Examining the strategic impact of using enterprise systems in manufacturing businesses

Ullmann, Kay Dirk (2001) Examining the strategic impact of using enterprise systems in manufacturing businesses. Doctoral thesis, University of London: London Business School.

Abstract

This study examines the strategic impact of enterprise system use at the business unit level. It does this from two different strategic perspectives, the resource-based and the activity-based views. This study also looks at the context of an enterprise system's implementation in order to identify the impact that it has on the realisation of the system's benefits. The purpose of this study is to examine whether the impact of enterprise systems goes beyond cost savings and other operational improvements. It also aims to shed some light on the 'enterprise system paradox', i. e. the apparent contrast between their evident popularity and widespread use, and the observed high variance of implementation success rates. Moreover, it aims at making a contribution towards the development of a theory that links the use of enterprise systems to firm performance, and predicts how contextual factors can affect this chain of causality. The lack of theory in this field and the ambiguity surrounding the enterprise system paradox provide motivation for this research. Data was collected in a series of five in-depth case studies. A positive impact was found on relevant strategic resources, dynamic capabilities and critical value chain elements; thus highlighting the strategic relevance of enterprise systems. At- the same time, a substantial variance in impact was found, providing further evidence for the enterprise system paradox. Some of this variance was explained by the use of business process reengineering as part of an enterprise system's implementation, and the integration of formerly separate information systems into a single system. The product/process structure of a business and its strategic configuration were also found to explain differences in the strategic impact of enterprise systems. Some variance, however, remains unexplained. This highlights the infant stage of enterprise system research.