Factors affecting cloud-based enterprise resource planning software adoption in Ethiopia

Abstract

Enterprise Resource Planning (erp) are integrated software solutions that transform organizations’ internal processes, provide collaboration with partners, external applications and information systems. Extant literature reveals that organizations are showing interest to transit from an on-premise erp to the new cloud-based erp solutions due to their extra benefits. There are few recent initiatives in Ethiopia to adopt cloud-based erp but challenges faced in the course of the adoption are not explored. Using the technology-organization-environment, diffusion of innovation, and the model of innovation resistance frameworks as lenses, this research aims at identifying factors contributing to the adoption of cloud-based erp in the Ethiopian context. A quantitative approach is adopted and survey was conducted using a self-administered online questionnaire using Google’s online form to gather data from employees of Ethiopian Shipping and Logistics Services Enterprise. Out of 295 questionnaires distributed, 152 valid questionnaires were collected and considered for the data analysis. The proposed model was tested using a partial least square with the help of the Smart pls software. The proposed model explained 58.5 % of the variance in cloud-based ERP adoption factors. The empirical analysis indicated that Relative advantage, Trust, IT Skill, and External pressure had a significant influence on the adoption of cloud-based erp in Ethiopia whereas Organizational Culture, Observability, and Trialability had no significant impact on the adoption of cloud erp service. The study provides a comprehensive understanding of the factors which affect the adoption of cloud-based erp technology in Ethiopia.