Technology factors and ERP system efficiency in the Jordanian industrial firms: does company size matter?

Organizations today face numerous challenges, including the rapid evolution of information and communication technology (ICT), globalization, and heightened competition. To overcome these challenges and ensure success, many firms are adopting Enterprise Resource Planning (ERP) systems. ERP systems are integrated software solutions designed to streamline various business processes, reduce costs, and improve communication. However, successful ERP implementation requires careful consideration of several factors. This study focuses on the impact of technological factors, such as ease of use, perceived usefulness, trust, and digital proficiency, on ERP system efficiency in Jordanian industrial firms. It also examines company size as a potential moderator of these relationships. The Jordanian industrial sector presents a particularly relevant context due to its ongoing efforts to modernize and improve operational efficiency. Understanding the role of technological factors in ERP success is crucial for the development of effective strategies for improving the performance of these firms and strengthening the Jordanian economy. The study's novelty lies in its specific focus on technological factors within the context of a developing economy, a frequently overlooked area in existing research.

The literature review extensively examines existing research on ERP system efficiency and the factors influencing its adoption and effectiveness. It highlights the limited research specifically focusing on technological factors and the impact of company size in developing economies. The review also explores relevant theories, such as the Diffusion of Innovation (DOI) theory, and its application to understanding technology adoption in organizational settings. This framework guided the development of hypotheses regarding the relationships between technological factors (ease of use, trust, perceived usefulness, digital proficiency), company size, and ERP system efficiency. The literature review underscores the gap in knowledge about the interplay of these factors, particularly in the context of Jordanian industrial firms, justifying the need for this empirical study.

This study employed a descriptive-analytical approach to investigate the impact of technological factors on ERP system efficiency in Jordanian industrial firms. The population consisted of all 55 Jordanian industrial firms listed on the Amman Stock Exchange. A sample of 92 valid questionnaires was collected from managers within these firms, with an average of four questionnaires per company. The response rate was 42%. The questionnaire measured ERP system efficiency (dependent variable), technological factors (ease of use, trust, perceived usefulness, digital proficiency – independent variables), and company size (moderator variable, measured as the logarithm of total assets). Data analysis involved descriptive statistics, simple linear regression, and hierarchical regression analysis using SPSS 25. The study's methodology rigorously employed validated measurement scales from prior research to ensure reliability and validity. The sample size, while relatively small due to the limited population of listed firms, was deemed sufficient for statistical analysis given the nature of the research questions. The demographic profile of the respondents (Table 1) showed a significant proportion in the 41-50 age group, predominantly holding bachelor's or master's degrees, with extensive work experience.

The study's multiple linear regression analysis revealed significant and positive relationships between ease of use, perceived usefulness, and digital proficiency, and ERP system efficiency. However, trust did not significantly influence ERP efficiency. The hierarchical regression analysis further indicated that company size positively moderated the relationship between perceived usefulness, digital proficiency, and ERP system efficiency. These findings suggest that larger firms benefit more from improved perceived usefulness and digital proficiency in terms of achieving higher ERP system efficiency. The R-squared value of 0.329 in the multiple linear regression indicated that the examined technological factors explained 32.9% of the variance in ERP system efficiency. This leaves a substantial portion (67.1%) unexplained, highlighting the potential influence of other factors not included in this study. The hierarchical regression, which incorporated company size as a moderator, showed a significantly higher R-squared value of 0.526, indicating that the model's explanatory power was substantially improved by the inclusion of the moderator variable. The results related to the sub-hypotheses regarding the moderating effect of company size on each technology factor independently are presented in detail in Tables 5-8. While the moderating effect of company size was significant for perceived usefulness and digital proficiency, it was not significant for ease of use or trust.

The findings largely support the hypotheses, demonstrating a significant link between technological factors and ERP system efficiency in Jordanian industrial firms. The positive relationship between ease of use, perceived usefulness, and digital proficiency and ERP efficiency aligns with expectations based on the technology acceptance model and other related theories. The lack of significant influence of trust might be due to factors like robust security measures already in place or the dominance of technical considerations over interpersonal trust in the industrial sector. The moderating role of company size highlights the importance of resource availability and scale in maximizing the benefits of ERP investments. Larger firms, with more resources for training and customization, are likely to experience more substantial improvements in efficiency due to enhanced perceived usefulness and digital proficiency. The study contributes to the literature by offering empirical evidence on the impact of technological factors on ERP system efficiency in a developing country context, providing valuable insights for practitioners and policymakers.

This study provides valuable insights into the factors influencing ERP system efficiency in Jordanian industrial firms. The findings highlight the importance of ease of use, perceived usefulness, and digital proficiency, while suggesting that trust may be less crucial in this specific context. The moderating role of company size underscores the need for tailored strategies to maximize ERP benefits based on firm size. Future research could explore other factors influencing ERP efficiency, expand the geographical scope, investigate the impact of ERP systems on financial performance, and incorporate additional control variables to enhance the robustness of the findings. The study's contribution lies in its unique focus on technological factors in a developing country context, enriching the body of knowledge related to ERP system implementation and effectiveness.

The study's limitations include its focus solely on technological factors, the use of data from Jordanian industrial firms only, the nascent stage of ERP system adoption in Jordan, and the lack of control variables. The relatively small sample size due to the limited population of listed firms is also a limitation. These factors could affect the generalizability of the findings and warrant further research incorporating broader contexts and additional variables. The reliance on self-reported data from questionnaires also introduces potential biases that should be considered when interpreting the results.