Professor questions ( think in researcher way not a practical way )
A problem statement is the heart of your thesis. It should reflect what you really want to do in the research. It should be a comprehensive description of the research – concise and precise.
As a research is a journey from curiosity to discovery – you should describe the journey well.
Start by describing your curisity on the issue and subject…. What is it that you are so curious to know the answer about the subject ?
Why is the topic so important and crucial ?…
What are the research gaps that exist in the literature on the subject ?
How do you propose to conduct the research to satisfy your curiosity ?
What do you think you will discover from the research that may break into a new knowledge ?
(Example)
problem Statement
While ERP software is increasingly being implemented in SME’s, many difficulties
are faced by researchers and managers in estimating potential benefits due to ERP
implementation. Such difficulties include conceptual difficulties in defining the construct
of benefits due to ERP, the long lead times for implementing ERP’s and then realizing
benefits. Furthermore, the platform nature of ERP which suggests that while base ERP
can provide an integration of internal systems, it may not provide benefits unless
customized and business specific add-on modules are implemented. Additionally, a
diversity of methods for measuring benefits of ERP all contribute to the difficulty of
measuring business benefits due to ERP investments.
For the purpose of this dissertation study, ERP would be defined as a large scale
system, which is cross-functionally integrated, packaged, allowing for interoperability,
capable to manage all enterprise’s data and deliver information based on such data, on
real time bases (Gefen and Ragowsky, 2005). ERP products in scope of this dissertation
study would include offerings by “SAP”, “Adage”, “BAAN”, “EPICOR”, “GEAC”,
Smartstream”, “Microsoft”, “Intentia International”, “JBA International”, “Lawson”,
“Oracle (JD Edwards, PeopleSoft)”, “QAD”, “ SSA”, and “SCT”.
Conceptual benefits in defining benefits in general IT context have been discussed
since the early research on productivity paradox in IT (Brynjolffson, 1993). Based on
prior work, Brynjolffson & Hitt (1996) suggest that while investments in IT have
increases dramatically among firms, statistical analyses did not suggest an improvement
in productivity – thus, the term productivity paradox. They distinguish between
productivity (measured as a ratio of outputs to inputs), profitability (measured using
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Return on Assets - ROA, Return on Equity – ROE, and Total shareholder return) and
value (measured as consumer surplus). Their argument can be illustrated using two firms,
Firm A and Firm B, in a competitive industry. When a new technology (such as ERP)
comes into the market, assume that Firm A invests in IT and improves productivity (e.g.,
produces more output per labor units) and use productivity improvements to achieve
strategic benefits such as increased sales, lower costs and increased profitability. Since
the technology is generic, Firm B can also implement the new technology and achieve
similar productivity improvements. If the market is competitive, neither of the firms can
translate productivity improvements into increased profitability since competition forces
prices to readjust to new levels. The consumers, however, will benefit since they can now
obtain the goods at lower prices than before – thus consumer surplus (defined as what a
consumer was willing to pay versus what he actually pays) can increase. This example
suggests that, IT can lead to an increased productivity but no increase in profitability for
firms, while increasing consumer surplus. Depending on how value of IT is defined (as
productivity, profitability, consumer surplus), one would expect to find different
predictions. In later work, Brynjolffson & Hitt (1998) show that complementary
investments (e.g., changes to business process, organizational changes etc.) are crucial to
receiving IT benefits. In summary, literature arising out of productivity paradox suggests
that value from IT needs to be defined carefully and that, complementary investments are
necessary for achieving higher returns and cost-effectiveness due to IT.
Investments such as ERP are known to take considerable time to implement and,
depending on the scale and complexity of a business, might take from three to five years
(Davenport, 2000; Nicolaou et al. 2004). Many authors argue that benefits accrue from
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ERP after the long implementation period and suggest measuring benefits after three
years. A conceptual issue with the long run horizon is that firms simultaneously engage
in many strategic activities (e.g., develop new products, enter new market segments etc.)
apart from ERP investments, and thus assigning benefit improvements to ERP versus
other investments becomes difficult.
Another aspect of ERP investments is the “platform” nature of ERP. Probably, the
first activity undertaken when planning an ERP implementation is to bring all the data in
the enterprise into a form that ERP can handle. The benefits of creating such an enterprise
level “logical view” of data has numerous benefits going far beyond single applications.
For example, add-on modules such as sales, production planning etc. all benefit from
having a logical view of enterprise data. Thus, investments such as ERP are better seen as
enabling “options” in future rather than specific, functional systems with limited scope
and impact.
Finally, a diversity of methods, drawing from different theories, informed prior
work on assessing benefits due to ERP. A subset of methods is based on the notion of
efficient markets theory in finance and justifies the use of event studies and related
methods (such as Tobin’s Q) for judging the impact of ERP investments. Another set of
methods uses the neoclassical view of the firms in economics as the basis and abstracts
the firm as a production function; the total factor productivity (TFP) models are then
estimated on data. A third set of models simply uses financial ratios reported in annual
financial statements as proxies for various measures of productivity and profitability.
Finally, a large amount of prior research uses models developed in strategy literature as
the basis of abstraction for a firm (e.g., Porter’s value chain) – such models use a
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combination of survey data (e.g., manager’s attitudes regarding value) as well as financial
ratios. Overall, different conceptualizations of the firm and different methodologies seem
to be used in prior research.
Overall, the current literature uses different notions of value, ignores the long run
versus short run issues in measurement, and the fundamentally “platform” and option
creating nature of ERP-type investments. Furthermore, current literature mixes and
matches several conceptualizations of firm and market in the study of ERP’s role in firm
value. This makes it extremely difficult to generalize the published findings across
published research on ERP benefits
Sample Solution