Skip to main content
SpringerLink
Log in

Antecedents of ERP assimilation and its impact on ERP value: A TOE-based model and empirical test

  • Published:
Information Systems Frontiers Aims and scope Submit manuscript

Abstract

Drawing on the technology-organization-environment (TOE) framework and prior IT assimilation literature, we develop and test an integrated model of ERP assimilation and value in Chinese firms. We also contrast the strength of the antecedents of ERP assimilation and value across different ownership types. Our empirical results using a survey data showed that relative advantage, complexity, compatibility, top management support, organization fit, financial commitment and competitive pressure are significant predictors for ERP assimilation. We also found that the linkage from ERP assimilation to ERP value is very significant. In addition, the strength of the antecedents of ERP assimilation and value varies dramatically across different firm ownership types. Our study confirms that traditional diffusion of innovation attributes, top management support and competitive pressure are significant during the whole ERP life cycle. Our findings also emphasize and validate the importance of ERP assimilation in improving firm performance, and provide evidence for the continued debate on ERP payoff and information technology productivity paradox. In sum, these findings provide insights into how ERP assimilation and ERP value are influenced by contextual elements, and how the impacts may vary across different ownership types.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Fig. 1
Fig. 2

Similar content being viewed by others

References

  • Al-Mashari, M., Al-Mudimigh, A., & Zairi, M. (2003). Enterprise resource planning: a taxonomy of critical factors. European Journal of Operational Research, 146(2), 352–364.

    Article  Google Scholar 

  • Bajwa, D. S., Lewis, L. F., Pervan, G., Lai, V. S., Munkvold, B. E., & Schwabe, G. (2008). Factors in the global assimilation of collaborative information technologies: an exploratory investigation in five regions. Journal of Management Information Systems, 25(1), 131–165.

    Article  Google Scholar 

  • Bala, H., & Venkatesh, V. (2007). Assimilation of interorganizational business process standards. Information Systems Research, 18(3), 340–362.

    Article  Google Scholar 

  • Barney, J. B. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99–120.

    Article  Google Scholar 

  • Bradford, M., & Florin, J. (2003). Examining the role of innovation diffusion factors on the implementation success of enterprise resource planning systems. International Journal of Accounting Information Systems, 4(3), 205–225.

    Article  Google Scholar 

  • Chan, F. T. S., & Chong, A. Y. (2013). Determinants of mobile supply chain management system diffusion: a structural equation analysis of manufacturing firms. International Journal of Production Research, 51(4), 1196–1213.

    Article  Google Scholar 

  • Chang, S., Yen, D., Ng, C., Chang, I. C., & Yu, S. (2011). An ERP system performance assessment model development based on the balanced scorecard approach. Information Systems Frontiers, 13(3), 429–450.

    Article  Google Scholar 

  • Chatterjee, D., Grewal, R., & Sambamurthy, V. (2002). Shaping up for e-commerce: institutional enablers of the organizational assimilation of web technologies. MIS Quarterly, 26(2), 65–89.

    Article  Google Scholar 

  • Darshana, S., Gable, G., & Rosemann, M. (2001). A balanced scorecard approach to enterprise systems performance measurement. Proceedings of the Twelfth Australasian Conference on Information Systems, December 4–7, Coffs Harbour, NSW, Australia.

  • Davenport, T. H. (1998). Putting the enterprise into the enterprise system. Harvard Business Review, 76(4), 121–131.

    Google Scholar 

  • Davenport, T. H. (2000). Mission critical. Boston: Harvard Business School press.

    Google Scholar 

  • Delone, W. H., & McLean, E. R. (1992). Information systems success: the quest for the dependent variable. Information Systems Research, 3(1), 60–95.

    Article  Google Scholar 

  • Devaraj, S., & Kohli, R. (2003). Performance impacts of information technology: is actual usage the missing link? Management Science, 49(3), 273–289.

    Article  Google Scholar 

  • Fichman, R. G., & Kemerer, C. F. (1997). The assimilation of software process innovations: an organizational learning perspective. Management Science, 43(10), 1345–1363.

    Article  Google Scholar 

  • Fornell, C., & Larcker, D. F. (1981). Evaluating structural equation models with unobservable variables and measurement error. Journal of Marketing Research, 18(1), 39–50.

    Article  Google Scholar 

  • Gallivan, M. J. (2001). Organizational adoption and assimilation of complex technological innovations: development and application of a new framework. The Data Base for Advances in Information Systems, 32(3), 51–85.

    Article  Google Scholar 

  • Gattiker, T. F., & Goodhue, D. L. (2005). What happens after ERP implementation: understanding the impact of interdependence and differentiation on plant-level outcomes. MIS Quarterly, 29(3), 559–585.

