Proceedings of the 41st International Conference on Computers & Industrial Engineering

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1 Surveying Enterprise Resource Planning (ERP) success factors in governmental organizations in Middle East Seyed Mohamad Mahdi kazemi Department of Endustrial Engineering, Damavand Branch, Islamic Azad Univesity, Tehran, Iran, , Seyed hossien Iranmanesh Department of Industrial Engineering, Damavand Branch, Islamic Azad Univesity, Tehran, Iran Seyed Mohamad kazemi Department of Endustrial Engineering, Lenjan Branch, Islamic Azad Univesity, Isfahan, Iran Abstract Implementing enterprise resource planning (ERP) is an important factor for organizations to consider. However, ERP software is too expensive and the failure rate of implementation is high. ERP software selection is an important step because it affects of all aspects of an organizations production and service methodology. It is obvious that ERP selection is becoming increasingly more difficult as new competitors emerge. In this paper, we will look at success factors of ERP implementation then we will survey the mentioned factors in the Ministry of commerce in Iran. Keywords: ERP- Success factors- Implementation-Organization- Information Technology 1. Introduction Although enterprise resources planning (ERP) implementation has been one of the most significant challenges of the last decade, it comes with a surprisingly high failure rate due to its high-risk nature. We mentioned ERP failure factors in Meadle East in another paper of the same authors(iranmanesh, Kazemi et al. 2011). The risks of ERP implementation, which involve both technical and social uncertainties, must be effectively managed(wu, Ong et al. 2008). Companies must take risk both to launch new products and to innovate themselves. However, risk processes do not require a strategy of risk avoidance but an early diagnosis and management (Keizer, Halman et al. 2002). Given the high risk of failure associated with enterprise system implementation projects(scott and Vessey 2002) (Sumner 2000)special attention to critical success factors in ERP implementation is necessary. These success factors range from technical know-how and expertise to people and organization-management skills required during a typical ERP implementation project (Holland and Light 2001; Lee, Siau et al. 2003) Developing the technology side of an ERP to cover all organizational processes can lead to successful outcomes only if it is accompanied by the evolution of human capabilities to understand the implications and handle the consequences of the new system and business processes defined for it(worley, Chatha et al. 2005). Enterprise system as a technology is designed to enable firms to better manage their knowledge by integration of business processes and to have better control of information and data in the organization. Ironically, to implement the technology that is aimed at improving the sharing and integrity of information and knowledge in the firms, organizations must have the capability of effective knowledge sharing to start with (Jones 2005). A great deal of time, effort, and cost has been directed toward the implementation of enterprise resource planning (ERP) systems (Al-Mashari 2003). Research of ERP implementation has mainly focused on initial startup (Markus, Tanis et al. 2000; Holland and Light 2001; Nah, Lau et al. 2001)However, there's another important phase named post-implementation support that is not as well-known. The start-up of an ERP system is a milestone and not important as a goal but if there is an incident inaccurate idea that says it's a final goal, this may cause a failure after a successful start-up. Folowing factors were found to be critical to ERP implementation success ERP teamwork and composition; change management program and culture; top management support; business plan and vision; business process reengineering with minimum customization; project management; monitoring 975

2 and evaluation of performance; effective communication; software development, testing, and troubleshooting; project champion; appropriate business and IT legacy systems(nah, Lau et al. 2001). ERP provides two major benefits that do not exist in non-integrated departmental systems: 1) a unified enterprise view of business that encompasses all functions and departments; and 2) an enterprise database where all business transactions are entered, recorded, processed, monitored, and reported (Davenport 2000; Umble, Haft et al. 2003). The acquisition of ERP software is a high-expenditure activity that consumes a significant portion of the company s capital budget. It is also an activity that is fraught with a high level of risk and uncertainty. This highlights the obvious need for making the right choice of software with the proper evaluation method (Verville and Halingten 2000). Many academic researchers and practitioners internationally have worked on the issue of software selection. Most of the proposed approaches are variants of the multi-criteria analysis, trying to define the final value of every available selection based on a set of criteria. Various attempts toward the formulation of the software selection problem (especially of production planning and control software) are reported by (Wortmann 1984), (Tatsiopoulos 1989; Tatsiopoulos 1990). At the same time, companies difficulty in adopting complicated mathematical models that require a significant amount of data, led many researchers and practitioners to design less-advanced models from a theoretical point of view, but easier and more effective from a practical one. The software selection issue has been covered by many consulting companies, but with dubious results. The selection of one of many software products for the implementation of specific business processes is the most typical of a series of problems that is called "software evaluation" (Vlahavas, Stamelos et al. 1999), (Anderson and Chen 1997). Many other problems may arise, such as the decision whether to develop a new product or acquire an existing commercial product with similar requirements. On the other hand, software evaluation may have different points of view and may concern various parts of the software itself, its production process, and its maintenance. Thus, software evaluation is not a simple technical activity, but a decision process where subjectivity and uncertainty are present without any possibility of arbitrary reduction. In recent years, research has focused on specific software characteristics, such as models and methods for the evaluation of the quality of software products and software production process (Fenton 1991), (Kitchenham 1987), (Miyoshi and Azuma 1993), (Schneidewind 1993), (Vollman 1993), (Zahedi 1990), (Kontio 1996). According to (Stamelos and Tsouki s 2003) some typical decisions that are related to software evaluation, include the following: Keep legacy system or replace it Make software or buy Commercial software product evaluation Tender evaluation Software certification Software process evaluation Software system design selection The software selection issue is a complicated decision-making problem, using many and, often, contradictory criteria that should be included in the final decision. Toward the solution of similar problems, Multi-Criteria Decision Aid (MCDA) has proved very useful(nikolaos, Sotiris et al. 2005). Succes factors can guide us to have appropriate ERP selection and that helps to success. In other hand by considering the success factors, we would have better implementation. 2- Success factors in governmental organizations in Middle East 976

