Information Technology in Supply Chain Management

Information Technology in Supply Chain Management

The Impacts of Enterprise Resource Planning on Supply Chain Management
Abstract
Information systems are essential components of successful supply chain
management. Supply chain information technology is a key enabler of effective supply
chain management operations and activities. Companies in the supply chain industry are
spending millions of monies to integrate supply chain management and supply chain
information technologies. To stay and survive in the modern competitive world, supply
chain companies should push to their limits to search for organizational technologies and
skills. This makes integration of supply chain management and Enterprise Resource
Planning a primary goal for companies aiming to create a hedge in today’s competitive
supply chain environment. Enterprise Resource Planning is the business process
management of using information technology systems of integrated applications for
managing the business and automate numerous supply chain management functions
related to services, technology, and human resources. Therefore, for companies to survive
and stay in supply chain competition, they are forced to improve their production and
performance as well as reduce their cost for performance improvement strategy.
Enterprise Resource Planning, supply chain management, and performance should go
hand in hand to achieving competitive advantage and improve information exchange
from both outside and inside. Thus, supply chain management is the term used to manage

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precise information inflow and outflow, while Enterprise Resource Planning is the
technology companies in the supply chain industry use to achieve the same strategy.
The purpose of this research is to advance the field of study and help solve real
problems that companies face in integrating Enterprise Resource Planning with supply
chain management. This will eventually create an analytical process and tools for the
integration of these systems. The advent of the Enterprise Resource Planning system
globalization is emerging as a major area of interest for various companies in supply
chain management. The research has two major orientations which are how to implement
Enterprise Resource Planning system in a supply chain management and the advantage of
the Enterprise Resource Planning system in solving numerous issues and problems in an
organizational setting.
Past studies have focused on the funding, timing, success, and economy of
implementing Enterprise Resource Planning. However, this study will establish the
impacts of Enterprise Resource Planning on supply chain management and address the
functions of Enterprise Resource Planning in operational and strategic levels. Besides, it
study aims at bringing in the major disadvantages and difficulties on Enterprise Resource
Planning systems’ implementation in supply companies integration with supply chain
management. The results will help in suggesting the impacts of Enterprise Resource
Planning integration with supply chain management. Enterprise Resource Planning

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systems are essential in the current state and play a modest role in obtaining supply and
management integration. There is a major advancement in the field of information
technology and the development of solutions that with time shift, companies will
establish strategic solutions for interfacing Enterprise Resource Planning systems with
supply chain management. This will help in realizing improved supply chain
management. Literature review shows that major advantages and impacts of Enterprise
Resource Planning systems are centralization and integration. An Enterprise Resource
Planning system provides the analysts and decision makers with the ability to make
decisions for advancing the knowledge about the processes for assisting managers in
making informed and reliable decisions more rapidly. They also help in the collection of
sources for supporting managers’ decisions. The findings from various studies show that
it is evident that Enterprise Resource Planning assists in improving the reliability of
decision making through mutual participation of key decision makers and improving
coordination of process for making inter-related decisions faster and easier. This
integration results in improved satisfaction of decision-making process across the supply
chain management. Thus, the purpose of this dissertation is the establish the impacts of
Enterprise Resource Planning on supply chain management. This will shed light on this
vital research area.
In chapter two, the paper will review the literature to establish the direct impacts
of Enterprise Resource Planning on supply chain management and on company

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performance. The descriptive research methodology will investigate the impacts, benefits,
and characteristics of Enterprise Resource Planning and supply chain management
integration as well as parameters such as data compatibility, application integration,
evaluation, alertness ability, and analytic ability. This will be important in determining
whether supply chain information technologies are universally associated with improved
company performance. For example, supply chain information technologies have
multiple characteristics and each specific characteristic is associated with different
performance indicators.
In chapter three, the paper provides the methodology applied, data analysis,
research questions and research designs to be used. This will establish the structure that
will conditionally change the relationship between supply base, performance and
customer base complexity. The methodology will establish the descriptive procedures for
the extant literature for suggesting the complexity of the supply chain for improved
performance. The use of secondary data will enable the research to establish impacts of
Enterprise Resource Planning and supply chain management on performance in the
supply chain industry. This will enable how to systematically investigate the indirect and
direct impacts of Enterprise Resource Planning on firm performance. Therefore, this
dissertation will contribute to the comprehension of the roles of Enterprise Resource
Planning on supply chain management.

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Contents
1.1. Introduction 3
1.2. Historical Background 4
1.3. Research Rationale 5
1.4. Thesis Statement 6
1.5. Problem Statement 6
1.6. Enterprise Resource Planning and Supply Chain Management 9
1.7. Enterprise Resource Planning and Supply Chain Integration 11
1.8. Benefits of ERP 14
1.9. Research Design 15
1.9.1. Purpose of Study 15
1.9.2. Statement of Problem 16
1.9.3. Research Objectives 17
1.9.4. Research Questions 17
1.9.5. Significance of Study 18
1.9.6. Theoretical and Methodological Framework 19
1.9.7. Validity and Reliability 20
1.9.8. Research Roadmap 21
2.0. Chapter Two 22
2.1. Literature Review 22
3.0. Methodology 33
3.2. Data Collection 33
3.3. Results Analysis 34
3.4. Result Presentation 34
4.0. References 36

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The Impacts of Enterprise Resource Planning on Supply Chain Management

1.1. Introduction

This paper focuses on the impacts of enterprise resource planning (ERP) in supply chain
management (SCM). It has been over decades since the internal operations of companies
to be streamlined, manufacturing up, and products’ quality are improved, and the
manufacturing costs reduction. However, in modern business operations, firms are now
strategizing on the logistics reduction by implementing the correct supply chain strategies
for the excellence of companies in the supply chain industry. Statistics indicate that there
is a mounting focus on supply chain management as a component via which companies
can realize competitive advantages in both domestic and global markets (Stefanou, 1999).
A significant portion of examples in the past decades demonstrate how firms have made a
huge investment for streamlining their supply chain systems to enhance the satisfaction of
customers and improve their internal productivity. Studies indicate that not actually
individual companies that compete in the markets; however, the real competition is
between rival supply chain systems. Therefore, the supply chain systems that add the
most customers’ values with the least costs in the chain make up the winning network of
different firms (Buurman, 2002).
The recent statistics show that American companies incur logistic costs that are
significant to the budget or the company turnover. The increasing costs and challenges
faced by logistics companies have informed the research on the impact that enterprise

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resource planning have of supply chain management. The research will find the best
enterprise resource planning model that can strategically improve supply chain
management (Aziz, Ragheb, Ragab & El Mokadem, 2018). The other major reason for
the modification that is frequently applied in the methodologies and the scope of the
supply chain management are the introduction of the supply chain network economy. In
the modern business operations, there is increased transparency in the market because
there is enhanced customization applied to the demand of consumers. The strategic
development of supply chain systems through the implementation of enterprise resource
planning can have great impacts on business operations (Chen, Preston & Swink, 2015).
There is rapid literature that is constantly published about the new business
models. Information technologies in supply chain management are providing increased
benefits to companies in the industry (Kasemsap, 2015). The emergence of enterprise
resource planning technologies through the age of the internet has enabled companies to
create competitive advantages. Most companies believe that proper supply chain
management is the application of the competency component with the increasing rivalry
in the markets (Christopher, 2016).
This research will provide an interesting study on the impacts of the Enterprise
Resource Planning (ERP) on the supply chain management. Therefore, Enterprise
Resource Planning (ERP) is growing in the business networks where companies are

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failing to take advantage of improving operations of their management of the supply
chain. Enterprise Resource Planning (ERP) is currently used as an extension of the
Market Requirement Planning (MRP) and the Manufacturing resource planning (Stevens
& Johnson, 2016).

1.2. Historical Background
Enterprise Resource Planning (ERP) started in the early 1980s and then properly
extended in the 1990s focusing on the large areas of huge scale business companies.
Supply chain management systems are considered extremely complex, expensive and
powerful. Managers consider supply chain management as an essential platform for
simplifying complex operations (Gunasekaran & Ngai, 2004). However, there are
specific limitations that are accompanied modifications making organizations change in
the entire operating system of the business for making adjustments with the emerging
technologies in the supply chain management (Al-Mashari & Al-Mosheleh, 2015).
Organizations are currently seeking on integrating decisions across supply chain
operations and across diverse regions which are geographically dispersed facilities and
across time basing on the management of supply chain. This is a crucial activity in any
business strategy in the retail industry. Companies are finding that Enterprise Resource
Planning is a strategic activity to improve services, enhance efficiency, ensure customer
satisfaction and create competitive advantages (Aziz et al, 2018).

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1.3. Research Rationale
For companies to survive in the modern competitive business environment it is
important to adopt profitable strategies in essential for ensuring continuous performance.
It is extremely difficult for companies to survive in today’s business dynamic
environment. Therefore, evidence shows that organizations are speeding up as well as
enhancing quality and flexibility. This has improved the strategies for reducing
operational costs in different operational circumstances for making up the performance
organizations (Zhang, 2016). This has increased competition in the supply chain industry.
Thus, integrating Enterprise Resource Planning with Supply Chain Management is
extremely important for companies in the industry. The benefits of integrating both
Enterprise Resource Planning and Supply Chain Management include access to accurate
information, essential information outside and within the company and the effective and
efficient use of this information to draw operational strategies (Chofreh, Goni & Klemeš,
2018). Integrating Enterprise Resource Planning with Supply Chain Management is also
important for achieving diverse purposes through the use of information technology tools
and information systems (Aziz et al, 2018). This is essential for ensuring the effective use
of Information Technology in order to achieve and main competitive advantages.

1.4. Thesis Statement

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This is an important research intended to provide essential information based
study in the supply chain management. The thesis statement of this research is the “the
impact of Enterprise Resource Planning in the Supply Chain Management (SCM).”

