Evaluating readiness to use an enterprise solution (ERP) based on critical success factors (case study of Iran Khodro Diesel Company)

Evaluation of the readiness to use an enterprise solution (ERP) based on critical success factors (case study: Iran Khodro Diesel Company)

Abstract

The enterprise resource planning system is a software package with a very wide application that integrates all the functions of the organization in a single system. In order to successfully implement an ERP[i] project in the organization, it is recommended to evaluate the readiness to use the system. In this research, with the aim of evaluating the readiness to use organizational resource planning, emphasizing the critical factors of success in Iran Khodro Diesel Company, it has been carried out with a statistical population of 200 people. The sampling method in this research is simple random which was calculated using the Morgan Krejci table. The research method used was descriptive-survey, where secondary data was collected by studying the research literature and primary data was collected by using questionnaires.  Cronbach's alpha coefficient was used for the reliability of the opinions of experts, professors and the reliability of the research tool, namely the questionnaire. The results of the research showed that all factors are in poor condition. They need improvement and strengthening.

1. First chapter

1-1. Introduction

     In the current post-modern and post-industrial era, organizations are undergoing fundamental changes and these changes are increasing in the new millennium. The new millennium organization is identified and measured based on the amount of attention and emphasis on creating added value in each of the work processes and internal activities of the organization, and therefore such an organization needs the ability to create change as well as the use of expertise and organizational experience to act quickly. Therefore, such a view requires a new type of organizational architecture that provides flexibility and resistance as a driver to survive in the competitive market of this millennium. ERP software packages provide such a powerful architecture.

1-2.  The main problem of the research:

The unpredictable growth of information and communication technology in the past decades, which has been based on the development of various industries such as electronics, computers, telecommunications, etc., has had tremendous effects on various aspects of the performance of organizations. Along with these changes, the activity environment of organizations has become more complex and therefore the need for different systems that can establish an integrated communication between the various components of the organization and facilitate the flow of information between them has increased significantly. These systems, which are collectively known as enterprise systems [1], have provided a basis for managers to use appropriate and integrated information in their various decisions at any place and time. (Chun-Chin Wei-2005)

Since the early 1990s, the emergence of integrated software under the name of Enterprise Resource Planning (ERP) with the aim of being used in large organizations has developed greatly. These very powerful, complex and expensive software are pre-designed systems that are implemented and implemented after changes are made by consultants, implementers and organizational process analysis consultants. In many cases, organizations are forced to modify and review their processes due to the compulsion to follow the logic governing these softwares. In these softwares, unlike the old softwares that were developed in organizations through different organizational units, this work is not easily done.

So ERP can be defined as an integrated software that has components or modules for planning, production, sales, marketing, distribution, accounting, human resource management, management The project is inventory management, service and maintenance management, transportation management and e-commerce. The architecture and structure of ERP is such that it provides the integrity and comprehensiveness of information at the organization level and provides the smooth flow of information between different departments of the organization (Jafarzadeh 2016).

The American Production and Inventory Control Association defines ERP as follows:

"an information system for effective planning and control of all resources required to receive, produce, send and respond to customer needs in manufacturing, distribution and service companies.

There are many other definitions for ERP, including:

ERP is a business software package whose purpose is the integration of information and the flow of information between all departments of the organization, including finance, accounting, human resources, supply chain and customer management. (Davenport, 1998)

ERP systems are changeable and adjustable information systems that integrate information and information-based processes in the organization within organizational units and between them. Hilsgersberg.et al. Some of these articles have examined ERP from a comprehensive and comprehensive perspective. On the other hand, there are studies and articles that have examined a specific aspect of ERP in the following way: (Somers M. & Nelson G. 2004).

General Specialized Researches Figure 1 Spectrum of ERP Research Due to the scope of the discussion and the time limit, this research will focus on one topic. Therefore, the intended research in this research is on the left side of the spectrum and is of specialized research.

In this research, the intention is to evaluate the readiness to use the Enterprise Resource Planning (ERP) system.

To clarify the issue, it is appropriate to determine the place of the discussion in this research among the wide range of ERP:

The execution of an ERP project has many steps and steps, which can be displayed in the framework presented in Figure 2. :

Figure 2) ERP life cycle framework

(Jose M. Esteves, Joan A. Pastor. 2001)

This framework has six ((phase[2])) and four ((dimension[3])). The phases represent different stages of the life cycle of the ERP system in the organization and the dimensions represent different perspectives [4], according to which each of the phases can be examined. Below, we briefly describe the phases and then the dimensions:

The phases are:

1) Adoption: During this phase, managers examine the level of need and readiness of the organization in using an ERP system and choose the general approach of the organization's information systems in such a way that they can clearly define the business challenges and improve the organization's strategies. This stage includes the definition of goals, achievements and requirements.

2) Acquisition: This stage includes choosing the best system that matches the needs of the organization and has the least need for localization. Also, a consulting company is usually selected to accompany the organization in the next steps of ERP implementation.

In this step, factors such as price, training and maintenance services, contractual agreements and return on investment are examined. Usually, this work is done with the help of consultants who are familiar with the implementation methodologies and its skills.

4) Use & Maintenance: This stage includes using the product in a way that achieves the expected benefits. During this phase, aspects such as efficiency, suitability and adequacy should be taken into consideration. Also, once the system is implemented, it must be maintained and its problems solved and new requirements and general improvements applied to it.

5) Evolution: During this stage, the integration of the ERP system with other capabilities such as advanced planning[5], scheduling[6], supply chain management[7], customer relationship management[8] and workflow[9] is tried to be developed and evolved.

6) Retirement: This time stage It is that with the emergence of newer technologies or the ineffectiveness of the ERP system or the change in the organization's business views, managers decide to replace the existing ERP system with another ERP or other information systems that are more in line with the organization's needs.