The purpose of this paper is to help managers to successfully plan, implement, and operate enterprise resource planning (ERP) projects using a risk management framework.
This paper adopted a combined literature review and case study method. Using literature review, the paper first identified major issues of managing ERP projects and develops a risk management framework for managing those issues. The proposed risk management framework was then applied to a ERP implementation project of a UK‐based energy services group and its effectiveness for managing ERP projects implementation had been demonstrated. Additionally, the risk factors as identified from the case application are compared with the risk factors from the previous researches so as to suggest mitigating measures.
All the risk factors are categorized into planning, implementation and operations phases along with project processes, organizational transformation and information technology (IT) perspectives. Project implementation phase is the most vulnerable to failure. The case study results reveal that the effect of other projects on on‐going ERP project, management of overall IT architecture and non‐availability of resources for organizational transformation are most critical from likelihood and impact perspectives. Managing risk across various phases of project and equal emphasize to effective project management, organizational transformation and IT adoption are the key to success in ERP implementation.
The risk factors, which were identified using literature review and the case study, have great significance as mitigating measures of those risks may result successful implementation of ERP projects in the industry. Additionally, proposed risk management framework could be customized to implement ERP projects elsewhere.
ERP projects are risky as they are capital intensive, technically complex, and call for organizational transformation. There are both success and failure stories. However, both researchers and practitioners agree, that if it can be implemented and operated successfully and benefits should be achievable. Although there are many studies on ERP implementation, little has been discussed on managing risks of ERP projects. Therefore, this paper bridges the gap.
Dey, P.K., Clegg, B.T. and Bennett, D.J. (2010), "Managing enterprise resource planning projects", Business Process Management Journal, Vol. 16 No. 2, pp. 282-296. https://doi.org/10.1108/14637151011035606Download as .RIS
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