1.5. Problem Statement
Enterprise Resource Planning in Supply Chain Management is an essential
activity that improves efficiency, effectiveness, accuracy, and performance. Different
studies show that there is an increased focus on the management supply chain as a
strategy via which companies can realize their competitive advantages in the markets. A
significant proportion of companies of the early 1990s demonstrate how firms have put
huge investment for streamlining their supply chain systems. These strategies are aimed
at improving customer satisfaction and increasing their operational productivity.
Companies that compete together in a rival supply chain have the chance of improvement
of their productivity. However, only the supply chains that add the most value for its
consumers with the lowest costs in the chain end up as the successful network in the
various supply chain networks (Aziz et al, 2018).
The recent change in market strategies due to emerging technologies has seen
companies integrate decisions across supply chain operations across different isolated
facilities and across time and facts based on supply chain management. ERP is important
in integrating decisions in the supply chain management. The core reason for adopting a

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fact-based supply chain management is the integration of planning and control which are
essential dimensions of managing supply chain networks. The problem discussion shows
that most supply chain management illuminates that effective integration of ERP and
SCM improves the performance of the supply chain systems (Gattorna, 2017). The
adoption of Enterprise Resource Planning is a strategy for improving supply chain
management and ensuring easy operations for companies in the industry. Companies in
the supply chain system have encountered increasing challenges due to complex supply
chain networks. Integrating Enterprise Resource Planning with Supply chain management
is essential given the benefits associated with the systems. Many companies in the supply
chain networks are currently adopting Enterprise Resource Planning technologies in order
to promote their operations, enhance traceability and create competitive advantages. For
these reasons, this research seeks to establish the impacts that Enterprise Resource
Planning has on supply chain management.
Enterprise Resource Planning (ERP) systems are adjusting and changing the
processes many companies and business organizations carry out their activities to provide
means of linking all various facilities and departments together. This results in more
precise information for companies. Enterprise Resource Planning systems offer
organizations with a single platform system to assist in the integration and coordination
of vital business processes. Enterprise Resource Planning system ensures a smooth
information flow within different levels of the organizations which leads to extra focus

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and accurate decisions for the companies. However, before implementing Enterprise
Resource Planning systems, companies had numerous different information systems in
place to support company activities such as supply chain, logistics, finance, and human
resource. This was happening without the integration of individual activities. The systems
existed in separate applications and didn’t support system interconnectivity (Subramani,
2004). Thus, effective implementing of the Enterprise Resource Planning systems allows
all the above systems land other business systems to become integrated and in creating a
backbone for the provision of the means of linking all various departments via a single
system that is efficient enough for integrating all the relevant organizational divisions
through effective information together. Besides, Enterprise Resource Planning is able to
present meaningful real-time and on-time information or data and business results.
There are numerous impacts associated with the adoption of Enterprise Resource
Planning by supply chain companies. Enterprise Resource Planning systems are regarded
as the systems of records that many firms use to enhance efficiency and offer persistence
or consistent results for years. Enterprise Resource Planning systems are expensive for
companies to implement and cost a significant amount to fully implement. Studies show
that Enterprise Resource Planning systems are widely used by global companies and the
systems have a market value in terms of software and growth for companies in the supply
chain systems. Companies in North America are widely using Enterprise Resource
Planning systems as compared to the rest of the world. However, different studies show

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that Enterprise Resource Planning has potential markets in Eastern Europe, Asia Pacific,
Latin America, and the Middle East.
There are challenges in implementing Enterprise Resource Planning systems in
supply chain management. However, integrating Enterprise Resource Planning systems
not only connects different individual systems within a company but it also offers an
integrated system which is able to support various web services, integrated supply chains,
mobile support, and e-commerce (Hendricks, Singhal & Stratman, 2007). Not only
companies in the supply chain management system are adopting ERP, but statistics also
show that over 70% of US federal, state and local government agencies are implementing
Enterprise Resource Planning systems basing on same reasons as businesses in order to
fully integrate the organizational wide information and leading to more useful decisions
(Cachon & Fisher, 2000). Many Enterprise Resource Planning vendors in supply chain
systems see this as an opportunity to install ERP to replace their traditional legacy
systems through both federal and local departments for increasing productivity and
efficiency. Therefore, an Enterprise Resource Planning system is not just constraint to
large companies but also is extremely useful for other small firms in the industry (Aziz et
al, 2018).

1.6. Enterprise Resource Planning and Supply Chain Management

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Numerous companies are using Enterprise Resource Planning systems in supply
chain applications. Enterprise Resource Planning has enabled companies to ensure
complete use of capabilities of information technology. Despite that Enterprise Resource
Planning systems look still challenging to use in supply chain networks, it is evolving and
the percentage of companies implementing ERP is increasing. Therefore, enhancing
knowledge and awareness is vital for the adoption of Enterprise Resource Planning
systems in supply chain systems globally at both organizational and inter-organizational
levels (Subramani, 2004). This research will seek to establish also what companies
require to establish and comprehend the significant factors that impact the successful
implementation of Enterprise Resource Planning systems in supply chain management.
Managers are mandated to address the factors established effectively for ensuring that the
promised merits are realized and avoiding any incidents of failures (Aziz et al, 2018).
Suppliers are situated all globally making it necessary to integrate the operations
both outside and inside the company structure (Hwang & Min, 2015). Thus, companies
require enterprise-wide information systems in order to share information on various
values to add activities along the supply chain. The other problem is establishing the
relationship between supply chain management and Enterprise Resource Planning
systems to facilitate companies and software vendors in the supply chain industry to
develop an integrated supply chain system.

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According to Ptak & Schragenheim (2016), Enterprise Resource Planning system
effectively integrate all information needed by the functions of the operating system such
as quality management, human resources, material management, distribution and sales by
companies in the supply chain industry. Thus, information technology will be one of the
main aspects to examine its influence in the implementation of Enterprise Resource
Planning systems by companies operating in the supply chain industry. Enterprise
Resource Planning systems provide integrated information systems that help in
integrating enterprise internal function working processes. Besides, the standardized
internal data processing processes help in combining the operational data integrated by
various company functions. It is important to establish how Enterprise Resource Planning
systems will integrate supply chain management more precise information (Subramani,
2004).
The supply chain is a concept that looks how business distribution process will
interconnect entities and facilities to provide efficient and effective operations.
Companies are able to model their supply chain systems for reducing inventory lead time
and costs at every link under given constraint. Thus, it is important to establish the
relationship between Enterprise Resource Planning and Supply Chain Management. This
research will provide a study of various companies in the supply chain industry and their
operations of ERP and SCM. The results intend to produce expectations and uses of ERP
systems implementation in a supply chain management perspective (Ptak &

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Schragenheim, 2016). Besides, it is noticeable that many companies in the supply chain
industry are deploying Enterprise Resource Planning systems as well as consider
extending the system scopes majorly for integrating their customers, suppliers or both to
their systems for providing extra electronic commerce or operations of the business. This
also increases the functionalities of the supply chain. It has been established that the
relationship between Enterprise Resource Planning and Supply Chain Management is an
important aspect and this study intends to provide a framework and model that companies
can adapt to ensure successful integration of the two frameworks (Subramani, 2004).
However, there are challenges for modern organizations to comprehend the elements that
play a significant role in using Enterprise Resource Planning system capabilities as well
as their impacts on the management of supply chain in order to help them to compete
strategically and successfully in the market as well as utilizing their results to enhance
company performance. The earlier studies have not been comprehensive and holistic in
providing complete information in the integration of ERP with SCM. Lack of competing
for literature to support the study makes ERP systems relatively immature. However, the
application of ERP systems is evolving as well as sees the number of companies involved
grow rapidly in the recent past.
It is important before implementing successful Enterprise Resource Planning
systems to consider various factors for smooth integration. This study will identify the
factors of Enterprise Resource Planning, provide a better understanding of supply chain

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and employees’ perceptions of Enterprise Resource Planning systems success dimensions
and offer an extensive review of literature for Enterprise Resource Planning systems and
supply chain integration. The findings will show how Enterprise Resource Planning
systems have positive impacts on both external and internal supply chain integration
(Subramani, 2004).

1.7. Enterprise Resource Planning and Supply Chain Integration
Enterprise Resource Planning systems success refer to the user if the systems in
enhancing organizational effectiveness (Fredendall & Hill, 2016). This varied from the
technical execution success of ERP system whereas measurement indicators like time
estimates, cost overruns, and supply chain management are the major concerns. It is
important to establish what constitutes information system success and the interrelations
among the vital success components in early stages of Enterprise Resource Planning
implementation. This research will complement such efforts. Most importantly insights of
this study will benefit practitioners of ERP and supply chain management success
evaluations.
Companies planning to implement successful ERP systems to have technical
capacity and structure that will complement the operations of ERP system. Additionally,
Enterprise Resource Planning includes operational, managerial, technical, and strategic as
well as organization related elements. However, for the essence of accuracy, it is

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important to pay attention to the ERP system separately instead of mixing them with
other information technology systems (Hugos, 2018). This research will look into the
specific features of the information technology system that will improve the success of
ERP systems. This is because Enterprise Resource Planning system is a particularly
different class of IT systems. The paper will look to establish important measurement
model of the framework to be used in the evaluation or measurement of the success of
ERP systems. The implementation of Enterprise Resource Planning causes dimensions in
various companies involves system quality, individual impact, organizational impact and
information quality (Ross, 2016).
This paper will involve an in-depth literature review and case studies to propose
the impacts of various Enterprise Resource Planning systems integration with supply
chain management as well as propose an extended Enterprise Resource Planning system
success measurement model. It will also look into how companies have adopted
Enterprise Resource Planning systems to enhance cross-functional operations. This
involves effective success measurement model such as workgroup impact for functional
departments and sub-units of a company. Furthermore, information technology has turned
the world into a global village by enhancing transfers of files, data, and information as a
significant driver of supply chain integration (Altamony, Al-Salti, Gharaibeh & Elyas,
2016). Enterprise Resource Planning systems are the important drivers of company
success in the supply chain industry because of the coordination and integration of

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various functions and spatially distributed facilities and project units. Integration of
supply chain seeks to improve competitiveness in the industry by strategically integrating
the internal operations within an organization as well as closely connecting internal
functions with external functions of the suppliers, customers and other channel partners
(Liu, Wei, Ke, Wei & Hua, 2016).
Supply chain management and integration categories will be examined to suggest
the establishment of internal supply chain integration on how to precede the external
integration as established in the integration of logistics operations across company
boundaries. For example, by looking into the manufacturing enterprise regarding the
entire supply chain network which significantly will consist of numerous companies
linked together in network arrangements can result in effective adoption of ERP system.
Companies should use Enterprise Resource Planning systems in order to
streamline and enhance the efficiency of their activities or operations. This saves
resources in terms of money and time in supply chain management (Monczka, Handfield,
Giunipero & Patterson, 2015). Thus, in implementing Enterprise Resource Planning,
organizations should standardize and automate many processes of their businesses to
eliminate manual effort and save time. It is important to examine ERP components that
companies should select before starting Enterprise Resource Planning implementation
(Kache & Seuring, 2017). This often depends on the specific business processes in the

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supply chain management that the company desires to improve through the entire supply
chain. Companies that supply or delivery products in the supply chain should have
efficient manufacturing, supply chain, distribution and inventory management functions
that the Enterprise Resource Planning system should effectively address.

1.8. Benefits of ERP
Enterprise Resource Planning system offers a single repository for companywide
data and mitigates the risks associated with working with disparate data and systems.
These can include the potential for error or duplication of business functions in various
departments. Large companies in supply chain industries have various systems often
independently installed by companies. It is important to execute a single Enterprise
Resource Planning system that takes the place of the traditional system in eliminating the
time delays and operational inefficiencies that have accrued over years (Mangan, Lalwani
& Lalwani, 2016). Medium size firms can take advantage of identified benefits to
enhance their operations. Additionally, ERP systems can help companies to establish
level playing field with their larger corporate competitors. It is important to establish an
ERP system that is able to expand to accommodate continuous growth. Cloud-based ERP
offers small companies with an added advantage as they lack the expertise or internal
resources to institute Enterprise Resource Planning software for taking advantage of
lower costs and technical expertise of suppliers and gain quick business efficiencies.
Companies should look for ERP that is specialized to the requirements and needs of their

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supply chain industries. Besides, a number of ERP vendors provide supply chain industry
vertical specialization. Therefore, companies should adopt Enterprise Resource Planning
system or software either as an intensive suite or as a smaller suite that encompasses only
financial systems, manufacturing systems or only service systems (Mentzer, DeWitt,
Keebler, Min, Nix, Smith & Zacharia, 2001). Companies in the supply chain industry can
purchase a specifically designed Enterprise Resource Planning system of a particular
model that best fits its operations in order to enhance competitive advantage in the
markets (Gunasekaran, Subramanian & Tiwari, 2016).

