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The Influence of ERP on Performance Management – Case Study

ERP Systems

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Literature Review

2.1. Performance Management

Franco‐Santos & Otley (2018) defined performance management as a tool for cooperating management that helps managers monitor and evaluate every employee’s work.  Performance management goals are to create an environment in which the employees can perform effectively by offering their best efforts.  Through this, both the employees and managers in an organization can see eye-to-eye about the goals, expectations, and career progress. Audenaert et al. (2019) added that performance management in an organization views the employees in a system of an extensive workplace system.

As obtained from a recent study carried out by Ramdani & Hadijah (2020), on how knowledge management affects organizational performance, performance management involves creating and measuring goals, objectives, and milestones. It enables the employees to understand the effective performance expected from them and work to their maximum ability.  Nevertheless, performance management does not use the reviews of the end-year traditional paradigm but turns all interactions with the employees into a learning occasion.  The study of Ramdani & Hadijah (2020) was to add weight on the investigation carried out by Aydiner et al. (2019), which pointed out that managers in various organizations make use of management performance tools in adjusting the workflow of their employees, implement new actions and make decisions that help employees in achieving their best (Azevedo et al., 2014).  As a result, such organizations reach their goals easily and perform effectively.

The above studies on the performance management were supported by an investigation that was done by Kwahk et al. (2020), which discussed that applying performance management tools in organizations enables employees to focus on accountability, hence creating a healthier and transparent working environment.  Furthermore, through performance management, organizations can emphasize regular meetings, thus improving overall communication. As discussed by Aydiner et al. (2019), employees in an organization are expected to understand their goals since performance management incorporates concrete rules.  In such a situation, the workplace becomes less stressful. Besides, an employee from an organization that applies performance management does not have to impress their managers through carrying out random tasks, and managers, on the other hand, are not worried on how to inform employees that they are not working as expected (Aloini et al., 2011). If the system of performance management is working effectively, the employees will discover their performance already.

2.1.1. Benefits of performance management in Emirates group

Performance management involves a process whereby the workers and directors within an organization work together to plan, monitor, and review their operations towards the organization’s goals and objectives (Hazarika & Boukareva, 2016). It helps different organizations improve the efficiencies of their operations, forecasting, and monitoring various activities.  Airline industries employ many employees who require a considerable amount of aircraft investments and infrastructure (Mardani et al., 2016). Furthermore, airline companies have fixed costs that make them operates in a competitive environment, with many businesses offering similar services.  These make most airline industries feel pressured on responding to the demand as quickly as possible. As a result, performance management has been effectively used in airline industries, where the performance management tools have been used in assessing both the current and future operations. According to Hazarika & Boukareva (2016), having effective performance management in the airline industry is crucial for effectively implementing business strategies.

The Emirates airline was started in 1985, with two aircrafts operations; Airbus 300 B4 and Boeing 737 (Gengo et al., 2011).  It has been operating as a subsidiary of the Emirates groups, meaning that the government has owned it. Emirates group is the largest industry in airline services, with emirates airline earning more than US$ 18.4 billion (“Performance Management at Emirates,” 2020). Emirate airlines aim at delivering their services by considering the following factors; People, financial strength, service excellence, innovation, and safety.  The industry encourages teamwork, commitment, loyalty, as well as employee’s welfare. Emirates Airlines, as a primary carrier within the Middle East, has implemented performance management tools.  The annual growth of Emirates Airlines has been more than 20% every time for more than two-decade. In 2001, Emirates Airlines had declared the most significant value at the demand of $ 15 billion throughout aviation history (“Performance Management at Emirates,” 2020). This marked the beginning of the establishment of developing airline businesses. In enhancing safety, the emirates airline has been working effectively to protect its staff, customers, and assets.  They have been very innovative, and have introduced the Audio Video on Demands (AVOD) in all seats, to ensure that customers’ expectations are well met. Currently, Emirates Airlines is developing gradually and has acquired a higher number of travelers.  Therefore, it is among the most developing airline industries within the world. Performance management has enhanced it to redesign and change the aspect of tourism in the country.

