Skip to main content Accessibility help

We use cookies to distinguish you from other users and to provide you with a better experience on our websites. Close this message to accept cookies or find out how to manage your cookie settings.

Close cookie message
×
Hostname: page-component-745bb68f8f-grxwn Total loading time: 0 Render date: 2025-01-14T13:20:59.753Z Has data issue: false hasContentIssue false

10 - Implementing Enterprise Resource Planning Systems: The Role of Learning from Failure

from Part III - From Learning to Knowledge

Published online by Cambridge University Press:  05 February 2012

By
Judy E. Scott  and
Iris Vessey
Edited by
Graeme Shanks ,
Peter B. Seddon  and
Leslie P. Willcocks
Judy E. Scott
Affiliation:
Assistant Professor, University of Colorado
Iris Vessey
Affiliation:
Professor of Information Systems, Indiana University's Kelley School of Business, Bloomington
Graeme Shanks
Affiliation:
University of Melbourne
Peter B. Seddon
Affiliation:
University of Melbourne
Leslie P. Willcocks
Affiliation:
University of Warwick
Get access

Summary

Introduction

Problems associated with software implementations are not new, nor specific to enterprise resource planning (ERP) systems. Nevertheless, ERP systems have been blamed for the poor performance of several organizations (Osterland, 2000). A number of companies have reported negative impacts on earnings as the changeover to an ERP takes place, among them Hershey (Girard and Farmer, 1999), AeroGroup (Asbrand, 1999), and Snap-On (Hoffman, 1998). Hershey, for example, suffered a third quarter (1999) sales decrease of 12.4% and an earnings decrease of 18.6% compared with the preceding year (Osterland, 2000).

Implementing an ERP is a major undertaking and the Standish Group International estimates that 90% of SAP R/3 (the dominant ERP) projects run late (Williamson, 1997). The trade press is now also replete with articles on ERP failures, cancellations, and cost/time overruns. Dell canceled its R/3 system after two years when it determined that it could not support the required processes (King, 1997). AeroGroup (Asbrand, 1999), Unisource (IW, 1998), and a number of garbage disposal companies (Bailey, 1999) also abandoned their ERP projects. The most dramatic example of an organization claiming to be damaged by an ERP implementation is that of FoxMeyer Drug Corporation. FoxMeyer claims that its SAP R/3 system sent the company into bankruptcy (Bulkeley, 1996). Note, however, that, at the same time, many companies have experienced benefits that far exceeded their expectations (Davenport, 1998; Deloitte Consulting, 1998).

Type
Chapter
Information
Second-Wave Enterprise Resource Planning Systems
Implementing for Effectiveness
 , pp. 241 - 274
Publisher: Cambridge University Press
Print publication year: 2003