1.9. Research Design
There are three research designs adopted in social sciences study which include
explanatory, exploratory and descriptive researches. Exploratory research is carried out to
establish preliminary comprehension of some phenomena while explanatory research is
employed to explore and report relationship among various aspects of the phenomena.
However, descriptive researches are carried out to define the accurate measurement and
report of the features of the phenomena under evaluation. Therefore, the explanatory
study approach is applicable when it is essential to demonstrate that one variable can
cause or determine the values of the other variables. This research is both explanatory
and exploratory. The explanatory study will aim to cover a broad diversity of companies
in American supply chain members. Since sampling of companies that use ERP is hard,
there will be no comprehensive sampling frames. The selection of sampling method will

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be also hard because there are no available databases specialized in the implementation of
ERP systems.
1.9.1. Purpose of Study
This study will focus to further the implementation of Enterprise Resource
Planning and solving real issues in order to create an effective and efficient framework
for the system. There is increasing ERP globalization of the software. This is because
Enterprise Resource Planning has emerged as a major interest area in Supply Chain
Management for many companies in the industry. Thus, companies are significantly
interested to implement an Enterprise Resource Planning system in their operations. For
this reason, it is important to develop a proper implementation for adopting and
integrating Enterprise Resource Planning and Supply Chain Management. This is because
the very advantages of Enterprise Resource Planning themselves can be described as its
major disadvantages (Stadtler, 2015). Some studies show that ERP will not make
decisions by itself while others believe that making decisions basing on information
stored in Enterprise Resource Planning depends on the integrity and algorithm
optimization (Costa, Ferreira, Bento & Aparicio, 2016).
In contrast, the entire system processes and data integration organization is an
essential tool for supply chain management and prerequisite to implement and establish
the impact of the process (. Neubert, Ouzrout & Bouras, 2018). However, in the process,
it is a must to interact with Enterprise Resource Planning. This will cause a challenge to

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implement standard processes and supply chain collaboration. The research will try to
establish how information transparency impacts on company process towards the
reduction of operational cost. The research will also aim to study the impacts of
Enterprise Resource Planning in supply chain management and in the decision making
process. Thus, the research will establish the precise role of Enterprise Resource Planning
in implementing standard supply chain processes and collaboration. The research will
establish problems about supply chain and provide information on how to improve the
performance of supply chain indicators to implement Enterprise Resource Planning
(Costa et al, 2016).

1.9.2. Statement of Problem
The problem for this study will revolve around Enterprise Resource Planning and
Supply Chain management. This is an important research intended to provide essential
information based study in the supply chain management. The thesis statement of this
research is the “the impact of Enterprise Resource Planning in the Supply Chain
Management (SCM).”
1.9.3. Research Objectives
The research is will be carried out following the numerated objectives below;
I. To offer a comprehensive literature review on Enterprise Resource
Planning (ERP) and supply chain integration.

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II. To establish how Enterprise Resource Planning (ERP) enhances
operations of supply chain management
III. To analyze the impact of Enterprise Resource Planning in enhancing
operations binding organizations
IV. Analyzing and establishing the roles of Enterprise Resource Planning
(ERP) in making decisions in Supply Chain Management

1.9.4. Research Questions

The research will be conducted using the following research questions;
I. What are the impacts of Enterprise Resource Planning on supporting
management of supply chain?
II. What are the impacts of Enterprise Resource Planning systems on
organizational decisions?
III. Does Enterprise Resource Planning have a positive or negative impact on
company productivity?
IV. What are the implementation faces for ERP and SCM integration?
V. What are the challenges faced by companies during ERP integration with
supply chain management systems?
VI. Does ERP installation increase the cost of firm productivity?

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VII. Do companies struggle to identify and understand the real value
and return on investment by integrating supply chain management and
Enterprise Resource Planning?
VIII. What is the relationship between SCM and ERP integration on
firm performance?
IX. What are the roles of Enterprise Resource Planning on supply chain
management and its impacts on company performance?
X. What are the initiatives that companies in the supply chain industry are
adopting to integrate ERP and SCM?
XI. How is ERP changing to adapt to the current stream of interoperability?
XII. What is the role that interoperability plays in the ERP system
evolution?
1.9.5. Significance of Study
Enterprise Resource Planning plays a significant role in supply chain
management. This is because it offers an easy access to reliable integrated information.
Besides, it plays an important role in Vendor Managed Inventory (Emmett & Crocker,
2016). Supply chain management is the process of planning and controlling operations of
supply chain systems. ERP plays as a major component of tactical supply chain systems
and allows managers to follow digitally agreed objectives between a manufacturer or
distributor and end user by enhancing transaction costs and filling rates. Supply chain

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management and Enterprise Resource Planning will be discussed and their impacts on
supply chain integration mechanized reviewed. ERP is important in reducing operational
costs in supply chain activities. This will be discussed as the operational model and the
rate of quantity improvement and measurement.
There are various studies on the ERP field and its impacts on integration with
supply chain management. The study will focus on bringing out the importance of
integrating Enterprise Resource Planning into the entire system of SCM in order to
ensure the system can yield long term positive impacts. The main reason for integrating
ERP implementation is to have positive impacts which change the operations of the entire
organization and ensure proper comprehension of the system and cooperation for
execution of the network between the actors of the network. This is because people are
prone to changes but change is essential, especially in the adoption of Enterprise
Resource Planning. Therefore, the study will bring out how beneficial can be Enterprise
Resource Planning on a wider scale like during decision making of organizations and
effective management of the supply chain system. Additionally, the study is important in
aiming the ability to bring out the impacts of Enterprise Resource Planning in the
reduction of costs during the distribution of products in the supply chain system.
1.9.6. Theoretical and Methodological Framework
This study will adopt a methodology to gather information from various literature,
articles, textbooks and diverse types of reliable information from various firms and

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 27

numerous other reliable sources. This is a descriptive literature review intended to
provide information for analysis and drawing impacts of ERP in supply chain integration
The study will also investigate other order interviews with numerous supply chain
managers will help in the construction of this thesis. The interdependency of supply chain
management and Enterprise Resource Planning will be backed by various journals or
articles and will choose a few of the articles depending on the main goal and objective of
this study. The study will analyze all data and information from various literatures and
from other sources critically depending upon the requirements of the thesis work in order
to establish the results o the basis of the gathered information. The results will be
narrowed down in an easy form in the resulting chapter to help in resolving confusion to
any reader which is one of the main priorities. The paper also provides a list of sources
along with references for the provision of more information on how the result will be
arrived at. The paper will consider applied investigation in terms of target and will have
descriptive approach because of modeling and some other analytic tools that are
applicable to the research work.
This study will review the role of Enterprise Resource Planning systems on
supply chain management, especially the information infrastructure of cooperation
mechanism and an integrated model of the supply chain. Besides, the paper will consider
and discuss information sharing effect on decision making in supply chain network. In
the next chapter, the paper will discuss the literature review for the project and research

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 28

on past studies about the impacts of Enterprise Resource Planning on company decisions
and supply chain management. The third chapter will provide the role of enterprise
resource planning system on supply chain management. The reporting and analysis
chapter will provide order model for supply chain distribution mechanisms through in-
depth review. The final chapter will provide discussion and conclusion about developing
model and usage techniques in the future of supply chain management.
1.9.7. Validity and Reliability
This study has the efforts to bring out the importance of unknown elements of the
Enterprise Resource Planning system which inherits both merits and demerits. However,
in most cases, ERP is a disabled function in large scale companies. The work will be
developed in close relativity to the available information from various trusted sources.
The authenticated reference list for diverse sources has been given for this thesis work
and therefore, the information will be provided will be valid. However, the information
reliability will be tested in real scale for future work that will take an extended amount of
time regarding the time given for the research work. Therefore, the paper will provide
reliable results and information except that the facts are not yet tested in a real-time
environment.

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 29

1.9.8. Research Roadmap

Introduction

Methodology Literature Review

Findings, Analysis and Discussion

Conclusions and
Recommendations

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 30

2.0. Chapter Two
2.1. Literature Review

Supply chain management is the flow of services and goods that involves the
movement and storage of products or inventory as well as finished products from the
point of manufacture or origin to the point of consumption. Mentzer, DeWitt, Keebler,
Min, Nix, Smith & Zacharia (2001) defined supply chain management as the “origin,
planning, execution, control and monitoring of supply chain activities with the objective
of creating net value, building a competitive infrastructure, leveraging worldwide
logistics, synchronizing supply with demand and measuring performance globally (Costa
et al, 2016).”
According to Buurman (2002) companies can find new methods for creating and
delivering value by integrating Enterprise Resource Planning with supply chain
management. Managers can now understand the value of cost reduction and improved
services for companies. This study offers an in-depth comprehension of logistics and the
changes to Supply chain management and customer-driven logistics. According to
Cachon & Fisher (2000), “supply chain inventory management and the value of shared
information is important to establish supply chain systems which are effective and
efficient.” This study is important as it provides information can be shared by various
companies in a supply chain system. It provides an understanding of how information

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 31

technology now allows companies in sharing demand and inventory data inexpensively
and quickly (Nettsträter, Geißen, Witthaut, Ebel & Schoneboom, 2015). It also provides
“the difference between traditional information policy and the lower bound of
incorporating information technology into supply chain management (Cachon & Fisher,
2000).” Therefore, supply chain management borrows heavily from the fields of systems
engineering, procurement, logistics, information technology, industrial engineering, and
marketing as well as services for an integrated approach. For example, marketing
channels play an essential role if management of supply chain systems. However, it is
important to establish risk management and sustainability. This research will help
establish ethical issues, transparency/visibility, internal integration, talent management
and human capital in supply chain management (Kurbel, 2016).
The literature review explores the existing studies in an effort to understand the
concept of supply chain management. It offers a consistent means to conceptualize
supply chain management. The study will propose the terms of business functions and
organizations and how effectively companies can adopt information technology in supply
chain management (Kurbel, 2016).
According to Stefanou (1999), “Enterprise Resource Planning provides a robust and
modular framework of business applications, the fundamental purpose of which is
integrating business and supporting managerial decision-making.” There is an increase in

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 32

ERP Systems’ popularity among numerous companies which pursue supply chain
management. Firms which search for even hedge or enhanced functionality and small
competitive advantage have the likelihood of implementing best-of-breed applications.
However, companies should not sacrifice their application integration. This allows the
company system to remain its core Enterprise Resource Planning suite. Firms operating
in rapidly changing and vastly competitive environs are supposed to depend on trained
internal developers as well as hire external specialists for the swift development and
execution of strategic applications. This should include interfaces provided by Enterprise
Resource Planning systems like SAP’s BAPL. Studies show that the adoption and
implementation of Enterprise Resource Planning are not straightforward. Thus,
companies pursuing supply chain management should first re-organize their human
capital as well as transform the cultures of companies and visualize on the technical
facets of the execution process. Management should ensure that there is a commitment to
team-work, advanced communication skills, transformational leadership, training of
project developers and organizational openness that reflect in the readiness to share
information (Tian, 2016). These are vital factors that ensure successful adoption of
Enterprise Resource Planning systems under the strategies of supply chain management
strategies. The process of Enterprise Resource Planning and supply chain management
involves a corporate culture that stresses on benefits to share shared goals over the pursuit
of personal goals and the significance of trust between employees, partners, corporations,

