How to disable mortal loops of ERP implementation: A System dynamics analysis

Despite the fact that ERP system are introduced more than two decades ago, their implementation failure rate is still high. Such high risk in ERP implementation failure is the most important challenge for organizations to accept the risks or to eliminate ERP solutions and deal with the lack of process integrity problems in competitive e-business environment. Successful ERP implementation depends on various factors known as critical success factors (CSFs) which are mainly focused by both ERP researchers and practitioners. Questions which may arise is why ERP implementation failure risk is still high while there are lots of comprehensive analysis on CSFs and how organizations are able to reduce the failure risk through focusing on CSFs. To answer above questions this study developed a proposition system dynamic model of ERP implementation based on CSFs to discuss ERP implementation complexities, which identifies CSFs causal feedback loops and effects of those loops on different aspects of failure. The model is able to completely cover risk management cycle and illustrate impacts of applied policies on CSFs behavior change, cause implementation failure. Consequently it can be used to compare performance of different policies to achieve the best tradeoff on different ERP implementation success indicators