It’s impossible to ignore the impact of ERP in today’s business world. As enterprise data and processes are corralled into ERP systems, businesses can align separate departments and improve workflows, resulting in significant bottom-line savings. Examples of specific business benefits include: Improved business insight from real-time information generated by reports Lower operational costs through streamlined business processes and best practices Enhanced collaboration from users sharing data in contracts, requisitions, and purchase orders Improved efficiency through a common user experience across many business functions and well-defined business processes Consistent infrastructure from the back office to the front office, with all business activities having the same look and feel Higher user-adoption rates from a common user experience and design Reduced risk through improved data integrity and financial controls Lower management and operational costs through uniform and integrated systems
ERP system usage has been identified as a critical factor in attaining the benefit from an ERP installation. However, the specific antecedents of ERP usage and its impact on ERP benefit remains largely unknown. Drawing on absorption capacity theory, this study develops a theoretical model that examines the mediating effect of ERP system usage on ERP benefits. Similarly, the study also identifies the antecedents of ERP system usage. A model is tested using the responses of 157 ERP system end-users across the United States and the results suggest that ERP system usage is directly related ERP benefit. However, the relationship is moderated by the degree of knowledge integration mechanisms within the firm. Consistent with the proposed model, the results also reveal that technical resources, organizational fit and the extent of ERP implementation are key drivers of ERP system usage. The research findings advance our knowledge on how managers can enhance ERP usage and realize optimal ERP benefits.