Impact of Enterprise Resource Planning Tools & Techniques in Management

[Former Member]

Impact of Enterprise Resource Planning Tools & Techniques in Management

Education

Bharat N. Kantharia

IBS, Ahmedabad

bharat_kantharia@hotmail.com

Historically, business education is fragmented with different bodies of knowledge taught in separate functional courses. Although

students become specialists in specified area, they many times miss the complete picture where interdependencies and

interconnectedness among various business processes create efficient synergies in achieving business goals. The purpose of this

research paper is to understand deeper nuances of an integrated educational environment & its impact on student communities,

Faculty or teaching community & administration, society at large. Impact of Enterprise Resource Planning (ERP) in management

education can be analysed basis three major phases, namely:

Phase I: Teaching ERP based Courses & provide guidance to

educators on ways to effectively teach, in order to accomplish the synergistic goals of hands on exercises by students using the

ERP package, ii) illustrating real-world business processes & integration, (iii) re-designing the curricula in different functional

courses.

Phase II: Implementation of ERP based integrated Learning Management Systems (LMS) to carry on with day to day

activities of the management of education.

Phase III: Improving pedagogical tools, techniques & processes in an integrated

manner to improve brand equity of the institute.

1. Introduction: Impact of ERP in Management Education

Management education in India is one of the prime & fastest growing components of education industry. It is estimated that there

are more than 3000 management education institutes in India. Education industry in India is estimated to be more than INR 20,000

Crores which is more than the size of domestic software or automobile industry

1. In a world economy strewn with recession;

Indian economy is growing between 7 to 10 % & is expected to grow at the same rates in medium term to long term. Indian

corporate is bullish on acquiring foreign firms & integrates them with domestic operations. Foreign Institutional Investors are also

investing in Indian markets at increasing rates. Globalization trend is breaking all notional & physical boundaries to capture the

market potential. It opens up tremendous potential for the businesses to grow & compete.

In emerging economies like India, it has been reported that 90% of ERP implementations were failure.

Even in developed countries failure rates are high: "Failure rates estimated to be as high as 50% of all ERP implementations"

(Muscatello & Parente 2006:61).”70 percent of ERP implementations fail to deliver anticipated benefits" (Wang et al 2007:200).

One of the major reasons for failure is reported as non availability of trained leader managers. Management education institutes

being at the fore front of education, training & development; it becomes an unattended opportunity. Above statistics indicate the

potential which is available to the management education institutes to tap. With fantastic growth of Management education &

Government of India initiating steps to open up higher education to foreign universities, competition is likely to increase multifold

in near future.

India has very large population of graduates passing out every year. However it is said that a small percentage of it is

employable. Primary aim of management education is to equip the student with the knowledge and skills to “get started on the job”

when he/she begins his/her first day and also when he/she advances in the career. In competitive business world; employers expect

new-comers to understand how businesses function in today's economy. This requires knowledge of basic business processes and

the underlying technology support. It is very essential & beneficial when ERP tools & techniques are incorporated in the content of

course curricula so that students gain appreciation & understand complexity of the true impact of such systems on organizational

functioning

. Management education needs to prepare the students to be in a state of readiness with heightened sensitivity to enable

them see, say or think something what they may not have seen or said or experienced before.

Exposure to large-scale ERP or ERP

II systems, its interfaces & workflows are very well-suited to support the hands-on component of a management education &

learning by simulating the real world scenarios. Two very compelling reasons may be cited for this. First, the comprehensiveness

of large ERP Packages such as SAP All-in-One or Oracle Applications, exposes students to the extensive interdependencies

involved in running a large business (Joseph and George, 2003). No amount of textbook explanation or case studies can inculcate

this message or personal interaction with such a system. Second, exposure to Enterprise Systems (ES) in different courses of

Management education like Sales & Distribution Management, Financial Management, Materials Management and Human

Resources Management integrated with ERP functionalities would expose students to find the common threads or interfaces

between such courses & enterprise processes.

Very few B Schools in India have acquired or developed ERP with the intention of incorporating the same into new and existing

courses. There is no documented effort to list the same. Currently there is a trend to implement open source based campus

management system (CMS). However it does not add value to student learning because same is used for organisation’s internal

working rather than extending student’s learning or exposure. What is apparent from published reports of such efforts is that ES

integration is much harder than expected (Fedorowicz et al, 2004; Farrell, 2001). Failure rates in meeting expectations exceed

50%. Students who undergo courses on ERP tools & techniques and graduated with combination of business management and IT

skills can help enhance the credibility of a business school in the eyes of industry (Watson and Schneider, 1999). Schools with

ERP systems in place can also use the same as a marketing tool to attract potential students, employers & possibly organisations

that may be willing to pay the Faculty members for consultancy assignments.

While it is true that most of the Fortune 500 has already implemented ERP systems, and thus the initial wave of the demand for

ERP skills is past; the next wave of growth, the Micro, Small and Medium Enterprises (MSMEs) market and industry-specific

solution market, is underway. Hence, the fundamental ERP skill set is still in demand by the employers. Same is not true for

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Eighth AIMS International Conference on Management

management education institutions. Very few management institutes in India have implemented ERP & operationalised the same

in day to day working. Question arises as to for both faculty and administrators: Will future automation make education more

effective? Or will automation create additional work with limited benefits? Researchers need to address issues & reasons for the

leading management institutes not grabbing the opportunity & shying away from the same. We need to take care of three major

issues of teaching ERP in a business school; namely: designing the curricula and implementation issues, training and outside

support, and student and faculty issues.