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Alschuler, D. and Dorin, R. (1998) Accelerated SAP Works! An Executive White Paper, Aberdeen Group, June. http://www.aberdeen.com
Ang, K., Thong, J., and Yap, C. (1997) IT Implementation through the Lens of Organizational Learning: A Case of Insuror. Eighteenth International Conference on Information Systems, Charlotte
Argyris, C. (1985) Strategy, Change and Defensive Routines. Boston, MA: Pitman
Argyris, C. and Schon, D. A. (1978) Organizational Learning. Reading, MA: Addison-Wesley
Asbrand, D. (1999) Peering Across the Abyss: Clothing and Shoe Companies Cross the ERP Chasm. Datamation, Executive Diary: Part 3, January
Attewell, P. (1992) Technology Diffusion and Organizational Learning: The Case of Business Computing. Organization Science 3, 1–19CrossRefGoogle Scholar
Bailey, J. (1999) Trash Haulers Are Taking Fancy Software to the Dump: Allied Waste, Following Waste Management, to Shed SAP's Costly R/3. The Wall Street Journal, 9 June, p. B4
Bancroft, N., Seip, H., and Sprengel, A. (1998) Implementing SAP R/3: How to Introduce a Large System into a Large Organization. 2nd edn, Manning Publications, Chapters 6, 7, and 11
Barki, H., Rivard, S., and Talbot, J. (1993) Toward an Assessment of Software Development Risk. Journal of Management Information Systems, 10(2), 203–225CrossRefGoogle Scholar
Block, R. (1983) The Politics of Projects. Yourdon Press, Prentice-Hall, Chapter 1
Brown, C. and Vessey, I. (1999) ERP Implementation Approaches: Towards a Contingency Framework. Research-in-Progress, Twentieth International Conference on Information Systems, Charlotte
Bulkeley, W. M. (1996) When Things Go Wrong. The Wall Street Journal, 18 November, R25
Caldwell B. (1998) Andersen Sued On R/3. InformationWeek, 6 July
Champy, J. (1997) Packaged Systems: One Way to Force Change. Computerworld, 22 December, 61
Cliffe, S. (1999) ERP Implementation: How to Avoid $100 Million Write-Offs. Harvard Business Review, January–February, 16–17
Computergram International (1998) FoxMeyer Plus Two Sue Andersen for SAP Snafus. Computergram International, 20 July
Davenport, T. H. (1998) Putting the Enterprise into Enterprise Systems. Harvard Business Review, July–August, 121–131
Deloitte Consulting (1998) ERP's Second Wave: Maximizing the Value of ERP-Enabled Processes
Dodgson, M. (1993) Organizational Learning: A Review of Some Literatures. Organization Studies, 14(3), 375–394CrossRefGoogle Scholar
Financial Times (1998) SAP in $500m US lawsuit. Financial Times, Surveys, 2 September, 2
Fiol, C., and Lyles, M. (1985) Organizational Learning. Academy of Management Review, 10(4), 803–813CrossRefGoogle Scholar
Gable, G. G. (2000) The Expert's opinion – A Conversation with Tom Davenport. Journal of Global Information Management, 8, 60–62, Idea Publishing Group
Girard, K. and Farmer, M. A. (1999) Business software firms Sued over implementation. CNET News.com, 3 November. http://news.cnet.com/news/0-1008-202-1428800.html
Hedberg, B. (1981) How Organizations Learn and Unlearn. In Handbook of Organizational Design, P. C. Nystrom and W. H. Starbuck (eds), Vol. 1, New York: Oxford University Press, pp. 3–27
Hoffman, T. (1998) Software Snafu Triggers Order Delays, Loss: Snap-On Software Leads to $50m. Dip, Computerworld, News, 6 July, 6
Holland, C. P. and Light, B. (1999) A Critical Success Factors Model for ERP Implementation. IEEE Software, March/June, 30–35CrossRef
Huber, G. (1991) Organizational Learning: The Contributing Processes and Literatures. Organization Science, 2(1), 88–115CrossRefGoogle Scholar
Information Week (IW) (1998) SAP Installation Scuttled: Unisource Cites Internal Problems for $168m Write-off. Information Week, 26 January
Jesitus, J. (1997) Broken Promises? FoxMeyer' s Project was a Disaster. Was the Company Too Aggressive or was it Misled? Industry Week, 3 November, pp. 31–37
King, J. (1997) Dell Zaps SAP. Computerworld, 26 May, 2
Kotter, J. P. (1995) Leading Change: Why Transformation Efforts Fail. Harvard Business Review, 73(2), 59–67Google Scholar
Levitt, B. and March, J. G. (1988) Organizational Learning. In Scott, W. R. and Blake, J. (eds) Annual Review of Sociology 14, 319–340CrossRef
LJX Files, The Complaint in Brown v. Andersen Consulting (1997), http://www.ljx.com/LJXfiles/bankruptcy/andersen.html
