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Enterprise resource planning systems utilize both internal and external management
information (Hamilton, 2003). Utilizing such a system can improve productivity and efficiency.
However, in order to fully use the system processes must be codified. The codification of
processes eases input of processes when they need to be conducted. This in-turn saves on
efficiency when running the various processes. Because processes are performed effectively
using ERP systems, they also work to improve the overall competitiveness of the organization. If
a process can be performed faster than their competitors who perform the process by hand, they
the company that uses the ERP system will have significant competitive advantage.
While using an ERP system may work to give some competitiveness to the organization,
there is a risk of innovation limitation. I believe that this can be minimized by assigning a
committee to continually develop new products and technologies that will help the organization.
This committee will need to work with IT to determine system changes that will be required and
how to best implement the new innovations effectively.
If I were an ERP vendor selling my system, I would focus upon highlighting the various
functionalities of the system that would likely be utilized by the organization. Focus must be
placed upon the improvements in efficiency and productivity that can be realized with such a
system. This point of view is important to offset any worry about limitations on innovation
(Howlett, 2010). Specific focus should also be placed upon the organization and centralization of
information. By having all of this information in one place, it can provide a more accurate
picture of what is needed by consumers. This information can then be passed along to a research
and development team, which can move forward with innovating a new product or service. The
argument of centralized data is important in debunking the thoughts of limitations on innovation.
Organizations must realize the amount of time that would have been spent collecting the same
amount of data, and their inability to collect such thorough data without the utilization of an ERP

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