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 33

and managers. Companies should have employees trained in Enterprise Resource
Planning systems’ philosophies across the organizational structure to ensure the
successful implementation of ERP (Tian, 2016).
However, many organizations have experienced ERP implementation issues which are
yet to be solved. This shows that future studies must concentrate on how companies
pursuing supply chain management must adjust employees’ behaviors and attitudes for
managing the organizational changes for enhancing successful Enterprise Resource
Planning implementation (Stevens & Johnson, 2016). Companies should find suitable
methods to measure the performance of both firms partaking in the supply chain industry
and the Enterprise Resource Planning systems are major concerns among information
technology and supply chain managers. There is significant growth in the numbers of
companies competing worldwide and the comprehension of the numerous global
practices of business and ethnic cultural components which are important for effective
Enterprise Resource Planning implementation (Stevens & Johnson, 2016).
The paper indents to provide findings on Enterprise Resource Planning implementation
and its impacts on supply chain management. The review of this literature targets to
establish numerous cases of successful implementation of systems of Enterprise Resource
Planning. The analysis of this literature review will help to reveal the critical factors and
impacts for successful ERP implementation systems and integration with supply chain

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 34

management. This falls into two categories of organizational and technological factors.
Nevertheless, the organizational issues appear to be more critical as compared to
technological factors as far as the successful Enterprise Resource Planning execution of
its packages under supply chain management is concerned (Stevens & Johnson, 2016).
In the extremely competitive international environment for drawing the attention of
customers, companies respond to the ongoing adjustments by transforming vividly the
process of production. The supply chain management practices and business process re-
engineering (BPR) have shifted the attention from functional to inter-organizational and
cross-functional processes. Moreover, worldwide phenomena like alliances, joint
ventures, and outsourcing and partnerships transversely the supply chain industry, have
populated a new type of organizational structure defined as “virtual enterprise” (Zhang,
2016). The virtual enterprise emergence brings questions about the nature of ERP to
systems of traditional business information. Monopolistic companies or stand-alone
business information systems give way to a more flexible, modular and integrated system
for supporting business processes across the value chain from suppliers to the customers
(Stadtler, 2015).
Supply chain management is a strategic process that needs the organizational
management of company information and materials to flow in the entire chain, from a
supplier via a customer. Stefanou (1999) argues that “if business success is to be

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 35

achieved, optimization of business processes across the value-added chain must be
accompanied by modern processing technology for optimization of enterprise-wide
information management.” Modern companies are using modern technologies and have
gone into the direction of broad or cross-enterprise integration and are developing multi-
functional and flexible modular packages that offer inclusive views of the multi-
dimensional information and business (Stadtler, 2015). The initial focus of enterprise
resource planning was to optimize internal business processes. However, the current
enterprise resource planning offers data warehouse and supply chain management
software. Therefore, supply chain and demand forecasting optimization applications
allow companies to integrate into the standard tools for allowing third-party supply chain
applications to be connected to Enterprise Resource Planning systems and to legacy
mainframe packages (Stadtler, 2015).
Thus, the decision to implement and integrate all in one Enterprise Resource Planning
package or the best of application package or system is not always easily achieved. For
example, some firms have decided on investing in an all-in-one Enterprise Resource
Planning package while other companies are just committed to supplying chain
management (Stevens & Johnson, 2016). This makes it hard for an Enterprise Resource
Planning integrated package may fail to offer the best solutions for operations of their
businesses in the industry they believe it is important. Most companies which search for
competitive advantages search for the best-of-breed supply chain management as well as

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 36

demand-predicting software. Despite the fact that a high degree of business integration
and applications are clear advantages to use all-in-one Enterprise Resource Planning
packages, some firms can’t sacrifice their greater functionality (Stadtler, 2015). These
companies prefer mostly third-party solutions. The competitive environment is constantly
changing and there is an emergence of new partnerships as well as intensifying markets
which may require applications to be established. Besides, the open Enterprise Resource
Planning system’ environment should be incorporated into the main system via a strategic
Application Programming Interface. For example, SAP’s Business Application Interface
offers clients the ability to use internal developer’ or third-party software solutions. For
this reason, it is important to for the ERP system to be flexible, functional and adaptable
to change conditions to greatly improve performance through the establishment of fresh
elements that are can be easily reprocessed across diverse networks, multiple systems,
and platforms of enterprises. Moreover, there is the emerging Enterprise Application
Integration (AEI) market which is rapidly developing and creating increasing
opportunities in the supply chain industry (Schoenherr & Speier‐Pero, 2015). The ability
to enhance customer satisfaction is not a stagnant activity for the optimal use of business
processes
The implementation of an Enterprise Resource Planning package is a strategic and
continuous process that requires strong management vision and support. The
applications’ development can be done from within through trained developers as well as

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 37

finding external consultants. Since the implementation of systems of Enterprise Resource
Planning is a complex process across the supply chain industry, companies should use
various organizational and technological issues (Schoenherr & Speier‐Pero, 2015). This
should happen through careful management, especially when the cost of implementation
is to be minimized. Additionally, for successful implementation of enterprise resource
planning systems under the supply chain management practices, change of organizational
structure is a requirement. This should be achieved through corporate cultural
transformation. Successful implementation of Enterprise Resource Planning systems
relies on various factors which are identified largely through in-depth considerations
(Schoenherr & Speier‐Pero, 2015).

Moreover, team-work is a vital implementation aspect of Enterprise Resource Planning
systems. For example, technical issues should be first solved through teamwork and via
sincere relationships of work. It is important to test how teamwork and team relationships
should be streamlined to achieve clear successful implementation of Enterprise Resource
Planning systems. Besides, clearly defined goals and communication skills are essential
for the effective integration of Enterprise Resource Planning and supply chain
management (Ross, 2015). In addition, it is of paramount importance to share common
goals and adopt new relationships of work. This leads to major organizational structure.
Besides, transformational leadership should commit continuous efforts that require
efficacious implementation of Enterprise Resource Planning systems. This helps to solve

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 38

conflicts and effectively manage resistance to technology. The coordination of personal
demands and vision should be planned well to enable coordination of individual technical
skills that lead to successful implementation of ERP systems (Schoenherr & Speier‐Pero,
2015).
Over the recent past, academic research has focused on two important aspects. These
include the supply chain management importance and the roles of information
technologies in the management of the supply chain (Ross, 2015). The issues
complement each other. Therefore, effective supply chain management cannot easily be
achieved without information technology. This is because development and use of
information technology are has become more pervasive in the era of supply chain
management. Evidence shows that effective supply chain management yields significant
financial and operational benefits (Zhang, 2016). Companies are reevaluating their supply
chains and collaborating with their suppliers and customers. This has resulted in
increased benefits such as fast product lead times, innovative products, reliable and quick
delivery, efficient inventory, enhanced performance, and profitability. The success of
companies can’t be separated from their intensive use of information technology.
Companies that have recognized strong use of Information Technology in their supply
chain management operations. For instance, various companies are gradually installing
radio frequency identification (RFID) which tag items in their products (Ross, 2015).

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 39

Enterprise Resource Planning systems are important in pinpointing mistakes, sizes, and
models that require replenishing which enables possible fulfillment and procurement.
There is significant supply chain management information technology. SCIT is used
within and across boundaries to enable easier communication and sharing of information
in the supply chain industry. The depth of literature has provided contradictive results in
regard to relationships between firm performance and supply chain information
technology. The research will provide the correlation between the integration of
Enterprise Resource Planning with supply chain management with firm performance
(Ross, 2015).
The linkage between firm performance and supply chain information technology is still
an area with less literature review. Researchers have focused majorly on measures that
can be generalized. Improved firm performance is a major concern for every manager.
Companies in the supply chain industry are concerned with firm performance and
profitability in order to remain competitive and adapt to the rapidly changing global
environment. Besides, focusing on short-term performance, companies should also focus
on long-term firm performance in the supply chain industry (Christopher, 2016). To
remain competitive in the supply chain industry, it is important to integrate Enterprise
Resource Planning systems with supply chain management. This allows companies in the
industry to share information fast and improve the efficiency of performance. The
integration should focus on both financial and operational performance which have a

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 40

longer-term performance in the industry. Theoretically, Enterprise Resource Planning is
assumed to positively impact firm performance in the supply chain industry. However,
empirical research shows inconsistent links between Enterprise Resource Planning and
firm performance (Christopher, 2016). Enterprise Resource Planning systems have
positive impacts on supply chain management, especially on the operational and financial
performance. This has indicative aspects of improving costs, inventory turnover, and
delivery. The impacts of Enterprise Resource Planning on supply chain management are
areas of interest for managers in the supply chain industry. This is an influential aspect of
the sector and the research will create an avenue for roles and impacts of Enterprise
Resource Planning on supply chain management (Christopher, 2016).
The world is becoming more digitized each day and it is essential for companies to focus
on information technology systems to create competitive advantage and remain relevant
in the industry (Christopher, 2016). Company businesses are relying on modern
technologies to assist managers for an information system for handling massive
workloads. The impact of Enterprise Resource Planning systems now plays a vital role in
ensuring improved and reliable performance. An Enterprise Resource Planning enables
integration of different subsystems into a huge system for sharing information and
sharing one database. Thus, Enterprise Resource Planning enhances productivity and
helps in bringing improved profitability of the companies in the industry. This literature
review focuses on the impacts of Enterprise Resource Planning on supply chain

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 41

management which also have significant impacts on firm performance. The literature
review focuses on books, articles, and other publications to gather the appropriate
resources for helping researchers to discuss issues and factors contributing to Enterprise
Resource Planning systems (Christopher, 2016).
The ERP system is used for enhancing and improving organizational performance and
efficiency. Enterprise Resource Planning is basically an information system combining
various sub-systems into one huge system for easier coordination of activities and
processes. The operation is referred to as integration. The initial system is used to handle
human capital and the second system is used to handle finance while the third tire is used
to handle manufacturing. Enterprise Resource Planning is used to integrate the above
three sub-systems into one huge system for sharing information and data among the three
sub-systems (Christopher, 2016). The Enterprise Resource Planning system should target
to improve organizational efficiency and performance. The traditional Enterprise
Resource Planning is referred to as the back-office system and is used exclusively by
workers. The traditional Enterprise Resource Planning is not for customers or the public.
Besides, it involves only the core processes of the organizational business without
involving company customers. The main goal of the traditional Enterprise Resource
Planning is to only improve organizational efficiency (Christopher, 2016).

