Real Options and Subsequent Technology Adoption: An ERP System Perspective

An Enterprise Resource Planning (ERP) system has been identified as having option-like characteristics making such systems unique and different from many Information Systems (IS) technologies. Given the growing need to extend ERP systems beyond the boundaries of an ERP implementing organization, there is need to explore how an ERP system as an IS platform technology, can enable the subsequent adoption of other function-specific applications. Using insights from real options theory, this study proposes a conceptual framework that views ERP adoption as a technology positioning investment with options at each stage of the decision making process. Specifically, in a post-ERP implementation, the study proposed that organizational factors such as managerial flexibility, technical resources and level of technological uncertainty, affect the organizational ease of use of subsequent technology which in turn influences ERP-enabled adoption.