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  • 标题:The role of consultants in the implementation of enterprise resource planning systems.
  • 作者:Metrejean, Eddie ; Stocks, Morris H.
  • 期刊名称:Academy of Information and Management Sciences Journal
  • 印刷版ISSN:1524-7252
  • 出版年度:2011
  • 期号:January
  • 语种:English
  • 出版社:The DreamCatchers Group, LLC
  • 摘要:Organizations implement enterprise resource planning (ERP) systems to solve their accounting, scheduling, and production problems and because existing business practices and procedures are inadequate to meet their current or future strategic needs (Nah, et al. 2001; Karakanian 1999; Davenport 1998). Details on the inner workings of ERP systems can be found in resources such as O'Leary (2000) and Jacobs and Whybark (2000).
  • 关键词:Business consultants;Consultants;Consultants (Persons);Consulting services;Enterprise resource planning;Management consultants

The role of consultants in the implementation of enterprise resource planning systems.


Metrejean, Eddie ; Stocks, Morris H.


INTRODUCTION

Organizations implement enterprise resource planning (ERP) systems to solve their accounting, scheduling, and production problems and because existing business practices and procedures are inadequate to meet their current or future strategic needs (Nah, et al. 2001; Karakanian 1999; Davenport 1998). Details on the inner workings of ERP systems can be found in resources such as O'Leary (2000) and Jacobs and Whybark (2000).

Because ERP implementations are very complex, costly, and risky, organizations typically use consultants to assist them in their implementation. Many organizations lack the information technology (IT) personnel with the required expertise and time to undertake implementing an ERP system, and consultants often assist their clients throughout the entire implementation process (Glover et al. 1999; Nah et al. 2001; Thong et al. 1994; Yap et al. 1992).

Considerable research has been performed in the areas of ERP systems and the presence of consultants during these implementations. The use of consultants is often cited as a critical factor for the success of an implementation (Nah et al. 2001; Thong et al. 1994; Yap et al. 1992). However, little research, if any, has examined the phases of an ERP implementation and how the consultants fit into an implementation on a phase-by-phase basis. If consultants are not necessary and/or effective in a particular phase, they can then be left out of the work on that phase, potentially saving considerable money for the implementing organization. The results give researchers a starting point for examining how consultants fit into the specific parts of an ERP implementation. Further, practitioners will have an idea about were to best use their scare resources when implementing ERP systems.

In light of this lack of research, this study has a twofold purpose. The first purpose is to examine whether consultants are perceived to be more effective and necessary in certain phases of an ERP implementation than in other phases. The results of this research should provide researchers who study ERP systems with information about the phases of an implementation in which organizations use consultants. If consultants are not perceived to be effective in a particular phase, then consultants may be left out of that phase and internal IT personnel may be used. The results show that IT managers do perceive that consultants are more effective and necessary in the configuration and integration phase of an implementation and least effective and necessary in the operation of the ERP system. Thus, organizations may be better able to focus the use of their ERP consultants on those particular phases, which should save resources.

The second purpose of this study is to examine whether certain characteristics possessed by ERP consultants contribute more to their effectiveness than other characteristics. Researchers who study ERP implementations should benefit from this research because the results will give them some idea of which characteristics and skills that real users consider most important. The results show that IT managers do perceive that four characteristics (technical skills, business context skills, commitment to quality, and the ability to manage ERP implementations) are related to ERP consultant effectiveness. ERP consultants may be able to focus on these particular skills to enable them to provide more value to their clients who are implementing ERP systems. Organizations may be able to look for consultants with a particular skill set because that skill set tends to improve the consultants' effectiveness.

The remainder of this paper examines the existing literature regarding the effectiveness and need for ERP system consultants and describes the development of a multiple-phase ERP implementation model used to structure the research instrument for this study. Next, the research method is described and results are examined. The final section includes a conclusion and a discussion of the limitations of the research.

REVIEW OF PRIOR LITERATURE

ERP implementations are costly in terms of both dollars and time spent by personnel. Estimates of a typical ERP implementation range from a low of 14 months to as high as 23 months to actually implement the ERP system and another 31 months to see the benefits of the effort (Bingi et al. 1999; Chen 2001; Koch 2002). Estimates on the cost of a new ERP system range from $2 to $4 million dollars for a small organization with simple processes to over $1 billion for a large organization with complex processes (Bingi et al. 1999; Chen 2001; Koch 2002). The fees of ERP consultants are included in those costs.

Although many organizations have successfully implemented ERP systems, studies have found that between 40 and 50 percent of ERP implementations are only partially successful and 20 percent of ERP implementations are scrapped as total failures (Davenport 1998; Chen 2001). Donovan (2002) suggests that 90 percent of the organizations that have implemented ERP systems have not had a truly successful implementation the first time. These implementations fail for many reasons such as a failure to effectively reengineer business processes, a lack of management support for the project, ineffective pre-implementation activities, and inexperienced consultants or IT personnel driving the implementation.

Because these systems are so costly and risky, most organizations use consultants to assist in the implementations. Good consultants can handle many tasks or projects that organizations are unwilling or unable to handle. External consultants may bring an outside perspective to the implementation team, which may contribute to the implementation's success (Willcocks and Sykes 2000; Thong et al. 1994; Spacek 2000; Mische 2000). In many instances, consultants have been an invaluable resource for the organizations implementing ERP systems. Ifenedo (2008) shows that the use of quality external experts is critical for the success of ERP systems. The study also shows that the user of external experts is more important that even management's support of the ERP system.

