Enterprise resource planning systems change organization structures

Integrating business and information system know-how is essential

Päivi Tossavainen, M.Sc. (Econ), will defend her PhD dissertation at the Helsinki School of Economics (HSE) on Thursday, June 16th 2005. The dissertation is entitled “Transformation of organizational structures in a multinational enterprise. The case of enterprise resource planning utilization” and is in the field of International Business. The public defense will start at 12:00 in the auditorium of the main building (address Runeberginkatu 12-14). The opponent is Professor Marjatta Maula (Tampere University of Technology) and the custos is Professor Hannu Seristö (HSE).

In her PhD research, Päivi Tossavainen examines what kind of challenges a multinational enterprise (MNE) faces when it constitutes a large number of business entities and actors, is geographically dispersed, and when both information systems and business activities require constant development. The study focuses on enterprise resource planning systems (ERP) that have become popular for integrating operational data and for supporting operations and logistic business processes globally.

For a globally operating MNE, the use of the ERP system in a long-term perspective is important. The main thesis of the dissertation is that enabling long-term ERP use requires fundamental changes in the structure and governance of the implementing organization.

The findings of the research suggest that to enable successful long-term use of the ERP system, corporations should focus on novel organizational development, and its structures, roles, and organizational capabilities. It is essential to integrate the business domain with the IT domain, i.e. business and information system knowledge, because ERP implementation should be business-driven. The organizational capabilities include self-organizing.

In her study, Tossavainen examined the challenges and identifies a transformation trajectory and new roles for the organization. The conceptual model created suggests the main elements that can explain the success of ERPs from the organizational perspective.

The present research examined through a longitudinal in-depth analysis of a single case study. The case company is Nokia Corporation.