Current prospects and challenges of enterprise resource planning (ERP) adoption in developing countries

Abstract

Enterprise Resource Planning (ERP) is an enterprise system that helps organizations to integrate their functional areas such as finance, human resources, accounting etc. It improves transparency, productivity and communications in organizations. It also improves the flow of information between departments. ERP has originally been developed with the best practices of large organizations, however Small and Medium Enterprises (SMEs) are also implementing ERP in order to remain competitive. Furthermore, ERP is not only implemented in developed countries where it originated, organizations in regions such as Africa and Asia are also implementing ERP. Considering the fact that ERP systems were developed in first world countries, their in-built processes are compatible with organizational structures of those countries. But ERP has taken over the whole world. Due to the differences on how organizations operate, organizations from other regions experience challenges when implementing ERP. This study explored the adoption of ERP implementation in developing countries, focusing on challenges and risks that they face. The study has found unreliable vendors, lack of skilled human resources, misfits between the ERP system’s built-in processes and the companies’ business processes as the main challenges.