According to Gengo et al. (2011), performance management in Emirates Airlines is effective in planning and controlling. On the plan, the main aim of the Emirates airline has been to continue using new technology in all the operations of the business. Furthermore, it has been able to evaluate the cost-benefit analysis to keep the company’s growth continuous and make it profitable. This has also helped the industry to have an effective way of executing its strategies of the operations. Through controlling, performance management in Emirates Airlines has contributed to influencing the employees and motivating them to achieve the set goals. It also helps in establishing and following the organizational operations, with a filmy system of performance management. Besides, it helps it in establishing effective standards of measuring performance.

2.1.2. Performance Measurement in an airline industry

As Hazarika & Boukareva (2016) pointed out, the operations of an airline industry must be analyzed keenly, to keep them growing and maximize profits. Therefore, measuring the performance of services can be done by selecting quantitative items that are measurable in daily operations. Every airline industry needs to implement performance indicators to help them reach corporate goals.   The primary key performance indicator used in the airline industry is the Misconnex Quota. This is calculated in terms of percentage to connect passengers who miss out on their onward flight. This is related to the complete numbers that connect passengers, and it is usually used by about 45% of the airline industries in the world (Dinçer et al., 2012).  Arrival punctuality is another key performance indicator.  It is usually calculated as the percentage of flights that arrive on the planned destinations on time, concerning all operating flights.

In most cases, flights are counted to arrive on time, only if their arrivals are not delayed for more than 15 minutes.  This is the most used and effective performance indicator within the airline industries. Walther (2020) discussed that 67% of all airline industries use this performance indicator.

Utilization is another key performance indicator used in measuring performance management within the airline industries.  This is calculated as the percentage of the passengers checked in the aircraft, concerning all available seats.  The utilization key performance indicator is used by more than 71 % of the airline (Walther, 2020).  Interestingly, it is the only key performance indicator of the airline industry that is not related to customers’ satisfaction, but it is profit-oriented.   Furthermore, airline industries use regularity’s critical performance to show the percentage of the flights operated about the trips planned.  In other words, it determines the number of flights that have been canceled.  This indicator is used by almost 90% of airline companies.  The last critical performance and most applied is the departure punctuality (Hazarika & Boukareva, 2016).

 

 

 

 

 

 

 

 

 

 

 

 

2.2. Theoretical Framework

Figure 1. Prior investigations of ERP systems on the effectiveness of performance management

Author(s ) Study context Determinants of  performance management Capabilities investigated
Costa, 2019. ERP – Enterprise Resource Planning. Integration of  elements like purchasing, inventory, planning, marketing sales, and human resource Improve performance management
De Andrés et al., (2012). The effects of ERP implementations on the profitability of big firms: Integration of efficiencies Reduce operational costs, increase overall productivity
Venkatraman and Fahd (2016). Challenges and Success Factors of ERP Systems in Australian SMEs. Lack of user’s involvement and training, lack of support from top management Ineffectiveness in organizational operations
Aydiner et al., (2019). Supply chain orientation, ERP usage, and knowledge management in the supply chain. Enhance the adequate flow of goods and services within organizations Enhance an effective procurement and supply of the goods and services
Garg and Garg (2014). Factors influencing ERP implementation in the retail sector: Lack of support from top management, reluctant to changes by employees, and incompetent ERP team. affect  performance management  by Lowering employees effectiveness
Erdogan and Kaya (2014). Understanding performance indicators of organizational achievement in Turkish airline companies IT implementation, employees commitment, and customers service Improves efficiency and accuracy in service provision
Gengo et al. (2011). Performance Indicators for Operations Management in an Airline training, user’s adoption and support from management Enhance growth, through profit maximization
Gupta et al. (2018).

 

Role of cloud ERP on the performance of an organization Saves operational costs and enhance communication networks Improves collaboration and communication from remote areas
Haigang and Wanling (2008) A case study of the ERP system application in the aviation maintenance department of H company Planning, monitoring and reviewing operational processes Improves operational efficiencies and enhance forecasting
Hazarika and  Boukareva (2016). Performance Analysis Of Major Airline Companies In Uae Profitability, Liquidity, Efficiency, Employee Strength And Productivity Performance measurements in the airline industries
Jamrose ( 2017). An Empirical Investigation of the Impact of Enterprise Resource Planning (ERP) Systems on Firm Performance Planning and controlling Increase productivity

 

 

