The Barriers and Enablers of ERP Adoption in Small and Medium Enterprises (SMEs)

Abstract

Enterprise Resource Planning (ERP) is the trend that supports business processes and thereby smoothens business operations. ERP adoption has gained significant attention as a crucial information management system that facilitates the improvisation and automation of business processes by effectively tracking organisational resources and processes (Fadelelmoula, 2018). However, the adoption of ERP varies according to the scale of business operations, as small and medium enterprises (SMEs) face various barriers when implementing ERP. The utilisation of ERP by SMEs can potentially be profitable, as it contributes to effectively conducting business activities – from the acquisition of resources from vendors to the final delivery of goods. It is difficult to implement given the significant costs and longer time for customisation (Venkatraman and Fahd, 2016 A requisite for effectively implementing ERP in a business enterprise is having an adequate storage capacity to save data, which can only be achieved by spending a large amount of money on hardware (Lasisi and Owens, 2018). Since small firms generally do not have good liquidity, it can be problematic for them to spend extensively on the adoption of ERP in their business practices. This research project aims to explore this problem and determine the barriers and enablers regarding the adoption of ERP in SMEs.