Several studies have examined the factors that lead to a successful ERP implementation. Bingi et al. (1999) outline several critical factors, including the use of ERP consultants, for success in an ERP implementation. Nah et al. (2001) determine, through a review of the literature, that 11 factors are critical to ERP implementation success. Previous studies in their literature reviews suggest that the ERP implementation team should include a mix of consultants and internal personnel. Yap et al. (1992) found that for organizations that used consultants, the likelihood of a successful implementation was associated with the use of an effective consultant. In other words, the effectiveness of the consultant is important to the success of an information system implementation. Loh and Koh (2004) found that for small- and medium-sized organizations, consultants are key players in the early phases of ERP implementations.

Several other studies or articles offer advice about the use of consultants for IT or ERP implementations. Ko et al. (2005) examine the relationship between consultants and their clients. The authors find that it is important to create an environment in which the consultants and client personnel can interact frequently and freely so that knowledge can flow freely between the two parties. Spacek (2000) indicates that external consultants should be used because they bring an external and hopefully independent point of view to the implementation team. Slater (1999) suggests that using consultants may lead to getting things right the first time; however, many implementations in which consultants were used still have not been completely successful. Based on the arguments above, organizations should be encouraged to use external consultants for their IT and ERP implementations.

Several studies have identified characteristics of effective consultants. In their book, Arnoudse et al. (1989) identify four sets of skills that lead to effective information system consulting. These sets of skills are technical skills, human interaction skills, business context skills, and consulting framework skills.

Yap et al. (1992) use three characteristics to associate the effectiveness of consultants with information system implementation success. These three characteristics are consultant experience, consultant capability, and consultant effectiveness during the feasibility study. Experience typically leads to capability.

Thong et al. (1994) identify four variables to assess a consultant's performance during an information system implementation. These variables are consultant effectiveness in performing analysis of requirements of the business, consultant effectiveness in recommending the proper solution, consultant effectiveness in managing the implementation, and the relationship between the consultant and the other parties involved with the project.

Mische (2000) proposes several characteristics that are desirable in information systems consultants. These characteristics include communication skills; the consultant's background, experience, and familiarity with the issues in the implementation; the ability to determine the organization's needs and expectations and assign personnel to meet those needs and expectations; personality and chemistry; objectivity; expertise with systems implementations; and commitment to quality.

While many of the cited studies have examined characteristics of IT consultants, those characteristics should also be present in ERP consultants. ERP systems are quite different than other IT systems, but without good consultants with appropriate characteristics, the chances for failure of either IT or ERP systems increase. Knowing the characteristics of an effective ERP consultant is quite important for the organization to pick the best consultant for their ERP implementation.

THE ERP IMPLEMENTATION MODEL

One area that has been addressed in the ERP literature is the attempt to develop definitive models for ERP implementations. For example, Parr and Shanks (2000) and Markus and Tanis (2000) have proposed different ERP implementation models. ERP implementation models allow a deeper understanding of what occurs during the implementation.

Parr and Shanks (2000) developed what they called the project phase model (PPM) that has three major phases: planning, project, and enhancement. To give more detail of the actual installation, the project phase is further divided into five subphases: set-up, reengineering, design, configuration and testing, and installation. The PPM includes elements from two other models developed by Ross (1998) and Bancroft et al. (1998).

In the PPM, the planning phase includes tasks such as selection of the ERP system, assembly of the steering committee, and determination of the scope of the implementation. The project phase includes tasks to get the new ERP system up and running. These tasks include reengineering business processes, installing the software, mapping the processes to the software, detailed design, configuring the system to match the company, testing the new ERP system, and installing the ERP interfaces on the users' computers. Finally, the enhancement phase includes monitoring the system and repairing, maintaining, and upgrading the ERP system.

In their article, Parr and Shanks (2000) used the PPM and case studies of two companies that had recently implemented ERP systems to determine which critical success factors (CSFs) are necessary in the particular phases and subphases of their model. However, the study makes no mention of whether the PPM is actually used by organizations as a model to be followed in the implementation of ERP systems.

Markus and Tanis (2000) developed a theoretical model called the enterprise system experience model (ESEM) that has four phases: chartering, project, shakedown, and onward and upward. In the ESEM, the chartering phase includes activities leading up to the beginning of the implementation, including selecting the ERP system, identifying a project manager, and building a case for the implementation. The project phase involves getting the system up and running and includes selection of the project team, modeling and reengineering current processes, software configuration, integration of "bolt on" software and other systems that the organization wishes to retain, data conversion, training, and rollout. The shakedown period includes time for employees to get acclimated to new information systems and includes tasks such as debugging and retraining users, among others. The onward and upward phase includes tasks such as continuous business improvement, user training, and a post-implementation assessment.

While both the PPM and ESEM are good models, neither was judged a perfect fit for this study. For example, the PPM includes the subphases of the project phase that allow for a more detailed look at the project phase In the present study, more detail is needed to differentiate the tasks done by the consultants in an ERP implementation. In addition, the ESEM gives a good description of the shakedown phase. This phase is important because users of ERP systems must have time to become acclimated to the new system, but the PPM does not include a separate phase in which users become acclimated to the system.

Since neither of the aforementioned models is a perfect fit for this study, a model that combines elements of both the PPM and the ESEM is developed. The new ERP implementation model consists of four phases: planning, project, shakedown, and operation. The project phase is further divided into five subphases: reengineering, design, configuration and integration, testing, and installation and conversion.

The first phase is the planning phase. Activities involved in planning are building a case for the implementation, selection of the steering committee, ERP system, and project manager, and approval of a budget, among others. The project phase includes activities involved in configuring the system and integrating the new system with other applications, such as reengineering, design, configuration of the system to match the organization's processes, integration of existing systems, testing the new system, installation of the interfaces on the users' computers, and conversion of data to the new system. The shakedown phase includes tasks such as debugging and fine-tuning the system and training users. Finally, the operation phase includes modifying the ERP system, debugging, repair and maintenance, and post-implementation analyses. Table 1 summarizes the activities that are included in each of the phases and subphase of this ERP implementation model in greater detail.