2.3. Organizational Information Systems Theory

The organizational information system theory developed from the general system theory. The general system theory assumed that; when there are low uncertainties, organizations naturally use four methods in increasing the coordination of the interdependent of the tasks within the organization. They involve; rules and programs, the hierarchy of authority, planning and setting of goals, as well as reduce the control span (Stichweh, 2011).  However, in cases of high uncertainties, two ways can be used to address them.  One is to reduce the information’s need, which is processed using self-contained tasks, slack resources, or even environmental management. The other one is increasing the processing information capacity by using an information system, Madapusi & D’Souza (2012).  According to Ruben (2018), the general system theory in an organization is not yet connected with the world of information, and it does not involve computer applications. Ruben added that the purpose of organization information system theory is building a gap between the general system theory and information technology.

The development of information system theory within organizations focused on the transition of information technology.  Therefore, it introduces a new formalism, to build a model of information, with a dynamic system. This helps in describing the regularities in the system. As pointed out by Huang et al. (2004), the introduction of organizational information system helps in proposing a unique concept of information, whose model is used to describe the information system as the whole system (whole entity), combines as well as holds a various category of the system. These categories involve; aggregation, integration, cooperation, hierarchy, complexity, self- organization, stability, and adaptation. Pone (2012) urged that the theory of information management is a concept of the management field. The only factor that distinguishes the approach of information systems from other management fields is that; it is concerned with the use of artificial in the systems of human machines. Thus, it can intersect the knowledge of properties in machines (physical objects), with the understanding of physical behaviors (Mabert et al., 2003).

The theory of information system will be used in this study to enhance the integration of various operations, which improves the organization’s overall functioning. This will be achieved by implementing the following four methods in the business; rules and programs, the hierarchy of authority, planning and setting of goals, and reducing the control span. As pointed out by Madapusi & Souza (2012),   using information systems in businesses enables them to be more self-aware by linking together information from finance, production, distribution, and human resource. In this matter, EPR application is the most effective in connecting various technologies; within the four mentioned processes of the business, it easily eliminates incompatible technology and costly duplicate as well. Furthermore, Malhotra & Temponi (2010) also supported this point, by maintaining that the ERP system are packages of software involves various modules like sales, finance, human resource, and production to enable the organization in data integration. Jenatabadi et al. (2013) added that the ERP systems within businesses have evolved from the outdated software models, which serve clients physically, and developed to cloud-centered software that enhances web-based access remotely (Gupta et al., 2018).  Additionally, customization of these ERP packages can be done to cater to various organizational needs.

From the study carried out by Alsène (2007), the ERP system in organizations improves collaboration.  The centralized database is used as an integral section that marks the ERP’s uniqueness since they are of different types. Besides, this database enables the organization to work with a single source of truth, hence reducing errors around using incorrect data (Kiarie & Wanyama, 2007). In return, it further reduces the cost of operations within the organizations. Furthermore, having a central database in the organization can minimize stalling or hesitation that may arise during the project. This is simply because all employees within the organization have easy access to the vast information that they may require.

2.4. Productivity paradox theory

As discussed by Polák (2017), information technology involves studying, designing, developing, implementing, supporting computer-based information systems.  These mainly include computer hardware and software applications. According to Yadeta (2016), the information system involves anything that deals with both computers and computing. Hence, when an organization decides to buy a database, computers, software, and network or any other related material, such an organization is investing in information technology. Although this may seem like a magnificent process on the surface, it has no evidence in the reality that making investments in information technology is profitable.

The productivity paradox theory is a peculiar observation that is made in the analysis of business performance, which states that; “more investment is made in information technology; worker productivity may go down instead of up” (Polák (2017).  This form of observation has been supported firmly with empirical evidence in businesses, especially from the 1970s to the early 1990s. Before many businesses invested in IT at large, the return on expected investments in the bases of productivity was 3-4%.  This average rate advanced from the mechanization of the organizations/ automation, and the factory sectors. However, the regular investment’s return in the 1970s and 1990s was only 1%.

