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In this white paper, we measure how end users of Enterprise Resource Planning (ERP) applications describe the impact of Microsoft and SAP applications on their business productivity. This research found that Microsoft Dynamics end users on average rated their experience with Microsoft applications more favorably than SAP users rated their experience with SAP. These findings are based on a business productivity measurement framework developed by Keystone Strategy, working under the direction of Dr. Marco Iansiti, the David Sarnoff Professor of Business Administration at the Harvard Business School, and sponsored by Microsoft.
Background
Keystone's research fits within the context of several recent studies exploring the impact of software applications business productivity, beyond traditional measures such as the level of information technology (IT) investment or feature/function comparisons.
A study from AMR Research finds that only 15% of employees are licensed to use their company's ERP system and furthermore that 46% of licensed ERP seats go unused. Logical follow-on questions to these findings include: How can an application have a deep impact on productivity at a access to the system? Why would an investment in a tool as powerful as an ERP system and with such potential to boost business performance be limited to such a small set of employees? Of the already limited number of licenses purchased, why do nearly half go unused?
In a separate study, Forrester concludes that "poorly designed user interfaces can profoundly affect the bottom line. The expenses associated with a bad UI, over the course of the application's lifetime, may end up being many times the cost of the application itself." The report continues on to explain the costly implications of a bad UI, including increased new user training times, a decrease in productivity, and poor user adoption.
Against the background provided by AMR and Forrester, Keystone Strategy has initiated a broader research program to analyze the interrelationships between IT and business productivity. Previously, Keystone has found that firms with the highest deployed IT capabilities in their peer groups have been best able to profitably grow revenues. This finding has been true of both enterprise and midsized businesses.
In this white paper, we extend our previous research to investigate how enterprise applications, such as ERP systems, affect business performance - in particular end-user productivity. We believe this approach yields particular insight. If IT leads to more profitable sales growth as we have found, which factors drive the productivity of individual users? Which applications are most satisfying to users? And, which applications hold the potential to be more utilized, benefiting the firm's scalability? In short, what is behind the end user's experience with applications they use, and how do those interactions positively or negatively impact business productivity?
To answer these and other related questions, we evaluate the extent to which end users of ERP applications in production environments feel software makes them productive in ways relevant to them in their day-to-day responsibilities. Does the software help users with the tasks they do every day in a way that is intuitive to them? Does, for example, a warehouse manager feel like this ERP application was designed by a warehouse manager, for a warehouse manager? Is critical business information readily and broadly available to all employees who will benefit from it? Through this research, we argue that end-user productivity is based on multiple dimensions, all of which are fundamental to maximizing the potential of the investment in IT systems.
Business Productivity Framework
Measuring the impact of applications on ERP end-user productivity is a complex undertaking because of the wide range of business functions, vertical industry requirements, and user types who interact with such systems. In this study, we developed a business productivity framework to measure how ERP end users feel Microsoft and SAP applications impact their personal productivity.
The framework was developed by leveraging a combination of industry standard usability tests and exhaustive research into the roles and responsibilities of end users across Sales & Marketing, Finance and Operations department areas. Usability tests such as the Software Usability Measurement Inventory (SUMI) were evaluated to identify typical factors impacting application usability and end-user business productivity.
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