ERP System as an Enabler for Bottom up Innovations

This research adopts a resource-based approach to develop and test a new framework related to improvement in bottom up innovations by means of enterprise resource planning (ERP) systems. The framework consists of five primary resources: attitude, organisational characteristics, skills, ERP human resources, and ERP technological resources. Responses from 210 organisations that have adopted ERP were analysed using Structural Equation Modelling (SEM). Regarding organisational resources, the research results did not support the premise that an organisation’s characteristics (i.e. agility, or the innovation sponsorship) and attitude to technology have direct effects on organisational innovativeness. Rather, it was found that these relationships are fully mediated by the employees’ quantitative skills. Regarding technical resources, ERP Human resources, i.e. the ability to create business partnerships, and ERP technical resources, i.e. the customisability of reports, have significant impacts on organisational innovativeness. The main implication of this research is that ERP is not only a planning technology but also a driver of innovation when supported by the necessary organisational and technical resources.