Title

How factors affecting selection of implementation approach influence ERP system implementation costs

Abstract

Different approaches on how to implement or deploy enterprise resource planning (ERPs) systems

exist. Although virtually nobody really doubts importance of ERPs for running a business today, there

is a sentiment regarding their implementation – both in terms of time and money. In this paper we

investigate relationship between factors influencing selection of a specific implementation approach

and companies’ ability to stay on budget when implementing ERPs. The question is: whether factors

influencing implementation approach then affects to what extent ERP system implementation costs

exceed planned costs for implementation. The questionnaire research, focused on this issue, was

conducted in Denmark, Slovakia and Slovenia. Dependent variables were percentage of actual ERP

system implementation costs and staying on budget vis-à-vis the planned costs and budgets. The

independent variables were implementation approach, country, company size, information strategy,

representation of the IT department on board level, and number of implemented modules. Main

conclusions are that number of modules influences selection of implementation approach and

companies with information strategy are more likely to stay on budget. However, implementation

approach does not significantly influences implementation costs and clear relationships between

factors influencing selection of implementation approach and costs for ERP implementation could not

be found.

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