Adaptation of diffusion of innovations theory for successful ERP implementation

Samudaya Nanayakkara, Nisanka Kusumsiri, Prasad Perera

Research output: Contribution to journalArticlepeer-review

Abstract

Information and Communications Technology (ICT) plays a critical
role in today’s organization environment and Information Systems
(ISs) hold an enormous control in organizational operations with
data entering is governed by it. Enterprise Systems (ESs) such
as Enterprise Resource Planning (ERP), Customer Relationship
Management (CRM), Supply Chain Management (SCM), Advance
Planning and Scheduling (APS) systems are the most cutting-edge
IS in present corporate world covering all the business sectors.

ERP system connects the organization’s different operations
organized into a single large integrated system with proper
controls so that interconnectivity creates an extra opportunity for
growth and increased productivity of the depending divisions [1].
Organizations invest millions of dollars to implement a suitable
ERP system with enormous effort consuming hundreds man months
of an implantation team to harvest these benefits. Successful
implementation of ERP heavily depends on human-factors [1-2].
[1] and [3] presented that organization’s implementation team is
highly critical to success of ERP implementation.

According to the Diffusion of Innovation theory, most individuals
evaluate new technology through subjective evaluations of nearpeers who have adopted the technology [4]. Early adopters
decrease the uncertainty about a novel idea by adopting it and
then conveying near-peers through interpersonal networks [4].
The present research attempts to identify any relationship between
‘Diffusion of Innovations Theory’ and core implementation team
of successful ERP project.

This research is based on a mixed methodology of qualitative and
quantitative methods in two stages. In the stage one, 24 participants
were researched implementing qualitative methodology. In
the stage two, 104 participants were researched by means of
quantitative methods. Initially, qualitative methods of interviews
were conducted to categorize the ERP project as successful or
unsuccessful, impact of implementation team in success or
failure. In the stage two, short questionnaires were implemented
to quantitatively categorize implementation team members based
on Diffusion of Innovations Theory. Collected data were analysed
compared with project success and impact of implementation
team. Furthermore, secondary data such as literature was also
contributory to the main outcome and results.

The research shows that most of the ERP implementation team
consist of Early Adopters and Early Majority. Early Majority have
above average social status, contact with Early Adopters and hold
lower level of opinion leadership compared with Early Adopters
in a system [4]. Early Adopters decrease the uncertainty about a
novel idea and technology by adopting it and then transmitting
to near-peers through interpersonal networks [4]. The impact
of human characteristics on ERP project implementation has
similar impact as innovation establishing in the society, which
is demonstrated by ‘Diffusion of Innovations Theory’. The
research shows, if the majority of implementation team consists
of Early Adopters, they will mitigate the uncertainty about a new
Enterprise Software Solution by adopting it very quickly and
then transmitting to other employees through interpersonal and
organizational networks. The study also reveals ways in which
sensible selection of implementation team could be conducted to
assist the successful implementation of ERP.
Original languageEnglish
Pages (from-to)25-30
Number of pages6
JournalInternational Journal of Computer Science and Technology
Volume7
Issue number1
Publication statusPublished - 2016
Externally publishedYes

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