Impact of ERP Implementation on Productivity and Profitability: An Empirical Study on the Largest Bangladeshi Steels Manufacturer

Abstract

The research aims to evaluate the impact of Enterprise Resources Planning (ERP) implementation on the productivity and profitability of BSRM Steels Limited. The study focuses on addressing the gap in technology adoption literature by undertaking an empirical comparison of the impact of ERP implementation. Five productivity variables called service time, lead time, inventory turnover, output-input ratio, and warehouse cost are evaluated. Gross Profit Margin represents profitability as ERP is mainly implemented in the inventory management system of BSRM. Paired sample t-tests between the pre and post ERP performances have been used to evaluate the impact of ERP. Ten years' data ranging from 2010 to 2019 have been considered for the study.  Five years' data (2010-2014) consist of before ERP period, and the other five years' data (2015-2019) represent after ERP implementation period. The study reveals that both the productivity and profitability of BSRM have significantly improved after ERP implementation. This paper will have an impactful contribution to the academic literature of technology adoption in the manufacturing sector, particularly for ERP implementation in the steel industry of Bangladesh, which could be supportive for further study on the topic.