ERP Systems Implementation And Firm Performance

Abstract

The recent wave of enterprise resource planning systems adoption represents a significant commitment of resources and has a dramatic effect on all business processes. These systems influence a firms performance over a long-term time horizon. This study examines the effect of adoption of ERP on a firms long-term operational performance. Financial data of companies adopting ERP systems and of a matched control group of firms were compared before and after adoption. The results from an analysis of performance differences across time periods has shown that firms adopting ERP systems have exhibited a significantly higher differential performance during the two years following the completion of the system than the control group of firms. These results provide important insights about ERP implementation.