Understanding the plant level costs and benefits of ERP: will the ugly duckling always turn into a swan?

This paper explores the impact of enterprise resource planning (ERP) systems using the individual manufacturing facility as the level of analysis. A model of ERP costs and benefits based on organizational information processing theory is proposed. The model resolves some of the apparently contradictory ERP impacts that have been reported in the trade literature. The paper then describes ERP implementations in two plants. Organizational information processing theory explains many of the costs and benefits that were observed in the cases. The cases also revealed several unexpected insights. Based on the case study findings, the paper proposes a revised model of ERP impacts.