Challenges of enterprise resource planning (ERP) implementation in agriculture

Abstract

The underlying assumption of the study is that ERP systems can crucially facilitate information exchange; yet, the agricultural sector is slow in their adoption due to different reasons, including a shortage of skilled personnel as well as a lack of knowledge about ERP capabilities among top managers and key employees. The study intends to identify challenges and prospects for ERP implementation in agriculture. The applied methods include the analysis of WoS publications and questionnaire surveys of executives of 55 companies operating in the Middle Urals’ agricultural sector. ERP systems can be defined as comprehensive software solutions aimed to integrate business and management processes through a holistic approach and a single information system. According to expert estimates, in today’s Russia the projects related to the agro-industrial sector account for 1-2% to 10-15% of the projects from the leading ERP vendors, including 1C, Bars Group, and Navigator-Agro. ERP systems in agriculture help improve business performance, reduce and monitor costs. These systems are effective in decision-making and can serve as the basis for precision agriculture. The main barriers are poor personnel skills and competencies, shortage of funds for ERP adoption, poorly developed or absent infrastructure, difficulties of fitting and adapting of ERP systems to agricultural business. In addition, agricultural business owners show no confidence in high-tech solutions and poor knowledge of the above systems. Other problems include operation complexity and insufficient government support in ERP implementation. The results of the study can be used by government authorities in their programs for innovative development and technical upgrading of the agriculture industry. © 2020 by author(s) and VsI Entrepreneurship and Sustainability Center.