    Google Scholar 

  • Grover, V., & Davenport, T. H. (2001). General perspectives on knowledge management: fostering a research agenda. Journal of Management Information Systems, 18(1), 5–21.

    Google Scholar 

  • Hitt, L. M., Wu, D. J., & Zhou, X. (2002). Investment in enterprise resources planning: business impact and productivity measures. Journal of Management Information Systems, 19(1), 71–98.

    Article  Google Scholar 

  • Hong, K. K., & Kim, Y. G. (2002). The critical success factors for ERP implementation: an organizational fit perspective. Information Management, 40(1), 25–40.

    Article  Google Scholar 

  • Hunton, J. E., Lippincott, B., & Reck, J. L. (2003). Enterprise resource planning systems: comparing firm performance of adopters and nonadopters. International Journal of Accounting Information Systems, 4(3), 165–184.

    Article  Google Scholar 

  • Kaplan, R. S., & Norton, D. P. (1992). The balanced scorecard-measures that drive performance. Harvard Business Review, 70(1), 71–79.

    Google Scholar 

  • Karimi, J., Somers, T. M., & Bhattacherjee, A. (2007). The impact of ERP implementation on business process outcomes: a factor-based study. Journal of Management Information Systems, 24(1), 101–134.

    Article  Google Scholar 

  • Keil, M., Tan, B. C. Y., Wei, K. K., Saarinen, T., Tuunainen, V., & Wassenaar, A. (2000). A cross-cultural study on escalation of commitment behavior in software projects. MIS Quarterly, 24(2), 299–324.

    Article  Google Scholar 

  • Li, D. H., Chau, P. Y. K., & Lai, F. (2010a). Market orientation, ownership type, and e-business assimilation: evidence from Chinese firms. Decision Sciences, 41(1), 115–145.

    Article  Google Scholar 

  • Li, D., Lai, F., & Wang, J. (2010b). E-business assimilation in China’s international trade firms: the technology-organization-environment framework. Journal of Global Information Management, 18(1), 39–65.

    Article  Google Scholar 

  • Liang, H., Saraf, N., Hu, Q., & Xue, Y. (2007). Assimilation of enterprise systems: the effect of institutional pressures and the mediating role of top management. MIS Quarterly, 31(1), 59–87.

    Google Scholar 

  • Lin, H., & Lin, S. (2008). Determinants of e-business diffusion: a test of the technology diffusion perspective. Technovation, 28(3), 135–145.

    Article  Google Scholar 

  • Liu, L., Feng, Y., Hu, Q., & Huang X. (2010). Understanding organizational level ERP assimilation: a multi-case study. Proceedings of the 43rd Hawaii International Conference on System Sciences, January 5–8, Koloa,Kauai,HI,USA.

  • Mabert, V. A., Soni, A., & Venkataramanan, M. A. (2003). Enterprise resource planning: managing the implementation process. European Journal of Operational Research, 146(2), 302–314.

    Article  Google Scholar 

  • Maloni, I., & Benton, W. C. (1997). Supply chain partnerships: opportunities for operations research. European Journal of Operational Research, 10(3), 419–429.

    Article  Google Scholar 

  • Markus, M. L., & Tanis, C. (2000). The enterprise systems experience-from adoption to success. In R. W. Zmud (Ed.), Framing the domains of IT management: Projecting the future through the past (pp. 173–207). Cincinnati: Pinnaflex Educational Resources.

    Google Scholar 

  • Martinsons, M. G. (2004). ERP in China: one package, two profiles. Communications of the ACM, 47(7), 65–68.

    Article  Google Scholar 

  • Mascarenhas, B. (1989). Domains of stated-owned, privately held, and publicly traded companies in international competition. Administrative Science Quarterly, 34(4), 582–597.

    Article  Google Scholar 

  • Moore, G. C., & Benbasat, I. (1991). Development of an instrument to measure the perceptions of adopting an information technology innovation. Information Systems Research, 2(3), 192–221.

    Article  Google Scholar 

  • Murphy, K. E., & Simon, S. J. (2002). Intangible benefits valuation in ERP projects. Information Systems Journal, 12(4), 301–320.

    Article  Google Scholar 

  • Nicolaou, A. I. (2004). Firm performance effects in relation to the implementation and use of Enterprise Resource Planning Systems. Journal of Information Systems, 18(2), 79–105.

    Article  Google Scholar 

  • Nunnally, J. (1978). Psychometric theory. New York: McGraw-Hill.

    Google Scholar 

  • Peng, M. W., Tan, J., & Tong, T. (2004). Ownership types and strategic groups in an emerging economy. Journal of Management Studies, 41(7), 1105–1129.

