Es And Empowerment Elmes Strong Volkoff


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Es And Empowerment Elmes Strong Volkoff

  1. 1. INFORMATION AND ORGANIZATION Information and Organization 15 (2005) 1–37 Panoptic empowerment and reflective conformity in enterprise systems-enabled organizations Michael B. Elmes *, Diane M. Strong, Olga Volkoff Department of Management, Worcester Polytechnic Institute, Worcester, MA 01609, US Received 18 August 2003; received in revised form 22 August 2004; accepted 9 December 2004 Abstract In this study of enterprise system (ES) use at a global manufacturing organization, we have taken an interpretive perspective and used a Glaserian grounded theory methodology to explore the ES-enabled changes in organizational control that emerged after system implemen- tation. From our field data we identified two seemingly contradictory theoretical concepts: panoptic empowerment and reflective conformity. Panoptic empowerment refers to the greater visibility of information provided by the common shared database of an ES that empowers workers to do their work more efficiently and effectively, but which also makes them more vis- ible to others throughout the organization who can then more easily exercise process and out- come control. Reflective conformity describes how the integrated nature of the ES with its embedded rules and procedures for organizational processes leads to greater employee disci- pline while simultaneously requiring them to be highly reflective as well in order to achieve organizational benefits from the ES. These concepts embody an understanding of organiza- tional control that is rooted in a Foucauldian view of disciplinary power rather than a tradi- tional perspective of mechanistic bureaucracy. Ó 2004 Elsevier Ltd. All rights reserved. Keywords: ERP systems; Enterprise systems; Control; Empowerment; Panopticon; Discipline * Corresponding author. E-mail addresses: (M.B. Elmes), (D.M. Strong), ovolkoff@ (O. Volkoff). 1471-7721/$ - see front matter Ó 2004 Elsevier Ltd. All rights reserved. doi:10.1016/j.infoandorg.2004.12.001
  2. 2. 2 M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 1. Introduction Enterprise systems (ESÕs) have become increasingly popular over the last 15 years. Produced by companies such as SAP, Oracle, and PeopleSoft, enterprise systems are commercial software applications that support and integrate organizational pro- cesses across functional boundaries. They are designed to replace disparate, local leg- acy systems and to support a full range of business functions from finance and accounting, inventory management, and sales order processing to HR and payroll, warehouse management and production planning. The salient and identifying char- acteristic of ES is their ability to integrate these business processes by standardizing data, storing them in a common, shared database, and ensuring that these data are accessible to whoever needs them on a real time basis (Davenport, 1998; Klaus, Rosemann, & Gable, 2000; Shanks & Seddon, 2000). Known also as enterprise resource planning systems (ERP), ESÕs have evolved from their roots as transactional systems supporting back office functions such as inventory management and sales order processing, to enterprise-wide systems that encompass a broad range of organizational and inter-organizational functions from customer service to supply chain optimization (Davenport, 2000). By 2002, 67% of all companies and 74% of manufacturing companies were using or implementing some form of ES, and 15% of the remainder were intending to do the same (Scott & Shepherd, 2002). This pervasiveness, coupled with the integrated and organiza- tion-wide and even inter-organizational reach of such systems, as compared to the localized domain of their predecessors, heightens the need for understanding the organizational implications associated with using them. Organizations purchase enterprise systems for a variety of reasons, both technical and organizational. Expected benefits include improved efficiency, reduced costs, better decision making, increased customer responsiveness, better performance con- trol, and increased data visibility (Besson & Rowe, 2001; Markus, Axline, Petrie, & Tanis, 2000; Ross & Vitale, 2000; Shang & Seddon, 2000). At the heart of many of the intended organizational impacts lies a desire to create rationalized and efficient processes with predictable outcomes. Increased rationality lies at the heart of the traditional bureaucratic hierarchy (Blau & Meyer, 1971; Weber, 1947), and in many ways ESs are structured to sup- port bureaucratic control. For example, the software promotes organizational dis- cipline both through constraining users to follow prescribed processes and by limiting access to transactions to specific organizational roles. This mirrors bureau- cratic features such as the application of consistent rules to operations and a clear- cut division of labor with specialized experts in each position. At the same time an ES provides visibility of data, which goes beyond the characteristics of a hierarchi- cal bureaucracy, but which is the cornerstone of FoucaultÕs (1977) views on disci- plinary power and control. Foucault suggests that because employees know that their actions are more visible to others, they will engage in greater self-discipline and act in ways that are aligned with a rationalized system. One objective of this paper is to discover how enterprise systems are used in the exercise of management control.