HYPOTHESES

One aspect of this research addresses whether individuals feel that consultants are effective in the tasks that they perform and are necessary members of the implementation team on a phase-by-phase basis. Effectiveness is commonly defined as producing a definite or desired result and, in this study, refers to how well a consultant performed the tasks that are involved in a particular phase of an ERP implementation. Consultant effectiveness can be concretely measured by how well a task is performed by the consultant. Conventional wisdom suggests that when a consultant is effective in their tasks, their work should lead to a successful ERP implementation. Following this discussion, the following hypothesis is examined.

H1: Relative differences exist in the effectiveness of consultants across the phases of an ERP implementation and overall.

Necessity is commonly defined as being indispensable, unavoidable, or required and, in this study, refers to whether an individual perceives that ERP consultants are an indispensible part of the implementation team. Consultant necessity is more of a perception of whether one feels that the consultants are needed on the implementation team. Because of the complex nature of ERP implementations, consultants are certainly thought to be necessary; however, no prior research has examined the specific phases in which consultants are necessary or if they are perceived as being more necessary in one phase versus other phases. Following this discussion, the following hypothesis is examined.

H2: Relative differences exist in the necessity for consultants across the phases of an ERP implementation and overall.

It is possible that a consultant could be very effective in a particular phase, but not necessary to a particular organization in that phase. Conversely, it is possible that an organization would have the need for assistance in a particular phase, but their experience suggests that consultants lack effectiveness in that particular phase. Accordingly, the effectiveness and necessity measures are not expected to be perfectly correlated.

As discussed above, prior studies have shown that certain characteristics impact the effectiveness of information system consultants. These prior studies included a total of 18 characteristics, many of which are similar. An examination of these characteristics to determine whether they were essentially the same as other characteristics pared the 18 characteristics down to eight distinct characteristics. These characteristics and their descriptions are:

Technical skills and knowledge--knowledge of a variety of technologies, including ERP systems

Human interaction and communication skills--ability to communicate with and relate to others

Business context skills--ability to gain an understanding of the detailed operations of the client organization

Consulting skills and knowledge--ability to perform analysis of information requirements and feasibility analyses (among other things) and to make proper recommendations

Objectivity--freedom from bias regarding the organization and ERP vendors

Experience with ERP implementations--whether the consultant has been involved in ERP implementations and the similarity of previous implementations

Commitment to quality--responsibility to perform the implementation to the best of the consultant's ability and to produce the best possible product

Management ability--ability to manage projects and implementations and supervise personnel.

This study examines whether these characteristics have some impact on the effectiveness of ERP consultants. Following this discussion, the following hypothesis is examined.

H3: Individual characteristics possessed by ERP consultants contribute to the perception of consultant effectiveness in ERP implementations to varying degrees.

Prior studies (Yap et al. 1992; Thong et al. 1994) indicate that all characteristics are rated similarly, and no single characteristic stands out as having more of an impact on effectiveness. For this study, the expectation is that the characteristics contribute to the effectiveness of consultants to varying degrees; therefore, no predictions are made regarding which characteristics have more of an impact on effectiveness.

METHODOLOGY

A research instrument was administered via email and the Internet to chief information officers (CIO), vice presidents of IT, and IT directors and managers using rented lists of subscribers to the magazines CIO and Enterprise Systems Journal and to individuals who had indicated involvement with various ERP user groups. Subscribers to CIO and Enterprise Systems Journal were used because the target audiences of these magazines are IT executives who are looking for an information source that focuses on their needs and that provides information clearly and concisely. Since virtually all Fortune 1000 companies and many smaller organizations have implemented ERP systems, many CIOs and IT managers who subscribe to these magazines have probably been involved with ERP implementations to some degree. Members of ERP user groups are used because many of these individuals have been involved to some degree with an ERP implementation.

Four thousand email addresses were rented from each of the two magazines based on the respondents' positions in their organizations (CIO, vice president of IT, or IT director). The transmitted email included a description of the study and the purpose of the research instrument. Prior research indicates that response rates for emails surveys are typically higher than for traditional mail surveys when the email is sent to computer savvy individuals (Sheehan 2001; Flicker and Schonlau 2002; Schuldt and Totten; Ali and Jones 2002). However, in an era of "spam" and the spread of destructive programs via email, the response rates for this study were quite low. Of these 8,000 individuals, only 43 (0.5 percent) completed the research instrument. However, some overlap may have been present. In other words, some subscribers chosen by CIO may have also been chosen by Enterprise Systems Journal, thus decreasing the real number of individuals in the population. A decrease in the number of individuals in the population would, in turn, increase the response rate. Because the two journals retained control over the emails and email addresses, so there is no way of knowing if any overlap occurred.

Since so few responses were received via rented email lists, the public domains of websites for the SAP, Oracle, and J.D. Edwards user groups were searched to find as many names and email addresses as possible. Other ERP user group websites could not be found or required registration and membership in the user group to access information on the website; therefore, no email addresses were found for ERP user groups such as PeopleSoft and Baan. Also, since the data collection, there have been mergers among ERP systems vendors, so these user group websites may no longer exist. The user group website searches netted a total of 1,675 viable email addresses. Of the individuals emailed using this method, 143 (8.8 percent) responded to the research instrument. As with the two magazines, there may have been some overlap in subjects. In other words, some of the subjects chosen from the user groups may have also been in the group of individuals chosen from one or both magazines. Again, such a situation would reduce the number of individuals in the population and thus increase the overall response rate. In total, 9,675 emails were sent, and 186 responses were received for an overall response rate of 1.9 percent.

To test for non-response bias, early and late respondents were compared on organization size, industry, and ERP consultant type. The results of Chi-square tests showed no significant differences among these key organizational characteristics.

