Using a KM framework to evaluate an ERP system implementation

Competitive advantage can be gained in several ways including gaining a knowledge advantage (K‐Adv). This paper sets out to report on the first stage of broad study to assess the effectiveness of implementing an enterprise resource planning system (ERP) from a knowledge management (KM) perspective.

The study used a survey of a small but representative group to gain feedback in their experience of using the ERP system. Results are evaluated using a KM framework, the knowledge advantage (K‐Adv) capability maturity model (CMM) tool that was initially developed for use by construction organisations to assess the impact of leadership and its supporting ICT infrastructure on the ability of people (by effectively creating, sharing, disseminating and using knowledge) operating in a highly dynamic business environment.

The K‐Adv framework analysis for the study indicates that the ERP system was seen as a useful tool for cost management and that its deployment effectiveness is mainly dependent on human‐to‐human knowledge transfer about how to make the ERP system work. Also, how leaders in organisations facilitate and support people is a critical enabler of the ERP system deployment. The K‐Adv CMM tool was useful in making sense of the degree of organisational maturity from a KM perspective.

The findings first highlight the usefulness of focusing on people‐support in using the ERP adoption in this organisation's context and, second, they illustrate how a CMM tool like the K‐Adv can be used to evaluate KM practices.

The likely effectiveness of use of an ERP is well‐known. However, the originality of the paper is twofold. First, it explains effective ERP application drivers and inhibitors from a KM perspective. Second, it tests and adapts a tool that helps evaluate KM effectiveness and assists better understanding of how these practices are enacted from a cost management business unit perspective.