  3. 3. M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 3 The rhetoric around enterprise systems is not, however, limited to the enhance- ment of organizational control and discipline. Somewhat paradoxically, organiza- tions purchasing such systems also expect that the increased visibility of data will empower employees, enabling them to be more responsive to customers (Ross & Vi- tale, 2000) and each other, and increase their autonomy, morale, and satisfaction (Shang & Seddon, 2000). The prospect of increasing empowerment through ES seems unlikely, however, if an ES increases both bureaucratic and disciplinary (Fou- cauldian) control. A second objective of this paper is to explore this apparent contradiction. Our three-year grounded theory study of the organizational consequences expe- rienced during and after an ES implementation allowed us to explore the extent to which these broad and potentially contradictory expectations of ES purchasers and/or the claims of vendors are realizable. As our theoretical understanding of the control mechanisms that are employed in an ES-supported organization emerged from the data, we compared them to traditional views on management control. We found that while new mechanistic and rationalizing mechanisms are enabled by an ES, consistent with the tenets of an ideal bureaucracy, its integrated nature interferes with the realization of completely rationalized efficiency. In addi- tion, workers are indeed empowered, but in a way that is strongly constrained. In particular, the ‘‘gaze’’ enabled by an ES has significant differences from what Fou- cault (1977) described, leading to a complex web of power/empowerment. Further- more, the integrated nature of an ES requires increased reflection on tasks, even though organizational procedures that are embedded in software routines require greater conformity and discipline. Below we consider these seeming contradictions by first examining the literature on control, empowerment, Foucault, and enter- prise systems. 2. Background literature 2.1. Control in a rationalized organization Methods of organizational control are essential for influencing whether and how managers and workers engage in instrumental rational action to achieve institutional objectives. In the literature on organizational control, one standard definition is ‘‘at- tempts by the organization to increase the probability that individuals will behave in ways that will lead to the attainment of organizational objectives’’ (Flamholtz, Das, & Tsui, 1985). This definition assumes that organizations have objectives, and that individuals working in organizations are purposeful and goal seeking, but that their goals may differ from the ideal state. Thus, from a managerial control perspective, controls are needed to engage workers in instrumental rational action that is aligned with the firmÕs objectives. The origins of current approaches to organizational control lie in WeberÕs (1947) delineation of the core elements of an ideal bureaucracy (Beniger, 1986; Child, 1972). The defining features Weber identified include the division of labor
  4. 4. 4 M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 into fixed and official jurisdictional areas, office holding as a vocation based on specialized training, a hierarchy of offices with both accountability to superiors and authority to give commands to subordinates on matters within the jurisdiction of the office, and the impersonal and objective application of a consistent system of abstract rules. Combined, these characteristics enable organizations to conduct business according to calculable rules and to decrease the importance of individual action. These characteristics of bureaucracy enable the exercise of process (also called behavioral) control. Process control uses devices such as operating manuals, standard operating procedures and reporting structures to specify and monitor acceptable behaviors directly. The purpose of process control is to control the behaviors of employees as they work by overseeing how tasks are executed and more generally, to structure the process of transforming inputs into outputs (Snell, 1992). While process controls are relatively effective in mechanistic organizations operat- ing in stable environments (Burns & Stalker, 1961), attempts to define rules and pro- cedures becomes more difficult as task uncertainty increases. In an unstable environment it is more efficient to allow workers greater discretion (Galbraith, 1973). To maintain alignment with organizational goals, two alternatives to process control are available. Outcome controls focus on performance outcomes and finan- cial measures. The central attribute of outcome controls is that at the end of either a set period of time or a specific set of activities, a measurable objective is supposed to be attained; control is exercised by comparing actual to expected performance (Eisenhardt, 1985; Ouchi & Maguire, 1975; Snell, 1992). Informal/internal controls use various forms of socialization to