While the response rate for the study is low, the demographics show that the respondents are quite diverse. Several interesting results were noted. Of the 112 respondents who answered the item regarding the type of consultant used, 74 (66.1 percent) used consultants who were owned by or involved with ERP vendors. One questions whether a consultant can be (or should be) truly objective in a consulting engagement when such a relationship exists. A large majority of the respondents (136, or 73.1 percent) indicated that their organizations use SAP. Only 23 respondents (12.4 percent) indicated that their organizations had fewer than 500 employees, so most organizations were fairly large. Most respondents (72, or 38.7 percent) work in organizations that they classify as manufacturing companies.

One hundred thirty-two respondents (74.6 percent) felt that the implementation was successful, while only 45 respondents (25.4 percent) felt that the implementation was not successful or was only partially successful. This rate of unsuccessful implementations is lower than those found in other studies such as Davenport (1998), Chen (2001), and Donovan (2002). Respondents gave varying reasons why they felt that their implementations were not successful. Reasons given were: the organization had not achieved its full return on investment (ROI); the consultants "milk the clients;" no knowledge transfer took place; cost overruns; inadequate time, financial resources, testing, or training; resistance to change; lack of communication between management and the consultants; long implementation time, and unrealistic expectations. Each of these causes of unsuccessful implementations has also been noted in the studies mentioned above.

THE RESEARCH INSTRUMENT

The research instrument included four parts. Part 1 was an introductory section that explained the purposes of the study and included definitions of consultant effectiveness and necessity to help the individuals differentiate the two items. Instructions informed the respondents of pop-up boxes that included descriptions of each of the phases and subphases of the ERP implementation model and of the characteristics of consultants. This information was provided to ensure that the individuals understood what happened in each of the phases and what each characteristic meant. The final item of Part 1 was a question that asked whether the respondent had ever been involved in an ERP implementation. Depending on the response to this question, the respondent was redirected to one of two forms of the research instrument tailored to an individual who either had experience with an ERP implementation or who did not have such experience. Part 1 of the research instrument is included in Appendix 1.

For individuals who had experience with ERP implementations (ERP implementers), Part 2 of the research instrument included items regarding both consultant effectiveness and necessity during an actual ERP implementation. These items asked the respondents to rate their consultants on effectiveness and necessity in the individual phases and subphases of the ERP implementation model and overall in the implementation using a Likert-type scale from one (Strongly Disagree) to seven (Strongly Agree). For non-ERP implementers, Part 2 of the research instrument included items regarding only consultant necessity because they had no way of rating consultants on their effectiveness. Although data were collected from these non-ERP implementers, their responses have been omitted from most analyses because so few non-ERP implementer responses were received (nine of 186). No significant differences were observed in the responses between implementers and non-implementers. Only Part 2 of the research instrument differed between ERP implementers and non-ERP implementers. The remainder of the research instrument is included in Appendix 2.

Part 3 of the research instrument was included to gather data on which characteristics the respondents felt contribute to the effectiveness of ERP consultants. All respondents completed Part 3 because even non-ERP implementers should have some perception of whether a characteristic contributes to the effectiveness of a consultant. The respondents were first asked to indicate the phase or subphase in which they felt that their consultants were or would be (in the case of non-ERP implementers) most effective. The respondents were then asked to rate the characteristics' contributions to effectiveness using Likert-type scales from one (Low Contribution) to seven (High Contribution). Part 3 also included an open-ended item that asked the respondents to indicate any additional characteristics that they felt contributed to consultant effectiveness. Finally, respondents were asked to indicate the phase or subphase in which they felt their consultants were or would be (in the case of non-ERP implementers) least effective. These last two items allowed for the consideration of characteristics not included on the research instrument and also allowed confirmation of the results of other parts of the study.

Part 4 of the research instrument included questions designed to gather demographic data about the respondent. All respondents were asked to complete Part 4.

A pretest of the research instrument was performed to determine if changes were necessary. Four members of ERP implementation teams from two organizations that had recently implemented ERP systems were asked to complete the research instrument and provide any comments regarding the items on the instrument and the overall understandability of the instrument. These individuals were also asked whether they felt that effectiveness and necessity should be more clearly defined to eliminate confusion about whether they represented the same construct. All individuals indicated that the instrument and instructions were understandable and that they understood the difference between effectiveness and necessity. Only insignificant changes were suggested. The responses from the pretest are not included in the results.

RESULTS

CONSULTANT EFFECTIVENESS AND NECESSITY

Analyses of means and frequencies were performed on both consultant effectiveness and necessity by phase. Higher means indicate that a consultant was considered to be more effective in the tasks they performed or more necessary to the implementation. Table 2 shows the means for consultant effectiveness and necessity for each phase and subphase of the implementation model. The highest mean rating for consultant effectiveness is for the configuration and integration subphase, with a mean of 5.21. Consultant effectiveness in the operation phase received the lowest mean rating, with a mean of 3.95. Overall, consultant effectiveness was rated 4.83, indicating that the respondents feel that their consultants were effective overall but not overwhelmingly so.

Part 3 of the research instrument asked the respondents to indicate the phase or subphase in which they felt their consultants were most effective and least effective. An examination of frequencies for these responses shows that the vast majority of respondents indicated that their consultants were most effective in the configuration and integration phase. Most respondents indicated that their consultants were least effective in the operation phase. These results are consistent with the ratings in Table 2.

Table 2 also shows the means for consultant necessity for each phase and subphase. The highest mean rating for necessity was in the configuration and integration subphase, with a mean of 5.52. Consultant necessity in the operation phase received the lowest mean rating, with a mean of 3.60. The overall mean rating was 5.20, indicating that the consultants were perceived to be necessary overall.

