Future ERP Systems: A Research Agenda

Benedict Bender, Clementine Bertheau and Norbert Gronau

Department of Business Informatics, University of Potsdam, August Bebel Str. 89, 14489 Potsdam, Germany

Keywords: ERP, Enterprise Resource Planning, Enterprise System, Three-tier Architecture, Reference Architecture

Model, Problems, Research Agenda.

Abstract: This paper presents a research agenda on the current generation of ERP systems which was developed based

on a literature review on current problems of ERP systems. The problems are presented following the ERP

life cycle. In the next step, the identified problems are mapped on a reference architecture model of ERP

systems that is an extension of the three-tier architecture model that is widely used in practice. The research

agenda is structured according to the reference architecture model and addresses the problems identified

regarding data, infrastructure, adaptation, processes, and user interface layer.

1 INTRODUCTION

The digital transformation as well as the further

development of existing products and services set

new requirements to the dominating class of

enterprise systems in companies, the ERP systems.

These requirements stem partly from problems that

are related to the architecture of ERP systems, the

way the systems are implemented which is tightly

related to the aspect and degree of customization.

Except for challenges related to the systems

themselves, the changing business landscape poses

new requirements on ERP systems. For instance, the

emergence of the Industrial Internet of things (IIoT)

allows processes and decision-making to be

supported by data that was gathered throughout

operation (Lazarev and Nekrasov 2017; Bragalia et

al. 2019).

So far, research on ERP systems to a great extent

focussed on the implementation and post-

implementation phase and corresponding critical

success factors (e.g. Mahraz et al., 2020; Poluektova

et al., 2018; Zare Ravasan and Mansouri, 2016).

While this lifecycle-oriented perspective is of great

importance for practice, problems related to the

architectural design of current-generation ERP

systems are of minor importance in previous

considerations. As such, the problems of ERP are not

addressed holistically. This leads to the issue that the

system design, which might be the root of many

problems during system implementation and

operation, may not be attributed to the relatively

stable architecture of ERP systems.

By means of a literature review, problems with the

current ERP system generation were systematically

identified and mapped to a reference architecture

model of ERP systems. Related findings are

integrated into a research agenda. The integration of

the lifecycle and architecture perspective may guide

the conceptualization of the next-generation

enterprise systems.

The paper is structured in four sections. The

following selection introduces the architectural

framework and attributes the problems identified in

the literature. Section three presents the research

agenda, while section four concludes the paper.

2 PROBLEMS OF CURRENT ERP

SYSTEMS

The research agenda on the future ERP systems is

centered around a reference architecture model of

ERP systems. In contrast to previous approaches, the

idea is to systematically group the identified issues

according to the different levels of systems

architecture. Thereby, this approach allows to

attribute related challenges to the respective research

domains and develop solutions accordingly. Finally,

the integration of findings allows fostering the

discussion on the future generation of ERP systems in

terms of architecture.

776

Bender, B., Bertheau, C. and Gronau, N.

Future ERP Systems: A Research Agenda.

DOI: 10.5220/0010477307760783

In Proceedings of the 23rd International Conference on Enterprise Information Systems (ICEIS 2021) - Volume 2, pages 776-783

ISBN: 978-989-758-509-8

2.1 Theoretical Background

The reference architecture model by Andresen and

Gronau (2005) that is considered in this article is an

extension of the three-tier architecture that is widely

used in practice. The three-tier architecture followed

the generation of two-tier ERP systems, a simple

client-server division (Bahssas et al., 2015). For a

three-tier ERP architecture, more layers are specified.

Those are presentation or user interface, application,

and database (Bahssas et al., 2015; Qin and Wei,

2013). The user interface or presentation layer forms

the connecting piece between the system and the user.

The dialog triggered by the user via the user interface

is admitted at this layer. The application or

functionality layer combines the central algorithms of

the software. Software components are structured on

this layer and resources and transactions are executed

and managed here. This includes the processing of the

data, which is read from and written to the database.

On the database layer, manipulations are made to the

stored data. The data is managed in a database system,

which is usually relational in the current generation

of ERP systems (Plattner 2009).

