An institutional perspective on sources of ERP package–organisation misalignments

• Published in: The journal of strategic information systems Vol. 13; no. 4; pp. 375 - 397
• Main Authors: Soh, Christina, Sia, Siew Kien
• Format: Journal Article
• Language: English
• Published: Elsevier B.V 01.12.2004
• Subjects: Computer applications; Customization; Enterprise resource planning; ERP package; Package–organisation; Package–organisation; Customization; ERP package
• ISSN: 0963-8687; 1873-1198
• DOI: 10.1016/j.jsis.2004.11.001

Organisations often appear to be unaware of fundamental differences that exist between their organisational context and that which is assumed by ERP package developers. This has undermined expected benefits from ERP implementation, and in extreme cases of package-organisational misalignment, has led to project and even organisational failure. In this study, we explain package-organisational misalignments as the result of differences between the structures embedded in the package and those embedded in the organisation. These differences reflect the different institutional context of the package developers and implementing organisation. Some organisational structures are imposed while other structures are voluntarily adopted. The organisation has less control in the case of imposed structures and misalignments associated with imposed structures are therefore more likely to be resolved through package customization. We apply the framework to three hospitals implementing the same ERP package, identify the structural sources of the misalignments, and analyze the relationship to the type of resolution (package customization or organisational adaptation). We found that imposed structures were indeed overwhelmingly resolved through package customization, while most voluntarily acquired structures were resolved via organisational adaptation. We identified the different context specific sources for these structural differences and contribute to the research on ERP implementation, institutional theory, as well as draw implications for practice in managing package–organisation misalignments.