Enterprise resource Enterprise resource planningplanning

Information technology as a Information technology as a steamrollersteamrollerfor management politics?for management politics? 指導教授：指導教授：歐陽超歐陽超 教 教授授 學 生：學 生：劉晃溢劉晃溢

M9101005M9101005 吳宇玄吳宇玄 M9101006M9101006 羅凱文羅凱文 M9101110M9101110

日 期：日 期： 2003/02003/05/275/27

OutlineOutline IntroductionIntroduction MethodMethod The combined political process and The combined political process and

sociology of technology approach to sociology of technology approach to techno-organisational changetechno-organisational change

Political programmesPolitical programmes The content and characteristics of The content and characteristics of

ERPERP ERP: information technology as ERP: information technology as

political programmespolitical programmes Conclusion: the freezing of ERPConclusion: the freezing of ERP

IntroductionIntroduction This article focuses on the role of This article focuses on the role of

enterprise resource planning (ERP) systems enterprise resource planning (ERP) systems as political programmes for organisational as political programmes for organisational change.change.

The context used is ERP software systems The context used is ERP software systems within manufacturing in Denmark and within manufacturing in Denmark and Germany. The particular emphasis is on Germany. The particular emphasis is on the software side of the systems. the software side of the systems.

First, the combined political process and First, the combined political process and sociology of technology perspectives on sociology of technology perspectives on change are described. change are described.

Second, a characterisation of ERP Second, a characterisation of ERP technology is offered, pointing out the technology is offered, pointing out the flexibility ``in principle’’.flexibility ``in principle’’.

MethodMethod The material presented here draws The material presented here draws

on projects undertaken at the on projects undertaken at the Technical University of Denmark Technical University of Denmark from 1994 to 2000.from 1994 to 2000.

The article uses this material in two The article uses this material in two ways:ways:

(1) the large sample of cases is (1) the large sample of cases is used to illustrate the role of the used to illustrate the role of the communities related to ERP communities related to ERP systems.systems.

(2) the two in-depth cases are used (2) the two in-depth cases are used to discuss enterprise politics.to discuss enterprise politics.

The combined political process and The combined political process and sociology of technology approach to sociology of technology approach to techno-organisational changetechno-organisational change Political processes can be Political processes can be

understood as a combination of a understood as a combination of a political programme and a coalition-political programme and a coalition-building process.building process.

The The structured inequalitiesstructured inequalities between between actorsactors, , the societal embeddednessthe societal embeddedness and and the limited scope for voluntary the limited scope for voluntary decision making and agency within a decision making and agency within a specific organisational contextspecific organisational context are are important features of the concept of important features of the concept of political processes.(Knights and political processes.(Knights and Murray 1994)Murray 1994)

Political programmesPolitical programmes The term The term political political

programmeprogramme is used to is used to understand understand the content side the content side of political processesof political processes..

A political programme is a A political programme is a piece of thinking concerning piece of thinking concerning the content of changethe content of change and and how to achieve ithow to achieve it..

The hardness of political The hardness of political programmesprogrammes The hardness of the political The hardness of the political

programme is a central issue.programme is a central issue. Technologies embodied in artefacts Technologies embodied in artefacts

might have been perceived as might have been perceived as obdurate political programmes obdurate political programmes because of the artefact.because of the artefact.

The sociology of technology tells us The sociology of technology tells us that artefacts are in fact quite that artefacts are in fact quite malleable under certain malleable under certain circumstances.(Bijker 1995, circumstances.(Bijker 1995, Orlikowsky 1992)Orlikowsky 1992)

The hardness of political The hardness of political programmesprogrammes Central elements concerning Central elements concerning

malleability or the obduracy malleability or the obduracy are:are:

(1)A (1)A leitbildleitbild for the actors to for the actors to follow.follow.(2)(2)InclusionInclusion//exclusionexclusion of of certain actors.certain actors.(3)(3)SocialSocial and and geographicalgeographical distancedistance..(4)(4)ResourcesResources..

