Customer Satisfaction as a Critical Success Factor for ERP Design
Jamie Plunkett and Craig M. Gelowitz
a
Faculty of Engineering and Applied Science, University of Regina, 3737 Wascana Parkway, Regina, Canada
Keywords: Enterprise Resource Planning, Balanced Scorecard Approach, As-Is To-Be Methodology, Critical Success
Factors, Small and Midsized Enterprise, Customer Satisfaction Analysis.
Abstract: Enterprise Resource Planning (ERP) systems have been an important tool in managing business processes in
corporations worldwide. This paper briefly looks at some popular business process analysis methodologies
such as Balanced Scorecard and Critical Success Factors (CSF). It also includes a customer satisfaction
analysis as a supplementary mechanism to design and implement an ERP system for small to mid-size
enterprises (SMEs). In addition to the traditional metrics, customer satisfaction is included as a critical success
factor that drives the changes to business processes and provide insight into the design of an effective ERP
for an SME.
1 INTRODUCTION
Enterprise Resource Planning (ERP) systems are
software systems that are utilized to manage all
aspects of operations within a corporation (Kiran &
Reddy, 2019). ERP systems typically focus on
vendors, accounting, human resources, sales,
customer service, inventory, purchasing and
production planning departments. All of these
individual areas and departments are linked through
an ERP system in order to get valuable information
on internal business processes and company
information in a consistent and timely fashion.
Small and Mid-sized Enterprises (SME) are
businesses that generally consist of companies with
less than 250 people on staff within a given location
(Alaskari et al., 2021). In much of the world, SME’s
have a notable impact on the economies of countries
and contribute to a significant portion of gross
domestic product (GDP) internationally (Genc et al.,
2019).
Previous to the development of ERPs, many
companies would utilize decentralized systems to
manage their business processes. This can lead to
undesirable situations where individual departments
are the only ones with access to information other
departments might urgently need (Elbahri et al.,
2019).
a
https://orcid.org/0000-0002-2300-3189
For example, a centralized ERP system can enable
a sales department representative, in response to a
customer query, to easily check the database of the
inventory department and give feedback in real time.
If a product is not in the inventory, the inventory
department can do a purchase request immediately.
Or, if a product is to be manufactured internally, the
by-products can be purchased and preparation can be
made to get that product manufactured for the
customer. Throughout the entire process the customer
can be provided valuable time sensitive information
on what stage the product is in before it is ready for
shipping or pickup.
Utilizing an ERP system allows an accounting
department to get information on all transactions and
process them accordingly. Billing can be sent to
customers, while vendor accounts can be handled
simultaneously and all in real-time. Vendors are able
to send in their invoices and those invoices can be
reconciled with what is on the ERP system and then
processed for payment.
The human resource department can manage the
corporate workforce and make decisions based on the
jobs coming in from the Sales and Production
Planning department. This information indicates the
production output levels required which can drive the
necessary staffing levels. An ERP system can also
maintain a database of available staff, their work-load
as well as those recently interviewed.
114
Plunkett, J. and Gelowitz, C.
Customer Satisfaction as a Critical Success Factor for ERP Design.
DOI: 10.5220/0011065700003179
In Proceedings of the 24th International Conference on Enterprise Information Systems (ICEIS 2022) - Volume 2, pages 114-118
ISBN: 978-989-758-569-2; ISSN: 2184-4992
Copyright
c
2022 by SCITEPRESS Science and Technology Publications, Lda. All rights reserved
An ERP system can maintain inventory listing
information that may be valuable for price
comparisons and approval of purchase orders. This
can also be important for formulating price indices for
future analysis.
An ERP can also be utilized to keep track of
customers. Customer data whether prior, present or
future, can be used for marketing and promoting a
business.
2 ANALYSIS METHODOLOGIES
2.1 Balanced Scorecard
The Balanced Scorecard is a management model and
tool that was designed to help corporations measure
their performance (Frederico et al., 2021). The main
parameters are:
1. Financial
2. Customers
3. Business Process
4. Learning and Growth
The “Financial” parameter looks at the actual
monetary gains made throughout the period being
analysed. The “Customers” parameter takes a broad
look at the customer’s overall experience with the
organization and enables changes to be made to
improve customer interaction and satisfaction. The
“Business Process” parameter deals with process
management. It includes an analysis to check if
internal processes are up to par with current standards
while also determining if any processes can be
improved. The “Learning and Growth” parameter
deals with companies making improvements,
learning from mistakes and improving. It also relates
to understanding the customer experience as a whole.