Table 2 also includes the rankings based on the mean ratings of the phases and subphases. The mean ratings for consultant effectiveness and consultant necessity are consistent. The only difference in the rankings occurred between the reengineering and testing subphases. For consultant effectiveness, the testing subphase was ranked fifth, and the reengineering subphase was ranked sixth. Conversely, for consultant necessity, the testing subphase was ranked sixth, and the reengineering subphase was ranked fifth.

Although the rankings in the phases are quite similar, effectiveness and necessity were not expected to be perfectly correlated, as stated in an earlier section. Table 3 shows that for effectiveness and necessity by phase, correlations range from .506 for the testing subphase to .678 for the configuration and integration subphase. Thus, while effectiveness and necessity appear to be related, they are not perfectly correlated.

Hypothesis 1 states that relative differences exist between perceptions of consultant effectiveness in the various phases and subphases of an ERP implementation. Repeated measures analysis of variance (ANOVA) is used in this study because the study examines the respondents' ratings for successive phases within an ERP implementation, i.e. repeated polling of the same subjects. According to Stevens (1999), repeated measures ANOVA is appropriate when the same subjects are "polled" about successive points during a process. The results of the repeated measures ANOVA show that significant differences exist in the perceptions of the effectiveness of consultants across the implementation model (F=22.820, p<.001). Therefore, Hypothesis 1 is supported.

To determine between which phases the differences occur, a post hoc test using a Bonferroni adjustment was performed. Table 4 shows the differences among the mean ratings for consultant effectiveness between the individual phases. These differences are calculated as the mean for the phase on the top of the table minus the mean for the phase on the left of the table. Table 4 shows that, in general, respondents rated consultant effectiveness significantly lower than all other phases and lower than overall effectiveness. The respondents also rated consultant effectiveness in the configuration phase significantly higher than all other phases except planning. Finally, the respondents rated consultant effectiveness in the shakedown phase significantly lower than in all phases except reengineering, testing, and operations, which is rated lower than shakedown.

These results suggest that ERP consultants must work on becoming more effective in the phases that are rated significantly lower than others. Clients might feel that resources are wasted when a consultant is not perceived to be effective in the tasks performed in any given phase of the ERP implementation. Reengineering is particularly important in ERP implementations, and consultants were rated significantly lower than in the design phase and in the configuration and integration subphase.

Hypothesis 2 states that relative differences exist in the ratings regarding consultant necessity in the phases and subphase of the implementation model. The results of a repeated measures ANOVA show that significant differences exist in the perceptions of the necessity for consultants across the implementation model (F=43.782, p<.001). Therefore, Hypothesis 2 is also supported.

Table 5 shows the results of a post hoc test using a Bonferroni adjustment to determine where the differences between phases exist. Consultant necessity in the configuration phase stands out as being more highly rated than in all other phases, and the ratings for the shakedown and operation phases are lower than in most other phases.

Perhaps consultants should "market" themselves more aggressively in the phases in which their necessity is rated significantly lower than others. Alternatively, ERP consultants may be, in reality, less necessary to the typical user in certain stages of the implementation. If so, a more effective strategy may be for consultants to concentrate their efforts in the stages of the implementation in which they are most effective. These results give consultants a starting point for focusing their resources on making ERP implementers feel a greater need for consultants' services throughout an implementation, particularly in phases in which consultants are perceived as necessary for ERP success.

Table 6 shows the mean ratings on consultant effectiveness and necessity by phase and the differences between the mean ratings on a phase-by-phase basis. To determine whether the differences were significant, paired t-tests were performed on the mean ratings by phase. If the respondents rated their consultants higher on effectiveness than on necessity, the consultants appear to be outperforming the expectations of their clients. Alternatively, if the respondents rated their consultants higher on necessity than on effectiveness, the consultants appear to be underperforming or not living up to expectations.

Respondents rated consultants as more effective than necessary only in the operation phase (at p<.01), indicating that the consultants are outperforming their clients' expectations only in the operation phase. On the other hand, the respondents feel that their consultants do not meet expectations in the planning phase (at p<.01), in the design (at p<.001) and configuration and integration (at p<.01) subphases, or overall (at p<.001). Such results should be of concern to the consulting industry and may also be a factor in the high rate of unsuccessful ERP implementations that have occurred over the years. Consultants must improve their skills and abilities and apply these skills more effectively in these phases and subphases and in the overall implementation. If clients continue to perceive that consultants are ineffective in certain phases, they may see the consultants as unnecessary and look elsewhere for assistance in their ERP implementations.

CHARACTERISTICS OF CONSULTANTS

Table 7 shows the mean ratings for the individual characteristics and their contributions to the effectiveness of ERP consultants. Higher ratings for the characteristics indicate that the respondents feel that the characteristic makes a high contribution to the effectiveness of ERP consultants.

Technical skills and knowledge received the highest mean rating with a mean of 5.59. Consultants' ability to manage ERP implementations received the lowest mean rating, with a mean rating of 4.73. Table 7 includes the mean ratings and the relative rankings of all characteristics included on the research instrument. All characteristics have a mean rating above four (neutral rating), so all characteristics appear to contribute to the effectiveness of ERP consultants. This result is consistent with prior studies such as Yap et al. (1992), Thong et al. (1994), and Mische (2000). Respondents who indicated that their ERP implementations were successful consistently indicated that the characteristics, except business context skills and objectivity, contributed significantly more to consultant effectiveness (at p<.05) than respondents who indicated that their ERP implementations were not successful. These results are not unexpected given that these respondents' implementations were successful and they were likely happy with their consultants and their skills.

Hypothesis 3 states that characteristics possessed by ERP consultants contribute to the effectiveness of the consultants to varying degrees. To examine this hypothesis, two regression models are estimated using two different dependent variables. For these models, the characteristics of ERP consultants (independent variables) are used to determine whether ERP consultants are effective (dependent variables). Table 8 shows the eight independent variables used in the regression analyses. Explanations of the characteristics are given in a previous section. The general regression equation can be written as:

RATING FOR PHASE = [[beta].sub.0] + [[beta].sub.1]TECHNICAL + [[beta].sub.2]COMM + [[beta].sub.3]BUSINESS + [[beta].sub.4]CONSULT + [[beta].sub.5]OBJECT + [[beta].sub.6]CONSULTERPEXPER + [[beta].sub.7]QUALITY + [[beta].sub.8]MANAGE.

