps before ERP implementations
identification of core processes in the value chain; communication throughout the
organisation about these critical processes; creation and deployment of measures
regarding end-to-end process performance and defining of process owners with
end-to-end authority for process design, resource procurement, process monitoring for
redesign and improvement. This culture of process enterprises is essential for effective
enterprise resource planning.
Proposition 6 The strategic fits are causally linked in such a way that they reinforce
ERP implementation. Also, there are interrelationships among some
strategic fits.
Here, we have shown the interrelationships among various factors of the proposed
strategic framework (Figure 6). From this paper, it is clear that all four strategic fits
have significant effects on implementation of ERP system. The technology scheme is
positively controlled by all four schemas computing, networking, data and application.
Also, it can be observed that there are interrelationships among some strategic fits.
For instance, the enterprise application domain should be selected on the basis of
internal enabling conditions of an enterprise. On the other side, the enterprise application
domain is the most critical factor to define an efficient technology schema. Moreover,
external-enabling conditions can influence the internal enabling conditions and
technology schema of an enterprise in a significant way. Most ERP initiatives fail due to
the inability of the entrepreneurs and managers to recognise the importance of the fit
and their tendency to concentrate only on a few of these factors and ignore others.
Figure 6 Integrated strategic framework of ERP
Enterprise
resource planning
External enabling
conditions
Enterprise
application domain
Technology
schema
Internal enabling
conditions























548 S. Chakraborty and S.K. Sharma
7 Conclusion
ERP implementations are not only costly, time and resource consuming but are difficult
to manage and measure its success. ERP implementation involves many internal
and external factors and has a great impact on the organisation in terms of the risks
involved and the opportunities provided. In this paper we argue that successful ERP
implementation requires an integrated strategic framework. The suggested integrated
strategic framework that was tested through a case study provides effective parameters
that need to be addressed for successful ERP implementation. The paper also provides
theoretical specifications for generating a cumulative body of knowledge in the ERP
implementation area.
References
Sammon, D. and Adam, F. (2004) Towards a model for investigating non-decision making, The
Enterprise Resource Planning Era, Lessons Learned and Issues for the Future, Chap. XI,
Hershey, PA: Idea Publishing Group.
Akkermans, H. and Helden, K.V. (2002) Vicious and virtuous cycles in ERP implementations, a
case study of interrelations between critical success factors, European Journal of Information
Systems, Vol. 11, pp.3546.
Aladwani, A.M. (2001) Change management strategies for successful ERP implementation,
Business Process Management Journal, Vol. 7, No. 3, pp.266275.
Allen, D. and Kern, T. (2001) Enterprise resource planning implementation, stories of power,
politics, and resistance, Proceedings of the IFIP TC8/WG8.2 Working Conference on
Realigning Research and Practice in Information Systems Development, The Social and
Organizational Perspective, Boise, Idaho, pp.149162.
Al-Mashari, M., Al-Mudimigh, A. and Zairi, M. (2003) Enterprise resource planning, a taxonomy
of critical factors, European Journal of Operational Research, Vol. 146, pp.352364.
ASAP World Consultancy, et al. (1998) Using SAP
TM
R/3, India: Prentice Hall, No. 2.
Ash, C.G. and Burn, J.M. (2003) A strategic framework for the management of ERP enabled
e-business change, European Journal of Operational Research, Vol. 146, pp.374387.
Bingi, P., Sharma, M.K. and Godla, J.K. (1999) Critical issues affecting an ERP implementation,
Information Systems Management, Vol. 16, No. 3, pp.714.
Bubak, O., Farley, R.L., Goebels, C., Gonzalez, P., Gulledge, T.R. and Russell, R. (2006)
Implementing SAP from end-to-end business process scenarios, International Journal of
Management and Enterprise Development, Vol. 3, No. 5, pp.419437.
Butler, T. (2004) Examining the influence of ERP systems on firm-specific knowledge assets and
capabilities, in Adam and Sammon (Eds.) The Enterprise Resource Planning Decade,
Lessons Learned and Issues for the Future, IPG, Hershey, PA.
Davenport, T.H. (1998) Putting the enterprise into the enterprise system, Harvard Business
Review, Vol. 76, No. 4, pp.121132.
Davenport, T.H. (2000) Mission Critical, Realizing the Promise of Enterprise Systems, Boston,
MA: Harvard Business School Press.
DeLone, H.W. and McLean, R.E. (2003) The DeLone and McLean model of information systems
success, a ten-year update, Journal of Management Information Systems, Vol. 19, No. 4,
pp.930.
Donovan, J.J. (1988) Beyond chief information officer to network manager, Harvard Business
Review, SeptemberOctober, pp.34140.
Earl, M.J. (1989) Management Strategies for Information Technology, UK: Prentice Hall.























