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Economic benefits of enterprise resource planning systems: some empirical evidence

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Abstract

The present study provides empirical evidence on the economic benefits of enterprise resource planning (ERP) systems. We use a modified value chain approach and identify several ratios for each component of the value chain to reflect improvements as a result of the adoption of ERP systems. These financial ratios are tracked for 2 years for a group of companies that adopted ERP systems versus a group of companies that did not adopt ERP. Both univariate and multivariate statistics are used to test for differences. The key result of the present study is that the adoption of ERP systems leads to sustained operational efficiencies and improved overall liquidity. In addition, some support is found for increased profitability 2 years after the adoption of ERP and for improvements in accounts receivable management.
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Keywords: Benefits of information systems; Enterprise resource planning; M49; Value of information technology

Document Type: Research Article

Affiliations: 1: School of Accounting, University of Technology, Sydney, 2007, Australia 2: Chancellery, University of Technology, Sydney, 2007, Australia

Publication date: 2005-11-01

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