    Article  Google Scholar 

  • Podsakoff, P., & Organ, D. (1986). Self-reports in organizational research: problems and prospects. Journal of Management, 12(4), 531–544.

    Article  Google Scholar 

  • Podsakoff, P., MacKenzie, S., Lee, J., & Podsakoff, N. (2003). Common method biases in behavioral research: a critical review of the literature and recommended remedies. Journal of Applied Psychology, 88(5), 879–903.

    Article  Google Scholar 

  • Porter, M., & Millar, V. (1985). How information gives you competitive advantage. Harvard Business Review, 63(4), 149–160.

    Google Scholar 

  • Poston, R., & Grabski, S. (2001). Financial impacts of enterprise resource planning implementations. International Journal of Accounting Information Systems, 2(4), 271–294.

    Article  Google Scholar 

  • Purvis, R. L., Sambamurthy, V., & Zmud, R. W. (2001). The assimilation of knowledge platforms in organizations: an empirical investigation. Organization Science, 12(2), 117–135.

    Article  Google Scholar 

  • Rajagopal, P. (2002). An innovation-diffusion view of implementation of enterprise resource planning systems and development of a research model. Information Management, 40(2), 87–114.

    Article  Google Scholar 

  • Ramamurthy, K., Premkumar, G., & Crum, M. R. (1999). Organizational and inter-organizational determinants of EDI diffusion and organizational performance: a causal model. Journal of Organizational Computing and Electronic Commerce, 9(4), 253–285.

    Article  Google Scholar 

  • Ranganathan, C., Dhaliwal, J. S., & Teo, T. S. H. (2004). Assimilation and diffusion of web technologies in supply-chain management: an examination of key drivers and performance impacts. International Journal of Electronic Commerce, 9(1), 127–161.

    Google Scholar 

  • Rogers, E. M. (1995). Diffusion of innovations (4rded). New York: Free Press.

    Google Scholar 

  • Ross, J. W., & Vitale, M. R. (2000). The ERP revolution: surviving vs. thriving. Information Systems Frontiers, 2(2), 233–241.

    Article  Google Scholar 

  • Russell, D. M., & Hoag, A. M. (2004). People and information technology in the supply chain. International Journal of Physical Distribution and Logistics Management, 34(2), 102–122.

    Article  Google Scholar 

  • Schultz, R. L., & Slevin, D. P. (1975). Implementing operations research/management science. New York: American Elsevier Publication.

    Google Scholar 

  • Sethi, V., & King, W. R. (1994). Development of measures to assess the extent to which an information technology application provides competitive advantage. Management Science, 40(12), 1601–1627.

    Article  Google Scholar 

  • Shang, S., & Seddon, P.B. (2000). A comprehensive framework for classifying the benefits of ERP system. Long Beach California: In Proceedings of the 2000 Americas Conference on Information System, 1005–1014.

  • Skok, W., & Legge, M. (2002). Evaluating Enterprise Resource Planning (ERP) Systems using an interpretive approach. Knowledge and Process Management, 9(2), 72–82.

    Article  Google Scholar 

  • Spathis, C., & Constantinides, S. (2003). The usefulness of ERP systems for effective management. Industrial Management & Data Systems, 103(9), 677–685.

    Article  Google Scholar 

  • Straub, D. (1989). Validating instruments in MIS research. MIS Quarterly, 13(2), 147–169.

    Article  Google Scholar 

  • Thong, J. Y. L. (1999). An integrated model of information systems adoption in small businesses. Journal of Management Information Systems, 15(4), 187–214.

    Article  Google Scholar 

  • Tornatzky, L. G., & Fleischer, M. (1990). Processes of technological innovation. Lexington: Lexington Books.

    Google Scholar 

  • Tornatzky, L. G., & Klein, K. J. (1982). Innovation characteristics and innovation adoption implementation: a meta-analysis of findings. IEEE Transactions on Engineering Management, 29(1), 28–45.

    Article  Google Scholar 

  • Vluggen, M. (2005). The determinants of enterprise resources planning (ERP) systems usage levels: An empirical study. The 5th European conference on accounting information systems, Copenhagen, Denmark.

  • Wang, E., Shih, S. P., Jiang, J. J., & Klein, G. (2008). The consistency among facilitating factors and ERP implementation success: a holistic view of fit. Journal of Systems and Software, 81(9), 1609–1621.

    Article  Google Scholar 

  • Wang, Y. M., Wang, Y. S., & Yang, Y. F. (2010). Understanding the determinants of RFID adoption in the manufacturing industry. Technological Forecasting and Social Change, 77(5), 803–815.

