The two critical aspects that slowed down Enterprise Resource Planning (ERP) implementation in the largest office furniture supplier company FurnitureCo in China were the inadequate support from the higher management and the cultural differences. In contrast to foreign ERP vendors’ the difficulty in Chinese market, is that China’s domestic ERP vendors expand their market share, showing capability to compete against their international competitors (Xue et al., p.280). The entry of the western culture into the Chinese market brought in many differences in comparison with the existing cultural differences in FurnitureCo. The Chinese business culture is shaped by paternalism, and high context communications, while the Western culture is centered with individualism, and formal communications (Xue et al., p.284).
FurnitureCo’s management was unsuccessful in implementing ERP due to the lack of support from the top management, as they could not understand the business model. Martinsons and Westwood (1997) suggest that as economic activity becomes more international, cross-cultural management issues become increasingly difficult to ignore. Most members of FurnitureCo’s management team received their higher education from the Western countries, and hence they tried to adopt to the western vendors that proved to be costly and could not be maintained (Xue et al., p.288). The company underwent many problems trying to match up with the huge discrepancies that were reported by the ERP system and the real-time demand.
FurnitureCo could not bear the maintenance cost of western ERP system and thus invested in the local ERP system that resulted in saving the costs to the company and was beneficial in communicating with the local consultants who followed the Chinese culture. Even with this change Martisons and Westwood (1997) suggest that the management systems of the Chinese are likely to reflect the inertia of their deeply-rooted values for many decades to come.
References
Martinsons, M. G., & Westwood, R. I. (1997). Management information systems in the Chinese
Business culture: An exploratory theory. Information & Management, 32.
Xue, Y., Liang, H., Boulton, & W.R., S. (2005). ERP implementation failures in China: Case
studies with implications for ERP vendors. Int. J. Production Economies.
