Introduction

---

Organizations worldwide, whether public or private, are moving away from developing Information Systems (IS) in-house and are instead implementing Enterprise Resource Planning (ERP) systems and other packaged software (AMR Research, 1998; IDC Software Research, 2000; Price Waterhouse, 1995). ERP has been referred to as a business operating system that enables better resource planning and improved delivery of value-added products and services to customers. ERP systems have, in recent years, begun to revolutionise best practice business processes and functions. They automate core corporate activities such as manufacturing and the management of financial and human resources and the supply chain, while eliminating complex, expensive links between systems and business functions that were performed across legacy systems (Bingi et al., 1999; Gable et al., 1998; Klaus et al., 2000; Rosemann and Wiese, 1999).

Despite warnings in the literature, many organizations apparently continue to underestimate the issues and problems often encountered throughout the ERP life cycle, as evidenced by suggestions that: (1) more than 40% of large software projects fail; (2) 90% of ERP implementations end up late or over budget; and (3) 67% of enterprise application initiatives could be considered negative or unsuccessful (e.g., Martin, 1998; Davenport, 1998; Boston Consulting Group, 2000).

ERP life cycle-wide management and support are ongoing concerns rather than a destination. The pre-implementation, implementation, and post-implementation stages continue throughout the lifetime of the ERP as it evolves with the organization (Dailey, 1998). Unlike the traditional view of operational IS that describes a system life cycle in terms of development, implementation, and maintenance, examination of ERP implementations is revealing that their life cycle involves major iterations. Following initial implementation there are subsequent revisions, re-implementations, and upgrades that transcend what is normally considered system maintenance. As the number of organizations implementing ERP increases and ERP applications within organizations proliferate (Bancroft, 1998; Davenport, 1996; Hiquet et al, 1998; Shtub, 1999), improved understanding of ERP life cycle implementation, management, and support issues is required so that development, management, and training resources can be allocated effectively (Gable et al., 1998). A better understanding of ERP life cycle issues will also help direct the ERP research agenda.

Although ERP sales in 2000 declined for the main vendors (e.g., SAP, Baan, ORACLE, JD Edwards, Peoplesoft) due to post-Y2K curtailment in IT/IS activity and to saturation of large organizations, the outlook through to 2004 is for compound annual growth of 11.4% for license, maintenance, and related service revenue associated with enterprise resource management applications (IDC Software Research, 2000). This sustained interest in implementing and realising the benefits of ERP systems, and the consequent life cycle issues, provide the rationale for this study (this need is further outlined in Gable et al., 1997a; 1997b; Gable, 1998; Gable et al., 1998).

The chapter proceeds as follows. First, the study background is described. Second, the research methodology is related. Third, study results are presented. Fourth, implications of the study findings are explored. Lastly, several broad conclusions are drawn.

---