Risks Assessment using Fuzzy Petri Nets for ERP Extension in Small and Medium Enterprises

Abstract

In this paper a Fuzzy Petri Net model (FPN) is developed and tested to assess the risks involved during Enterprise Resource Planning (ERP) adoption in Small and Medium Enterprises (SMEs). This model pertains only to the risks and risk factors identified in the extension phase of ERP adoption in SMEs. In other words, this work studied only the risk perception relating to extending the ERP integration between the supply chain partners. This paper addresses the problems of risk identification and assessment during the extension phase. There are two motives for this research namely, one to define the ERP extension risks and two to assess and quantify the risks in a simple yet robust model. The uniqueness of this paper is three dimensional because in addition to presenting and quantifying the risk values in FPN, the risks are categorized and further graded for decision support to SME stakeholders. Realignment and standardization of SMEs business process, lack of support from larger enterprises and incompatibility issues are perceived to be most critical risk factors.