Outcomes from ERP system upgrade

According to the literature, with new IT systems, organisations achieve a number of enhanced organisational capabilities (El Sawy & Pavlou 2008) including alignment of IT infrastructure, IT-enabled business capabilities, improved knowledge management and improved organisational performance. When asked about the outcomes and improvements the organisation achieved from the ERP system upgrade at Case One, the CIO explained that they now had a system that was flexible enough to meet the changing demands in each business unit. However, he explained that the most important outcome was data visibility for quick decisions and analytics for data-driven decisions:

Chapter Five: Case Study Findings

Since we upgraded the ERP system, we have a flexible IT system which supports the business directions of each of the three business units. The upgraded system allows us to access greater volumes of data from integrated business functions and processes supporting these functions, units and partners. Greater access to data helps monitor performance against plans

[CIO].

From this response, the most obvious enhanced organisational capability was big data management. Due to data analytics and visibility, better decision-making for business was achieved by being able to monitor online real-time information on all business activities. An ability to manage higher volumes of data resulted in greater flexibility to meet changes in the business.

The ERP system upgrade also led to better process integration enabling easier monitoring of production, inventory, sales, accounts payable and accounts receivable data in real-time from all business partners. The Senior IT Officer explained that:

The better data and processes integration among our subsidiaries help us to make good decision on choosing the right production plant to manufacture goods and distribute products to our subsidiary companies. Well, the intercompany stock transfer and billing payment functions with the upgraded ERP system supported our subsidiary companies to better manage and monitor inventory and sales [Senior IT Officer, Cement-Building

Materials].

This demonstrates that better decision-making for business management was facilitated through improved data management. Furthermore, better data integration also increased the ability to better manage and trade materials and products among the subsidiaries, hence enhancing better products and sales management. The Senior IT Officer at Cement-Building Materials unit further explained that:

In terms of production and sales, the upgraded single ERP system supported us to operate the system more conveniently for trading materials and products across our subsidiary companies. We also gained more accurate, real-time data from these end-to-end processes in the upgraded ERP system which improved our products and sales management [Senior IT Officer,

Cement-Building Materials].

As mentioned earlier, the organisation changed their chart of accounts. This enabled them to improve and standardise their financial and accounting process and procedure for use across the organisation, business units and subsidiaries as well as align with new functionalities of the upgraded ERP system. The organisation enhanced its ability to integrate larger volumes of financial data across the organisation and business partners both domestically and internationally. The online, real-time financial data supported the organisation to make decisions on business management more efficiently and maintain competitiveness. The CIO stated that:

The upgraded ERP system integrated data from all business functions in our organisation and from business partners which reflected our current business operation and financial status. For instance, the process automation from all modules of the upgraded ERP system integrated and provided useful financial data which supported our decision-making and gained us competitive advantage over the competitors. Additionally, we were able to consolidate financial data from all business units and subsidiaries as well as close our accounting period faster with the upgraded ERP system. It helped us to improve our financial management [CIO].

As the CIO explained, the ERP system upgrade improved the integration of larger volumes of data from all business aspects. This enabled the organisation to access transparent financial data and to undertake strategic decision-making as well as improved financial management in the organisation.

Chapter Five: Case Study Findings

The organisation also gained access to HR data from the ESS due to the upgraded HR module. This module equipped top management with the tools to improve people management. The CIO stated that:

Well, I was informed that from the upgraded ERP system our HR department gained better data access on employees than our previous system. Now, the HRM system is more automated, and gathering all data which is required for reports is easier. We are able to run individual employee reports which we call ‘One Page.’ It contains information on each employee. This report supports our management to make better decisions on promoting employees to higher levels and internal job transfer in our organisation

[CIO].

The above comment implies that improved ESS functions with the new ERP version provides valuable employee information from all business functions across the organisation. This supports management in making better decisions for their HRM.

Furthermore, the new ESS function allowed the employees to manage their own information that led to reduced HR operation time and supported employees in performing their responsibilities more efficiently. The Corporate HRM Assistant Manager explained that:

With the use of the new HRM module from the new system I noticed that we gained accurate online real-time HR information from the system. Our employees were able to manage their own information via ESS online. They did not have to prepare paper documents anymore. It also reduced HRM administrative officers’ work load [Corporate HRM Assistant Manager].

The upgraded ERP system enables a single platform for developing training modules and knowledge sharing to support employees to self-learn and increase their understanding of new applications made possible by the upgraded ERP system. These learning platforms were also accessible via

mobile technologies, giving employees greater flexibility in managing their information. As explained by the Corporate HRM Assistant Manager:

I believed that everyone who participated in the upgraded ERP project had shared their knowledge and learned many new things such as learning new functions and how to use the new system [Corporate HRM Assistant

Manager].

Furthermore, the Supply Chain Process Improvement Manager at Chemicals added that online learning of ERP system upgrade was available for all employees to access:

I developed a SharePoint platform as a learning web application which is like a Wiki for all partners of our company to learn about the upgraded ERP modules. We prepared training material and training video clips for our users [Supply Chain Process Improvement Manager, Chemicals].

The CIO also further described that:

We had a learning management system that provided online courses for our employees. These online courses could be accessed via mobile devices. We deployed this system over the last two years. To date, we still use this system and also perform e-ethics testing with this system. This is mandatory for our 30,000 employees to do online test via the mobile devices, the results of which are sent back to the upgraded HR system for personnel evaluation [CIO].

The upgraded ERP system enables online and mobile learning and enhanced knowledge sharing among employees via the HR learning management module. The organisation is able to develop online learning modules on any topic to train employees to train and to inform them of upgrades to the ERP system.

The findings above show that the organisation enhanced various capabilities with the ERP system upgrade. Improved organisational performance was achieved along with better integration of larger volumes of data and big data management, improved decision-making due to enhanced data visibility and

Chapter Five: Case Study Findings

data analytics. Online real-time data from the upgraded ERP system improved finance management and enhanced communication across the organisation. Additionally, the new functionalities of the upgraded ERP system, such as intercompany procurement efficiency, ESS and HRM generally were improved.

When asked about productivity improvements achieved from the upgraded system, the respondents indicated that they did not have any hard evidence at the time of the interviews. None of the documents recorded any productivity improvements either. Therefore, since productivity improvements are usually long-term (Beheshti & Beheshti 2010), it was not possible to establish exact figures or amounts for productivity improvement achieved from the ERP system upgrade at Case One.