promote the inter- nalization of values, beliefs, and behavioral scripts that align employee objectives and behaviors with the objectives of the organization. Informal/internal controls mentioned in the literature include clan controls (Ouchi, 1979) and self-control or self-management (Manz & Sims, 1980; Mills, 1983). Clan controls (Ouchi, 1979) in- clude socialization processes designed to ensure that the right individuals are selected and properly socialized into the values, beliefs and goals of the firm; they ‘‘appeal to the shared values and the sense of belonging to align workplace behaviors’’ with organizational objectives (Tang, Sia, Soh, & Boh, 2000, p. 504). Clan control as- sumes that with sufficient socialization, individuals will act in the best interests of the organization without explicit outcome or process controls. Self-control, also called self-management or self-regulation, is defined as ‘‘the extent to which an indi- vidual exercises freedom or autonomy to determine both what actions are required and how to execute these activities’’ (Henderson & Lee, 1992; Manz & Sims, 1980; Mills, 1983). Studies of the conditions under which each form of control is most effective have generally confirmed OuchiÕs framework (1977, 1979). Specifically, use of controls de- pends on (1) whether performance objectives are well-defined and measurable (if so, outcome controls are effective) and (2) whether behaviors are observable and the relationship between behaviors and process outcomes are well-understood (if so, process controls are effective) (Snell, 1992). If neither, then organizations may use some form of informal or internal controls. While outcome and process control
  5. 5. M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 5 are considered to be better forms of control because they can be well-designed formal systems of control consistent with rational objectives and thinking, organizations sel- dom rely on only one mode of control; they use all together or some combination to achieve organizational effectiveness (Ouchi, 1979). Informal controls are typically part of an organizationÕs portfolio of control methods (Kirsch, 1997). Orlikowski (1991) notes that training and socialization served to support the formal process con- trols embedded in CASE tools. The three modes of organizational control described above - outcome, process, and informal/internal – are not the only way to conceptualize control. For example, Henderson and LeeÕs (1992) study of IT development teams includes team control and OrlikowskiÕs (1991) study of CASE tools defines control in terms of whether the mechanisms through which control is exercised are external or internal to the organization. In our study we use traditional modes and definitions of control so that we can distinguish how ES enable and inhibit control of outcomes, control of processes, and the exercise of clan control and self-control. 2.2. Empowerment in a rationalized organization Empowerment has been defined as ‘‘power sharing, the delegation of power or authority to subordinates in the organization’’ (Daft, 2002, p. 411) and the ‘‘use of voice to provide active participation and commitment to organizational members’’ (Putnam, Phillips, & Chapman, 1996). Conger and Kanungo (1988) have conceptual- ized empowerment as both a relational construct based on superior-subordinate authority sharing and a motivational construct that satisfies an individualÕs desire for self-determination and self-efficacy. By giving subordinates greater information and authority to address organizational issues quickly and autonomously, efforts to empower workers have been framed as an antidote to the adverse effects – e.g., over- specialization, lack of motivation, competition among functional groups, customer dissatisfaction – of highly rationalized systems and structures in modern bureaucracies (Bandura, 1986; Nielson, 1986). In this paper, we define empowerment as any increase in worker power (through, for example, increased formal authority or greater access to more useful informa- tion) that enables workers (and, collectively, the organization) to achieve institu- tional objectives with greater efficiency and effectiveness. By greater efficiency we mean with reduced costs and in less time. By greater effectiveness we mean with bet- ter quality and higher levels of customer satisfaction. By redistributing power in ways that enable workers to achieve institutional objectives more efficiently and effectively, empowerment serves to rationalize work processes but in a way that is different from WeberÕs ideal bureaucracy. Unlike various forms of control that serve to rationalize through, for example, the measurement of outcomes, the monitoring of processes, or socialization into a particular set of values, empowerment rational- izes the system by both removing or minimizing organizational barriers and giving workers the means (e.g., information, power, authority) by which they can achieve institutional objectives more efficiently and effectively.
