Confirmative Pressures in ERP Institutionalisation

Confirmative Pressures in ERP Institutionalisation

Azadeh Pishdad (School of Information Technology and Mathematical Sciences, University of South Australia, Mawson Lakes, SA, Australia) and Abrar Haider (School of Information Technology and Mathematical Sciences, University of South Australia, Mawson Lakes, SA, Australia)
Copyright: © 2013 |Pages: 13
DOI: 10.4018/jtd.2013040102
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Abstract

In the normal progression of events, firstly the technology is implemented, and then it is assimilated in the organisation. Once its usage becomes routinized and embedded within the organisations’ work processes and value chain activities, it leads to successful institutionalisation. Institutionalisation of technology, thus, is not a linear process, one that is independent of any organisational, cultural, technical, social, and environmental causes and effects that shape and reshape use of technology. Information system researchers, however, tended to limit their attention to the effects of the institutional environment (i.e., coercive, normative and mimetic pressure) on structural conformity and isomorphism, so they fail to study the role of other institutional contexts which affect technology implementation and institutionalisation in organisations. This paper, therefore, aims to fill this gap by introducing confirmative pressure as a new form of isomorphism among organisation and other sub-institutions. This paper presents an illustrative case study of ERP adopting organisation in Australia to show how various isomorphic mechanisms affect ERP implementation and institutionalisation process.
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Introduction

Institutional theory assumes that structural and behavioural changes in organisations are more driven by the need for organisational legitimacy than by competition and the desire for efficiency. Organisational intention to achieve legitimacy, thus, fosters the processes of institutionalisation which eventually makes organisations more similar without necessarily making them more efficient, giving rise to institutional isomorphism (DiMaggio & Powell 1983). Moreover, information systems are social systems and their use and acceptance in the organisation is fashioned by the human interpretation of technology. Assimilation and performance of technology can, thus, only be attained if the social and technical subsystems are brought together and treated as interdependent aspects of a work system (Clegg, 2000). Implementation of enterprise resource planning (here after ERP) system, thus, is not one off endorsement of technology; instead it should engage in the process of ERP institutionalisation to maintain its legitimacy, social and cultural fitness on an on-going basis. Once the organisation is making optimal advantage of ERP, its use will be legitimized by the organisational stakeholders to contribute to the value of the organisation. This legitimacy to provide value in day to day operations results in institutionalisation of the ERP system (Kouki et al., 2006; Ugrin 2009; Lyytinen et al., 2009; Maheshwari et al., 2010).

At the same time, technology is a social and cultural artefact, as it is developed on some defined assumptions, values, and beliefs (Soh et al., 2000; Gosain 2004). For example, an ERP system, owes its genesis to resources planning, is modular, and an integrated product. These characteristics help develop a specific culture in the organisation. Inconsistency between values of an organisational culture and assumptions embedded within the technology, however, are likely to come in conflict and cause problems, such as resisting the technology implementation and modifying underlying assumptions embedded in the technology to match existing organisational culture (Soh et al., 2000; Gosain 2004). Nevertheless, higher degree of institutionalisation results in greater generational uniformity ‘through transmission experience’, maintenance ‘once transmission has taken place’, and resistance to change ‘once maintenance has occurred’ of cultural understandings (Zucker 1977).

The behaviour of technology differs from organisation to organisation, because the use of technology follows a cause and effect relationship between the technology, organisation, external environment, and humans. Therefore, if organisation responses to technical, organisational, and environmental changes, the chance of successfully aligning technology with the organisational information requirements is higher. However, organisations mainly tend to focus on technical aspects of ERP system through various stages of its assimilation, and, thus, do not give due importance to organisational culture and social issues, especially when ERP system goes-live in the organisation (Robey and Boudreau 1999; Xue et al., 2004; Kouki et al., 2007; Chang et al., 2008; Ke and Wei 2008; Kwahk and Ahn 2009; Maheshwari et al., 2010). This research aims to fill this gap by introducing confirmative pressure as a novel form of isomorphism. Confirmative mechanism suggests that organisations are inclined to implement technological innovations which are complying with organisation’s cultural values and assumptions. This compliance helps the technology to become culturally and socially accepted within the organisation. This paper also describes how various isomorphic mechanisms can affect various stages of ERP assimilation and institutionalisation by presenting a case study of an ERP adopting organisation in Australia.

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