As discussed by De Andrés et al. (2012), the productivity paradox means that an organization has null or minimal increment in productivity when its expenses are very high. For an IT manager in every organization to have a clear understanding of the productivity paradox, the first and most crucial activity is to identify the differences between innovative and non-innovative technologies.  However, all these technologies are necessary for improving the value and the performance of an organization. In this matter, the ERP systems are observed as innovative technologies, since they facilitate the business’s main operations.  Therefore, using information technology excessively in an organization may lower a particular organization’s effectiveness and efficiency. Precisely, under the assumption of productivity paradox, organizations that adopt and implement more than the needed information systems are expected to decline in terms of overall productivity.  Nevertheless, it is also possible for the ERP non-adopting firms to gain a competitive advantage in the short time and after others adopt, due to challenges that may face organization during adoption and after, as the firm becomes stable.

Gomes et al. (2018) also added that there is any inconsistency between the investment in Information Technology and the organization’s productivity. According to these researchers, “while there doesn’t seem to be a direct, measurable correlation between improvements in IT and improvements in output, this might be more of a reflection on how productive output is measured and tracked.”  This means that Intangibles factors like increased coordination with the suppliers and better responsiveness towards customers do not increase the amount of output. Still, they enhance the effectiveness in terms of time place and the customers’ right attributes.

Ma et al. (2018) did not agree with the productivity paradox assumption, which states that “the more investment is made in information technology; worker productivity may go down instead of up.”  They maintain that the investment in information technology creates business value, and increase their overall productivity.  It has been effective in businesses, in automating the storage of data and its retrieval, conducting the processes of routine transactions and improving communications within organizations.  With information technology, the organizations require only a few numbers of employees to carry out their operations, thus reducing their costs. Olu-Egbuniwe & Maeyouf (2019) also disagree with the assumptions from the productivity paradox theory.  They discussed information technology as an effective factor in driving innovation. The technological revolution has dominated in most businesses, and they are greatly benefiting from it. Currently, the formula for the company’s success is straightforward, driving innovation with new technology.

The productivity paradox theory will be used in this study to show the importance of using the right information technology.  Basing on the theory of productivity paradox, technology alone does not signify the productivity of the organization. Other factors determine the productivity of an organization. For example, customers’ service plays a significant impact on determining the overall productivity of an organization. This is mostly determined by the relationship between the employees and the customers. It determines their loyalty towards that particular organization and reduces employees’ turnover (Demirhas, 2017). Through this, business operations must invest in the most useful information technology.

Figure 2: Structural research model

2.5. ERP value perception

ERP systems referred to as an essential process used by various organizations in managing and integrating some crucial elements of their business (Costa 2019).  An ERP system incorporates elements like purchasing inventory, planning, marketing, sales, human resource, and finance. De Andrés et al. (2012) argued that the ERP system is necessary for increasing the dependence of exchanging information between the modules of the system and its extensive functionality.  Since the systems are universal by nature, they can interface at different situations of organizational performance.  In most cases, businesses use many of the Enterprise Resource Planning systems by implementing resource planning, enabling them to use a single system in running their operations effectively. The benefits of the organizations using ERP systems are possibly increased by integrating business operations and the system (Ahmed et al., 2016).

From the research carried out by Garg & Garg (2014), organizations receive five benefits from using ERP systems. These are; managerial, operational, strategic, organizational, and IT infrastructure. The operational effectiveness is related to the tangible results like improvement of production, reduction of cycle time, and cost reduction. Besides, managerial effectiveness is based on the intangible benefits, on the development of information. For instance, the improvement of decision making, better management of resources as well as improved planning.  Strategic effectiveness also captures on intangible factors. For example, it supports the growth and alliances of business, enhances its expansion and e-commerce. On the IT infrastructure, the ERP system relates to the relationship of direct costs with information technology (Jamrose, 2017). This involves increasing the capability and flexibility of IT infrastructure and reducing the IT costs. Lastly, the organizational effectiveness of the ERP system is concerned with the changes within the organization. In this matter, the ERP helps change the working pattern of the employees, empowering them, increasing their morale and satisfaction, and building collective visions (Costa, 2019). Precisely, using ERP applications within the organizations enhances the collection of information on state and activities of various divisions, hence making the obtained information accessible and available to other sections, where it can be applied productively.

As pointed out by Madapusi & Souza ( 2012),  the use of EPR in businesses enable them to be more self- aware, through linking together information from finance, production, distribution, as well as human resource. Due to the ability EPR application in connecting various technologies from every section of the business, it easily eliminates incompatible technology and costly duplication. Furthermore, Malhotra & Temponi (2010) also supported this point, by maintaining that the ERP system are packages of software involves various modules like sales, finance, human resource, and production to enable the organization in data integration. Jenatabadi et al. (2013) added that the ERP systems within businesses have evolved from the outdated software models, which serve clients physically, and developed to cloud-centered software that enhances web-based access remotely (Gupta et al., 2018).