Enterprise resource planning: an integrated strategic framework 549

Gable, G. (2002) Enterprise application integration, Information Management Journal, pp.4850.
Gable, G., Sedera, D. and Chan, T. (2003) Enterprise systems success, a measurement model,
Proceedings of the Twenty Fourth Annual International Conference on Information Systems,
Washington, pp.576591.
Garg, V.K. and Venkatkrishnan, N.K. (2002) Enterprise Resource Planning Concepts and
Practices, India: Prentice Hall.
Glaser, B. and Strauss, A. (1967) The Discovery of Grounded Theory, Aldine Press.
Gulledge, T.R. and Sommer, R.A. (2004) Integrating e-business transactions across extended
enterprises, International Journal of Management and Enterprise Development, Vol. 1,
No. 2, pp.89101.
Gulledge, T.R., Sommer, R.A. and Vincent, J.P., Jr. (2005) An introduction to basic enterprise
resource planning concepts, International Journal of Management and Enterprise
Development, Vol. 2, No. 2, pp.204218.
Gupta, B. and Iyer, L.S. (2003) A theoretical framework for measuring the success of customer
relationship management outsourcing, in K. Kangas (Ed.) Business Strategies for Information
Technology Management, Hershey, PA: IRM Press.
Haig, B. (1995) Grounded theory as scientific method, Philosophy of Education Society, Illinois,
http//www.ed.uiuc.edu/EPS/PES-Yearbook/95_docs/haig.html.
Hall, R. (2002) Enterprise resource planning systems and organizational change, transforming
work or organization?, Strategic Change, Vol. 11, pp.263270.
Hammer, M. (2002) Process management and the future of six sigma, MIT Sloan Management
Review, Vol. 43, No. 2, pp.2632.
Hillman, W.T., Willis-Brown, A.H. and McMillan, A. (2001) Cost containment strategies for
ERP system implementations, Production and Inventory Management Journal, 2nd quarter,
pp.3642.
Holland, C.P. and Light, B. (1999) A critical success factor model for ERP implementation, IEEE
Software, Vol. 16, pp.3036.
Hong, K.K. and Kim, Y-G. (2002) The critical success factors for ERP implementation, an
organizational fit perspective, Information and Management, Vol. 40, pp.2540.
Jacobs, F.R. and Bendoly, E. (2003) Enterprise resource planning, developments and directions
for operations management research, European Journal of Operational Research, Vol. 146,
pp.233240.
Keen, P. (1991) Shaping the Future Business Design through Information Technology, Harvard
School Press.
Kirkpatrick, D.L. (2001) Managing Change Effectively, Butterworth Heinemann.
Klein, H. and Myers, M. (1999) A set of principles for conducting and evaluating interpretive field
studies in information systems, MIS Quarterly, Vol. 23, pp.6794.
Kyung, K.H. and Kim, Y. (2002) The critical success factors for ERP implementation, an
organizational fit perspective, Information and Management, Vol. 40, No. 1, pp.2540.
Lee, T., Moon, Y.B. and Lee, H. (2006) Enterprise resource planning survey of Korean
manufacturing firms, International Journal of Management and Enterprise Development,
Vol. 3, No. 6, pp.521533.
Linthicum, D.S. (2002) Enterprise Application Integration, Pearson Education Asia.
Mabert, V.A. (2002) Enterprise resource planning survey of US manufacturing firms, Production
and Inventory Management Journal, 2nd Quarter, pp.5258.
Mabert, V.A., Soni, A. and Venkataramanan, M.A. (2001) Enterprise resource planning, common
myths versus evolving reality, Business Horizon, MayJune.
Mandal, P. and Gunasekaran, A. (2003) Issues in implementing ERP, a case study, European
Journal of Operational Research, Vol. 146, pp.274283.