The extended reference architecture model was

introduced by Andresen and Gronau (2005) to

address the lack of adaptability that comes along with

the traditional design of ERP systems (see Figure 1).

According to the authors, an ERP systems

architecture (should) specify additional levels besides

the layers mentioned. These additional layers are the

control layer, located between the presentation and

functionality layer, the infrastructure layer which is

below the database layer, and the adaptation layer

which is a cross-section layer. The control layer is

where business processes should be monitored, and

internal consistency is ensured. The control layer

should provide the possibility to model business

processes with a specific modeling language.

Depending on the architecture of the respective ERP

systems, processes are mapped via workflow engines,

which are part of the application layer. The

infrastructure layer includes decisions concerning

distribution and topology. The cross-section to all

layers is the adaptation layer which covers all

adaptations that were implemented individually for

companies (ibid.).

2.2 Findings from Literature

To gain an understanding of the current state of

research on problems rooted in the selection,

implementation, and lifecycle of ERP systems as well

as its design and architecture a literature review was

conducted. For this purpose, the database Web of

Science was queried. Keywords included “ERP” OR

“Enterprise Resource Planning” AND “problems”

OR “issues”. Since the focus of the review lied in

current literature the time span was limited to the past

five years (2016 - 2020). Moreover, central influential

articles were identified through backward reference

research. The literature review was intended to be

representative and therefore to serve as a basis for

developing a research agenda (Cooper 1988).

Completeness was not aimed at.

In the following, the literature which identified

problems with ERP systems or tackled these is

presented. The problems are centered according to the

problem domains and phases.

Figure 1: Enterprise System architecture layers according

to Andresen and Gronau (2005).

2.2.1 Problems Related to Customization

Although ERP systems are standard software

packages, also known as commercial off-the-shelf

products (COTS), some customization always

becomes necessary to meet the functional and process

requirements of the implementing organization. This

topic is therefore of great interest in the research

community (Daneva, 2014; Light, 2005;

Parthasarathy and Sharma, 2017; Zare Ravasan and

Mansouri, 2016). Customizations can be manifold

and the widely used terminology that distinguishes

between configuration and modification is not

sufficient to estimate the associated efforts required

for implementation and maintenance (Brehm et al.,

2001). To customize an ERP system can be

problematic in various ways because it raises the

complexity of the software itself and the

implementation project. With customization the risk

for deployment and upgrade difficulties increases.

Heavy customization can even lead to project failure

(ibid.). Database and source code customization in

particular can cause issues with regards to software

quality (Parthasarathy and Sharma, 2017).

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777

2.2.2 Problems Related to ERP Selection

ERP selection is comprehensively researched as a

complex multi-criteria decision-making problem to

find the ERP system that matches the processes of an

organization best without the need for modifications

in terms of customization efforts (Ayağ and

Yücekaya, 2019; Hinduja and Pandey, 2019).

Naturally, quite some research deals with misfits of

ERP systems after selection which is a common

problem in practice (Wu et al., 2007). The increasing

use of cloud computing also influences the ERP

market. Companies that select a new ERP system are

faced with the decision of whether to operate it on-

premise or in the cloud. Recent research is devoted in

part only to cloud ERP systems and corresponding

implications and risks like functionality fit and

customization, data migration, organizational change,

reliability as well as data security and integrity

(Hinduja and Pandey, 2019; Saa et al., 2017; Şener et

al., 2016; Sørheller et al., 2018).

2.2.3 Problems Related to ERP

Implementation

After a successful selection of an ERP system, the

next challenge for companies constitutes the

implementation phase which can be even more

complex, difficult, and risky, especially for SMEs

(Leu and Lee, 2017; Poluektova et al., 2018). Factors

that lead to failure include among others: heavy

customization efforts, poor business process

reengineering, poor consultant quality, and the lack of

top management support (ibid.).

