Enterprise Resource Planning Systems : An Assessment of Applicability to Make-to-Order Companies.

Aslan, Bulut (2011) Enterprise Resource Planning Systems : An Assessment of Applicability to Make-to-Order Companies. PhD thesis, Lancaster University.

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Abstract

Many vendors of Enterprise Resource Planning (ERP) systems claim their software is widely applicable - configurable to meet the needs of any business, whatever the product or service offering. But Make-To-Order (MTO) companies, which produce high-variety and bespoke products, have particularly challenging decision support requirements, leading to questions about the effectiveness of ERP. This thesis takes a contingency-based perspective, assessing both the applicability and impact of ERP systems on MTO companies. A theoretical assessment is first provided based on a comprehensive literature review. This suggests a substantial misalignment does exist between ERP functionality and MTO requirements and calls for empirical research into the applicability and impact on ERP systems on MTO companies. This thesis addresses this gap through a mixed method study in which a survey is followed by case research. The survey is both explanatory and exploratory and compares MTO with Make-To-Stock (MTS) companies. Significant differences are found between the adoption of ERP systems in MTO and MTS companies. At an exploratory level, for example, MTO companies find ERP system selection more difficult than MTS companies while many non-adopters, particularly MTO nonadopters, claim ERP would not suit their needs. At an explanatory level, for example, Customer Enquiry Management (CEM) and Customer Relationship Management (CRM) are the best-utilised functionality by MTO companies, leading to improved performance but the effectiveness of Product Configurator (PC) and Product Lifecycle Management (PLM) functionality could not be demonstrated. The case study research involved two MTO adopters and one MTO non-adopter. While two cases had implemented ERP, only high-level functionality was in operation to get an overview of the status of company resources and processes. This is because there is not only a gap between the software available and MTO decision support requirements, but also between the expertise required to utilise the software and that found in small MTO companies in practice. Finally, this thesis has focused on comparing decision support requirements with ERP functionality and performance at a given planning stage. Future research should investigate the knock-on effects of planning at one stage on the effectiveness of planning at subsequent stages.