For implementation of an ERP system, the
balanced scorecard approach can be used in the
assessment stage.
2.2 As-Is and To-Be Business Process
The As-Is methodology is a process map used to
record business processes in an organization (Elragal
& Haddara, 2012). After recording the step-by-step
business processes, an analysis can be done to see
where potential improvements can be made.
Before implementing an ERP system, an analysis
of business processes can be made. Subsequently, a
To-Be map can be generated that describes the future
business processes based on the ERP modules that are
to be incorporated.
2.3 Critical Success Factors
Critical Success Factors (CSF) look into the activities
of a company that are required for a company to be
successful (Vargas & Comuzzi, 2020). Often, the
critical success factors for an SME are considered to
be parameters related to internal metrics such as:
1. Project team competence and composition
2. Vendor and consultant support
3. Business process reengineering and minimal
customization
4. Software development testing
5. End user involvement
6. User training and education
7. Clear goals and objectives
8. Monitoring and feedback
2.4 Customer Satisfaction as a CSF
Maintaining customer satisfaction is an important
part of any business. Consumer buying patterns can
be influenced by the level of customer service
obtained which then leads to customer loyalty (Adam
et al., 2020).
Previous studies have also found that parameters
like product quality and price perception have a
significant impact on customer satisfaction and
customer loyalty (Hudaya, 2020).
This research postulates that in addition to the
common critical success factors for SMEs, customer
experience and satisfaction can be utilized as a CSF
for help in both designing and evaluating the
effectiveness of an implemented ERP system.
3 INITIAL PROCESS ANALYSIS
To conduct this research and obtain some practical
and real-world results, a local auto repair shop and
SME in Regina Saskatchewan agreed to participate in
this research and implement a subsequent ERP
design.
An initial mapping of the process flow of the
business helps one understand the business
operations, both for software design insight as well as
to see where operations can be improved upon
(Parhizkar & Comuzzi, 2017). During this step, the
focus was on the “Business Process” parameter of the
Balanced Scorecard approach as well as the
“Business process reengineering and minimal
customization” of the Critical Success Factors
methodology.
Customer Satisfaction as a Critical Success Factor for ERP Design
115
Included in this analysis is the determination of
problems that could be solved to help improve
customer satisfaction. Some of the problems
identified for the SME were:
1. Customer documentation filed manually
2. Billing and documentation done manually
3. No notice board to keep staff aware of
activities at the establishment.
4. No organized price list
5. No employee records filed
6. Accounting done manually
7. No system in place to handle increased
workload, which leads to delays in customer
service.
Through utilizing the assessment methodologies
of the Balanced Scorecard model and Critical Success
Factors the additional success factor of customer
satisfaction was also included. In order to explore this
more fully, an analysis of customer responses from a
list of customer survey questions relevant to customer
satisfaction were also measured and evaluated to
include in the overall analysis. To accomplish this, a
survey with 17 questions relating to customer
satisfaction was created and sent out to previous and
current customers of the SME. 34 customer surveys
were completed and gathered for analysis.
The 17 questions included a 5-Point Likert Scale
ranging from Strongly Disagree to Strongly Agree
that attempts to determine levels of customer
satisfaction. For example, the following are five
questions that were included in the survey:
a) Would you say this company has a high
level of efficiency?
b) Would you say you have gain a high level of
satisfaction with our team in resolving your
issue?
c) Would you say this company delivers
customer service at a high-speed?
d) Based on your experience, would you agree
to returning to us again to do business?
e) Based on your experience, would you agree
to recommending us to others?
4 SURVEY ANALYSIS
Some of the analysis of the customer surveys
indicated that:
1) A majority of the customers like the staff
2) A majority of customers indicate that the
efficiency is not at a high level
3) A majority of customers indicate that the
customer service is not at a high level
4) A majority of customers believe price levels
are too high
5) A majority of customers feel phone calls are
not answered in a timely manner.