The prediction for the regression coefficients is that all variables have a positive effect on ERP consultant effectiveness because previous studies have shown that these characteristics contribute to the effectiveness of IS consultants.

The research instrument instructed the respondents to consider the phase in which they felt their consultants were the most effective. Therefore, for the first regression model, the dependent variable includes the ratings given by of each respondent for the phase in which their consultant was rated as most effective. In other words, if a respondent indicated that the consultant was most effective in the planning phase, that respondent's rating of effectiveness in the planning phase was used as the dependent variable for that observation. If a respondent rated the consultant as most effective in the reengineering subphase, that respondent's rating on effectiveness in the reengineering subphase was used as the dependent variable. This method was used for all respondents' ratings.

Table 9 shows the results of the regression equation for the characteristics of ERP consultants and their contributions to ERP consultant effectiveness. The regression equation is significant at p<.001, and the adjusted [R.sup.2] is .192. The TECHNICAL, BUSINESS, and OBJECT variables are all significant at p<.10. These results indicate that technical skills and knowledge, business context skills and objectivity are all moderately related to the effectiveness of ERP consultants. All of the regression coefficients are in the predicted direction, except for the coefficient for the BUSINESS variable. The negative coefficient on the BUSINESS variable indicates that a consultant's ability to gain knowledge about and understand the detailed operations of the client organization is inversely related to effectiveness in the planning phase, although only moderately (p=.070). Such a result could indicate that as a consultant learns more about a business, he or she becomes too comfortable and fails to listen to the needs of the client. This result could also mean that consultants attempt to apply "cookie-cutter" solutions to their clients' businesses or giving what they think the client needs rather than what is really needed.

Very few respondents indicated that their consultants were most effective in several phases. In particular, 10 or fewer respondents indicated that their consultants were most effective in the reengineering, testing, and installation and conversion subphases and the shakedown and operation phases. Only the configuration and integration subphase received a sizeable number of responses. The results in Table 9 should be interpreted with this in mind.

A second regression model with a different dependent variable was used to analyze the characteristics of ERP consultants and their contributions to the overall effectiveness of ERP consultants. While the respondents were asked to think about the phase in which their consultants were most effective when rating the characteristics, an analysis of the relationship of the characteristics and the overall effectiveness of the consultants is a reasonable progression of the examination of consultant effectiveness. The dependent variable is the average of each respondent's ratings in all phases and subphases of the ERP implementation model. While the respondents indicated a rating on their consultants' effectiveness overall, the average of their ratings for effectiveness in the individual phases is still a reliable measure of overall effectiveness of consultants. The averages of the respondents' ratings for all phases are highly correlated (r=.855) to the respondents' ratings for the consultants overall. Such a high correlation indicates that the respondents were consistent in their ratings by phase and overall.

Table 10 shows the results of the regression on the overall rating of ERP consultant effectiveness using the average of each respondent's ratings in all phases. This regression equation is significant at p<.001, and the adjusted [R.sup.2] for the equation is .394. The TECHNICAL, QUALITY, and MANAGE variables are significant at p<.05, and the coefficients of these variables are in the predicted directions, so the respondents feel that these characteristics contribute to effectiveness of consultants overall. The fact that only three variables are significant is somewhat unexpected because all characteristics in this study have previously been shown to contribute to the effectiveness of IT consultants. Perhaps the respondents in this study place more emphasis on other characteristics or assume that consultants possess some of these characteristics by default. Two variables, BUSINESS and CONSULTEXPER, although not significant, were not in the predicted direction, while all others are in the predicted direction.

The respondents were given room on the research instrument to indicate any other characteristics that they felt might contribute to ERP consultants' effectiveness. Examples of additional potential characteristics that may contribute to consultant effectiveness are product knowledge, experience in the client's specific industry, the ability to transfer knowledge to the client's personnel, and honesty.

CONTRIBUTIONS, LIMITATIONS, AND CONCLUSION

One purpose of this study is to determine whether a consultant is perceived as being more effective and more necessary in certain phases of ERP implementations. Respondents reported that their consultants were both most effective and most necessary in the configuration and integration subphase, while their consultants were least effective in the operation phase, thus showing that the perception that consultants are better in certain phases does exist. Results also show that consultants are consistently rated higher on their necessity than on their effectiveness in the phases of the ERP implementation model. Only in the operation phase did the respondents indicate that their consultants were more effective than necessary. These results indicate that consultants are not performing up to the expectations of their clients.

Another purpose of this study is to determine whether certain characteristics of ERP consultants contribute to the effectiveness of ERP consultants. The results of regression analysis of the characteristics of consultants are not conclusive. In a model using the respondents' ratings for the phase or subphase in which the respondent indicated that their consultants were most effective, the regression equation was significant, but none of the variables were significant, indicating that none of the characteristics contribute to consultant effectiveness. The second regression analysis examined the overall effectiveness of ERP consultants. In this analysis, the regression equation is significant, and the model includes three significant variables--TECHNICAL, QUALITY, and MANAGE. This result shows that the respondents feel that technical skills and knowledge, a commitment to producing quality work, and ability to manage the ERP implementation all contribute to the effectiveness of ERP consultants overall.

This study uses a research instrument to captures respondents' perceptions on consultant effectiveness and necessity. The limitations applicable to using a research instrument apply. Examples of these limitations are self-selection bias, honesty of respondents, and a limit on the ability to expand on answers, among others.

