Sharing Knowledge As A Tool To Accelerate.doc

SHARING KNOWLEDGE AS A TOOL TO ACCELERATE ENTERPRISE RESOURCES PLANNING IMPLEMENTATION PROCESSES IN INDUSTRY Zeplin.J.H. Tarigana,b, Djumilah Zainb, Surachmanb, Djumahirb a

Industrial Engineering Department, Petra Christian University, Surabaya, Indonesia b Management Department, Brawijaya University, Malang, Indonesia Email: [email protected]

ABSTRACT

ERP system is a technology to coordinate and integrate information system in a company and inter-companies on business processes area. It is used by word class manufactures to increase their performance. From many research results, it is found that ERP implementation can improve enterprise performance quickly but some of them say’s the enterprise was fail. ERP system is a complex and expensive system, so in implementation is needed a tool which is capable to change company organization culture. To accelerate implementation of ERP, organization culture components like key user affectivity team, commitment of top management, end user competency, vendor knowledge and consultant experience is needed. This paper discusses a conceptual framework of the interaction effect of above components in changing organization culture. This research tries to explain ERP implementation success in Indonesian enterprise especially on East Java. Key-words: sharing knowledge, ERP implementation, key user affectivity.

1. INTRODUCTION Enterprise resource planning (ERP), when successfully implemented, links all areas of a company including order management, manufacturing, human resources, financial systems, and distribution with external suppliers and customers into a tightly integrated system with shared data and visibility (Chen, 2001). Potential benefits include drastic declines in inventory, breakthrough reductions in working capital, abundant information about customer wants and needs, along with the ability to view and manage the extended enterprise of suppliers, alliances, and customers as an integrated. ERP traces its roots to material requirements planning (MRP) and manufacturing resource planning (MRP II). To better comprehend the ERP planning and implementation issues, therefore, a fundamental understanding of the MRP and MRP II mechanisms is essential. Thus, the evolution of ERP is described in the next section. Planning for

ERP adoption generally occurs when an organization recognizes that current business processes and procedures are inadequate for their current and/or future strategic needs. There have been a few papers recently published on the factors contributing to ERP implementation. Sun et al., (2001) proposed a conceptual model exploring the cost; schedule and objective have an impact on enterprise systems (ES) implementation. Xue et al., (2005) described organization culture; organization environment, technical issue and partnership are successes factor ERP implementation. Huang and Palvia (2001) proposed ten factors (at the national/environmental and organizational level) concerning ERP implementation by making a comparison of advanced and developing countries. The national/environmental factors identified by them are economy and economic growth, infrastructure, regional environment, government regulations, and manufacturing strengths. They also noted that information technology maturity, computer culture, business size, business process re-engineering experience, and management commitment are the

organizational level factors. Huang and Palvia (2001) did not categorize the factors into those that contribute to success and those that contribute to failure. Hong and Kim (2002) described data, process and user are organizational fit of ERP, When ERP implementation involves adapting the existing business processes to the standard business process of ERP, other organizational components (e.g. organizational structure, measurement compensation, organizational culture, training, etc.) and their interactions must also be changed together. Implementation of ERP in industry ERP are large, complex and often require fundamental changes to the way organizations perform processes. Organizational knowledge must be incorporated into an ERP system so that the system has a sufficient underlying knowledge structure to achieve this support. Knowledge is a multifaceted concept and is embedded within many entities in an organization including the organization’s culture, policies, documents, and members themselves. Because ERP system requires to integrated processes across department in organization, one of the most important areas of knowledge sharing in an ERP implementation is sharing of the knowledge that individual’s process about processes and business frameworks. Key user must to know Top management objective with ERP system. Vendor and Consultant understanding the business process in organization when a key user or end user explains their department business process. Organizational culture influences member’s attitudes towards knowledge sharing and because knowledge sharing is critical to successful ERP implementation, it is important to understand the relationship between organizational culture and knowledge sharing and develop theory that contributes to successful ERP implementation. This research explores how dimensions of culture influence knowledge sharing as a tool to accelerate ERP implementation. They are key user teams, vendor and consultant, top management and end user in organization to implementation ERP.

2. KEY USER TEAMS The overall life cycle of adoption and use of ERP systems within the ultimate user organization may be the responsibility of a special group whom are usually termed key-users; they are selected from operating departments and must be intimately familiar with business processes and have domain knowledge of their areas. They will be the developers of the requirements for the ultimate system. Key users, as a group, must help to select the appropriate vendor and act with them and any implementation contractor in completing the requirements definition and implementation phases.

Phase implementation where the contractors work under the direction by the key-user project team in ERP implementation. In an ERP outsourcing environment, because the systems are configurable IS packages, customization generally involves intense cooperation between key-users and contractors. When the ERP system has been implemented, the key-users train their end users, so end user know that their function (Fig.1).

ERP Vendors

Implementation

ERP Cosultants

Interaction

ERP Systems

Experience & Knowledge Module’s ERP

Top Management

Key User

Objective & Business Process

Sharing Knowledge of Module’s ERP

End User

Figure .1. Sharing in ERP Implementation

3. TOP MANAGEMENT Many studies have stressed the importance of top management support as a necessary ingredient in successful ERP implementation. Commitment and leadership in the upper echelons of management are often cited as the most important factors of a successful BPR project (Bradford & Florin, 2003; Sun et al., 2005; Umble et al., 2003; Zhang et al., 2005; Hammer, 1990; Jackson, 1997). Management comitment is a sucsess factor to implementation ERP (Umble et al., 2003; Soja, 2006; Nah et al., 2001; Aladwani, 2001; Mabert et al., 2001). Management has been efective, strong, visible, and creative in thinking and understanding in order to provide a clear vision of the future. This vision must be clearly communicated to a wide range of employees who then become involved and motivated rather than directly guided. This research focus in this variable how management sharing and communication objective company and business process with key user and end user in customize ERP system.