6) A majority of customers do not have a high
level of satisfaction
7) A majority of customers would not
recommend the company
8) A majority of customers do not feel updates
are communicated in a timely manner
9) A majority of customers do not feel there are
multiple methods of payment available
10) A majority of customers do not feel the
booking process was an easy process
11) A majority of customers do not intend to
return to do business or recommend the
business to others.
Figure 1: Survey Question Response Graph.
With the data from the customer satisfaction
survey and the internal issues that were found from
the As-Is analysis, a To-Be process map could then
be created. To-Be flow charts were then developed
with the ERP implementation in mind to aid in the
To-Be map of the future business processes.
5 ERP DESIGN
Based on the analysis in the previous section and
discussion with the owner of the SME, the design of
an ERP for the business was developed to improve
the business processes as well as improve customer
satisfaction. The design included things such as
customer history, accounting tools, cost analysis
tools, human resource management and a system to
handle processes that will hopefully cut the delay
time for customers.
The up-front implementation of theses analysis
methodologies allowed for the ERP to be designed
and developed to address issues uncovered through
the analysis which included both internal processes
and their potential effects on customer satisfaction.
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This allows the ERP design to both address the
internal business process issues as well as addressing
the customer satisfaction issues simultaneously.
The customer satisfaction survey also provided
insight into internal issues that may not have
otherwise been picked up on without this type of
analysis such as:
1) The ERP design allows office staff to take a
customer’s query and at the same time record
the customer’s information and post all
correspondence to the ERP.
2) Appointments can now be organized within
the ERP. All this is done in an orderly fashion
and can be done quickly.
3) The ERP enables a customer work queue that
is automatically generated. The mechanic can
look at his workstation and see the request and
appointments for the day and can assess the
vehicle in real time.
4) After assessment, a note can be made in the
ERP system and the mechanic can move on to
assessing other vehicles in the queue. This
enables staff to give customers feedback on
the assessment of their vehicles immediately.
5) Quotes can also be generated and customers
can decide how they would like to proceed.
6) Deposits and/or payment through the ERP
with functionality to take many payment types
based on the customer`s preference.
7) Mechanics can work on vehicles and update
the ERP in real time so when customers make
a query, staff can provide updates to customers
in real-time. When situations change, staff can
also call or email customers with updates.
8) As soon as the vehicle is ready, the balance of
payment can be collected, the ERP updated,
and a survey sent to customer to measure
customer satisfaction. As customer
satisfaction is continually measured, a
continual improvement business process is
established through the ERP design.
9) Customer issues with the price may have been
caused by the office not doing a proper cost
analysis per job. The ERP system design has
an accounting module as well as a human
resource module attached that will enable
management to do cost analysis before
pricing. This includes monitoring expenses
and knowing the cost of goods sold before
generating any customer pricing.
10) The human resources module includes other
available staff such that as the work load rises,
additional man power can be utilized such that
the level of customer service is maintained.
8 CONCLUSION
Utilizing customer satisfaction analysis as a critical
success factor provides additional information that
shapes the resulting design of an ERP system. The
ERP is then designed to improve the internal business
processes in addition to addressing improvements in
customer satisfaction.
The ERP implementation in this paper was
intended to both improve the internal business
processes while simultaneously improve customer
satisfaction. This included addressing such things as
efficiency, speed, price, payment methods, real-time
status updates, marketing, and appointment
processing as well as maintaining a process for
continual improvement through ongoing customer
satisfaction input.
Analysis utilizing the Balanced Scorecard and
traditional Critical Success Factors can be important
for an ERP design. As an additional measure, a
customer satisfaction analysis provides both context
and further insight into the potential effectiveness of
an ERP design for improving an SME’s business.
Future research work will include the SME
utilizing the aforementioned ERP design for a year.
Following that period, another customer satisfaction
analysis will be done to gather data and try to
understand if the improvements in customer
satisfaction have been achieved. The management
and staff will also be surveyed to determine if the ERP
system has led to any significant improvement in their
business processes and customer satisfaction from
their unique perspective.
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