INTRA-ORGANISATIONAL ERP LIFECYCLE

KNOWLEDGE ISSUES

Greg Timbrell

Queensland University of Technology, Brisbane, Australia

Keywords: Enterprise Resource Planning Systems (ERP), Knowledge Management, Issues Study.

Abstract: A study of 27 ERP systems in the Queensland Government revealed 41 issues clustered into seven major

issue categories. Two of these categories described intra- and inter-organisational knowledge-related issues.

This paper describes and discusses the intra-organisational knowledge issues arising from this research.

These intra-organisational issues include insufficient knowledge in the user base, ineffective staff and

knowledge retention strategies, inadequate training method and management, inadequate helpdesk

knowledge resources, and finally, under-resourced helpdesk. When barriers arise in knowledge flows from

sources such as implementation partner staff, training materials, trainers, and help desk staff, issues such as

those reported in this paper arise in the ERP lifecycle.

1 INTRODUCTION

This paper reports results from a Delphi Study of

major issues that arose during the deployment and

ongoing management of 27 Enterprise Resource

Planning (ERP) systems within the Queensland

Government, a state government of Australia.

In 1994, the Queensland Government selected

SAP R/3 to replace the existing, centrally managed,

mainframe-based, Dun & Bradstreet systems. Each

SAP implementation was managed separately,

employing different implementation partners (IPs),

the majority drawn from large consulting firms e.g.

Accenture. During the course of these

implementations, numerous issues arose, several of

them knowledge-related.

Although increasingly widespread, and despite

warnings in the literature (Boston Consulting Group,

2000), many organisations appear to underestimate

the issues and problems often encountered

throughout the ERP lifecycle. ERP lifecycle-wide

implementation, management, and support are

ongoing concerns. As the number of organisations

implementing ERP increases and ERP applications

within organisations proliferate (Bancroft et al.,

1998; Davenport, 1996; Hiquet et al., 1998; Shtub,

1999), improved understanding of ERP lifecycle

management issues is required so that

implementation, development, management, and

training resources can be allocated effectively

(Gable, 1998).

This paper concentrates on five intra-

organisational, knowledge-related, ERP lifecycle

issues. These five issues were initially identified

during the first round of a Three-round Delphi

process. A factor analysis of weights ascribed to

issues in the third Delphi round resulted in five

issues clustering within a single factor: Knowledge

required to support and run SAP was not managed

effectively.

This study is unique because it built the list of

issues using inductive, data driven and holistic /

interpretive approaches. To date, there has been a

paucity of literature addressing knowledge-related

ERP lifecycle issues.

This paper will firstly describe the Delphi

method by which the issues were uncovered and the

factor analysis that grouped these five issues

together.

Each of the five knowledge-related issues will

then be discussed individually. Finally, this paper

will summarise the knowledge-related findings from

this research programme.

2 DELPHI METHOD

The Delphi method, developed by the Rand

Corporation in the 1950s, is a data collection

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Timbrell G. (2008).

INTRA-ORGANISATIONAL ERP LIFECYCLE KNOWLEDGE ISSUES.

In Proceedings of the Tenth International Conference on Enterprise Information Systems - DISI, pages 226-231

DOI: 10.5220/0001694602260231

 SciTePress

approach designed to structure group opinion and

discussion (Snyder-Halpern et al., 2000).

Mohapatra et al. (1984, p. 159) suggest that a

Delphi study is usually directed to four broad

categories of issues. These are: normative issues

such as goal setting; narrative issues such as

problem statements; predictive issues such as

forecasting occurrence of new events or point values

and trends of key parameters; and, suggestive issues

such as developing causal models and formulating

new policies. The category that this study falls into

is the ‘narrative issues such as problem statements’.

This Delphi-study consisted of three rounds.

