Exploring the Challenges of Implementation of Enterprise Resource Planning in Small and Medium Enterprises

Abstract

Small and Medium scale Enterprises (SME) are key players in Sri Lankan economy due to the fact that it contributes 52% to the Gross Domestic Product (National policy Framework for SME Development, 2015) and considered as the back born of the economy. ERP offers the best solution for SMEs without the overheads of the huge investment and management costs that are associated with traditional ERP systems, yet the SME sector faces many challenges in their adoption.  Traditional ERP studies have predominantly focused on large organizations, and gaps within in the literature indicate that both vendor and consumer perspectives require more understanding with new technology offerings for SMEs and short of challenges are faced by SMEs in the implementation. However, SMEs enthusiasm to adopt ERP system is low. This study aims to explore the challenges faced by the SME in implementing ERP system. In order to achieve the research objective an exploratory research approach was used. Interviews were executed by means of face-to-face approach. Interview techniques are used to extract understanding, opinions and challenges faced by SMEs on their way to adopt ERP system. Based on the responses, the researcher found six (6) themes that are challenges in adopting ERP in SMEs.  However, this study endeavors to explore the challenges of implementing ERP project in selected SMEs and contributes the lack of literature on ERP implementation and provides insight for future study by the researcher and respondents.