Measuring Utilization of ERP Systems Usage in SMEs

Abstract

Since deployment of Enterprise Systems (ES) such as Enterprise Resource Planning systems (ERPs) within enterprises, both Large Enterprises (LEs) as well as Small and Medium-sized Enterprises (SMEs) have increased and continue to increase, making it increasingly desirable to measure the degree of utilization of ERP systems in enterprises. One reason for this interest is that no benefits are realized if the systems are not used; since ERPs are massive investments, they need to show benefits, or at least be able to measure the benefits. However, to be able to do so, there is a need to explain ERP systems utilization and the factors that influence ERP utilization. This chapter provides an explanation of factors influencing ERP systems utilization by testing a research model building on four dimensions: volume, breadth, diversity, and depth. The contributions of the research are: First, it provides support for the notion of diffusion found in the theory of network externalities where a critical mass is necessary to achieve benefits. This can be used to better understand failures in ERP projects. Second, the use of volume, breadth and depth provide insights for use as a construct and the need to treat it more rigorously. Third, the study contributes to our understanding of the many aspects of use of IT, such as ERPs, and potentially contributes to value and firm performance from ERP utilization.