Round-One sought to inventory issues. The central

question posed to the target respondents was “What

do you consider have been the major issues in

implementing, managing and/or supporting the

Enterprise System in [agency name]?” 432 surveys

were sent out and 130 were returned of which 112

from 15 clients and five implementation partner (IP)

organisations were usable. Respondents were also

classified as being either Strategic or Operational

staff. 708 raw issues were harvested from this

process. We next synthesised their responses into a

manageable, summary set of issues (initially 41)

using an open-coding approach.

In Round-Two, we validated our summary set of

issues. Each response from Round-One was mapped

to the summary set of issues and returned to each

respondent for confirmation of that mapping.

Following this confirmation round, the research

team held a workshop of senior ERP experts from

Queensland Government. Using Nominal Group

Technique, these experts refined the final set of (37)

summary issues. In Round-Three, respondents were

asked to score or weight the relative importance of

the summary issues using a Likert scale. We elicited

207 usable responses from the population for

Round-Three. Factor analysis was conducted to

identify the major issue categories.

The Delphi Method was deemed the appropriate

method to use because this was an empirical,

exploratory study to systematically identify,

rationalise and determine the relative importance of

ERP lifecycle issues.

The next section reports the list of major issues

categories resulting from the factor analysis. The

(equal) second issue, which describe the internally

focused knowledge issues, is discussed in this paper.

3 FINDINGS

Table 1 lists the major issues arising from a factor

analysis of weights attributed to the 37 issues found

in the Delphi study.

Table 1: Resultant factors.

Major issue Category Rank Mean Std

Dev

Lack of organisation-wide

knowledge strategy reduces

benefits

1 4.92 1.87

Knowledge required to support

and run SAP was not managed

effectively

=2 4.30 2.02

Costs are too high or benefits

relative to costs are too low

=2 4.30 2.16

Customisation and systems

integration

4 4.18 2.03

The SAP system is inadequate or

difficult to use

5 4.17 2.05

Poor management of the

implementation project and

processes

6 4.17 2.11

Organisational restructuring

affected implementation effort

7 3.57 2.14

There are seven factors listed in Table 1 of which

the first two are knowledge-related. The first factor

“Lack of organisation-wide knowledge strategy

reduces benefits” refers to inter-organisational

knowledge issues. These issues are not discussed in

this paper. The second major issue category,

“Knowledge required to support and run SAP was

not managed effectively”, encompassing intra-

organisation knowledge issues, is further explored.

The five issues that clustered into this second

major issue category are: (1) Users do not have

sufficient SAP knowledge; (2) Staff/knowledge

retention strategies were ineffective; (3) The training

method or management was inadequate; (4) Help

desk SAP knowledge was inadequate; and, (5) The

help desk was under-resourced.

This major issue category predominantly

concerns knowledge management issues that are

internal to an organisation. The overall research

argues that ERP knowledge management

decisions/strategies taken early during the systems

lifecycle affect knowledge related decisions at later

points in the lifecycle e.g. if you outsource

implementation management to consultants without

properly constructed knowledge transfer

mechanisms in place, problems can occur in support

and upgrade phases (Timbrell et al., 2003).

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Poorly targeted or inadequate training will lead

to a diminished staff knowledge base putting further

pressure on support and help desk staff.

The help desk is a central source of ERP

knowledge in an organisation. Because it is often the

last internal knowledge resource before seeking

(often expensive) outside assistance, insufficient

help desk knowledge can result in diminished ERP

performance and (possibly) reduced organisational

effectiveness.

Even if an organisation has developed sufficient

ERP expertise within its staff and help desk during

an implementation, part of an enterprise knowledge

strategy must address retaining that expertise. Under

certain market conditions specific knowledge can

become scarce, thereby forcing up its price. This

major issue category includes issues that result from

a paucity of internal knowledge resources.

The following sections will discuss each of the

five issues in detail. The format of the discussion

will be as follows: firstly, a description of the issue

from the Round-Three survey is provided; secondly,

there is an example of a (Round-One) response from

which the issue category is derived; thirdly, there is

an example comment from a respondent from the

Round; this is followed by general discussion on the

issue; finally, some comments are made about the

different perspectives of responding cohorts –

Operational vs. Strategic Staff and Client vs. IP.

