A Process Model for ERP Upgrade and Replacement Decisions

Abstract Background: This paper aims to develop an effective decision making (DM) process for ERP change or replacement. ERP in most organizations constitutes a key critical system of high complexity with many stakeholders. A major change activity for such a system therefore exposes an organization to great risks, and thus should be well organized. Method: A design science approach was chosen for this research. Based on a review of related literature and evidence of the DM process at different companies, a general process of DM for ERP upgrade was designed, and later evaluated and improved through a case study approach. Results: The decision process assumes a model with variables describing characteristics and performance of possible alternatives, and the decision is decomposed into steps with three loops that are executed iteratively. We believe that the findings and approach can be useful both for the immediate problem context and also for other IT-related DM problems. Conclusions: The main outcome is the new process of DM that includes several novel contributions: three main loops of DM, multiple repetition of loops, and possible returns to the starting point.