Understanding the Impact of Technology on Managerial Decision Making - The Case of the ERP System

Previous research has illustrated the difficulty in understanding the impact of new technologies on the work of managers, e.g. their decision making. The breadth of functionality and level of integration in ERP applications means that research on their impact on organisations is particularly difficult to conduct without looking at a very granular level of business process. This paper reports on two in-depth studies of mature ERP applications in two organisations, from the point of view of managers in charge of managing key business processes. The key objective was to construct a framework to represent the impact of ERP on the ability of firms to make good decisions rapidly. We found that, although ERPs are sold as tools to increase speed and visibility of operations, they don't always deliver such benefits. They can distort the reality they seek to represent. Our cross case analysis show that much of the benefits associated with real time access to key operational data is compromised by the use of other technologies, such as off-line data warehouses, business intelligence tools and spreadsheets that are required to correct the distorted reality represented in ERP applications. Thus, decision makers still need to manually combine data from a variety of information systems, thereby losing out on the integration promised by ERP technology.