3.1 Users do not have Sufficient SAP

Knowledge

The respondents who rated this issue perceived that

“For a variety of reasons users do not have

sufficient knowledge about the SAP system to run,

maintain or configure it properly”.

An example of a Round-One issue reported by a

[Client-Strategic] respondent in this category is:

“System Knowledge - Not full knowledge of system

and its requirements and some were critical for

usage.”

A comment made in Round-Three by a [Client-

Operational] respondent in the same department

noted: “General users – as with any system, some

users excel and some have ongoing difficulties,

while the majority learn enough to perform their

duties. User knowledge limited by the amount of

initiative or desire to understand the system.”

3.1.1 Discussion

This issue addresses users’ lack of knowledge of the

SAP system. The identification by respondents of a

lack of knowledge about the SAP applications

within the user community implies that greater

knowledge would enable the system to function

better and, subsequently, there would be greater

resultant benefits to the organisation. A Round-One

respondent noted that users were unaware of some

necessary critical functions in SAP that required

ongoing oversight. This is an example of

‘unconscious incompetence’ where a novice does

not realise they are making errors through lack of

knowledge (Howell, 1982).

This issue is the third highest ranked issue in the

study. Comments from Round-Three vary in their

reasons for the lack of SAP user knowledge. One

respondent blames the users themselves for not

exploring the software of their own accord. Another

suggests that the training was inadequate and yet

another blames this outcome on the reliance and role

of the IPs. This is an example of ‘finger pointing’:

one group blaming another for weaknesses, issues or

the non-realisation of benefits.

Operational vs. Strategic: Operational staff

ranked this issue as the second most important issue

overall with Strategic staff ranking it seventh. The

two cohorts generally agree on the importance of

this issue.

Client vs. IP: While Client staff ranked this issue

second, IP staff ranked it nineteenth. The mean of

Accenture’s and PWC’s rating was the same at 4.0,

below that of all the major agencies. The difference

in perception of this issue’s importance between

Client and IP could be illustrated by the IP’s

comment in the Round-Three survey (above) where

they note that the users’ knowledge is increasing

over time. In other words they could be suggesting

that this lack of knowledge will correct itself and

therefore is not an ongoing concern.

3.2 Staff/Knowledge Retention

Strategies were Ineffective

The respondents who rated this issue perceived that

“Staff (and their knowledge of SAP) were lost to

other organisations. The incentives and strategies to

retain them were inadequate” (Round-Three Survey

Instrument).

An example of a Round-One issue pertaining to

“Staff (and their knowledge of SAP) were lost to

other organisations” reported by a [Client-

Operational] respondent in this category is:

Knowledge drain - Implementation partners overly

responsible for configuration. Departure of

implementation partner meant departure of

specialist knowledge insufficient skill sharing. In

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relation to: “The incentives and strategies to retain

them were inadequate”, a [Client-Strategic]

respondent reported: Retaining skilled staff

whenever in house staff are trained to a high level of

proficiency, the market place beckons as the salaries

paid in the commercial are higher than those on

offer in the public sector.

3.2.1 Discussion

The world-wide market for SAP R/3 was booming

in the mid to late 1990s and demand for staff was

very high. Vayo, a Queensland Government senior

ERP manager, reported that once they went ‘live’,

most Queensland Government departments

immediately lost their skilled staff.

Skilled and experienced SAP staff working in the

government could sometimes double their salaries

by moving into implementation partners or just

contracting to implementing organisations.

By 2000, most departmental implementations

had finished. The end of the implementations led to

a subsequent drop off in demand for SAP expertise.

Scores of consultants were made redundant and the

salary levels collapsed. SAP support staff were

now in plentiful supply but this development did not

necessarily solve the knowledge retention issue.