The conceptualisation of the The conceptualisation of the technology studied here technology studied here proceeds in two steps: proceeds in two steps:

(1)First, some general (1)First, some general definitions of the features of definitions of the features of crosscutting information crosscutting information technology.technology.

(2)Second, a more precise (2)Second, a more precise definition of the development definition of the development and contemporary versions of and contemporary versions of ERP systems.ERP systems.

The content and The content and characteristics of ERPcharacteristics of ERP

The content and The content and characteristics of ERPcharacteristics of ERP Crosscutting information Crosscutting information

technologytechnology -general -general characterisationcharacterisation

Multiple control visions and Multiple control visions and systemssystems

Configuration of ERPConfiguration of ERP - what - what is malleable and what is notis malleable and what is not

Crosscutting information Crosscutting information technologytechnology Aimed at Aimed at the whole row of typical the whole row of typical

departments of a manufacturing departments of a manufacturing enterpriseenterprise..

IT develops through cyclical changes IT develops through cyclical changes of representation and form and of representation and form and there is a co-existence of relatively there is a co-existence of relatively stabilised,previously developed, stabilised,previously developed, elements with those under elements with those under construction.(Salzman and construction.(Salzman and Rosenthal 1994)Rosenthal 1994)

The strategy adopted by most The strategy adopted by most developer and supplier enterprises is developer and supplier enterprises is incremental, and IT systems are incremental, and IT systems are therefore under therefore under continual continual developmendevelopmentt. Some elements . Some elements might be developed at high speed, might be developed at high speed, whereas others are stable over a whereas others are stable over a long period of time.long period of time.

Multiple control visions and Multiple control visions and systemssystems ERP systems are a merger of a ERP systems are a merger of a

number of number of visions of controlvisions of control and and accompanying routines and accompanying routines and practices embeddedpractices embedded in systems in systems of software.(erpsupersite.com) of software.(erpsupersite.com)

One can point to three main One can point to three main visions of controlling a visions of controlling a manufacturing enterprise.manufacturing enterprise.(Heiliger 1996)(Heiliger 1996) (1) (1) Economic visionEconomic vision: the enterprise as a : the enterprise as a financial entity financial entity

with economic flows.with economic flows. (2) (2) Logistics visionLogistics vision: the enterprise as : the enterprise as

material flow.material flow. (3) (3) Information visionInformation vision: the enterprise as : the enterprise as

information information system and flow.system and flow.

Configuration of ERPConfiguration of ERP Below it is discussed, in four levels, to Below it is discussed, in four levels, to

what extent and in what dimension what extent and in what dimension the system is open for negotiation the system is open for negotiation and where notand where not ：：

Level1Level1-The overall design of the -The overall design of the enterprise / corporation.enterprise / corporation.

Level2Level2-Design of certain business -Design of certain business activities.activities.

Level3Level3-User profiles, parameters and -User profiles, parameters and business processes.business processes.

Level4Level4-Supplementary programming.-Supplementary programming.

ERP: information technology ERP: information technology as political programmesas political programmes

The role of technology in a process is base on empirical and is discussed below mainly using the concepts “political programme” and “the building of coalitions”.

The general results from the sample cases: ERP

communities The case studies of the three

communities around the ERP systems SAP R/3, Baan and Concorde XAL show that even though each enterprise case in principle is unique, one can point to a number of similarities.

Similar CharacteristicSimilar Characteristic The implementations of R/3 are

characterized by the most ambitious programmes of change.

R/3 community is characterised by the relative lack of decentralization.

The Baan and Concorde XAL implementations are mixtures of different organizational changes, decentralized,status quo or more centralized versions.

Different choices of modulesDifferent choices of modules Implementations are grouped into

three variants in each of the three system communities characterized by different choices of modules

The longitudinal SAP case Jensen is a manufacturing network.

Before it changed it consisted of a.five factories b.40 distributions units c.a network of sales offices Although the group did have a central

corporate unit before the change, the management group was diverse and relatively autonomous at the single unit in the network.

The longitudinal SAP case (cont.)

A management coalition in the group decided to do a business process reengineering (BPR) and an SAP R/3 project. The project subsequently developed in three phases:

1.The BPR analysis 2.The BPR implementation and the

configuring of the SAP R/3 system 3.The implementation and use of SAP

R/3

The longitudinal SAP case (cont.)

