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Extending the ERP system: considering the business relationship portfolio

Peter Ekman (School of Business, Society and Engineering, Mälardalen University, Västera˚s, Sweden)
Peter Thilenius (Department of Business Studies, Uppsala University, Uppsala, Sweden and School of Business, Society and Engineering, Mälardalen University, Västera˚s, Sweden)
Torbjörn Windahl (School of Business, Society and Engineering, Mälardalen University, Västera˚s, Sweden)

Business Process Management Journal

ISSN: 1463-7154

Article publication date: 27 May 2014

2207

Abstract

Purpose

Research has shown that companies focus their internal processes when they adopt enterprise resource planning (ERP) systems. However, the ERP systems need to expand their functionality to include customers and suppliers (with e-commerce functionality) to reach their full potential. The purpose of this paper is to consider business relationships as a resource but also a limitation when companies strive to get an extended ERP system.

Design/methodology/approach

The paper presents an illustrative case study of an industrial company's process of developing an extended ERP and how the company's portfolio of business relationships has affected the solution. The analysis is supported by the markets-as-networks theory.

Findings

The process of developing an extended ERP system needs to incorporate the company's business partners (customers and suppliers). It is a simultaneously bottom-up and top-down process given that the operative frontline staff hold the knowledge about the company's business relationships while the corporate management has the means of extending the ERP system functionality and align it with the focal company's strategy.

Research limitations/implications

Companies need to consider the fact that the technological and financial status of their customers and suppliers differ. Thus, an effective and flexible extended ERP system needs to include both a high-end and low-end solution as well as understand that a full interorganizational integration might not be realistic.

Originality/value

The paper puts forth business relationship portfolios as an important factor to consider when extending the ERP system functionality in the supply chain and toward customers.

Keywords

Acknowledgements

This study was partly financed by the EU-project “Automation Region” and by Handelsbanken's Research Foundations.

Citation

Ekman, P., Thilenius, P. and Windahl, T. (2014), "Extending the ERP system: considering the business relationship portfolio", Business Process Management Journal, Vol. 20 No. 3, pp. 480-501. https://doi.org/10.1108/BPMJ-08-2012-0085

Publisher

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Emerald Group Publishing Limited

Copyright © 2014, Emerald Group Publishing Limited

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