Lounamaa, P. H. and March, J. G. (1987) Adaptive Coordination of a Learning Team. Management Science 33, 107–123CrossRefGoogle Scholar
Lyytinen, K., Mathiassen, L., and Ropponen, J. (1998) Attention Shaping and Software Risk – A Categorical Analysis of Four Classical Risk Management Approaches. Information Systems Research, 9(3), 233–255CrossRefGoogle Scholar
March, J. G. (1991) Exploration and Exploitation in Organizational Learning. Organization Science, 2(1), 71–87CrossRefGoogle Scholar
Markus, M. L. and Benjamin, R. I. (1997) The Magic Bullet Theory in IT-Enabled Transformation. Sloan Management Review, 38(2), 55–68Google Scholar
Markus, M. L. and Tanis, C. (2000) The Enterprise Systems Experience – From Adoption to Success. In Framing the Domains of IT Research: Glimpsing the Future Through the Past, R. W. Zmud (ed.). Cincinnati, OH: Pinnaflex Educational Resources
Nonaka, I. (1994) A Dynamic Theory of Organizational Knowledge Creation. Organization Science, 5(1), 14–37CrossRefGoogle Scholar
Osterland, A. (2000) Blaming ERP. CFO Magazine, January. (http://www.cfonet.com/Articles/CFO/2000/00Jablam.html)
Pentland, B. T. (1995) Information Systems and Organizational Learning: The Social Epistemology of Organizational Knowledge Systems. Accounting, Management and Information Technologies, 5(1), 1–21CrossRefGoogle Scholar
Porter, M. and Millar, V. (1985) How Information Gives You Competitive Advantage. Harvard Business Review 63, 149–160Google Scholar
Radosevich, L. (1997) Quantum's Leap. CIO, 15 February
Robey, D., Wishart, N. A., and Rodriguez-Diaz, A. G. (1995) Merging the Metaphors for Organizational Improvement: Business Process Reengineering as a Component of Organizational Learning. Accounting, Management and Information Technologies, 5(1), 23-39CrossRefGoogle Scholar
Ross, J. (1996a) Dow Corning Corporation (A): Business Processes and Information Technology. Center for Information Systems Research, Sloan School of Management, MIT
Ross, J. (1996b) Dow Corning Corporation (B): Reengineering Global Processes. Center for Information Systems Research, Sloan School of Management, MIT
Ross, J. (1999c) Dow Corning (C): Transforming the Organization. Center for Information Systems Research, Sloan School of Management, MIT
Sauer, C. (1999) Deciding the Future for IS Failures: Not the Choice You Might Think. In Rethinking Management Information Systems: An Interdisciplinary Perspective. W. Currie and R. G. Galliers (eds), Oxford: Oxford University Press
Scott, J. E. (1999) The FoxMeyer Drugs' Bankruptcy: Was it a Failure of ERP? Proceedings of the Fifth Americas Conference on Information Systems, pp. 223–225
Scott, J. E. and Vessey, I. (2000) Toward a Multi-Level Theory of Risks in Enterprise Systems Implementations. Working Paper
Senge, P. M. (1990) The Fifth Discipline: The Art and Practice of the Learning Organization. Doubleday
Sitkin, S. B. (1992) Learning Through Failure: The Strategy of Small Losses. Research in Organizational Behavior 14, 231–266Google Scholar
Stedman, C. (1998) Big-bang R/3 Rollout Forced Compromises with Business Goals. Computerworld, 32(11), March 16, 1, 97Google Scholar
Stein, E. W. and Zwass, V. (1995) Actualizing Organizational Memory with Information Systems. Information Systems Research, 6(2), 85–117CrossRefGoogle Scholar
Sumner, M. (1999) Critical Success Factors in Enterprise Wide Information Management Systems Projects. Proceedings of the ACM-SIGCPR Conference, 297–303CrossRef
Welti, N. (1999) Successful SAP R/3 Implementation: Practical Management of ERP Projects. Addison-Wesley Longman, Chapter 2
Willcocks, L. P. and Griffiths, C. (1997) Management and Risk in Major Information Technology Projects. In Managing IT as a Strategic Resource, Willcocks, L. P., Feeny, D., and Islel, G. (eds), Berkshire: McGraw-Hill, pp. 203–237
Williamson, M. (1997) From SAP to ‘nuts!’. Computerworld, 31, 45, 10 November, 68–69

Save book to Kindle

To save this book to your Kindle, first ensure no-reply@cambridge.org is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.

Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

Find out more about the Kindle Personal Document Service.

Available formats
×

Save book to Dropbox

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.

Available formats
×

Save book to Google Drive

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.

Available formats
×