1. The BPR analysis Point of departure is BPR, a ``clean

sheet’’ approach to previous ways of operation, focus on cross cutting processes and the like.

The analysis finished by pointing to three core business processes, seven support processes and a catalogue of proposals for reorganization of the group.

The longitudinal SAP case (cont.)

2. The BPR implementation and the configuring of the SAP R/3 system

In the BPR implementation phase, considerable reorganization took place in the administrative and distribution units of the group, including finance, sales,ordering process, wage-administration and purchasing.

The longitudinal SAP case (cont.)

A process leading to major changes in work, the distribution network was reduced the number of units to 28 from 40.

Concentration into one unit of a number of processes, and second, linking them up with the other units through IT.

Finally shop floor employees were consulted in an informal fashion when the configuration of SAP R/3 became more detailed.

The longitudinal SAP case (cont.)

3. The implementation and use of SAP R/3

SAP R/3 was configured and implemented in order to underpin and enhance the changes initiated by the BPR project.

The sales and order processing modules were used to integrate sales offices with logistics in the plants.

The finance modules were configured to consolidate the “one enterprise’’concept.

The longitudinal SAP case (cont.)

The logistics modules are configured seeing all the production facilities as a resource for production, thus combining geographically spread units.

The longitudinal Baan case BTP is characterized by discrete

high volume production combined with a large net of suppliers and distributors.

At BTP, sales have moved into a dominant position, and the current CEO stems from sales.

The longitudinal Baan case (cont.)

The management coalition that adopted ERP as their political programme, was predominantly embedded in the production areas.The process fell into three phase:1.1.Preparation and Preparation and

analysis.analysis.2.2.ConfigurationConfiguration3.3.ImplementationImplementation

The longitudinal Baan case (cont.)

As part of the first phase, which is in focus here, a management coalition was formed, and over the first months (1995-96) an understanding of the required facilities, scope of the ERP system and the features of the supplier were developed.

The coalition invited three suppliers to present their systems. In order to cope with the complexity of the systems, the participants needed and carried out simplification.

The longitudinal Baan case (cont.)

The systems role of social glue, boundary object, turned out to be contradictory.

Different enterprise actors interpreted the systems in a quite different ways.

When the production-based coalition tried to enrol more actors and enlarge the scope of the technology, these different interpretations were mobilized by non-enrolment,but some problems were occurred.

The longitudinal Baan case (cont.)

The management coalition opted for a logistics and finance variant and started configuring the software package. This process was prolonged by serious performance problems.

• During configuration the power of default was exercised in a surprising way in the finance department.

Conclusion: the freezing of Conclusion: the freezing of ERPERP

The ERP communities built up practices, which constrain enterprise choices.

Across the three communities the enterprise choices within the design of major business activities are a combination of common choices and unique single enterprise choices.

Two case: SAP and Baan

Conclusion: the freezing of Conclusion: the freezing of ERP (cont.)ERP (cont.)

The SAP case demonstrated how a ``headline’’ management political programme of BPR and ERP emerged into a more explicit change programme, relatively successfully merging the factories, distribution units and the sales organization into one manufacturing network.

Conclusion: the freezing of Conclusion: the freezing of ERP(cont.)ERP(cont.) The Baan case demonstrates a multi

front exercise for the production-based management coalition. At the one front the management coalition should target sales and finance, the programme therefore encompasses a redesign and integration of the overall business.

Conclusion: the freezing of Conclusion: the freezing of ERP(cont.)ERP(cont.) Both cases thus demonstrate how

technology, R/3 and Baan IV, and their supporting communities can act as a steamroller for management politics although in different ways.

Conclusion: the freezing of Conclusion: the freezing of ERP (cont.)ERP (cont.) Importantly the steamroller

metaphor cannot grasp the way the technology penetrates the organization.

In the analysis it has been demonstrated how the overall business structure, the business processes and the micro level elements can all be reshaped, thus leaving the question of hardness as an empirical matter.