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RESEARCH PRODUCT

Why Benefits Realization from ERP in SMEs Doesn't Seem to Matter?

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Author's version of a chapter in Proceedings of the 44th Hawaii International Conference on System Sciences. Also available from the publisher: http://dx.doi.org/10.1109/HICSS.2011.497 It is often argued that IT investments require active management practices for benefits realization. This applies also to enterprise resource planning (ERP) systems. As well, benefits realization efforts are assumed to create more value than they cost. Hence, the maturity of organizations should be increased and their cultures cultivated towards more rational benefits realization practices. Our study on ERP implementations in Egyptian medium-sized organizations, however, provides aberrant results that challenge the fundamental arguments for formal benefits realization practices. While investments in ERP are regarded as significant, and the projects challenging, formal benefits realization and investment evaluation practices are considered largely irrelevant. The reasons include the "self-evident" nature of ERP benefits, perceived difficulty and costliness of method use and suspicions on rationality of methods. A government policy to support ERP investments may also decrease incentives for further benefits optimization. Cost coordination of the implementation efforts, however, continues to be an issue.