Vargas & Comuzzi (2019) discussed that importance of ERP implementation falls into two factors; the impacts of its adoption and the success factors. The study supports that the adoption of an ERP within an organization helps improve the integration of the information and efficiencies.  The ERP system in organizations enhances collaboration.  The centralized database is used as an integral section which marks the uniqueness of the ERP since they are of different types (Bititci et al., 2016). Besides, this database enables the organization to work with a single source of truth, hence reducing errors that come around with using incorrect data. In return, it further reduces the cost of operations within the organizations (Adams, 2013).  Furthermore, having a central database in the organization can help it to reduce stalling or hesitation that may arise during the project. This is simply because all employees within the organization have easy access to the comprehensive information that they may require.

ERP system effectiveness can be affected by several factors. These involve; lack of enough support from top management, reluctant to changes by employees, and incompetent ERP team within the organizations (Ha et al., 2014).   On the senior management support, they mostly consider going live during the final stage of implementation, rather than offering direct assistance towards the system and its related sources.  This ends up affecting the overall motivation of the ERP team, as well as their absorptive capacity. The study also recognizes user training as the main factor for ERP implementation in the organization. User training is essential in coping with the changes made and be able to employ capability. This was supported by the study carried out by Vargas & Comuzzi (2019). The implementation of the ERP system is viewed through the performance management lens.  However, Vargas & Comuzzi (2019) argued that implementing a successful ERP system must be conceptualized independently. After the system goes live, its fit keeps on developing.  This study maintains that firms witness an improvement in management performance after implementing ERP.

Huang et al. (2004) described the ERP as the central system of the organization, which enhances an effective sharing of information within the function of that business and all levels of management to support various operations from one system.  It helps to reduce the problem of inconsistency and lack of information within businesses that can be led by the transaction of multiple systems within the individual department.  According to Morris & Venkatesh (2010), ERP enhances the responsiveness and agility required to achieve a dynamic environment in business. In return, this can reduce the convenience and cost incurred by a business that manages various systems and platforms. The ERP also helps companies overcome challenges related to the storage of information in different databases, hence saving more time and effort for the organization. As pointed out by Leyh (2011), businesses can use package software systems like the ERP system to manage the effective and efficient use of materials, finance, and human resources by offering an integrated and total solution for processing its information needs.  These researchers added that the ERP supports the view of the oriented process within the organization. Since the adoption of ERP in an organization is an initial approach of the organization from the top management, the organization’s enthusiasm for the ERP adoption is mostly influenced by external pressures from the competitors (Jahanyan et al., 2012).

From the studies above, it has been found that ERP implementation within an organization helps it in managerial, operational, strategic, organizational, and IT infrastructure. This makes the organization operations more accurate and links the functioning of the different departments like finance, production, and human resources management.

2.6. Multi-Cloud SAP

A multi-cloud is the use of at least two computing services from different cloud vendors. Businesses use a multi-cloud environment to distribute resources in computing and minimize the risks of losing data and downtime risks.  Furthermore, they can increase the storage available and the computing power for the business. Precisely, a multi-cloud strategy may allow a company to select different services of clouds from various providers since some are better for particular tasks as compared to others. As pointed by Ferry et al. (2013), different organizations use multi-cloud technology for the following purposes; ability and flexibility to avoid vendor lock-in, disaster avoidance, and compliance.   Through compliance, the multi-cloud environment helps in achieving the organizational goals for governance. Merle et al. (2011) discussed that companies use multi-cloud solutions to enhance their ability to scale easily, improve their reliable performance, and improve their constant productivity. Multi-cloud SAP allows customers to develop and run apps through infrastructure providers (Gargeya & Brady, 2005). This means that a variety of layers of clouds can be easily accessed from various vendors.  Through the SAP platform, customers use Amazon Web Services, the Google cloud of the demo showcase, and Microsoft Azure. SAP, as an application vendor, has also been offering applications like XI/PI and MDM (Voulgaris et al., 2015).