3 According to Interviews, system data and surveys and mining processes, sub processes and Activity cards in a number governmental organizations in Middle East such as the Ministry of commerce in Iran (due to commercial reasons the number of the above cannot be mentioned) The following factors were identified as success factors in ERP implementation. We have to say some of these factors are the same with similar organizations in Europe and China and some are different ERP training should be held for the organization top managers and the importance, benefits, organizational requirements and software and hardware requirements of this issue for successful ERP implementation should be stated Justify top managers and gain their support which needs to provide economic and operational feasibility of ERP implementation for them To have briefing sessions for middle managers, executives and employees to state necessity of ERP implementation and the positive results of its successful implementation To have appropriate ERP selection process and have sufficient time and budget allocation We offer to pattern from similar organizations in different countries. We should mention that complete is not appropriate for the organization, but it partly shows the way We offer to develop the culture in different layers of managers and key employees and replace some employees that have traditional attitudes and resist against any change by appropriate person Training Certified domestic consultants along with Using of foreign consultants We offer to develop knowledge sharing and implement knowledge management in this region's organization. We should say that most of the organizations of this region have not implemented KM We offer to make process oriented look at the organization and re-engineering processes We offer to have effective project management. We should mention that one of the weaknesses in this region is weaknesses in project management We should have appropriate vendor support (Zhang, Lee et al. 2003). In many cases we studied, one of the major problems was weak support of vendor companies. 977

4 3- Conclusions One of the most important factors of an ERP implementation is the region of the organizations. Different organizations of different region have different cultures, behaviours, conditions, facilities and laws and these issues will affect successful ERP implementation. According to Interviews, system data and surveys and mining processes, sub processes and Activity cards in the Ministry of commerce in Iran, We have consulted with consultants and experts within the organization and outside the organization. We suggest that for successful implementation and achieving results, we change some processes of the organization. Due to the extent of this organization, we recommend the implementation of knowledge management and modification of the above factors. We can start from one of the key parts of the organization and if the implementation was successful then we can extend the implementation to whole organization. Finally, we developed a costum methodology of ERP selection in the mentioned organization but the expression is not currently available for commercial reasons. 4-References 1. Al-Mashari, M. (2003). "Enterprise resource planning (ERP) systems: a research agenda." Industrial Management and Data Systems 103(1): Anderson, E. and Y. Chen (1997). "Microcomputer software evaluation: An econometric model." Decision Support Systems 19(2): Davenport, T. (2000). "Mission Critical: Realizing the Promise of Enterprise Systems Harvard Business School Press." Cambridge, MA. 4. Fenton, N. (1991). Software metrics: a rigorous approach, Chapman & Hall, Ltd. London, UK, UK. 5. Holland, C. and B. Light (2001). "A stage maturity model for enterprise resource planning systems use." ACM SIGMIS Database 32(2): Iranmanesh, S., S. Kazemi, et al. (2011). Surveying Enterprise Resource Planning (ERP) failure factors in governmental organizations in Middle East. 41st International Conference on Computers and Industrial Engineering (CIE41), campus of the University of Southern California in Los Angeles, California, USA. 7. Jones, M. (2005). "Tacit Knowledge Sharing During ERP Implementation." Information Resources Management Journal 18(2): Keizer, J., J. Halman, et al. (2002). "From experience: applying the risk diagnosing methodology." Journal of Product Innovation Management 19(3): Kitchenham, B. (1987). "Towards a constructive quality model." 10. Kontio, J. (1996). A case study in applying a systematic method for COTS selection, IEEE Computer Society. 11. Lee, J., K. Siau, et al. (2003). "Enterprise Integration with ERP and EAI." Communications of the ACM 46(2): Markus, M., C. Tanis, et al. (2000). "Enterprise resource planning: multisite ERP implementations." Communications of the ACM 43(4):

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