An empirical analysis of business efficiency from the implementation of enterprise information system

Authors:
Ruey Kei Chiu;S.C. Lenny Koh;Angappa Gunasekaran
Affiliations:
Department of Information Management of College of Management, Fu-Jen Catholic University, 24205 No. 510 Cheng-Chung Road, Hsing-Chuang City, Taipei County, Taiwan.;MBA in Ecobusiness, University of Sheffield, Management School, 9 Mappin Street, Sheffield S1 4DT, UK.;Management Department, University of Massachusetts, 285 Old Westport Road, North Dartmouth, MA 02747 2300, USA
Venue:
International Journal of Business Information Systems
Year:
2006

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Abstract

Enterprises recently tend to implement their new enterprise information systems like the Enterprise Resource Planning (ERP) system in order to gain their competitive advantages and bring up their business efficiency, but the efficiency gained from this new implementation is not quite clear and is difficult to be identified. This paper presents an empirical research aiming to measure how business efficiencies in terms of scale efficiency and technical efficiency are influenced by the implementation of the ERP system. Six cases of large-scale companies in Taiwan are investigated. Data Envelopment Analysis (DEA) and Analytic Hierarchy Process (AHP) are the two main analytic methods used in this measurement. The key decision variables with their weights, which may significantly impact on business efficiencies, are firstly identified by employing AHP and then used by the DEA model to measure business relative efficiencies resulting from ERP implementation. Through this hybrid approach of objectively quantified analysis, we attempt to obtain more reliable business efficiency, which is truly affected by the implementation of ERP system.