2.6.1. Importance of Multi-cloud

Merle et al. (2011) maintain that multi-cloud technology plays four significant roles in a business.  It acts as a shadow for the information technology, enhances the flexibility of that particular business, covers the failovers, and increase proximity. The software or hardware that has been deployed independently from the central team of IT may play a significant role in warranting more oversight.  Transferring the data or migrating the infrastructure to a preferred system can be out of the question. Therefore, the existing cloud within an organization can be aggregated to create a multi-cloud. On flexibility, an organization can find a perfect cloud solution for a particular aspect, an exclusive cloud to host a proprietary app, an accurate and affordable cloud for storage of its records and a cloud that enhance a broad scale to hold systems with high and valuable use rates (Venkatraman &Fahd, 2016).  This significantly shows that there is no single cloud that can handle all these activities.  On the proximity, a multi-cloud enhances an adequate response of users from different geographical regions. This allows certain workloads to be hosted by the regional cloud providers, thus reducing a heavy workload experienced if the main operations are taking place from the headquarters.  Lastly, on the failover, a multi-cloud environment prevents businesses from outages. This is by allowing them to have high scalable data backups, effective workflow, and systems in cases of breakdowns in the primary clouds (Schmitz & Galer, 2020).

Paraiso et al., (2012) added that multi-cloud technology in organizations plays five main roles; optimizing the ROI, enhance superior security, reducing the latency, lowering disaster, and increasing autonomy. On maximizing the ROI, different clouds are built differently. These differences do involve not only physical infrastructure but also incorporate a wide range of functionality, characteristics, policies, and pricing models. According to Passacantando et al. (2016), lack of transparency and changes in dynamic IT makes it hard to predict the right cloud for a particular business. Multi-cloud technology enhances superior security for businesses by maintaining a hybrid cloud environment that enhances a combination of cost savings and security at the same time (Wickramasinghe & Gunawardena, 2010).  It also reduces the rate of inactivity, by ensuring that the data center, which is closest to the end-user, can serve data with less or minimum server hops.  This capability is helpful for businesses that operate globally since it enables the serve corporate data geographical locations.

Furthermore, the multi-cloud infrastructure empowers different organizations to match and mix vendors and platforms. According to Naik (2016), this ensures that their workloads are not locked in certain Cloud providers.  This simply means; it gets easier, simpler, and fair for companies to switch vendors.  Lastly, the Multi-cloud infrastructure reduces disaster monitoring the applied networks with tools that deliver end-to-end visibility in all networks.

2.6.2. How Organization Invest in Multi-cloud

According to Naik (2016), there has been a gradual increase in the rate that businesses accept the Multi-cloud framework in the last decade.   This is because it has been very effective in expanding different organizations’ markets, accelerating their innovations, and reducing their operation cots.  Currently, most of the industries and enterprises are shifting their workload towards the public cloud,   while at the same time; they are empowering their on-premise arrangement with cloud capabilities.  Gu et al. (2014) pointed out that; organizations can invest in multi-cloud through; finding the main areas where cloud can be effective for the organization. Since the cloud offers several business benefits, businesses need to define their motivations and aims for them to formulate a successful cloud strategy.  The second step of organizations investing in multi-cloud outlining their multi-cloud approach, and making it future-proof (Ramdani & Hadijah, 2020). In this matter, most large organizations today are using multi-cloud and have a hybrid strategy that comprises both private and public cloud options.   According to Wanyoike (2017), the organization should demise ways of overcoming the cloud’s common hurdles. The journey for cloud implementation in any organization is rife with various challenges, which mostly involve culture, governance, and cost. An enterprise should also get prepared for the cloud journey. In this matter, it should have cloud architects, cost management specialists, program/project managers, and DevOps engineers (Morgan, 2019).  Lastly, the business should evaluate whether their multi-cloud platforms fit their needs well.

Multi-cloud technology has increased the rate of collaboration within organizations.  (Gupta et al., 2018). Besides, the ERP has taken advantages of such technologies in integrating the operations that control the work station in the remote regions, and in real-time. As pointed out by Ullah et al. (2018), the use of ERP in businesses offers effective sales and customer service with proper means of communication, which leads to excellent customer care and sales predicting.  In both customers and suppliers in the aviation industry, the ERP system effectively enhances both the back end and the company’s front end connection through conveyance and transportation structure, respectively. Therefore, it enhances an easy restructuring of transportation time by maintaining a good customer’s experience. According to Demirhas (2017), the structure of ERP improves customer’s prioritization offer opportunities for enhancing their retention.