Following the Year 2000 ‘event’, agencies began

implementing the first round of SAP upgrades. In

come cases (e.g. Premiers), the extent and cost of

these major upgrades matched or exceeded the initial

implementation and management began to

appreciate the need to recall their lessons and

practices from these initial projects.

3.3 The Training Method or

Management was Inadequate

The respondents who rated this issue perceived that

“The quality and/or quantity of training was

unsatisfactory and did not prepare users and/or help

desk personnel adequately. Trainers did not have

sufficient experience in the software. The training

strategy was poorly executed. Training has not been

ongoing” (Round-Three Survey Instrument).

An example of a Round-One issue reported by a

[Client-Strategic] respondent in this category is:

Inadequate training of Implementation Team:

Agency resources should be given adequate pre-

implementation training and background knowledge

in the capability of SAP.

A comment made in Round-Three by a [IP-

Operational] respondent observed: Often to cut

costs, training is provided on a train the trainer

basis. The newly trained trainer may not follow

through properly.

3.3.1 Discussion

Training and updating employees in ERP knowledge

is a major challenge. ERP are complex and

employees not only have to absorb the technical

knowledge but also their new process

responsibilities (Bingi et al., 1999). Sumner (2000)

identified ‘insufficient training and re-skilling of the

IT workforce in new technology’ as a risk factor in

the systems implementation and maintenance phases

of an ERP system project. Markus et al. (2000)

noted common ERP training related problems such

as poor quality of training materials and cutting

training when the schedule gets tight. Both Bancroft

(1996) and Esteves and Pastor (2001) suggested

training users and the project team were critical

success factors for ERP success.

The training strategy for ERP implementations

commonly used in the Queensland Government is

‘train the trainer’. Outside experts and IPs provide

Client staff with training materials and guidance on

the training process. The client staff would then be

‘seeded’ back into the user environment to run

training courses and provide support. Ideally these

would be personnel who were familiar with the

business environment and had a sound grasp of the

system’s technical aspects. Unfortunately, market

forces attracted such people away to join consulting

firms, diluting the expertise in the training pool.

Under the old QGFMS regime (Dun &

Bradstreet) training was run centrally by FISB senior

consultants who had a strong grasp of the software

and practical experience in its application. In the

new SAP environ, FISB training staff were

relatively inexperienced in all aspects of the

application: support, implementation and operation.

Client vs. IP: Client staff ranked this issue at 9th

position in the top quartile while IP staff ranked this

issue at 23rd in the 3rd quartile. The difference in

rankings could be explained by the fact that IP staff

were responsible for the development of training

strategy, training materials and in some cases

delivery of training. Client staff, for the most part,

were the recipients of the training. They were

affected by the consequences of the training methods

and management and therefore more sensitive to this

issue.

Operational vs. Strategic: Operational staff

ranked this issue at 14th in the second quartile while

Strategic staff ranked this issue at 25th in the 3rd

quartile. Operational staff were more affected by the

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consequences of the training, they being the

personnel who had to bear the frustration of

operating a system without the benefit of satisfactory

training. Strategic staff were more likely to be

‘information clients’ of the operational staff ie. the

recipients of reports generated by operational staff.

Chang (2002) reported similar outcomes in his

study as did Dhaheri (2002) in his study of Oracle

Financials in the Abu Dhabi government.

3.4 Help Desk SAP Knowledge was

Inadequate

The respondents who rated this issue perceived that

“Users AND/OR help desk personnel regard the

SAP knowledge of the help desk personnel to be

insufficient to meet the needs of help desk

customers. This issue relates to the quality of the

SAP knowledge of help desk personnel” (Round-

Three Survey Instrument).

An example of a Round-One issue reported by a

[Client-Operational] respondent in this category is:

Help Desk - At times it appears that the people who

are there to answer the questions are not able to as

they do not have a practical application of the

system ... A comment made in Round-Three by a

[Client-Operational] respondent observed: This was

due to the knowledge transfer from the subject

matter experts (SME) and the consultants to the

helpdesk staff being very inadequate.