    Article  Google Scholar 

  • Wieder, B., Booth, P., Matolscy, Z. P., & Ossimitz, M. L. (2006). The impact of ERP systems of firm and business performance. Journal of Enterprise Information Management, 19(1), 13–29.

    Article  Google Scholar 

  • Wu, I. L., & Chuang, C. H. (2010). Examining the diffusion of electronic supply chain management with external antecedents and firm performance: a multi-stage analysis. Decision Support Systems, 50(1), 103–115.

    Article  Google Scholar 

  • Xu, S., Zhu, K., & Gibbs, J. (2004). Global technology, local adoption: a cross-country investigation of internet adoption by companies in the United States and China. Electronic Markets, 14(1), 13–24.

    Article  Google Scholar 

  • Yu, C. S., & Tao, Y. H. (2009). Understanding business-level innovation technology adoption. Technovation, 29(2), 92–109.

    Article  Google Scholar 

  • Zabjek, D., Kovacic, A., & Stemberger, M. I. (2009). The influence of business process management and some other CSFs on successful ERP implementation. Business Process Management Journal, 15(4), 588–608.

    Article  Google Scholar 

  • Zhang, Z., Matthew, K. O. L., Pei, H., Liang, Z., & Huang, X. Y. (2005). A framework of ERP systems implementation success in China: an empirical study. International Journal of Production Economics, 98(1), 56–80.

    Article  Google Scholar 

  • Zhang, N., Guo, X., & Chen, G. (2011). Why adoption and use behavior of IT/IS cannot last? Two studies in China. Information Systems Frontiers, 13(3), 381–395.

    Article  Google Scholar 

  • Zhao, X., Flynn, B. B., & Roth, A. V. (2006). Decision sciences research in China: a critical review and research agenda ---foundations and overview. Decision Sciences, 37(4), 451–496.

    Article  Google Scholar 

  • Zhu, K., & Kraemer, K. L. (2005). Post-adoption variations in usage and value of e-business by organizations: cross-country evidence from the retail industry. Information Systems Research, 16(1), 61–84.

    Article  Google Scholar 

  • Zhu, K., Kraemer, K., & Xu, S. (2003). Electronic business adoption by European firms: a cross-country assessment of the facilitators and inhibitors. European Journal of Information Systems, 12(4), 251–268.

    Article  Google Scholar 

  • Zhu, K., Kraemer, K. L., Xu, S., & Dedrick, J. (2004). Information technology payoff in e-business environments: an international perspective on value creation of e-business in the financial services industry. Journal of Management Information Systems, 21(1), 17–54.

    Google Scholar 

  • Zhu, K., Xu, S., Kraemer, K. L., & Dedrick, J. (2006a). Global convergence and local divergence in e-commerce: Cross-country analyses. In K. L. Kraemer, J. Dedrick, N. Melville, & K. Zhu (Eds.), Global e-commerce: Impacts of national environments and policy. Cambridge: Cambridge University Press.

    Google Scholar 

  • Zhu, K., Kraemer, K. L., & Xu, S. (2006b). The process of innovation assimilation by firms in different countries: a technology diffusion perspective on e-business. Management Science, 52(10), 1557–1576.

    Article  Google Scholar 

  • Zhu, Y., Li, Y., Wang, W., & Chen, J. (2010). What leads to post-implementation success of ERP? An empirical study of the Chinese retail industry. International Journal of Information Management, 30(3), 265–276.

    Article  Google Scholar 

Download references

Acknowledgments

This research is supported by The Ministry of Education of Humanities and Social Sciences Project of China (14YJC630102) and The Fundamental Research Funds for the Central Universities of China (SK2014008).

Author information

Authors and Affiliations

  1. College of Economics and Management, Northwest A & F University, Yangling, 712100, China

    Wenjuan Xu

  2. School of Management, Xi’an Jiaotong University, Xi’an, 710049, China

    Peiyu Ou

  3. Pamplin College of Business, Virginia Tech, Blacksburg, VA, 24061, USA

    Weiguo Fan

Authors
  1. Wenjuan Xu
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Peiyu Ou
    View author publications

    You can also search for this author in PubMed Google Scholar

  3. Weiguo Fan
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Peiyu Ou.

Appendices

Appendix A

Table 4 Common method bias analysis
Full size table

Appendix B

Table 5 Reliability and validity of constructs
Full size table

Appendix C

Table 6 Correlation matrix of the constructs
Full size table

Rights and permissions

Reprints and permissions

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Xu, W., Ou, P. & Fan, W. Antecedents of ERP assimilation and its impact on ERP value: A TOE-based model and empirical test. Inf Syst Front 19, 13–30 (2017). https://doi.org/10.1007/s10796-015-9583-0

Download citation

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s10796-015-9583-0

Keywords

Search

Navigation