2.2.4 Problems Related to ERP Usage

After implementation, in the usage phase, some

companies have difficulties in realizing the benefits

of implementing an ERP system. This is because

companies lack the competencies to define benefits to

be expected before implementation and to monitor

success and failure (Anaya, 2019). Key users can play

an important role as knowledge managers for the

realization of benefits in this phase (Maas et al.,

2016). ERP upgrading being a typical maintenance

process in the usage phase is considered just as a

complex problem as ERP selection (Goman and

Koch, 2018). It includes similar steps like

requirements engineering, the evaluation of options,

and the identification of dependencies (ibid.). Related

to this is a challenge for companies to find the right

time for a systems’ switch because the status of

alignment between business and system often is

unclear over time despite customization decision in

the early phase of implementation (Huang and

Yokota, 2019).

2.2.5 Further Problems

Other problems that are discussed in the literature

concerning ERP systems are (master) data quality

issues (Zong et al., 2017) and master data

management (Schäffer and Leyh 2016). Other

research focuses on poor usability that is hindering

productivity gains (Babaian et al., 2017) and

interoperability and integration problems that can be

due to semantic interoperability (Badr et al., 2016)

and environmental, technical, managerial as well as

organizational aspects (Banaeianjahromi et al.,

2016).

Considering the specifics of the manufacturing

industry, further problems occur. For instance, ERP

systems seem to not support the monitoring of

production processes sufficiently because they only

provide synthetic information about the inputs and

outputs of processes. That makes it necessary to close

the gap between ERP and production management

systems (Krótkiewicz et al., 2019). The increasing

importance of industry 4.0 that entails among others

more available information brings new requirements

for ERP systems that are not met in practice yet

(Braglia et al., 2019; Lazarev and Nekrasov, 2017)

like higher security standards (Elkhawas and Azer,

2018).

2.3 Problem Mapping

Apart from the lifecycle-oriented consideration of

ERP systems, which dominates previous literature,

most problems identified in the literature can be

mapped to the layers of the reference model (Table

1). The following overview is filtered for problems

that can be attributed to a specific layer of ERP

systems. This focus allows to further develop the

architecture of enterprise systems which may help to

resolve the origin of potential issues on the

architectural level of enterprise systems.

As such aspects that solely focus the ERP project

as such are not considered for the research agenda on

the architectural issues of the current ERP systems

generation.

Table 1 shows that the problems identified in the

literature mapped with the architecture reference

model (see section 2.1).

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Table 1: Problems identified in literature per layer.

Problem References U P F D I A

Data quality Zong et al. (2017) x x

Poor usability Babaian et al.

(2017)

Integration and

interoperability

Badr et al. (2016)

Banaeianjahromi

et al. (2016)

Security

standards

Elkhawas and

Azer (2018)

x x x

Monitoring

requirements

Krótkiewicz

(2019)

x x x

Levels of

customization

Brehm, Heinzel

and Markus (2001)

x x

Requirements

from Industry

4.0

Bragalia et al.

(2019)

Lazarev and

Nekrasov (2017)

x x x

Cloud ERP Hinduja and

Pandey (2019)

Sorheller et al.

(2018)

Saa et al. (2017)

Şener et al (2016)

x x x x

Software

quality issues

Parthasarathy and

Sharma (2017)

x x

Customization

requirements

Ibrahim et al.

(2017)

Daneva (2014)

Ravasan and

Mansouri (2016)

Light (2001)

Amount 1 1 7 7 4 2

3 RESEARCH AGENDA

While previous literature focussed on specific phases

of the ERP lifecycle, we call for a consideration of the

architectural layers of modular ERP systems to

resolve prevailing challenges. Assuming that many of

the existing challenges are rooted in the architectural

foundations of ERP systems, system providers are

interested in how ERP systems can be further

advanced to fulfil the newer requirements of

customers.

This very first analysis of the problems of the

current ERP system generation showed that the most

pressing problems occur around databases and data

models. The equal number of problems are related to

the functional layer. Next in line are problems related

to the infrastructure layer followed by the adaptation

layer. Fewer problems occur around user interfaces

and the storage and the control layer, which is not

even available for all existing ERP systems.

3.1 User Interface

The user interface of ERP systems lags behind other

system categories concerning the adaptability to the

requirements of individual users. In this regard, future

developments may focus on the needs for special user

groups, such as young and old users or beginners and

advanced users. So far, the individualization of

enterprise systems is commonly bound to the use of

favourites and the like. Holistic concepts focusing on

adoption are rarely available. Nonetheless, the

importance of usability for ERP systems for

acceptance and project success has been highlighted

(Masa’deh et al., 2019).