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 42

However, the modern Enterprise Resource Planning system has broken the barriers or
boundaries of the back office to include the front office like clients. Therefore, modern
Enterprise Resource Planning includes the customers’ usage of making ERP a greater
system for handling massive operations and processes. The history of Enterprise
Resource Planning systems dates back to 1970s. The demand to integrate business
processes let to the emergence of Enterprise Resource Planning. However, companies
had slow implementation up to the beginning of the 1990s. Besides, software firms
commenced implementation of Enterprise Resource Planning systems in the early 90s
such as the SAP (Christopher, 2016). The old system added new characteristics such as
the addition of server-client hardware architecture. This enabled the software for running
on numerous platforms. Companies were implementing an Enterprise Resource Planning
system using an open architecture approach which allows third-party firms to integrate
their systems for improved efficiency and performance. The Enterprise Resource
Planning system allowed companies to grow rapidly and control of the market effectively
(Christopher, 2016). This allowed Enterprise Resource Planning system to spread fast in
globally. Furthermore, the Enterprise Resource Planning system is effective in addressing
numerous company issue. Enterprise Resource Planning systems have numerous benefits
to supply chain management. For example, ERP systems bring managerial benefits,
operation benefits, strategic benefits, organization benefits, and information technology
benefits (Zhang, 2016). However, there is equally the same number of obstacles in

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 43

Enterprise Resource Planning systems that organizations face. This makes
implementation of the Enterprise Resource Planning system a highly thought idea
business by companies in the supply chain industry. A scheme is need for making
implementation of Enterprise Resource Planning a success. However, there are limited
studies to support Enterprise Resource Planning implantation plans. There are numerous
factors to factor that are used to ensure that Enterprise Resource Planning project is
successful (Christopher, 2016).
Companies in the supply chain industry should clearly understand their strategic visions
and goals. The allows managers to link well their strategic directions and the reasons as
to why adoption of Enterprise Resource Planning system will be important to their
performance. This means that companies should understand their targets and what they
want to achieve and the strategies to achieve the goals (Zhang, 2016). The top
management should be committed to the idea of ERP system adoption. This is an
essential component for efficient ERP and SCM integration. The members of top
management for companies are the decisions makers. Therefore, in order to make
Enterprise Resource Planning project work, the top management should offer full
support. Besides, the company should have excellent project management. A successful
project management strategy requires the clear following by the management for the
company to achieve the Enterprise Resource Planning and supply chain management
integration. Thus, it should involve a clear definitions and understanding of objectives.

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 44

The company should have excellent work and effective planning of resources. Therefore,
the management should track the progression of the project. There should be
organizational change of management. The management change of organizations is
essential because most companies face resistance from users and employees (Al-Mashari
& Al-Mosheleh, 2015). The management should build and ensure a great implementation
team. This ensures that the process of implementation is well calculated and strategic for
easy and smooth system integration. The data accuracy should be kept during transfer of
information from old system to the new system. The data entered in the Enterprise
Resource Planning system must be correct and accurate to prevent instances of many
problems. The organizations adopting ERP and SCM integration should ensure extensive
education and training. This reduces user resistance and allows realization of the
successful Enterprise Resource Planning system implementation. Training and educating
employees is vital to the success of the Enterprise Resource Planning system
implementation. Additionally, performance measures should be used during the
implementation process. The performance of Enterprise Resource Planning system
should be evaluated by the management to track how the system meets the organizational
objectives. Moreover, there are multi-site issues which must be factored in during the
implementation process (Zhang, 2016).
The Enterprise Resource Planning system impacts company performance. Enterprise
Resource Planning system improves operations efficiency, makes life easier for

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 45

employees and simplifies business processes (Al-Mashari & Al-Mosheleh, 2015). There
are numerous factors that force organizations to choose Enterprise Resource Planning
system. On the other hand, other factors prevent organizations from choosing Enterprise
Resource Planning products. Enterprise Resource Planning systems’ success refers to
effective use of such systems for enhancing organizational effectiveness. This is different
from the technical implementation success of operations by measuring indicators such as
project management metrics, cost overruns and time estimates. Enterprise Resource
Planning systems are different from the information technology systems because
Enterprise Resource Planning implementation involves operational, technological,
strategic, managerial and organizational related elements (Al-Mashari & Al-Mosheleh,
2015).
The main purpose of this research will be identifying the impacts of Enterprise Resource
Planning and the relationships that effectively address the supply chain management.
This will ensure that the identified benefits or impacts are realized as well as the failures
are avoided by the company management. The will research will also contribute to supply
chain management and Enterprise Resource Planning systems. Consequently, new
research constructs and multi-item measurement scales associated with Enterprise
Resource Planning systems will be identified for the dimensions and supply chain
management (Al-Mashari & Al-Mosheleh, 2015). Therefore, companies striving to
integrate their supply chain management and Enterprise Resource Planning systems

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 46

should adequately establish cost-benefits analysis to ensure that the benefits out way the
challenges and obstacles. This ensures that the management is not faced with operational
or financial challenges during the system implementation.
According to Stefanou (1999), “Enterprise Resource Planning provides a robust
and modular framework of business applications, the fundamental purpose of which is
integrating business and supporting managerial decision-making.” There is an increase in
ERP Systems’ popularity among numerous companies which pursue supply chain
management. Firms which search for even hedge or enhanced functionality and small
competitive advantage have the likelihood of implementing best-of-breed applications.
However, companies should not sacrifice their application integration. This allows the
company system to remain its core Enterprise Resource Planning suite. Firms operating
in rapidly changing and vastly competitive environs are supposed to depend on trained
internal developers as well as hire external specialists for the swift development and
execution of strategic applications. This should include interfaces provided by Enterprise
Resource Planning systems like SAP’s BAPL. Studies show that the adoption and
implementation of Enterprise Resource Planning are not straightforward. Thus,
companies pursuing supply chain management should first re-organize their human
capital as well as transform the cultures of companies and visualize on the technical
facets of the execution process. Management should ensure that there is a commitment to
team-work, advanced communication skills, transformational leadership, training of

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 47

project developers and organizational openness that reflect in the readiness to share
information (Tian, 2016). These are vital factors that ensure successful adoption of
Enterprise Resource Planning systems under the strategies of supply chain management
strategies. The process of Enterprise Resource Planning and supply chain management
involves a corporate culture that stresses on benefits to share shared goals over the pursuit
of personal goals and the significance of trust between employees, partners, corporations,
and managers. Companies should have employees trained in Enterprise Resource
Planning systems’ philosophies across the organizational structure to ensure the
successful implementation of ERP (Tian, 2016).
However, many organizations have experienced ERP implementation issues
which are yet to be solved. This shows that future studies must concentrate on how
companies pursuing supply chain management must adjust employees’ behaviors and
attitudes for managing the organizational changes for enhancing successful Enterprise
Resource Planning implementation (Stevens & Johnson, 2016). Companies should find
suitable methods to measure the performance of both firms partaking in the supply chain
industry and the Enterprise Resource Planning systems are major concerns among
information technology and supply chain managers. There is significant growth in the
numbers of companies competing worldwide and the comprehension of the numerous
global practices of business and ethnic cultural components which are important for
effective Enterprise Resource Planning implementation (Stevens & Johnson, 2016).

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 48

The paper indents to provide findings on Enterprise Resource Planning
implementation and its impacts on supply chain management. The review of this
literature targets to establish numerous cases of successful implementation of systems of
Enterprise Resource Planning. The analysis of this literature review will help to reveal the
critical factors and impacts for successful ERP implementation systems and integration
with supply chain management. This falls into two categories of organizational and
technological factors. Nevertheless, the organizational issues appear to be more critical as
compared to technological factors as far as the successful Enterprise Resource Planning
execution of its packages under supply chain management is concerned (Stevens &
Johnson, 2016).
In the extremely competitive international environment for drawing the attention
of customers, companies respond to the ongoing adjustments by transforming vividly the
process of production. The supply chain management practices and business process re-
engineering (BPR) have shifted the attention from functional to inter-organizational and
cross-functional processes. Moreover, worldwide phenomena like alliances, joint
ventures, and outsourcing and partnerships transversely the supply chain industry, have
populated a new type of organizational structure defined as “virtual enterprise” (Zhang,
2016). The virtual enterprise emergence brings questions about the nature of ERP to
systems of traditional business information. Monopolistic companies or stand-alone
business information systems give way to a more flexible, modular and integrated system

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 49

for supporting business processes across the value chain from suppliers to the customers
(Stadtler, 2015).
Supply chain management is a strategic process that needs the organizational
management of company information and materials to flow in the entire chain, from a
supplier via a customer. Stefanou (1999) argues that “if business success is to be
achieved, optimization of business processes across the value-added chain must be
accompanied by modern processing technology for optimization of enterprise-wide
information management.” Modern companies are using modern technologies and have
gone into the direction of broad or cross-enterprise integration and are developing multi-
functional and flexible modular packages that offer inclusive views of the multi-
dimensional information and business (Stadtler, 2015). The initial focus of enterprise
resource planning was to optimize internal business processes. However, the current
enterprise resource planning offers data warehouse and supply chain management
software. Therefore, supply chain and demand forecasting optimization applications
allow companies to integrate into the standard tools for allowing third-party supply chain
applications to be connected to Enterprise Resource Planning systems and to legacy
mainframe packages (Stadtler, 2015).
Thus, the decision to implement and integrate all in one Enterprise Resource
Planning package or the best of application package or system is not always easily

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 50

achieved. For example, some firms have decided on investing in an all-in-one Enterprise
Resource Planning package while other companies are just committed to supplying chain
management (Stevens & Johnson, 2016). This makes it hard for an Enterprise Resource
Planning integrated package may fail to offer the best solutions for operations of their
businesses in the industry they believe it is important. Most companies which search for
competitive advantages search for the best-of-breed supply chain management as well as
demand-predicting software. Despite the fact that a high degree of business integration
and applications are clear advantages to use all-in-one Enterprise Resource Planning
packages, some firms can’t sacrifice their greater functionality (Stadtler, 2015). These
companies prefer mostly third-party solutions. The competitive environment is constantly
changing and there is an emergence of new partnerships as well as intensifying markets
which may require applications to be established. Besides, the open Enterprise Resource
Planning system’ environment should be incorporated into the main system via a strategic
Application Programming Interface. For example, SAP’s Business Application Interface
offers clients the ability to use internal developer’ or third-party software solutions. For
this reason, it is important to for the ERP system to be flexible, functional and adaptable
to change conditions to greatly improve performance through the establishment of fresh
elements that are can be easily reprocessed across diverse networks, multiple systems,
and platforms of enterprises. Moreover, there is the emerging Enterprise Application
Integration (AEI) market which is rapidly developing and creating increasing

