Managing risk factors in design and implementation of ERP systems (An empirical investigation of the Indian industry)

Abstract

Enterprise Resource Planning (ERP) Systems, which has became a buzzword in the late 1990, are the most integrated information systems that cut across various organizations as well as various functional areas. Small and medium enterprises, competitor’s behavior, business partner requirement are the identified and established dimensions that affect ERP systems. Further it has been observed that ERP systems prove to be a failure either in the design or its implementation. A number of reasons contribute in the success or failure of an ERP systems. Enterprise resource planning systems inherently present unique risks due to tightly linked interdependencies of business processes, relational databases, and process reengineering, etc. Knowledge of such risks is important in design of system and program management as they contribute to success of overall system. In this paper an attempt has been made to study the design and implementation risks factors for ERP systems in Indian organizations. For this two large public sector companies namely PUNCOM and PTL located in northern India have been selected. Based on the model used to study ERP risks and thus the findings, various recommendations have been put forward to suggest a strategy so as to mitigate and manage such risks.