With the increasing possibilities and demands

towards mobile operation, the group of ERP systems

may add responsive designs and web-based

approaches in their portfolio. While many systems

still rely on rich client architectures, the newer

generation of enterprise systems focuses on web-

based frontends such as HTML5-based approaches

which require only a standardized browser

environment for operation.

Finally, the group of ERP systems may support

newer forms of interaction, that do not only rely on

predefined forms. Available technologies in the form

of speech recognition may allow for more interactive

operation with ERP systems. Providers of ERP

systems are well-advised not to develop their own

solutions, but to provide specialized domain skills for

their systems to combine established technologies

with domain particularities.

3.2 Control of Business Processes

Business Processes vary between companies. While

some domains such as financial accounting are highly

regulated and standardized, operations in domains

such as logistics and manufacturing vary between

companies. These differences may constitute the

competitive advantage of companies (Lengnick-Hall

et al. 2004). ERP systems need to support and

maintain the competitive advantages of companies.

Especially for companies with individually

developed software, maintaining their competitive

advantage is a major concern when considering the

use of standardized software packages, such as ERP

systems (Lengnick-Hall et al. 2004).

To support the adaptability of individual

enterprise operations, ERP systems should allow for

reconfigurable processes. To do so, ERP systems may

provide their standard processes as a combination of

micro-services that are combined towards business

processes using modelling approaches. For this,

Future ERP Systems: A Research Agenda

779

standardized notations such as BPMN may contribute

to common sense within the respective system

category. The approach of “modelling instead of

programming” may guide future progress in the

domain of ERP systems. More and more system

providers add the functionality of workflow designers

in their systems. This allows system users to add

specialized procedures to existing standard processes.

However, especially regarding the core processes in

ERP systems, the easy adaptability to specialized

conditions is limited.

3.3 Functionality

Concerning the functionality of ERP Systems,

different aspects are of interest from an academic and

business standpoint. With the emergence of highly

specialized software systems, for instance, for

logistics and manufacturing as well as customer-

related CRM-systems, the question regarding the

future role of ERP systems emerges. While from the

early generations of ERP systems different business

functions were combined, future setups may involve

less integrated enterprise systems with additional

specialized systems. The ERP then serves as the

central point of integration. This also poses

requirements regarding the interoperability of ERP

systems and their specialized counterparts.

Even though the standardization of ERP systems is

a major advantage, a major success factor of system

operation is the fulfilment of specialized domain

requirements such as in the automotive or health

industry. So far, an industry-standard ERP

implementation strategy has not been developed in the

past (Ali and Miller 2011). In this regard, the right level

of standardization and specialization remains an

important challenge for system providers. Also, system

concepts that allow for generic functionality with

domain specialization deserve further attention. With

the emergence of software platform architectures,

future system generations might also allow for third-

party contributions in the form of software modules

(e.g., extensions, add-ons) as part of the modular

software infrastructures (Tiwana et al. 2010).

3.4 Database / Data Model

Many of the identified issues are related to the data

layer and related data models that are to be addressed

in future research. The data layer in ERP systems

serves as the permanent representation of business

transactions. To do so, enterprise systems typically

rely on relational database systems. Relational

database systems have long been the standard in the

enterprise application field (Plattner 2009). However,

relational databases recently reveal weaknesses

concerning new requirements. Increased data

volumes constitute a challenge concerning analytical

requests on existing database architectures. From a

broader perspective, requests in enterprise systems

can be categorized into transactional (OLTP) and

analytical (OLAP) processes. While relational

databases perform well on transactional processes

they do not on complex analytics requests (Plattner

2009). So far weaknesses were usually counteracted

with increased resources in terms of hardware and

approaches such as in-memory databases. While

increased resources allow for faster processing of

database requests, they do not address the structural

problem of relational databases concerning analytical

requests (Meyer et al. 2015). Future research may

provide concepts to provide integrated or hybrid data

environments that allow for the required performance

regarding transactional and analytical requirements.

