Using enterprise systems to realize digital business strategies

Abstract

PurposeOrganizations invest in enterprise systems (ESs) with an expectation to share digital information from disparate sources to improve organizational effectiveness. This study aims to examine how organizations realize digital business strategies using an ES. It does so by evaluating the ES data support activities for knowledge creation, particularly how ES data are transformed into corporate knowledge in relevance to business strategies sought. Further, how this knowledge leads to realization of the business benefits. The linkage between establishing digital business strategy, utilization of ES data in decision‐making processes, and realized or unrealized benefits provides the reason for this study.Design/methodology/approachThis study develops and utilizes a transformational model of how ES data are transformed into knowledge and results to evaluate the role of digital business strategies in achieving benefits using an ES. Semi‐structured interviews are first conducted with ES vendors, consultants and IT research firms to understand the process of ES data transformation for realizing business strategies from their perspective. This is followed by three in‐depth cases (two large and one medium‐sized organization) who have implemented ESs. The empirical data are analyzed using the condensation approach. This method condenses the data into multiple groups according to pre‐defined categories, which follow the scope of the research questions.FindingsThe key findings emphasize that strategic benefit realization from an ES implementation is a holistic process that not only includes the essential data and technology factors, but also includes factors such as digital business strategy deployment, people and process management, and skills and competency development. Although many companies are mature with their ES implementation, these firms have only recently started aligning their ES capabilities with digital business strategies correlating data, decisions, and actions to maximize business value from their ES investment.Research limitations/implicationsThe findings reflect the views of two large and one medium‐sized organization in the manufacturing sector. Although the evidence of the benefit realization process success and its results is more prominent in larger organizations than medium‐sized, it may not be generalized that smaller firms cannot achieve these results. Exploration of these aspects in smaller firms or a different industry sector such as retail/service would be of value.Practical implicationsThe paper highlights the importance of tools and practices for accessing relevant information through an integrated ES so that competent decisions can be established towards achieving digital business strategies, and optimizing organizational performance. Knowledge is a key factor in this process.Originality/valueThe paper evaluates a holistic framework for utilization of ES data in realizing digital business strategies. Thus, it develops an enhanced transformational cycle model for ES data transformation into knowledge and results, which maintains to build up the transformational process success in the long term.

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