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 51

opportunities in the supply chain industry (Schoenherr & Speier‐Pero, 2015). The ability
to enhance customer satisfaction is not a stagnant activity for the optimal use of business
processes
The implementation of an Enterprise Resource Planning package is a strategic and
continuous process that requires strong management vision and support. The
applications’ development can be done from within through trained developers as well as
finding external consultants. Since the implementation of systems of Enterprise Resource
Planning is a complex process across the supply chain industry, companies should use
various organizational and technological issues (Schoenherr & Speier‐Pero, 2015). This
should happen through careful management, especially when the cost of implementation
is to be minimized. Additionally, for successful implementation of enterprise resource
planning systems under the supply chain management practices, change of organizational
structure is a requirement. This should be achieved through corporate cultural
transformation. Successful implementation of Enterprise Resource Planning systems
relies on various factors which are identified largely through in-depth considerations
(Schoenherr & Speier‐Pero, 2015).
Moreover, team-work is a vital implementation aspect of Enterprise Resource
Planning systems. For example, technical issues should be first solved through teamwork
and via sincere relationships of work. It is important to test how teamwork and team

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 52

relationships should be streamlined to achieve clear successful implementation of
Enterprise Resource Planning systems. Besides, clearly defined goals and communication
skills are essential for the effective integration of Enterprise Resource Planning and
supply chain management (Ross, 2015). In addition, it is of paramount importance to
share common goals and adopt new relationships of work. This leads to major
organizational structure. Besides, transformational leadership should commit continuous
efforts that require efficacious implementation of Enterprise Resource Planning systems.
This helps to solve conflicts and effectively manage resistance to technology. The
coordination of personal demands and vision should be planned well to enable
coordination of individual technical skills that lead to successful implementation of ERP
systems (Schoenherr & Speier‐Pero, 2015).
Over the recent past, academic research has focused on two important aspects.
These include the supply chain management importance and the roles of information
technologies in the management of the supply chain (Ross, 2015). The issues
complement each other. Therefore, effective supply chain management cannot easily be
achieved without information technology. This is because development and use of
information technology are has become more pervasive in the era of supply chain
management. Evidence shows that effective supply chain management yields significant
financial and operational benefits (Zhang, 2016). Companies are reevaluating their supply
chains and collaborating with their suppliers and customers. This has resulted in

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increased benefits such as fast product lead times, innovative products, reliable and quick
delivery, efficient inventory, enhanced performance, and profitability. The success of
companies can’t be separated from their intensive use of information technology.
Companies that have recognized strong use of Information Technology in their supply
chain management operations. For instance, various companies are gradually installing
radio frequency identification (RFID) which tag items in their products (Ross, 2015).
Enterprise Resource Planning systems are important in pinpointing mistakes,
sizes, and models that require replenishing which enables possible fulfillment and
procurement. There is significant supply chain management information technology.
SCIT is used within and across boundaries to enable easier communication and sharing of
information in the supply chain industry. The depth of literature has provided
contradictive results in regard to relationships between firm performance and supply
chain information technology. The research will provide the correlation between the
integration of Enterprise Resource Planning with supply chain management with firm
performance (Ross, 2015).
The linkage between firm performance and supply chain information technology
is still an area with less literature review. Researchers have focused majorly on measures
that can be generalized. Improved firm performance is a major concern for every
manager. Companies in the supply chain industry are concerned with firm performance

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and profitability in order to remain competitive and adapt to the rapidly changing global
environment. Besides, focusing on short-term performance, companies should also focus
on long-term firm performance in the supply chain industry (Christopher, 2016). To
remain competitive in the supply chain industry, it is important to integrate Enterprise
Resource Planning systems with supply chain management. This allows companies in the
industry to share information fast and improve the efficiency of performance. The
integration should focus on both financial and operational performance which have a
longer-term performance in the industry. Theoretically, Enterprise Resource Planning is
assumed to positively impact firm performance in the supply chain industry. However,
empirical research shows inconsistent links between Enterprise Resource Planning and
firm performance (Christopher, 2016). Enterprise Resource Planning systems have
positive impacts on supply chain management, especially on the operational and financial
performance. This has indicative aspects of improving costs, inventory turnover, and
delivery. The impacts of Enterprise Resource Planning on supply chain management are
areas of interest for managers in the supply chain industry. This is an influential aspect of
the sector and the research will create an avenue for roles and impacts of Enterprise
Resource Planning on supply chain management (Christopher, 2016).
The world is becoming more digitized each day and it is essential for companies
to focus on information technology systems to create competitive advantage and remain
relevant in the industry (Christopher, 2016). Company businesses are relying on modern

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technologies to assist managers for an information system for handling massive
workloads. The impact of Enterprise Resource Planning systems now plays a vital role in
ensuring improved and reliable performance. An Enterprise Resource Planning enables
integration of different subsystems into a huge system for sharing information and
sharing one database. Thus, Enterprise Resource Planning enhances productivity and
helps in bringing improved profitability of the companies in the industry. This literature
review focuses on the impacts of Enterprise Resource Planning on supply chain
management which also have significant impacts on firm performance. The literature
review focuses on books, articles, and other publications to gather the appropriate
resources for helping researchers to discuss issues and factors contributing to Enterprise
Resource Planning systems (Christopher, 2016).
The ERP system is used for enhancing and improving organizational performance
and efficiency. Enterprise Resource Planning is basically an information system
combining various sub-systems into one huge system for easier coordination of activities
and processes. The operation is referred to as integration. The initial system is used to
handle human capital and the second system is used to handle finance while the third tire
is used to handle manufacturing. Enterprise Resource Planning is used to integrate the
above three sub-systems into one huge system for sharing information and data among
the three sub-systems (Christopher, 2016). The Enterprise Resource Planning system
should target to improve organizational efficiency and performance. The traditional

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Enterprise Resource Planning is referred to as the back-office system and is used
exclusively by workers. The traditional Enterprise Resource Planning is not for customers
or the public. Besides, it involves only the core processes of the organizational business
without involving company customers. The main goal of the traditional Enterprise
Resource Planning is to only improve organizational efficiency (Christopher, 2016).
However, the modern Enterprise Resource Planning system has broken the
barriers or boundaries of the back office to include the front office like clients. Therefore,
modern Enterprise Resource Planning includes the customers’ usage of making ERP a
greater system for handling massive operations and processes. The history of Enterprise
Resource Planning systems dates back to 1970s. The demand to integrate business
processes let to the emergence of Enterprise Resource Planning. However, companies
had slow implementation up to the beginning of the 1990s. Besides, software firms
commenced implementation of Enterprise Resource Planning systems in the early 90s
such as the SAP (Christopher, 2016). The old system added new characteristics such as
the addition of server-client hardware architecture. This enabled the software for running
on numerous platforms. Companies were implementing an Enterprise Resource Planning
system using an open architecture approach which allows third-party firms to integrate
their systems for improved efficiency and performance. The Enterprise Resource
Planning system allowed companies to grow rapidly and control of the market effectively
(Christopher, 2016). This allowed Enterprise Resource Planning system to spread fast in

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globally. Furthermore, the Enterprise Resource Planning system is effective in addressing
numerous company issue. Enterprise Resource Planning systems have numerous benefits
to supply chain management. For example, ERP systems bring managerial benefits,
operation benefits, strategic benefits, organization benefits, and information technology
benefits (Zhang, 2016). However, there is equally the same number of obstacles in
Enterprise Resource Planning systems that organizations face. This makes
implementation of the Enterprise Resource Planning system a highly thought idea
business by companies in the supply chain industry. A scheme is need for making
implementation of Enterprise Resource Planning a success. However, there are limited
studies to support Enterprise Resource Planning implantation plans. There are numerous
factors to factor that are used to ensure that Enterprise Resource Planning project is
successful (Christopher, 2016).
Companies in the supply chain industry should clearly understand their strategic
visions and goals. The allows managers to link well their strategic directions and the
reasons as to why adoption of Enterprise Resource Planning system will be important to
their performance. This means that companies should understand their targets and what
they want to achieve and the strategies to achieve the goals (Zhang, 2016). The top
management should be committed to the idea of ERP system adoption. This is an
essential component for efficient ERP and SCM integration. The members of top
management for companies are the decisions makers. Therefore, in order to make

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Enterprise Resource Planning project work, the top management should offer full
support. Besides, the company should have excellent project management. A successful
project management strategy requires the clear following by the management for the
company to achieve the Enterprise Resource Planning and supply chain management
integration. Thus, it should involve a clear definitions and understanding of objectives.
The company should have excellent work and effective planning of resources. Therefore,
the management should track the progression of the project. There should be
organizational change of management. The management change of organizations is
essential because most companies face resistance from users and employees (Al-Mashari
& Al-Mosheleh, 2015). The management should build and ensure a great implementation
team. This ensures that the process of implementation is well calculated and strategic for
easy and smooth system integration. The data accuracy should be kept during transfer of
information from old system to the new system. The data entered in the Enterprise
Resource Planning system must be correct and accurate to prevent instances of many
problems. The organizations adopting ERP and SCM integration should ensure extensive
education and training. This reduces user resistance and allows realization of the
successful Enterprise Resource Planning system implementation. Training and educating
employees is vital to the success of the Enterprise Resource Planning system
implementation. Additionally, performance measures should be used during the
implementation process. The performance of Enterprise Resource Planning system

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should be evaluated by the management to track how the system meets the organizational
objectives. Moreover, there are multi-site issues which must be factored in during the
implementation process (Zhang, 2016).
The Enterprise Resource Planning system impacts company performance.
Enterprise Resource Planning system improves operations efficiency, makes life easier
for employees and simplifies business processes (Al-Mashari & Al-Mosheleh, 2015).
There are numerous factors that force organizations to choose Enterprise Resource
Planning system. On the other hand, other factors prevent organizations from choosing
Enterprise Resource Planning products. Enterprise Resource Planning systems’ success
refers to effective use of such systems for enhancing organizational effectiveness. This is
different from the technical implementation success of operations by measuring
indicators such as project management metrics, cost overruns and time estimates.
Enterprise Resource Planning systems are different from the information technology
systems because Enterprise Resource Planning implementation involves operational,
technological, strategic, managerial and organizational related elements (Al-Mashari &
Al-Mosheleh, 2015).
The main purpose of this research will be identifying the impacts of Enterprise
Resource Planning and the relationships that effectively address the supply chain
management. This will ensure that the identified benefits or impacts are realized as well

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as the failures are avoided by the company management. The will research will also
contribute to supply chain management and Enterprise Resource Planning systems.
Consequently, new research constructs and multi-item measurement scales associated
with Enterprise Resource Planning systems will be identified for the dimensions and
supply chain management (Al-Mashari & Al-Mosheleh, 2015). Therefore, companies
striving to integrate their supply chain management and Enterprise Resource Planning
systems should adequately establish cost-benefits analysis to ensure that the benefits out
way the challenges and obstacles. This ensures that the management is not faced with
operational or financial challenges during the system implementation.
The study by Subramani (2004) explores “how suppliers benefit from information
technology use in supply chain relationships.” This study draws from organizational
theories of action, learning and transaction cost theory to develop models relating
suppliers’ use of supply chain management system advantages. It proposes the patterns
and models that companies in supply chain management to explore business
opportunities and adoption of information technology in the logistics network. The result
supports the vendors-to-partners to deploy information technology in the supply chain to
achieve closer supplier-buyer relationships. The findings also imply the complementary
of the resource-based and transaction-cost views as well as elaborate the logic by which a
specialized asset can also be a strategic asset (Kurbel, 2016).

