Measuring ERP success: The key-users’ viewpoint of the ERP to produce a viable IS in the organization
Introduction
Enterprise resource planning (ERP) is now considered to be the price of entry for running a business (Kumar & van Hillegersberg, 2000). It integrates core corporate activities and diverse functions by incorporating best practices to facilitate rapid decision-making, cost reduction, and greater managerial control. However, ERP systems are complex and expensive, and the decision to install an ERP system necessitates a choice of mechanisms for determining whether the ERP is needed, and once implemented, whether it is successful. Although it may be more desirable to measure system success in terms of monetary costs and benefits, such measures are often not possible due to the difficulty of quantifying intangible system impacts and of isolating the effect of the information system from the numerous intervening environmental variables that may influence organizational performance (DeLone & McLean, 1992). Consequently, the user-satisfaction construct has often been used as a surrogate for information systems (IS) success or IS effectiveness (Doll et al., 1995, Harrison and Rainer, 1996, Huang et al., 2004, Ives et al., 1983). It is believed that satisfied users will be more productive, especially where usage is mandatory (Calisir & Calisir, 2004).
In an ERP implementation process, there are two main types of user: key-user and end-user. Key users are selected from operating departments and generally familiar with business processes and having domain knowledge of their areas. They will be the developers of the requirements for the ultimate system. In addition, key users will specialize in parts of the ERP system and act as trainers, help-desk resources, educators, advisors, and change agents for end users. In contrast to key users, end users are the ultimate users of the ERP system. They have only very specific knowledge of the parts of the system they need for their work (Hirt & Swanson, 1999). Therefore, key-users’ role is essential to the ultimate system’s success; the measurement of key-user satisfaction with the entire ERP experience coupled with the perception of success of the final IS product is the essential theme of this article. This study was initiated to show how to measure key-user satisfaction and to also offer a proof-by-analysis that ERP key-user satisfaction is closely related to perceived system success.
Section snippets
User satisfaction measurement
User satisfaction (US) is the sum of one’s feelings and attitudes toward a variety factors related to the delivery of information products and services (Ives et al., 1983). It is an overall measure of how satisfied a user is with his or her information system. Bailey and Pearson (1983) first developed a valid and useful US measure with 39 items. The instrument provides a broad and complete base of satisfaction-related themes. Building upon the work of Bailey and Pearson, Ives et al. (1983)
Research methods
A two-phased approach was used in constructing the measure:
- Phase 1.
Develop an initial measure list by taking results from the literature review and examining ERP characteristics and then determining whether it was complete and clear by using it in five interviews of key-users and consultants of ERP.
- Phase 2.
Revise the list accordingly and use it in a pilot test with 30 key-users of ERP systems. As a result, the initial survey instrument was extensively revised. The new instrument was then tested via a survey of
Survey methods and sample
Data were collected using a questionnaire survey administered in Taiwan. The top-1000 firms were included, but only those with ERP systems implemented by a vendor were selected. This provided a sample of 617 Taiwan firms; of these, 587 received initial phone calls explaining the purpose of our project and inquiring whether the firm would be willing to participate in the study. A contact person was identified at each company; this person was asked to distribute the self-administered
Item analysis and reliability estimates
Prior to conducting formal factor analysis, internal consistency (α-coefficient) had to be examined to ensure measures were unidimensional and to eliminate “garbage items” (Churchill, 1979, Sethi and King, 1991). The results showed the 18-item ERP key-user satisfaction instrument had a reliability of 0.916, indicating that the test would correlate well with true scores.
Correlations of each item with the sum of scores on all items were plotted in descending order. Items were eliminated if their
Confirmatory analysis
Fig. 2 shows that this research proposes a secondary-order factor model of ERP key-user satisfaction that consists of three first-order factors measured by 14 items. This model hypothesized that the three first-order factors were correlated and the correlations are statistically caused by the second-order factor. The LISREL 8.30 program was then used to test the model fit.
Conclusions and implications
This article represents significant progress toward development of a measure of key-user satisfaction in ERP environments. Building upon several previously validated instruments, the instrument merges the factors of ERP product, knowledge and involvement, and contractor service. The instrument appears to have adequate reliability and validity. The measurement tool developed here can contribute to a better understanding of the specific aspects of ERP systems in organizations. This is becoming
Acknowledgements
This research was supported by the National Science Council of Taiwan under the Grants NSC 93-2416-H-110-015 and NSC94-2416-H-025-002.
Jen-Her Wu is Professor of Information Management and Director of Institute of Health Care Management at National Sun Yat-Sen University. He has published two books (Systems Analysis and Design, Object Oriented Analysis and Design) and more than 40 papers in professional journals such as Computers in Human Behavior, Information & Management, Decision Support Systems, International Journal of Human-Computer Interaction, International Journal of Technology Management, Expert Systems, Knowledge
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Jen-Her Wu is Professor of Information Management and Director of Institute of Health Care Management at National Sun Yat-Sen University. He has published two books (Systems Analysis and Design, Object Oriented Analysis and Design) and more than 40 papers in professional journals such as Computers in Human Behavior, Information & Management, Decision Support Systems, International Journal of Human-Computer Interaction, International Journal of Technology Management, Expert Systems, Knowledge Acquisition, Journal of Computer Information Systems, and others. His current research interests include various aspects of information systems development and management, human computer interaction, and knowledge management.
Yu-Min Wang is an assistant professor of Information Management at National Chi Nan University. He has over 6 years of IT experiences in various organizations and positions. His research interests include information technology adoption and implementation, human computer interaction, ERP, and knowledge management. His works have been published in several journals and conference proceedings.
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