4. VENDOR AND CONSULTANT

Vendor is the people who have developed the ERP packages. They are the people who have invested time and effort in research and development to create the packaged solutions. The ERP vendors spent money in research to come up innovations that make the package more efficient, flexible, and easy to implement and use. Business consultant is professionals who specialize in developing technique and methodologies for dealing with the implementation. They are expert in the administration, management and control of these type of projects. Consultant is responsible for administering each of the phases of the implementation. Consultant and key user discussing the current company processes in an effort to promote better businesses practices and better implementation result. The consultant will leave once the project is complete, but the knowledge of the project must stay within key user and end user in the organization. Business Process Reengineering RIP (1996) description in research was result failure implementation because a poor implementation by consultant. So explain with Grover, et al., (1995) lack of external consultant support for implementation ERP. Indicator in variable vendor and consultant the research use i.e. domain knowledge, related experience, project management, technical competency and training (Wu & Wang, 2007).

5. SATISFACTION END USER STRATEGIC PERFORMANCE These are the people who will be using the ERP system once it is in place. These are the people who were doing the functions that are being automated or computerized by the ERP system. With the implementation of the ERP system, the old job descriptions will change, the nature of the job will undergo drastic transformation (Davenport and Nohria, 1994; Hammer, 1990), ERP implementation to be a radical change in organization system. It is human nature to resist change. Job profiles will change and people will be forced to develop new skill. If the company can succeed in making its employees accept this fact and assist in making the transformation, then the major obstacle in the path of an ERP implementation. Indicators we use in variable end user i.e. understand theory Business Process Reengineering (RIP, 1996), understand modules and theory ERP (Grover et al., 1995; Davenport, 1993; Alter, 1990), quantity and quality training ERP (Grover et al., 1995; Davenport, 1993; Hall et al., 1993).

6. SHARING KNOWLEDGE Many factor to influences on knowledge sharing, and it is difficult to examine knowledge sharing separately from the factors. Sharing knowledge and experience vendor & consultant for customize objective and business processes industry with top management, team

project (key user) and end user in implementation module’s ERP system. For example, the coordination top management function and control influence are factors that are both rooted in organizational culture and influence the structure of decision making and the flow of knowledge through that structure (Jones et. al., 2006). Knowledge is embedded in the broader context of culture, and that culture influences the way organizational members share what they know. It focuses on organizational culture as a procedure and business process of shared values that define what is important and that guide organizational members’ attitudes and behaviors. Indicator in variable sharing knowledge i.e. team project members to understand processes in modules ERP, team project have change orientation in core business process, team project believe collaboration in sharing knowledge is more effective and efficient than individual (Jones et. al. 2006), member of team project understand and adequate determination of scope change (Hammer and Champy, 1993).

7. RESEARCH HYPOTHESIS CONCEPTUAL FRAMEWORK

AND

ERP software conjoins functional areas and business processes in an integrated environment that provides a broad scope of applicability for organizations. The acquisition of ERP software is not without its challenges. At a cost of several hundreds of thousands or even millions of dollars, the acquisition of ERP software is a high-expenditure activity that consumes a significant portion of their capital budgets (Verville & Halingten, 2002). As such, the research questions for the study were: ``How do sharing knowledge to accelerate implementation ERP in organizations?'', ``What are the processes that are involved for sharing knowledge ERP Modules?'' A model conceptual framework for measure the affect ERP product to increase enterprise performance in Fig. 2

Top Management Comitment

H1

H5 H4

H2

Vendor & Consultant Services

Effectivity Key User

End User Satisfaction

H6

Sharing Knowledge

H3

Figure .2. Model Sharing Knowledge as a Tool to

Accelerate ERP Implementation

H1

H2 H3 H4

H5

H6

= “Top management commitment” have a positive relationship with more effectively to design implementation ERP by “key user team ERP”. = “Top management commitment have a positive relationship with “end user satisfaction” to use module ERP. = “Vendors and consultant” have a positive relationship with “sharing knowledge” to accelerate implementation ERP. = “Key user project team ERP” have a positive relationship with “sharing knowledge” to accelerate implementation ERP in context experience and knowledge. = “Effectively key user project team ERP” have a positive relationship with sharing knowledge to accelerate implementation ERP in clear objective and business process. = “End user satisfaction” have a positive relationship with sharing knowledge to accelerate implementation ERP in preparing data management.

8. CONCLUDING REMARKS In this paper, we had discussed a model conceptual frame work for sharing knowledge as a tool to accelerate ERP Implementation. In this research we focus on sharing knowledge and experience vendor & consultant for customize objective and business processes industry with top management, team project (key user) and end user in implementation module’s ERP system. From review of any literatures, we developed 6 hypotheses that connected the top management commitment give a clear objective and business process to effectively key user project team ERP, top management commitment give a satisfaction for end user in preparing data management. Vendor and consultant sharing knowledge and experience with key user and end user to customize and accelerate ERP implementation.

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