3.4.1 Discussion

Help desks play a critical role in the support and

maintenance of ERP. The breaking up of ERP

support in the Queensland Government from a

largely centralised model to a predominantly

decentralised model had a large effect on the

structure and management of help desks.

Users were used to the three-tiered centralised

model of a local help desk, a central help desk in the

Treasury Department provided by senior personnel

with implementation and ongoing management

experience, and through Treasury, tertiary assistance

provided by the vendor. In the new de-centralised

environment, a two-tiered support system

eventuated. Staff in individual departments

provided tier-one support. Initially Treasury

provided tier-two support but this proved

unsatisfactory as they had not developed sufficient

capability to do so and this service was closed down.

Tier-three support came from SAP or IPs. Survey

respondents believed that the help desk staff were

under-trained or that continuous turnover of

contracted help desk staff diminished their capability

to support SAP.

Eventually, all the decentralised help desk

support for SAP was combined into one

organisation, CorpTech, in 2003. By 2007, this was

outsourced to IBM.

Strategic vs. Operational: Strategic staff ranked

this issue 28th in the 4th quartile of the rankings.

Operational staff ranked it higher at 20th place

probably because they were more affected by the

lack of knowledge in help desk staff. Unresolved

help desk queries usually result in ERP tasks not

being fulfilled often creating frustration amongst

operational staff.

3.5 The Help Desk was

Under-resourced

The respondents who rated this issue perceived that

“This issue relates to the quantity of help desk

resources: particularly understaffing, lack of

responsiveness, lack of staff looking after systems or

knowledgeable help desk staff assigned to other

duties” (Round-Three Survey Instrument).

An example of a Round-One issue reported by a

[Client-Operational] respondent in this category is:

Resource allocation - Support unit under-resourced

– staffing insufficient to both maintain and enhance.

3.5.1 Discussion

It is difficult to predict the workload of help-desk

particularly with a new application. If the service

from help-desk personnel is slow, a user may

perceive the help-desk knowledge to be inadequate,

whereas the real problem is that there isn’t enough

staff to process help-desk inquiries. This issue

reflects a quantitative lack of resources rather than a

qualitative lack of knowledge resources.

Respondents ranked this issue quite low: 29th,

and so in the bottom quartile.

Client vs. IP: Client staff ranked this issue at

26th, slightly higher than IP staff who ranked it at

34th. Client staff would have been more affected by

the lack of resources in the help-desk explaining

their slightly higher ranking.

Strategic vs. Operational: Operational staff

ranked this issue at 25th, higher than Strategic staff

who ranked it at 35th.

The difference in both Client vs. IP rankings and

Strategic vs. Operational rankings is consistent with

the differences in the issue “Help Desk SAP

knowledge was inadequate”.

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4 CONCLUSIONS

Like the previous major issue category, this category

illustrates the importance of knowledge management

to enterprise systems in organisations. Here, had

sufficient attention been paid by organisations to the

better management of knowledge, particularly in the

training and help desk functions, the above issues

may not have attracted the level of importance

recorded by respondents during Round-Three of the

modified Delphi study.

There are several knowledge sources addressed

in this major issue category. These knowledge

sources include: IP staff, training materials and

trainers, and other users and the help desk staff (both

internal and external). Knowledge flows from these

sources to the system users so they can effectively

operate the ERP for the benefit of the organisation.

When barriers arise between the sources and

recipients of ERP knowledge, issues such as those

described in this section arise.

The issues in this category also make a

distinction between the insufficient knowledge and

insufficient resources to distribute this knowledge.

Even when, for example, there is sufficient

knowledge in the help desk function to address

ongoing problems, there must also be sufficient

numbers of staff to handle the support load. This

distinction has not been made in prior studies.

ERP lifecycle knowledge-related issues account

for the top categories in this major issues study,

outranking other, sometimes more prevalent and

commonly found issues, listed in the lower ranked

factors.

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