Identifying success factors for implementation of ERP at Indian SMEs: A comparative study with Indian large organizations and the global trend

The purpose of this paper is to identify the success factors for implementation of enterprise resource planning (ERP) at Indian small to medium‐sized enterprises (SMEs) and to provide a comparative study with the trend in Indian large organizations and the global trend.

In this paper, the authors propose a hypothetical success factors model to address the research questions and validated the hypotheses using large‐scale survey‐based methodology. In this research the authors evaluated the success factors for implementation of ERP in Indian SMEs and then compared them with large Indian organizations and the global trends. In this paper, the authors have also tried to give some intuitive explanation to the possible reasons of difference between factors for SMEs compared to large organizations and global trends.

It was found that four of the five hypothesized technological factors are significantly related to the success of ERP implementation. They are: comprehensiveness of software development/process integration plan; significance of age of IT infrastructure; comprehensiveness of data migration plan; and extensiveness of system testing. Also, four of the nine hypotheses/sub‐hypotheses amongst the people factors are significantly related to the success of ERP implementation. They are: blend of cross‐functional employees in the team; extent of empowerment of decision‐making team; significance of morale of the implementation team; and exhaustiveness of user training. The authors have found that ten of the 11 hypothesized organizational factors are significantly related to the success of ERP implementation. They are: organisation's adaptability to changes; involvement of top management; degree of customization; efficiency of business process re‐engineering; exhaustiveness of contingency plans; clarity in definition of milestones; clarity in evaluation of milestones; alignment of ERP package with business processes; comprehensiveness of implementation strategy; involvement of consultant in implementation strategy; clarity of project status disclosure; and appraisal of clients about ERP strategy.

Though enough work has been done on implementing ERP systems in large organizations across the globe, the small and medium‐sized firms of India are largely left untouched. Through this paper, the authors aim to find out the various critical factors that any of these SMEs should keep in mind when planning the implementation of an ERP system.