550 S. Chakraborty and S.K. Sharma
Markus, M.L., Axline, S., Petrie, D. and Tanis, C. (2000) Learning from adopters experiences
with ERP, problems encountered and success achieved, Journal of Information Technology,
Vol. 15, No. 4, pp.245265.
Mashari, M.A., Zairi, M. and Okazawa, K. (2006) Enterprise Resource Planning (ERP)
implementation: a useful road map, International Journal of Management and Enterprise
Development, Vol. 3, Nos. 12, pp.169180.
McFarlan, F.W. and McKenney, J.L. (1983) The information archipelago governing the new
world, Harvard Business Review, pp.9199.
Olhager, J. and Selldin, E. (2003) Enterprise resource planning survey of Swedish manufacturing
firms, European Journal of Operational Research, Vol. 146, pp.365373.
Parr, A. and Shanks, G. (2000) A model for ERP project implementation, Journal of Information
Technology, Vol. 15, pp.289303.
Ray, S. and Chakraborty, S. (2003) Business failure in the digital world, in D.K. Banwet,
S.S. Yadav and K. Momaya (Eds.) Management of Research & Development in the New
Millennium, India: Macmillan, pp.711722.
Ross, J.W. and Beath, C.M. (2002) Beyond the business case: new approaches to IT investment,
MIT Sloan Management Review, Winter, pp.5159.
Sarkis, J. and Sundarraj, R.P. (2000) Factors for strategic evaluation of enterprise information
technologies, International Journal of Physical Distribution and Logistics Management,
Vol. 30, Nos. 34, pp.196220.
Shakir, M. (2001) Understanding the strategic decision making process of ES implementations,
Res. Lett. Inf. Math. Sci., Vol. 2, pp.4753, http://www.massey.ac.nz/wwiims/%7Erlims,
http://www.massey.ac.nz/wwiims/~rlims.
Shang, S. and Seddon, B.P. (2002) Assessing and managing the benefits of enterprise systems,
the business managers perspective, Information Systems Journal, Vol. 12, pp.271299.
Sharma, S.K., Chen, C. and Sundaram, S. (2006) Implementation problems with ERP systems in
virtual enterprises/virtual organisations, International Journal of Management and Enterprise
Development, Vol. 3, No. 5, pp.491509.
Somers, T.M. and Nelson, K. (2001) The impact of critical success factors across the stages of
enterprise resource planning implementation, Proceedings of the 34th Hawaii International
Conference on System Science (HICSS-3).
Staehr, L., Shanks, G. and Seddon, P. (2004) Understanding the business consequences of ERP
systems, in Adam and Sammon (Eds.) The Enterprise Resource Planning Decade, Lessons
Learned and Issues for the Future, Hershey, PA: IPG.
Sumner, M. (1999) Critical success factors in enterprise wide information management
systems, Proceedings of the American Conference on Information Systems, Milwaukee, WI,
pp.232234.
Tsai, W.H., Chien, S.W., Hsu, P.Y. and Leu, J.D. (2005) Identification of critical failure
factors in the implementation of Enterprise Resource Planning (ERP) system in Taiwans
industries, International Journal of Management and Enterprise Development, Vol. 2, No. 2,
pp.219239.
Umble, E.J., Haft, R.R. and Umble, M.M. (2003) Enterprise resource planning, implementation
procedures and critical success factors, European Journal of Operational Research, Vol. 146,
pp.241257.
Walsham, G. (1995) The emergence of interpretivism in IS research, Information Systems
Research, Vol. 6, pp.376394.
Whyte, D. and Fortune, J. (2002) Current practice in project management an empirical study,
International Journal of Project Management, Vol. 20, pp.111.
Zrimsek, B., et al. (2001) Estimating the time and cost of ERP and ERP II projects, a 10-step
process, Gartner.























Enterprise resource planning: an integrated strategic framework 551

Bibliography
Aalders, R. (2001) The IT Outsourcing Guide, New York: John Wiley.
Abdinnour-Helm, S., Lengnick-Hall, M.L. and Lengnick-Hall, C.A. (2003) Pre-implementation
attitudes and organizational readiness for implementing an enterprise resource planning
system, European Journal of Operational Research, Vol. 146, pp.258273.
Canon, J.P. and Homburg, C. (2001) Buyers-supplier relationships and customer firm costs,
Journal of Marketing, Vol. 65, No. 1, pp.2943.
Glover, S.M., Prawitt, D.F. and Romney, M.B. (1999) Implementing ERP, Internal Auditor,
Vol. 56, pp.4045.
Ribbers, P.M.A. and Klaus-Clemens, S. (2002) Program management and complexity of ERP
implementations, Engineering Management Journal, Vol. 14, No. 2, pp.4552.
Skok, W. and Legge, M. (2001) Evaluating enterprise resource planning systems using an
interpretive approach, Proceedings of the (2001) ACM SIGCPR Conference on Computer
Personnel Research, San Diego, pp.89197.
Skok, W. and Legge, M. (2002) Evaluating Enterprise Resource Planning (ERP) systems using an
interpretive approach, Knowledge and Process Management, Vol. 9, No. 2, pp.7282.
Soffer, P., Golany, B. and Dori, D. (2003) ERP modeling, a comprehensive approach,
Information Systems, Vol. 28, pp.673690.
Sumner, M. (2000) Risk factors in enterprise-wide/ERP projects, Journal of Information
Technology, Vol. 15, pp.317327.
Umble, E.J. and Umble, M.M. (2002) Avoiding ERP implementation failure, Industrial
Management, Vol. 44, No. 1, pp.2535.
Yang, C. and Huang, J. (2000) A decision model for IS outsourcing, International Journal of
Information Management, Vol. 20, No. 3, pp.225239.
Note
1 http://www.urchpublishing.com/erp.htm
Appendix 1 Steps in ERP implementation
Scope analysis
Data uploading
and test runs
Customisation and master
database configuration
Gap analysis
for BPR
Evaluation of ERP packages
and selection of consultants
Programme planning and
formation of implementation
team
Installation of
hardware and networks
Decision on
TO-BE process
Evaluation of AS-IS process
User training
Migration
to the new system
System monitoring, analysis
and performance optimisation