Communications of the IIMA


Enterprise Resource Planning (ERP) vendors have emphasized a positive impact of their ERP projects in enterprise performance and in costs reduction. Recently, some researchers have started to analyze the impact on business performance of the organizational changes that complement IT investments. However, there is a lack of research studies on ERP impact in Small and Medium Enterprises (SME). Based on Cobb-Douglas production function, this paper attempts to analyze the impact of ERP implementations in SMEs’ productivity. We have collected data from 168 Spanish SMEs during the period 1997-2005, concerning the type of purchased ERP, implementation period, number of employees and some financial indicators. We use a cross-sectional and time-series model to compare and analyze the SMEs’ productivity evolution, before and after ERP implementations considering SMEs size as a critical variable to determine the level of productivity reached. Our preliminary findings suggest that SMEs size moderates ERP impact in their productivity. Therefore, researchers and practitioners should not consider all SMEs in the same package and they should have different strategies and approaches to obtain the best results in each ERP implementation.