Actual vs. planned ERP system implementation costs in Slovak and Slovenian companies

Abstract

Enterprise resource planning (ERP) systems are still more and more common in companies, not only in large ones but also in small and medium enterprises. Although virtually nobody really doubts their importance for running business, there is a sentiment regarding their implementation - both in terms of time and cost. We focus on the latter in this paper. The research question is to what extent do ERP system implementation costs exceed the planned costs in European context, which is characterized by fixed price policy. The questionnaire research, which focused on this issue, was conducted in Slovakia and Slovenia. The dependent variable was a percentage of actual ERP system implementation costs vis-à-vis the planned ones. The independent variables were the country, company size, information strategy, and representation of the IT department on board level. According to the collected data, companies with information strategy, and small companies as opposed to large ones, are more likely to stay on budget. Overall, 68.5% of companies stayed on budget and companies, on average, spent 106.0% of what they originally planned to. © Springer Physica-Verlag 2010.