Another limitation of this study is the low response rate. While the response rate is low, enough responses were collected to enable meaningful and sound analyses, and the sample is diverse. Another limitation is the fact that most respondents were SAP users, which may have introduced bias into the results. Also, some consultants may have completed the research instrument, which would likely bias the results in favor of consultants.

Additionally, the sample of subjects is not completely random since ERP user group websites were examined to find names of ERP users. However, the subjects from the two magazines were chosen at random based on their positions within their organizations. There may also have been some overlap between the two groups of subjects. That is, some of the ERP users group subjects may also have been subjects selected by CIO or Enterprise Systems Journal; however, there is no way of knowing this for sure.

Finally, the intercepts in the two regression equations are significant. Such a result generally indicates that independent variables not included in the analysis contribute to the dependent variable. Because of the nature of behavioral research and the methods used in this type of research, it is not uncommon to have potentially significant independent variables that are not included. This result could have some impact on the predictive ability and generalizability of the regression equations. Also, very few independent variables (characteristics of consultants) are significant. In this study, the independent variables are taken from prior studies and are not exhaustive.

In spite of these limitations, the results of this research should provide many benefits to the companies who have implemented them. The knowledge of the phases in which ERP consultants are most effective and necessary and which characteristics contribute to consultants' effectiveness should provide an advantage to many organizations that decide to implement ERP systems.

The results of the study provide organizations that plan to implement ERP systems with knowledge of the phases of ERP implementations in which consultants are perceived to be most effective and necessary. By using the consultants only when necessary or only in certain phases in which the consultants are the most effective, organizations can utilize internal personnel and resources and reduce their expenditures for the consultants. The results of this study provide the knowledge to assist organizations in achieving cost savings regarding consultants.

Consultants themselves can also benefit from this research because they can see which areas they should stress more in their practices and which areas they should improve to give their clients more value. Any consulting firms that are interested in entering the ERP consulting area can see the areas on which to concentrate from the beginning. Of course, the resources and abilities that the vendors and consulting firms possess may limit their choices in strategy, but this research gives them insight on how their potential clients feel about the use of consultants for their ERP implementations.

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Table 1. Activities Included in the Phases of the Current ERP
Implementation Model

Phase/Subphase            Activities

Planning Phase            Building a business case for ERP system
Phase                     Assembly of a steering committee
                          Selection of an ERP system
                          Selection of project managers
                          Determination of scope of project
                          Approval of budget and schedule for
                            implementation

Project Phase

Reengineering Subphase    Detailed examination and evaluation of
                            current processes
                          Installation of ERP system

Design Subphase           High-level and detailed design
                          Prototyping to get feedback from users

Configuration and         Creation of the detailed configuration
Integration Subphase        based on processes
                          Preliminary testing of the configurations
                          Building and testing interfaces and reports

Testing Subphase          Testing of the system as a whole

Installation and          Building necessary networks
Conversion Subphase       Installing software on users' PCs

Training of users         Conversion of data and archive files

Shakedown Phase           Testing the system in operating mode
                          Debugging and fine-tuning the system

Retraining users          Staffing to handle temporary inefficiencies

Operation Phase           Continuous improvement and modifications

Debugging

Repair and maintenance

Continuous user           Post-implementation benefits analysis
training

Table 2. Mean Ratings on Consultant Effectiveness and Necessity by
Phase

                    Consultant                  Consultant
                   Effectiveness                Necessity

Phase or         Mean   Standard    Rank   Mean    Standard    Rank
subphase         n=177  Deviation          n=177   Deviation

Planning phase   4.83     1.47       3     5.23      1.771      3

Reengineering    4.46     1.505      6     4.74      1.816      5
subphase

Design           4.88     1.462      2     5.35      1.514      2
subphase

Configuration    5.21     1.534      1     5.52      1.612      1
and
integration
subphase

Testing          4.67     1.539      5     4.66      1.713      6
subphase

Installation     4.82      1.5       4     4.87      1.786      4
and
conversion
subphase

Shakedown        4.41     1.434      7     4.44      1.647      7
phase

Operation        3.95     1.625      8      3.6      1.739      8
phase

Overall          4.83     1.284             5.2      1.452

Note: Ratings were on a scale of 1 to 7 with 1 being strongly
disagree that consultant is effective-necessary and 7 being
strongly agree that consultant is effective-necessary. Only
responses of the ERP implementers (n=177) are used in the analysis
of consultant necessity because so few responses were received from
non-ERP implementers. No significant differences were observed
between the two groups.

Table 3. Correlation between Consultant Effectiveness and Necessity
by Phase

                                Effectiveness

                       Plan      Reeng    Design    Config

             Plan     .542 *
             Reeng              .591 *
            Design                        .580 *
Necessity   Config                                  .678 *
             Test
            Install
             Shake
             Oper

                               Effectiveness

                       Test    Install   Shake     Oper

             Plan
             Reeng
            Design
Necessity   Config
             Test     .506 *
            Install            .566 *
             Shake                       .584 *
             Oper                                 .639 *

* Significant at p<.01

Table 4. Differences in Mean Ratings for Effectiveness in ERP
Implementation Phases and Subphases

            Mean    Plan       Reeng      Design     Config

Mean                4.83       4.46        4.88       5.21
Plan        4.83     --
Reeng       4.46    0.37        --
Design      4.88    -0.05      -.42 *       --
Config      5.21    -0.38    -.75 ***    -.33 **       --
Test        4.67    0.16       -0.21       0.21      .54 ***
Install     4.82    0.01       -0.36       0.06       .39 *
Shake       4.41   .42 **      0.05       .47 **     .80 ***
Oper        3.95   .88 ***     .51 **      93 ***   1.26 ***
Overall     4.83     --        -0.37       0.05      .38 ***

             Test     Install     Shake       Oper     Overall

Mean         4.67       4.82       4.41       3.95       4.83
Plan
Reeng
Design
Config
Test          --
Install      -0.15       --
Shake        0.26      .41 ***       --
Oper        .72 ***    .87 ***    .46 ***       --
Overall      -0.16      0.01     -.42 ***   -.88 ***       --

* Significant at p<.05
** Significant at p<.01
*** Significant at p<.001

Note: Differences are calculated as the mean rating for the phase on
the top of the chart minus the mean rating for the phase on the left
side of the chart. A positive difference indicates that the mean for
the phase on the top is higher than the mean for the phase on the
left side. A negative difference indicates that the mean for the
phase on the top is lower than the mean for the phase on the left
side.

