Enterprise resource planning (ERP) systems as a technology of power: empowerment or panoptic control?

Reviewer: Jane Fedorowicz

This paper excels in two ways. First, it presents a very cogent and important explanation of the impacts of enterprise resource planning (ERP) on the people in organizations, even when such impacts were not anticipated. Second, it provides an insightful and in-depth view into a single organization, and does so through both qualitative and quantitative lenses. The authors studied the implementation of an ERP system in a Singapore hospital. The hospital's impetus for moving from an old, DOS-based administrative system to an ERP, in 1997, was the impending Y2K problem. In addition, a change in government-mandated reimbursement reporting methods required new financial data to be tracked for each admitted patient. Thus, the hospital's focus was on implementing a new system, and not necessarily on the new system's potential impact on business processes or organizational relationships. The study itself sought to examine the organizational impacts of the implementation across two potentially competing fronts. First, the authors proposed that ERP implementation would affect the empowerment of employees and management, enabled by increased information visibility, by increasing employees' job discretion (through greater cross-functional integration, and through expanded access to information), and by reducing procedural formality (by giving users more flexibility in using the system). Second, the authors anticipated the effects of panoptic control, which refers to the fact that users understand that others can track the quality, quantity, and timing of their work, resulting in increased self-imposed control over their own behavior. The data collection began seven months after the completion of the implementation. The authors interviewed 23 key informants in the qualitative phase of their study, followed by a survey of 206 system users. Results showed that panoptic control increased in the areas of system tracking capability, management visibility, and peer visibility. Significant empowerment increases were not noted, however. The discussion section proposes that a lack of planning for the organizational impact of the implementation enforced old business processes and job expectations, limiting the potential for empowerment. Better planning for job enhancement would have included changes in jobs, reporting structures, and reward systems, which in turn would have offset conservative management practices. The increased visibility arising from the ERP system enforced panoptic control, in part because the system worked well with current management structures, especially those resulting from the changes in newly imposed finance procedures. Overall, this study serves as an exemplar of field-based research into the impacts of technology implementation. It should be read by anyone who is involved in such a project. The paper provides good guidance in the study of second-order effects on the people who must use new systems. Online Computing Reviews Service