Development of a Small Business ERP Consultant Knowledge

Development of a Small Business ERP Consultant Knowledge Base David L. Olson, Univ. of Nebraska Vo Van Huy, Ho Chi Minh City Univ. of Tech. Nguyen Manh Tuan, Ho Chi Minh City Univ. of Tech. CONFENIS 2011, Aalborg

ERP ISSUES • Applicability of ERP to small businesses • How consultancy knowledge bases can be built • ERP Training – How to use the software – How to do your job in the new environment CONFENIS 2011, Aalborg

ERP in SMEs • There are risks to SMEs from ERP – Iskanius [2010]; Chang & Hung [2010] • SAP, Oracle too expensive for SMEs – Premkumar [2003] • SMEs can develop in-house ERP – Olsen & Sμtre [2007] CONFENIS 2011, Aalborg

ERP Risks for SMEs Poba-Nzaou et al. [2008] 1. Organizational risk includes personnel and organizational structure impact 2. Business-related risk involves changing business processes 3. Technological risk relates to computer and software systems 4. Entrepreneurial risk relates to top management views, 5. Contractual risk deals with relationships with contracted partners 6. Financial risk involves cash flow impact – – ERP system benefits tend to be in the long-run Costs tend to occur early CONFENIS 2011, Aalborg

Consultant Role • Consultancies emerging to serve SMEs – Chen et al. [2008]; Koh et al. [2009] • Help with – System design – Selection – Implementation – Training CONFENIS 2011, Aalborg

Knowledge Management • Consultants have experience in multiple ERP installations – Can thus develop knowledge bases • Tsai et al. [2009] • Training especially critical • Wang et al. [2007]; Bradley [2008] – Strong tendency to underestimate training cost • Slater [1998] CONFENIS 2011, Aalborg

System Components (Adapted from Gharajedaghi, 2005) • Function Structure Process 1 st iteration Context 2 nd iteration …. . nth iteration CONFENIS 2011, Aalborg

Structure HY-ICT information-communications technology consultant, Vietnam • Consulting case structure – Symptoms to identify problems, difficulties – Diagnose to explain problems – Treatment to remove symptoms • Consulting manifestations: – Key organizational knowledge tracks sales • Historical project profiles by industry, service • Pre-sales activities – visits, client business practices • ERP Implementation – user training, product installation, customization, Signed-off agreement CONFENIS 2011, Aalborg

Function • Human resources 1. Number of people involved (educational level, training) 2. Human resource quality (ability to develop & design products) 3. Development strategy • Training – – – Consultant training about ERP functionality Key user/division head training of business applications Client end-user training about operations • Key role as organizing business processes and tasks CONFENIS 2011, Aalborg

Process • • Business specifications & requirements Allocation of technical staff Create project development plan Software product – Identify existing business activities & systems • Competitive advantages • Off-the-shelf products available – Explore existing business processes • Train key users • Perform customization or select modules • Obtain management approval CONFENIS 2011, Aalborg

Context • Knowledge about dealing with new circumstances • Common source of change – governmental regulation (accounting requirements) • EXAMPLE: – Call center services • Individual operation response/action to inquiries • Over time – operator response data file is key asset • Give every operator instructions on rules of action – Organizational habits CONFENIS 2011, Aalborg

HY-ICT • Private medium-sized Information. Communications Technology consulting company • Specialize in enterprise-wide software implementation – Customization & implementation of ERP systems such as Oracle, Microsoft • BUSINESS GOALS: – Serve SMEs in Vietnam CONFENIS 2011, Aalborg

Knowledge Management Data • HY-ICT mission – Consult in implementing ERP packages • Two key business activities – Sales of ERP packages – Training • Database – Historical project profiles – Original product provider training & support – Pre-sales activities • Visits, explore client software practices – Implementation • User training • Product installation • Customizing CONFENIS 2011, Aalborg

Initial Codes • 13 common business processes – Organized into 5 categories of incidents • • • Time Business actors Business environment Business actions & Processes Business performance – Based on 8 interviews, 20 web pages coded by interview protocol – Four types of concepts • • Ends Means Process (behavior) Context (threshold) CONFENIS 2011, Aalborg

Knowledge Management as Training 1. Training for business consultants 2. Training for client key users or division heads 3. Training for client end-users • Each had different problems – Ground knowledge on experience • By vendor (SAP or Oracle) – Clearly identify key business processes to sort training classes – Organize training by business process CONFENIS 2011, Aalborg

Conclusions • HY-ICT revealed value of ERP consultants to SMEs • Competitive pressures make ERP mandatory for some organizations – New regulations also create demand • KEY ISSUES – Applicability of ERP to SMEs – How consultant knowledge bases can be developed – Training issues CONFENIS 2011, Aalborg

KEY FINDING • Organizational knowledge behaves as a system – Manifests itself as business activities • Structure – Justification of ERP packages as business effects on the bottom line • Function – Focus of ERP implementation on organizing business processes and tasks, particularly training. • Process – Customized ERP packages as in-demand products • Context – Adopted best practices or maintained business acts as business habits • ERP can be very useful to Vietnamese SMEs CONFENIS 2011, Aalborg