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According to Christopher (2016), logistics and supply chain management provide
strategies for developing and sustaining competitive advantage in the industry. It is an
important study for review as it provides information on how supply chain management
and logistics create a competitive advantage. It is important to review supply chain
becomes it has become the value chain and how information technology can help
companies in the changing competitive environment. Incorporating enterprise resource
management with the supply chain helps in ensuring effective performance and accurate
resource management (Kurbel, 2016).
The current state of enterprise resource planning is “evolving in lockstep with the
evolution of technology from the earliest bills of the material processor to integrated
enterprise management (Ptak & Schragenheim, 2016)”. Ptak & Schragenheim (2016)
provides the best techniques, tools, and applications for integrating the supply chain with
ERP. The supply chain is a related mechanism that helps in ensuring that techniques and
applications are integrated to provide the best operations (Kurbel, 2016).
Essentials of supply chain management provide a variety of software for the
supply chain. Hugos (2018) presents the types and role of the software used by
companies in the supply chain system shows that organizations should ensure proper
management of the supply chain system. It establishes internal linkages and serves as the

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platform for integrating the company with other software in the network. It will also
show how companies can link with customers and suppliers ((Altamony et al, 2016).
According to Gattorna (2017), recent advancement in technology helps in
strategic supply chain alignment. The recent advancements in technology and growing
regulatory freedom have changed the competition rules. This has allowed firms to
compete internationally and traditional barriers between industries are breaking down.
Thus, “for companies to cope with these changes and achieve superior performance,
managers are moving towards new business paradigms to allow their firms to work more
closely with their traditional and new business partners for adapting to the rapidly
changing marketplaces.” Technology is allowing integration of the supply chain not only
between operations within their own companies but also other companies up and down
the supply chain. Ross (2016) concludes that “the integration of supply chain with
Enterprise Resource Planning is important in engaging technology to build market-
winning business partnerships. “Companies are adopting e-supply in order to enhance
their competitive advantage. Additionally, companies can remove channel costs;
streamline channel communication and linking clients to the value-added resources found
along the supply chain field. Supply chain management is emerging as a tactical
operations tool.

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According to Mangan, Lalwani & Lalwani (2016) global logistics and supply
chain management are incorporating ERP in their systems in order to enhance their
tactical operations. This provides efficiency in the global logistics and the complexity of
managing supply chain due to complex supply and distribution channels. The
globalization of supply chains continues apace and show the growing skills and talent gap
in terms of the availability of managers with the experience and knowledge for effective
management of complex supply chain networks. Liu, Wei, Ke, Wei & Hua (2016) carried
out research “to show the configuration between supply chain integration and information
technology competency through a resource orchestration perspective.” Their research
provides the deployment of suitable information technology competencies that are
strategic for the supply chain integration of a company in order to induce superior firm
performance. Besides, appropriate information technology enhances information on
approaches that companies can use to integrate information technology competency to
reinforce the relationships between the supply chain and both financial and operational
performance. This offers SCI-IT competencies fit associated with financial performance.
According to Kache & Seuring (2017), “challenges and opportunities of digital
information at the intersection of Big Data Analytics and supply chain management
present supply chain managers with difficulties in asserting the right and effective tactical
tools for effective operations.” Supply chain managers are presented with the challenges
of adopting Big Data Analytics due to amplified information exploitation in supply

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chains. The finding portrays “the emerging transition and trend from a digital business
environment and how the findings contribute to extant knowledge by identifying
opportunities and challenges linked to the emergence of Big Data Analytics from a
corporate and supply chain perspective.” Chen, Preston & Swink (2015) carried out
research to establish “how the use of big data analytics affects value creation in supply
chain management.” This research helped in addressing essential research questions on
how companies can use big data analytics. The use of big data analytics to influence
creation value and how technological factors directly influence organizational big data
analytics will be important in addressing the adoption of information technology. Chen,
Preston & Swink (2015) provide “a theory-based understanding of the impacts and
antecedents of organizational big data analytic usage.” It also provides guidance in regard
to what a manager should anticipate from the usage of the quickly emerging technologies
(Chang, Kuo, Wu & Tzeng, 2015). This helps in setting companies apart and enhancing
supply chain competitiveness.
Gunasekaran, Subramanian & Tiwari (2016) asserts that “information technology
governance in the Internet of Things supply chain networks is important in improving the
operations.” Gunasekaran, Subramanian & Tiwari (2016) provide the benefits of
information and communication technology in supply chains. Information technology is a
significant and valuable resource for the successes of worldwide supply chain systems.
Besides, the Internet of Things plays a main responsibility in the modern global supply

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chain operations, network and performance. Companies should integrate fast pace
information technology in supply chain strategies and designing process in operating in
the digital business world. This will fulfill the new expectations of clients and the
unpredictable demands that digital marketing creates.
Schoenherr & Speier‐Pero (2015) carried out a study on predictive analytics, Data
science and big data in the management of supply chain both future potential and the
current state of managing the supply chain. Schoenherr & Speier‐Pero (2015) study help
in predicting the use of future potential and the current state of supply chain systems. The
study is important in providing a literature review to inform the incorporation of
information technology in supply chain management. Therefore, the researcher will be
able to establish research questions and information relevant to the study that will provide
the direction of integrating ERP with supply chain management.
Laudon & Laudon (2015) provide a model on “how business firms use
information technologies and systems to achieve corporate objectives.” The model is
important because it helps companies to use information systems as a tool to achieve
operational excellence in the supply chain networks and establishing a competitive
advantage. Govindan, Soleimani & Kannan (2015) conducted a study on the
effectiveness of reverse logistics, supply chain network and closed-loop supply chain. An
all-inclusive review was carried out to “explore the future of reverse logistics and supply

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chain as an emerging operation in the supply chain management and ERP integration
(Govindan, Soleimani & Kannan, 2015).” The research provides technical knowledge on
how companies should use reverse logistics and information technology for a closed-loop
supply chain. The research will enable this research to have an in-depth review of recent
studies to establish how information technology has assisted in supply chain
management. Enterprise Resource planning is a major aspect of modern business
operations. Most companies are currently in cooperating their business operations to
enhance efficiency and performance. This is geared towards improving their performance
as well as creating a competitive advantage in order to remain relevant and profitable in
the foreseeable future. This is an important aspect of business especially for companies in
the supply chain industry. Therefore, companies will be to promote logistics and sales in
the supply chain industry. Over time, companies in the supply chain industry have
majorly focused on forwarding logistics. However, the integration of supply chain
management and Enterprise Resource Planning will create more positive avenue with
significant information sharing that will enable managers to strategically improve their
performance. The benefits of Enterprise Resource Planning systems are overwhelming
and companies in the supply chain industry adequately focus on sure operations and
efficiency focused on resource mobilization and improved performance. However, the
current trend shows that performance is of major aspect for an increasing number of firms
in the supply chain industry (Kurbel, 2016).

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Proper preparedness and organization readiness to change are of much importance
for the successful implementation of systems of Enterprise Resource Planning. This is
because the integration of Enterprise Resource Planning systems and supply chain
management is a long process which requires resources and support of top management.
There are high costs associated with the integration of supply chain management
practices and Enterprise Resource Planning. The most significant costs are the financial
and operational costs which highly constraint the successful implementation of Enterprise
Resource Planning systems (Kurbel, 2016). The change of traditional business operation
to modern technology is not readily accepted and most of the employees are resistant to
new ways of doing business operations. It is the mandate of the top management to
support the integration of supply chain management and Enterprise Resource Planning
from its inception to the end of the implementation process. Enterprise Resource
Planning systems are focused on improving the existing company systems and improve
the sharing of critical information. Shared goals and strategies provided the strategic
direction for the business. With the adoption of supply chain information technologies,
majorly the Enterprise Resource Planning, companies are able to improve performance,
efficiency, and effectiveness of sharing information (Ptak & Schragenheim, 2016).
The integration of Enterprise Resource Planning systems and supply chain
management has significant benefits which enhance efficiency and business operations.
Companies in the supply chain industry are able to ensure effective sharing of

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information, data accuracy and back-up for company information. The activities of
supply chain ensure that measures are in place to monitor the sharing of information and
control the movement of inventory, products, and services for enhanced performance.
Enterprise Resource Planning systems are attractive to companies which largely operate
in the global business environment. The main purpose of Enterprise Resource Planning
systems is coordination, integration of packages and improving efficiency as well as
sharing of information across various platforms (Ptak & Schragenheim, 2016).
Companies which have already integrated their operations with Enterprise Resource
Planning are reaping more benefits in terms of competitive advantage and ability to
compete in global environments. Companies in the supply industry should give priority to
the integration of Enterprise Resource Planning systems and supply chain management.
A cost analysis benefits are important to be undertaken before adopting the
implementation of ERP systems. Enterprise Resource Planning ensures that companies
have the capacity for competing in global markets (Ptak & Schragenheim, 2016).
These papers look to address the impacts of Enterprise Resource Planning
systems and supply chain management. Enterprise Resource Planning systems enhance
the way the company does its operations. The management should partner with system
developers and specialists to ensure successful implementation of Enterprise Resource
Planning system. To establish the potential benefits or impacts of the Enterprise Resource

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Planning system for supply chain management, companies should ensure adequate
resources especially the primary resource of human capital (Stadtler, 2015).
Numerous companies are employing Enterprise Resource Planning systems in
applications of the supply chain. For example, firms are embarking upon ambitious plans
for making full utilization of the information technologies’ capabilities. However, in most
companies, the systems of Enterprise Resource Planning are still immature and evolving
and the number of companies adopting the Enterprise Resource Planning systems is
growing at an increasing rate (Stadtler, 2015). It is important to raise awareness and
knowledge which are important aspects for integrating Enterprise Resource Planning
systems in supply chain management at both inter-organizational and organizational
levels. Firms need to understand and identify the vital aspects that impact the usage of
Enterprise Resource Planning systems to successfully integrate into the supply chain
management. This is important in addressing obstacles effectively and ensuring that the
desired benefits are realized and failures are as well avoided. Besides, it is important to
integrate the company’s activities both outside and inside of an organization. This is
because suppliers and customers are located all over the world. Thus, it needs enterprise-
wide information systems to share information on numerous value-adding operations
along the supply chain industry. The relationships between supply chain management and
Enterprise Resource Planning systems should be studied and the needs assessment

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conducted for facilitating the client firms and software vendors to help in the
development of an integrated supply chain management (Stadtler, 2015).
The study aims to examine the factors and benefits that are associated with the
integration of supply chain management and ERP systems. Besides, the research will
ensure that companies understand their supply chain and workers’ perceptions of
Enterprise Resource Planning systems success dimensions and offering of intensive
review of the literature on Enterprise Resource Planning systems, and supply chain
management integration. The results will help to indicate whether Enterprise Resource
Planning systems have positive impacts on supply chain integration type. The success of
Enterprise Resource Planning systems, therefore, refers to the effective use of IT systems
in enhancing organizational performance and effectiveness (Stadtler, 2015). This is
diverse from the successful technical implementation of ERP systems wherein the
indicators of measurement of such costs over-runs, time estimates, and metrics of project
management. Enterprise Resource Planning systems are important in increasing the speed
of information flows and point to technologies such as web interfaces, Big Data, Internet
of Things, virtual reality and cloud computing platforms (Stadtler, 2015).
According to Ross (2016), Enterprise Resource Planning integration with supply
chain management significantly relies on supply chain management technologies. Ross
(2016) provides information on “how applications of integrative information technology

