The impact of ERP deployment upon organizational structure: a mixed method study of Chinese practices
Information technology (IT) plays an important role in the daily operation of themodem business organization. The implications for, and influences onorganizational structure from the deployment of IT have long been recognized. Oneof the most important, recent innovations, in the world of information technology,has been the Enterprise Resource Planning (ERP) system. Because of its widereach, sophistication and highly integrated nature, it is potentially far more powerfuland advanced than any of its predecessors, and thus has the potential to greatlyinfluence organizational practices and design. However, the understanding of theorganizational impact of IT in general, and ERP in particular, is rather limited. Due tothe shortcomings of past studies, no clear consensus has been reached withrespects to the structural impact of IT Moreover, though there 4ave been a largenumber of studies focusing on the implementation of EPR, very few empirical workshave explicitly and systematically explored the influence of ERP on a range ofdifferent structural dimensions.This study aims to fill these gaps in the literature, and in so doing, generate a morecomprehensive understanding of the organizational impacts of ERP To this end, itadopted a mixed method in order to deliver a more balanced and richer set ofconclusions. The outcomes of the quantitative data analysis confirmed the generalinfluences of ERP on a range of different structural dimensions. More specifically, ithas been shown that the deployment of ERP can lead to a flatter, moredecentralized, more standardized and a more tightly integrated organizationalstructure. Furthermore, the qualitative data provided meaningful insight into thestructural impact of ERP, in Chinese context. In addition,, the various analyses foundimportant associations amongst the corporate strategy, organizational structure,ERP deployment and organizational flexibility constructs, and in so doing,demonstrated that the relationship between ERP deployment and organizationalstructure is not independent of its organizational context. Indeed, it is shown that theresults of this study provide support for the 'configurational' view of organizationalstrategy and behaviour. Finally, this study's results have been strengthened bymodelling the technological artefact using a more balanced set of measures thanhad been employed in previous studies. Indeed, it was demonstrated that the use ofERP success, rather than the scale of its adoption, to model the independentvariable, was a more effective indicator of changes to structural design, andultimately also to the realization of organizational flexibility.
Year of publication: |
2007
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Authors: | Wang, Leitao |
Publisher: |
Leitao Wang |
Subject: | Information Technology (IT) | Enterprise Resources Planning (ERP) | Organizational structure | China | Centralization | Standardization | Configuration | Strategy | Flexibility |
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