Jamshidi et al. (2017) discussed that ERP is a form of multi-cloud technology.  Both the cloud ERP and on-premises systems have centralized databases for an organization’s adequate storage of data.  Businesses implement ERP software to allow their users to access enterprise resource planning software through the internet. Generally, the ERP has lower upfront costs and gives companies access to their crucial applications and within any location.  Leyh (2011) added that cloud ERP is valuable and very effective to small and medium-sized businesses, since it provides them access to the applications of full functions at a reasonable cost, without the substantial upfront expenditures for software and hardware. Therefore, a company that uses the right cloud provider can scale the business’s productivity, as it grows.

2.7. Research gap

Various studies have been carried out to investigate the effectiveness of ERP on business operations. Costa 2019 maintains that ERP in a business operation enhances the integration of multiple elements, and Garg & Garg (2014) argued that it is effective in managerial, operational, strategic, organizational, and IT infrastructure.  Madapusi & Souza (2012) have also investigated the use of ERP in businesses. Precisely, most of the discussed studies about ERP have looked at its effectiveness in business, use, and importance. The studies fail to consider implementation issues and how they can be addressed to achieve success. To help fill this gap, this study will look at the issues or challenges that face businesses while implementing ERP. Besides, most of these studies have general information on the effectiveness of ERP. This means that no particular research has investigated this influence of ERP on performance management.

Furthermore, other studies have been carried out to determine the effectiveness of multi-cloud technology on businesses. For example, Ferry et al. (2013) maintain that multi-cloud technology is effective in flexibility to avoid vendor lock-in, disaster avoidance, and compliance.  Miere et al., 2011 discussed that multi-cloud technology is effective as an IT shadow, enhances that particular business’s flexibility, covers the failovers, and increases proximity.  Furthermore, Paraiso et al., 2012 discussed the factors as the primary effectiveness of multi-cloud computing; optimizing the ROI, enhance superior security, reducing latency, lowering disaster, and increasing autonomy.  As observed from these studies, it can be easily noticed that none of them has looked at how multi-cloud technology improves agility and competitive pricing.  These are essential aspects of multi-cloud technology that need to be considered to enhance the effectiveness of business operations.

Furthermore, in these studies, and others that were carried out about cloud computing, none has looked at the challenges faced by different organizations in implementing it within an organization. They also fail to look at the factor that leads to ERP failure, as a form of multi-cloud technology, after the implementations. Therefore, this study will investigate on such challenges as part of its objectives.

2.8. Hypothesis

From the above literature, the following hypotheses were developed.

: Implementation of ERP systems positive impact on Performance management

: The user’s training and evolvement have a positive impact on ERP implementation success.

: Multi-cloud technology has a positive impact on the performance management of organizations.

:  Increased investment in information technology systems improves organization performance.

2.9. Objectives

The main objective of this investigation is to determine the influence of ERP on Performance Management. Other specific objectives will be;

  • To identify various implementation issues and how they can be addressed to achieve success.
  • To assess elements that may result in ERP failure.
  • To establish a direct link between successful ERP implementation and proper business performance.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

References

Adams, C.A., 2013. Sustainability reporting and performance management in universities: Challenges and benefits. Sustainability Accounting, Management and Policy Journal4(3), pp.384-392.

Ahmed, T.M., Bezemer, C.P., Chen, T.H., Hassan, A.E., and Shang, W., 2016, May. Studying the effectiveness of application performance management (APM) tools for detecting performance regressions for web applications: an experience report. In 2016 IEEE/ACM 13th Working Conference on Mining Software Repositories (MSR) (pp. 1-12). IEEE.

Aloini, D., Dulmin, R., and Mininno, V., 2012. Risk assessment in ERP projects. Information Systems37(3), pp.183-199.

Al-Raisi, A., Amin, S., & Tahir, S. (2011). Evaluation of re-performance analysis and assessment in the United Arab Emirates (UAE) Organizations. Journal of Internet and Information Systems2(2), 20-27.

Alsène, É., 2007. ERP systems and the coordination of the enterprise. Business Process Management Journal.

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