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caused the revolution in the practice and concept of supply chain management.” The
review will establish the real-time networking of channels of trading partners,
collaborative design, e-commerce, radio frequency identification, social networking and
connective power of modern arrays of information technology. Ross (2016) provides
“metrics relating to customer demand, base information like transaction databases and
visibility to disruptions impacting delivery and quality in the supply chain channel
activities.”
Peng, Quan, Zhang & Dubinsky (2016) carried out a study to establish the
mediation effects of business processes and management of supply chain capabilities on
the impacts of information technology on company performance. Peng et al (2016)
provide an in-depth review of IT and how it affects company performance. The study
aims to discover the mediation elements for the relationships between information
performance and capabilities. Companies have capabilities to manage both its external
and internal processes entirely through IT impacts on their performance. This study will
provide avenues for exploring other mediating variables in Enterprise Resource Planning
and supply chain management integration. Chong, Liu, Luo & Keng-Boon (2015)
conducted a study to establish “the predicting RFID adoption in healthcare supply chain
from the perspectives of users.” Chong et al (2015) provide information on how
companies in the supply chain have accepted RFID. This technology offers numerous
advantages to the healthcare industry’s supply chain. It also offers challenges faced by

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companies adopting the use of RFID and how to integrate IT in supply chain
management to enhance performance.
According to Korpela, Hallikas & Dahlberg (2017), digital supply chain
transformation toward blockchain integration is important in ERP and SCM integration.
Digital supply chain integration is increasingly becoming dynamic and essential in supply
chain management. IT helps in sharing customer demand and needs effectively and
deliveries of products are tracked efficiently to enable visibility in the supply chain
network. This will provide information on how companies can provide end-to-end
integration of product data, especially for firms operating in the supply chain networks.
However, Gligor, Esmark & Holcomb (2015) believe that the performance outcomes of
agility of the supply chain in establishing effective and efficient systems. The authors
provide information on how agility is an important component closely tied to the
effectiveness of strategic supply chain management. This is because agility is related to
client effectiveness and cost efficiency. The study provides findings on whether IT and
supply chain agility amount to greater performance for companies operating in a stable
environment. The study provides evidence to managers that deploying IT resources
enhances supply chain performance and positively impacts a company’s bottom line.
On the hand, a study carried out by Ho, Zheng, Yildiz & Talluri (2015) shows that
supply chain risk management is important in ensuring accurate Enterprise Resource

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Planning and Supply Chain management integration. The study provides the benefit of
risk management in effectively operating supply chain. Essential information was
gathered for review and synthesize on how IT enhances supply chain management. The
paper will provide a comprehensive review related to research and development in supply
chain risk management and exploring potential gaps. Also, “value-centric design of the
internet-of-things solution for food supply chain is important in developing value
creation, sensor portfolio and information fusion for supply chain management (Pang,
Chen, Han & Zheng, 2015).” The revelation of Internet-of-Things (IoT) is reshaping
supply chains with promising business prospects. This is essential information on how
income-centric values can be used to accomplish effective supply chain networks. The
paper is important because it proposes a value-centric business-technology joint design
framework.
According to Tian (2016), “an agri-food supply chain traceability system for
RFID & blockchain technology.” This is important as it enhances the integration of
supply chain systems and Enterprise Resource Planning. Tian (2016) provides the reason
for adopting a supply chain traceability system. The study shows how the use and
development situation of RFID and blockchain technologies is essential in the supply
chain system. Tian (2016) demonstrates how to build a supply chain process and how
traceability is important in the agri-food supply chain.

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Fan, Tao, Deng & Li (2015) carried out a study to “show the impact of RFID
technology on supply chain decisions with inventory inaccuracies.” Fan, Tao, Deng & Li
(2015) provide information on the impacts of RFID technology adoption on decisions of
supply chain and with the misplacement and shrinkage challenges on the Internet of
Thing. The study provides different assumptions and the model for applying RFID
technologies on supply chain profit and inventory control policy as well as
decentralization of the supply chain. The sharing of RFID by retailers and manufacturers
is important in supply chain management (Cooper, Chao, Chambers, Sze, Moor, Henning
& Bobba, 2017).
According to Cannella, Framinan, Bruccoleri, Barbosa-Póvoa & Relvas (2015),
“the effect of inventory record inaccuracy in information exchange supply chains.” This
study is important in quantifying “the impact of inventory record inaccuracy on the
dynamics of collaborative supply chains in both terms of operational performance and
customer service levels (Bose, Pal & Ye, 2008).” The study is relevant to ERP-SCM
integration because in modeling information exchange supply chain under shrinkage
errors in the supply chain management. For instance, Ng, Scharf, Pogrebna & Maull
(2015) carried out a study to show “contextual variety, Internet-of-Things and the choice
of tailoring over the platform as well as mass customization strategy in supply chain
management.” Supply chain management is a vital aspect of business management. The
study provides the implications of management of the supply chain through the

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establishment of the Internet of Things and Internet Connected Objects. Ng, Scharf,
Pogrebna & Maull (2015) focuses on challenges and opportunities stemming from
consumption data through IT and provides conditions on how to maximize strategies to
be profitable through the use of information technology.
Tan, Zhan, Ji, Ye & Chang (2015) harvesting big data is essential in enhancing
supply chain innovation capabilities. This study will provide information on how big data
and IT can be used to give new understanding or ideas about supply chain innovation, an
important source of value creation and competitive advantage. This study will provide
information on gaps in developing and testing the analytic infrastructure of innovation
afforded by data to gain a competitive advantage. The proposed data analytic will show
how firms can utilize big data to gain a competitive advantage by enhancing their supply
chain innovation capabilities.
Genovese, Acquaye, Figueroa & Koh (2017) believes that the establishment of
sustainable supply chain management and the transition towards a circular economy. The
study provides information on how supply chain management can adopt green energy and
IT to create self-sustaining supply chain systems for economic growth and sustainable
networks. The paper also compares the performances of traditional and circular
production systems across various supply chain industries (Sarno, Djeni, Mukhlash &
Sunaryono, 2015). This is essential in the integration of supply chain management and

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enterprise resource planning. According to Ross (2015), Enterprise Resource Planning is
important in supply chain distribution planning and control. This is because managing in
the era of supply chain management is essential in creating a competitive advantage for
supply. Ross (2015) provides a thorough and analytical view of the IT and supply chain
management while remaining approachable from the standpoint of the researcher. It also
provides today’s logistics and distribution channel organizations and provides a thorough
understanding of essential strategic and tactical planning and control processes as well as
problem-solving techniques that can be applied in modern supply chain management.
Another study by Luthra, Garg & Haleem (2015) carried out an analysis of interactions
among critical success factors to implement green supply chain management towards
sustainability. The study recognized critical success factors in supply chains and provides
a structural modeling technique to determine IT and supply chain interdependence in
implementing sustainability strategies.

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3.0. Methodology

The paper will perform a descriptive literature review to analyze findings from
available works of literature that are significantly availed on the impacts of Enterprise
Resource Management (ERP) on the Supply Chain Management (SCM). The
methodology to be adapted for this work will be to gather information from various
studies, textbooks, journals, and articles as well as varied kinds of reliable information
from different works of literatures and other her relevant sources. The interdependency of
Enterprise Resource Planning and Supply Chain Management has been backed by
numerous studies and the paper has chosen few for review depending on the research
objectives and goals.

3.1. Research Approach
The paper will adopt deductive research methodology as the basic approach to
deduct findings from available works of literature that are significantly availed on the
impacts of Enterprise Resource Management (ERP) on the Supply Chain Management
(SCM). The research of this study will assist in drawing the descriptive and empirical
findings to contribute to future researches and also provide an insight in literature works
on the current study genre. Therefore, the research study will be more focused on the
deduction of results instead of prompting the new results basing on the key assumptions.
The research will also have a specific focus on each individual work of literature
regarding Supply Chain Management (SCM) and Enterprise Resource Planning (ERP).

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 78

3.2. Data Collection
Secondary sources will be used for this research study because the research
methodology will use deductive research. The study will be using the previous works of
literature that are available on the current genres of the research. The paper will use
literature that based on the Enterprise Resource Planning (ERP) for assessing its impacts
while the literature on Supply Chain Management (SCM) will be assessed to establish the
role and impacts of Enterprise Resource Planning (ERP) on Supply Chain Management
(SCM). Moreover, the research study will additionally assess the works of literature that
are specifically aligned on interactive studies of Enterprise Resource Planning (ERP) and
also assess that of Supply Chain Management (SCM).
3.3. Results Analysis
The findings or results of this study will be empirically drawn from evaluated
works of literature. Thus, the direct findings will be empirically drawn where each
literature review will be directly focusing on the subject issue and any related findings
will be drawn from the findings of other genres by molding the findings towards the
current researches.

3.4. Result Presentation
This section will reflect on the explanatory findings from the study in the previous
section. This section will also identify sets of findings by prioritizing the list of supply
chain management trends, impact of Enterprise Resource Planning to the selected supply

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 79

chain management operations and shortcomings of Enterprise Resource Planning in the
other supply chain management trends. Recent supply chain management works of
literature will play a significant role in determining the role of Enterprise Resource
Planning on supply chain management. This research will empirically test a framework to
identify the relationships among supply chain management practices, systems of
Enterprise Resource Planning, competitive advantages and performance of companies.
The primary goal of the study will be to investigate the impacts of Enterprise
Resource Planning systems on the practices of supply chain management on the
performance of companies and the competitive advantage. The study will test the
hypothesis to show support of the hypothesis. For example, do supply chain management
practices have greater positive impacts on competitive advantage and firm performance?
Do Enterprise Resource Planning systems have positive impacts on the practices of
supply chain management? The study will establish standardized path coefficients for the
practices of supply chain management on firm performance and competitive advantage
respectively.
The findings will support the conceptual model and provide various managerial
implications. The study will provide a practical tool for companies in evaluating the
practices of supply chain management and systems of Enterprise Resource Planning. The
results will also show the effectiveness of supply chain management practices and

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 80

Enterprise Resource Planning through the developed and validated systems in improving
the performance and competitive advantage. It will also provide the benefits of adopting
Enterprise Resource Planning in supply chain management practices and reasons for
managers to adopt ERP in SCM practices in the industry. This is because the current
trends show that competition is moving from among companies to between supply chain
networks. Therefore, firms in the industry are more and more integrating Enterprise
Resource Planning and Supply Chain Management in order to secure competitive
advantage and reduce supply chain costs. Thus, the results of this study will be
supporting supply chain management practices and the ERP impacts on firm performance
and competitive advantage. However, it is important to note that supply chain
management practices and Enterprise Resource Planning systems can be influenced by
other contextual factors such as the size of the firm and industry. In this regard, the
research will integrate all the activities of the supply chain management and Enterprise
Resource Planning system and link these activities with firm performance and
competitive advantage.

RESOURCE PLANNING ON SUPPLY CHAIN MANAGEMENT 81

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