Journal of Engineering and Applied Sciences

Year: 2016
Volume: 11
Issue: 10
Page No. 2298 - 2303

Effects of the Enterprise Resource Planning (ERP) on Competitive Advantage and Performance of Manufacturing Firms in Indonesia

Authors : Rachmad Hidayat and Sabarudin Akhmad

Abstract: The purpose of the present study was to analyze a model of the factors affectingthe company’s performance, affected by the manufacturing firm’s ERP implementation and competitive advantages in Indonesia. Data were tested and analyzed using Structural Equation Modeling (SEM). Population was manufacturing firmsin five major cities of Jakarta, Bandung, Semarang, Surabaya and Balikpapan. Total sample was 250 manufacturing firms. Results showed that the manufacturing firm’s ERP implementation positively affected competitive advantage (differentiation strategy and low-cost strategy). ERP provided an integrated system that supplied information rapidly and improved efficiency of the administration system of the companies. The companie’s ERP implementationhad no direct effect on their performance but it hada significant effect through the intervening variables, differentiation strategy and low-cost strategy. The ERP implementation was incapable of leading to new product innovations for the manufacturing firms in Indonesia. The ERP system was only used to support the administrative system of integrated companies.

How to cite this article:

Rachmad Hidayat and Sabarudin Akhmad, 2016. Effects of the Enterprise Resource Planning (ERP) on Competitive Advantage and Performance of Manufacturing Firms in Indonesia. Journal of Engineering and Applied Sciences, 11: 2298-2303.

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