FIRM OPERATIONAL PERFORMANCE AND ERP USAGE: ROLE OF INTERNAL/EXTERNAL, INDIVIDUAL AND ERP FACTORS

Abstract

In the rapidly evolving landscape of modern technology, the convergence of diverse technological advancements is reshaping how ERP systems function and perform. This transformation aims to bolster the utilization of ERP systems, ultimately leading to improved organizational performance. Despite these developments, limited insights are available regarding the factors that both foster ERP system usage and impede organizational performance. Consequently, the present study strives to gain a deeper comprehension of the determinants influencing ERP system utilization, consequently contributing to organizational advancement. Specifically, the study seeks to explore how ERP system usage acts as a mediator within the framework of internal and external factors, individual characteristics, ERP-specific elements, and overall organizational performance. To achieve this objective, survey questionnaires were administered to employees within Saudi Arabian companies, utilizing the convenience sampling technique. The subsequent analysis was conducted using Structural Equation Modelling (SEM) through Amos-16. The study's outcomes highlight the significance of User Support, Top Management Support, IT Expert/Consultant Support, Computer self-efficacy, and Communication Effectiveness in driving increased ERP system utilization, thereby fostering organizational performance enhancement. The outcomes of this study enrich the existing knowledge base by deepening researchers' comprehension of the various elements that impact both ERP utilization and overall firm performance. Furthermore, the study's findings provide valuable insights for industry practitioners, enabling them to strategically incorporate these factors to optimize ERP usage and consequently enhance firm performance. Notably, the examination of these interrelationships among variables, particularly within the context of Saudi Arabian organizations, remains a relatively underexplored area within the current body of research, based on the researchers' available information.