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Early information systems (IS) adoption studies have helped improve the understanding about the key factors that explain IS acceptance. However key challenges such as underutilization of Information Technology (IT) which constitute “major barriers to successful IT implementations in organizations” are still faced (Venkatesh & Bala, 2008, p. 273). The lack of assessment of unobserved heterogeneity in IS adoption research is considered a key reason for the low acceptance of IT. Complex social and behavioral phenomena are studied in IS research and thus it is highly likely that heterogeneity exists in the samples used to develop and test models. When this heterogeneity is not uncovered and controlled, it is called unobserved heterogeneity and it can bias results and conclusions (Ansari, Jedidi, & Jagpal, 2000). Invalid conclusions due to unobserved heterogeneity is thus an important validity threat for the structural model, the measurement model, or both (Becker, Rai, Ringle, & Völckner, 2013). This study is thus an effort toward bridging this gap that exists in the IS adoption literature. It is believed that unobserved heterogeneity is also present in the sample data for ERP system adoption empirical studies resulting in biased results and conclusions which in turn affect ERP system adoption. The IS system adoption that is explored in this research study is the enterprise resource planning (ERP) system.
ERP systems enable organizations to realize strategic and operational business value thus providing competitive advantage. When successfully implemented ERP system links all areas of a company thus providing a tightly integrated system with shared data and visibility (Chen, 2001). Despite having great potential to improve business operations there has been considerable uncertainty about the actual value that ERP systems add to organizations. There are many reports of difficulties in implementing ERP systems in organizations (Ram, Corkindale, & Wu, 2013). It is estimated that 66-70% of ERP projects fail in achieving corporate goals and are considered unsuccessful (Chang, 2004; Poba-Nzaou, Raymond, & Fabi, 2008; Panorama, 2012). Thus, despite its promise ERP implementations suffer extremely high failure rates. The worldwide ERP market experienced a slow growth of only 2.2 percent (Huang &Yasuda, 2016). A major reason for failure of ERP systems is end user resistance to change (Scott & Vessey, 2002; Barker & Frolick, 2003; Lapointe & Rivard, 2005; Morris & Venkatesh, 2010; Sykes, Venkatesh, & Johnson, 2014). It is thus extremely important to conduct research on the antecedents that impact behavioral intention to use ERP systems. Prior research also suggests that it is very important to conduct more research on behavioral aspects of ERP implementation and how individual or collective behavior might impact ERP implementation success prior to actual implementation of the ERP system (Scniederjans & Yadav, 2013). There are many studies on technology adoption in the field of information systems (IS) at both individual and organizational level (Abu-Shanab & Ghaleb, 2012; Alshehri, Drew, Alhussain, & Alghamdi, 2013). According to a major survey of 82 company leaders, ERP system implementation projects are considered to be very risky involving very high cost (Austin & Nolan, 1999; Poba-Nzaou et al., 2008). Furthermore, the perception of managers and end users regarding the critical success factors of implementation of ERP system is significantly different (Lin & Rohm, 2004). The sources and types of user resistance to a disruptive technology like ERP are many such as perceived risk and habit. Perceived risk refers to user’s perception of ERP system as a threat to their own jobs and habit refers to the current practices that the user is routinely doing and the ERP system attempts to change that way of doing things (Aladwani, 2001).