Table 5. Differences in Mean Ratings for Necessity in ERP
Implementation Phases and Subphases

          Mean     Plan      Reeng     Design     Config      Test

Mean               5.23      4.74       5.35       5.52       4.66
Plan      5.23      --
Reeng     4.74    .49 **      --
Design    5.35    -0.12     -.61 ***     --
Config    5.52    -0.29     -.77 ***   -0.17        --
Test      4.66    .57 **      0.08     .69 ***    .86 ***       --
Install   4.87     0.36      -0.13     .48 **     .65 ***     -0.21
Shake     4.44   .79 ***      0.3      .91 ***    1.08 ***     0.22
Oper      3.6    1.63 ***   1.14 ***   1.75 ***   1.92 ***   1.06 ***
Overall   5.2      0.03     -.46 **      0.15      .32 **     -54 ***

          Install      Shake      Oper      Overall

Mean        4.87       4.44        3.6        5.2
Plan
Reeng
Design
Config
Test
Install      --
Shake      .43 **       --
Oper      1.27 ***   .84 ***       --
Overall    -0.33     -.76 ***   -1.60 ***     --

** Significant at p<.01

*** Significant at p<.001

Note: Differences are calculated as the mean in the phase on the top
of the chart minus the mean in the phase on the left side of the
chart. A positive difference indicates that the mean of the phase on
the top is higher than the mean of the phase on the left side. A
negative difference indicates that the mean of the phase on the top
is lower than the mean of the phase on the left side.

Table 6. Differences in Mean Ratings for Effectiveness and Necessity
by Phase

Phase or Subphase        Effectiveness   Necessity   Difference
                                                      in Means

Planning phase               4.83          5.23       -.40 **

Reengineering subphase       4.46          4.74        -0.28

Design subphase              4.88          5.35       -.47 ***

Configuration and            5.21          5.52       -.31 **
integration subphase

Testing subphase             4.67          4.66         0.01

Installation and             4.82          4.87        -0.05
conversion subphase

Shakedown phase              4.41          4.44        -0.03

Operation phase              3.95           3.6        .35 **

Overall                      4.83           5.2       -.37 ***

** Significant at p<.01

***Significant at p<.001

Note: Differences are calculated as mean on effectiveness minus mean
on necessity. A positive difference indicates that the consultants
were rated as being more effective than necessary; a negative
difference indicates that consultants were rated as being more
necessary than effective.

Table 7. Means of Respondents' Ratings on Characteristics of ERP
Consultants

Characteristic           Mean (n=177)   Standard    Rank
                                        Deviation

Technical skills and
knowledge                    5.59         1.403      1

Human interaction and
communication skills         4.81         1.345      6

Business context
skills                       4.77         1.503      7

Consulting skills and        5.06         1.335      3
knowledge Objectivity        4.84         1.449      5

Experience with ERP          5.49         1.434      2
implementations              4.87         1.529      4
Commitment to quality

Ability to manage ERP
implementations              4.73         1.554      8

Note: Ratings were on a scale of 1 to 7 with 1 being low
contribution to effectiveness and 7 being high contribution to
effectiveness. Only the responses of the ERP implementers (n=177)
are used in the analysis of the characteristics because so few
responses were received from non-ERP implementers. No significant
differences were observed between the two groups.

Table 8. Explanation of Variables for Regression Equations

Variable          Explanation

TECHNICAL         Technical knowledge of the ERP consultant

COMM              Human interaction and communication skills of the
                  ERP consultant

BUSINESS          Business context skills of the ERP consultant

CONSULT           Consulting skills and abilities of the ERP
                  consultant

OBJECT            Objectivity of the ERP consultant

CONSULTERPEXPER   ERP consultant's experience with IS and ERP
                  implementations

QUALITY           ERP consultant's commitment to quality

MANAGE            Management skills of the ERP consultant

Table 9. Regression Results for Contributions of Characteristics to
Effectiveness of ERP Consultants by Phase in which Consultants
are Rated Most Effective

Variable       Predicted Sign   Coefficient Estimate   p-value

Intercept            ?                 2.921              0
TECHNICAL            +                 0.157            0.075
COMM                 +                 0.111            0.245
BUSINESS             +                 -0.153           0.07
CONSULT              +                 0.003            0.976
OBJECT               +                 0.156            0.054
CONSULTEXPER         +                 0.044            0.669
QUALITY              +                 0.109            0.244
MANAGE               +                 0.083            0.385

Adjusted [R.sup.2] = .192

F=6.081, p<.001

Table 10. Regression Results for Contributions of Characteristics to
Overall Effectiveness of ERP Consultants

Variable        Predicted Sign   Coefficient Estimate   p-value

Intercept             ?                 1.784              0
TECHNICAL             +                 0.173            0.009
COMM                  +                 0.025            0.721
BUSINESS              +                 -0.071           0.258
CONSULT               +                 0.062            0.413
OBJECT                +                 0.033            0.577
CONSULTEXPER          +                 -0.067           0.385
QUALITY               +                 0.149            0.031
MANAGE                +                 0.276              0

Adjusted [R.sup.2] = .394

F=15.289, p<.001
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