ERP and SCM Integration: The Impact on Measuring Business Performance

ERP and SCM Integration: The Impact on Measuring Business Performance

Shereen Mekawie (Faculty of Management Technology, German University in Cairo, New Cairo, Egypt) and Ahmed Elragal (Faculty of Management Technology, German University in Cairo, New Cairo, Egypt)
Copyright: © 2013 |Pages: 19
DOI: 10.4018/jeis.2013040106
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Abstract

Organizations rely on various types of information systems (IS) to manage day-to-day business and make decisions such as enterprise resource planning (ERP) and supply chain management (SCM) systems. Organizations rely on ERP systems to replace their legacy systems, integrate core business processes and to help adding value and increasing visibility. Additionally, SCM systems help organizations to enhance relationships with supply chain members. It is essential for organizations to measure their business performance by taking into consideration intra-organizational and inter-organizational indicators. Therefore, the integration between ERP and SCM systems is a key to enable more business performance; that were otherwise hidden. Accordingly, the motive for this paper is to study the influence of ERP-SCM integration on enabling more business performance measures. For this reason, a business performance measures framework was constructed and then tested on two organizations using multi-case study qualitative research approach. Analysis results indicated that integrating ERP and SCM systems would render more performance measures and hence enable better and wider-scope evaluation. Consequently, managers are more informed and accordingly are able to make high quality decisions.
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Research Gap

Previous research aimed at studying the impact of implementing either the SCM or ERP system on the business performance, other research focused on the overall organization’s benefit after the ERP and SCM integration (Stefanou, 2001; Tarn et al., 2002; Akkermans, et al., 2003; Kova´cs & Paganelli 2003; Burca et al., 2005; Wieder et al., 2006; Bose et al., 2008; Daghfous & Barkhi 2009; Ge & Vob 2009; Su & Yang 2010; Yang & Su 2009). Other researches studies inspected the technical details of integrating the two systems i.e., ERP and SCM (Helo et al., 2005; Goossenaerts et al., 2009).

To our knowledge, too little research efforts were exerted to study the influence of ERP and SCM systems integration on business performance measures (BPM). Based on previous researches, major business processes have been identified at each functional area within its corresponding organizational level. This research is investigating the ERP-SCM integration on each of those business processes presented in the BPM framework. For this reason, the research is to provide an in-depth analysis of performance measures aligned to the business processes and organizational units for organizations with ERP-SCM systems. The research is an exploratory investigation for providing organizations - regardless of its size and industry - with various performance measures to assist managers in the decision making process and measuring their organization’s performance.

The research question is “what is the influence of the ERP-SCM integration on business performance measures?”

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