Enterprise systems and databases in specific are

faced with the field of tension between

standardization and individualization. With the aim of

ERP systems to integrate different products into one

coherent data model, they might fail to address the

individual specifics of related domains. While for

instance, one product might be a food product

stemming from a recipe, another product might be a

machine being composed of a bill of materials. While

standardization provides many advantages

concerning the uniform treatment of related products,

it might fail to cover the ever-increasing complexity

and specialization of products. New forms that allow

for a combination of standardization and covering the

particularities of products are to be identified in future

research.

Databases of ERP systems need to be more

adaptive and self-automatized. While many database

approaches rely on predefined structures, the

potential of recognizing patterns in existing data

structures and data entries is not fully realized yet.

Master data management for a long has been a

challenge of enterprise systems. To improve related

issues, corresponding functions can be implemented

on the level of the data model. Therefore, findings

from related fields such as AI and machine learning

are to be adapted to the context of enterprise systems

data structure.

With the rising complexity of nowadays system

landscapes, interoperability becomes another urgent

topic. Not all companies have Enterprise Application

Integration (EAI) tools available and ERP system

typically offers few possibilities to manage and adapt

interfaces to other systems.

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3.5 Infrastructure

Concerning the infrastructure layer, three aspects

were identified. Modern hardware infrastructures

provide enhanced power for processing. For example,

new processor architectures allow for massively

parallel processing (Wust et al. 2012). Modern

enterprise systems should be able to utilize related

advantages for their operation. To do so, the software

architecture of an ERP system needs to be adapted

accordingly. In this regard, future research could

analyse the architecture of the systems and asses how

far ERP systems currently use related possibilities.

Moreover, the conception of architectural archetypes

allows deducting design principles for modern

systems architecture.

ERP systems as a central software instance in

companies should allow for the scalability of related

business operations. Scalability is required over the

long term, for instance when companies grow over

time, as well as in a short period, for instance in times

of high transaction volume such as Christmas

shopping. Moreover, scalability is required up- and

downwards. Future studies might identify which

system architectures do well with regard to scalability

and develop architectural principles that contribute to

ERP system’s scalability.

With the emergence of cloud-based software

provision and Software as a Service (SaaS) offerings,

current and potential ERP users are faced with the

question of which is the most suitable type of

provision for them (Hinduja and Pandey 2019). While

some requirements, as well as regulations, may

restrict the use of cloud services, the option may be of

interest to many users. In this regard, research and

practice are requested to develop decision models that

allow for the identification of the ERP provision that

best fits their targets.

3.6 Adaptation

The possibilities of adoption in the ERP domain are

important for the implementation as well as the

operation phase.

During system implementation, the design of

ERP systems needs to allow for the adoption of the

system as a whole as well as on each layer. For

instance, the adoption of the user-experience layer

may allow for user-specific needs to enable more

effective system usage. Adoption of the business

process level involves reconfigurable business

processes. In terms of enterprise systems

functionality, it might be possible to add extra

functionality or include specialized systems. From an

overall perspective, ERP systems should balance their

power of standardization with the possibilities to

support individual companies, their operation, and

users.

During the operation stage, systems need to be

adaptable to newer circumstances. So far, the

implementation of a newer system version still is a

common issue in ERP system operation (Barth and

Koch, 2019). Related upgrades are often considered

extensive projects with many costs involved (ibid.).

4 CONCLUSION

This position paper proposes a research agenda to

address problems that exist with the current

generation of ERP systems. Recent problems were

identified within the literature and presented

according to the traditional ERP lifecycle-oriented

consideration.

Many of the problems during ERP selection,

implementation, and usage can be attributed to the

system’s design and architecture. As such, the authors

call for the consideration of the architecture of

enterprise systems as the root of related issues. To do

so, existing problems were mapped on a five-layer

reference architecture model. By that, future research

might be devoted to related issues in more specialized

domains rather than a consideration of ERP systems

as a whole. Specialized solutions can afterwards be

integrated into the overarching systems architecture.

Issues were identified for the infrastructure,

database, functional, control of business processes,

user interface, and adaptation layer. Indications for

further research are given. The research agenda

presented might foster the discussion on the future

role and architecture of ERP systems.

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