Adoption factors for cloud based enterprise resource planning systems: : And how system vendors can act on these

Abstract: No matter how big a company is or what market segment it serves it still needs administration and supervision. An ERP system is a system that has the sole purpose to help a company with these activities and is often considered the backbone that intertwines the key business-processes in an organization. More specifically an ERP system can help a company to manage everything from product planning, purchasing, and inventory control to interaction with suppliers and customer service. Implementing a competitive ERP system into an organization can however become very capital intense, and small and medium enterprises do not often have the financial strength to handle this investment. An important step in the evolution of ERP is therefore cloud based ERP systems which are considered an enabler for many advantages for small and medium enterprises. The purpose of this master thesis is to establish which factors that affect the decision of small and medium enterprises to move their ERP system to the cloud or to implement a brand new cloud solution. Further, these factors have been evaluated and investigated from a strategic perspective in order to provide managerial recommendations for vendor companies. The main research questions for this master thesis are therefor: • What factors affect the client’s adoption decision of cloud based ERP systems technology? • How can the vendors cope with these factors? In order to collect empirical data, a set of interviews have been conducted with vendors which is targeting the small and medium enterprise segment; and customers to these vendors which have adopted a cloud based ERP system. These companies are the system vendors Implema AB, Alterview, and Unit4Agresso and the adopters Handheld, Naty, Grays American Stores, and Södertörns Högskola. The resulting data from this have been analyzed with the help from a theoretical framework which consists of theories from technological change (Types of technological change); Technological change as a social process (Technology diffusion; Technology adoption); Technology system evolution (Salient and Reverse Salient). The results of the empirical research show that risk, function, cost and flexibility are strong contributing factors for the adoption of cloud based ERP systems.