The ERP Purchase Decision: Influential Business and IT Factors

Our objective for this paper is to identify a parsimonious set of business and IT factors that are associated with the purchase of ERP systems. A survey instrument of 36 items that describe potential ERP package capabilities is developed after a review of prior literature. Based on factor analyses of the survey responses from 122 senior IS managers, four business factors (data integration, new ways of doing business, global capabilities, flexibility/agility) and four IT factors (IT purchasing, IT cost reduction, IT expertise, IT architecture) are identified. We also confirm that many of the ERP purchases in the last half of the 1990s were at least partially motivated by the avoidance of Year 2000 maintenance costs