  6. 6. 6 M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 2.3. Foucauldian views of the panopticon and disciplinary power The literature on understanding IT effects in organizations and on workers has cited two concepts from Foucault: (1) panopticism (e.g., Sayer & Harvey, 1998; Sia, Neo, & Tan, 2003; Zuboff, 1988) and (2) disciplinary power (e.g., Orlikowski, 1991; Robey & Boudreau, 1999). These concepts are key for understanding the ways in which an ES enables organizational changes beyond those that strengthen existing forms of managerial control. Panopticism is based on BenthamÕs panopticon, an architectural structure with a central tower for observation and cells around the central tower for individual pris- oners (Foucault, 1977). It involves ‘‘the gaze’’, continuous surveillance that is hier- archical (the observers can observe the prisoners and can themselves be observed by their superiors) and one-way (the prisoners cannot see the observer, cannot see each other, and cannot know whether they are being observed). A key point of the panopticon structure is that the gaze need not actually be continuous – prisoners begin to act as if they are being observed because they cannot tell when or whether they are being observed. While the panopticon was proposed as an ideal structure for observing prison inmates and thus exercising control over their behaviors, Foucault discussed it and other arrangements of space to explain the same phenomenon – the gaze – in schools, in hospitals, in the military, and in the workplace (Foucault, 1977, pp. 141–149). Disciplinary power increases as a result of the gaze. As individuals become accus- tomed to the gaze, i.e., as they are continuously observed by parents, teachers, super- visors, military commanders and police, they learn to exercise self-discipline, i.e., to act as though they are under the gaze even when they may not be. As Foucault (1977) noted, once there is some form of panoptic observation, there is no need to observe continuously because disciplinary self-control will be exercised. By applying the panopticon concept to IT, Zuboff (1988) proposed the concept of an ‘‘information panopticon’’ in which IT rather than a physical structure provided the gaze. More recently, Sia et al. (2003) suggested that the panopticon lens, still only infrequently employed in studying IT-enabled control and empowerment in organi- zations, would produce a better understanding of current contradictory results on the impact of ES implementation in organizations. Enterprise systems with their integrated common database provide a much better approximation to the ideal information panopticon than the earlier technologies from which the concept was developed. An ES employs a gaze because it records all user actions, which can be observed in real-time and also stored for later observation. Thus, with no extra effort ES surveillance is essentially continuous. In addition to the panopticon and disciplinary power from the gaze, FoucaultÕs concepts about power and their relationship to individual actions, governance, knowledge, and truth are helpful in understanding the emerging control and empow- erment effects of ES in organizations. First, power is a relational concept that ‘‘exists only when it is put into action’’; ‘‘the exercise of power . . . is a way in which certain actions modify others’’ (Foucault, 1983, p. 219). Power can only be exercised over free subjects. If subjects do not have the freedom to choose actions, then by defini-
  7. 7. M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 7 tion there can be no exercise of power to influence those actions (Foucault, 1983). Power is exercised, that is power relations come into being, through many means including complex controls and systems of surveillance (Foucault, 1983). Thus, power is not a thing possessed by individuals, groups, or organizations, but actions taken at the local level governed by local rules that can affect the actions of others. As such, the traditional concept of empowerment as the delegation of power, i.e., authority and resources such as information, from managers to workers is problem- atic since power is not a thing that can be transferred between individuals (Hardy & Leiba-OÕSullivan, 1998). Second, the concept of power as actions that affect othersÕ actions is related to the concept of governance, which Foucault defines as structuring the possible actions of others (Foucault, 1983). ‘‘The exercise of power consists of guiding the possibility of conduct and putting in order the possible outcome’’ (Foucault, 1983, p. 221), which has similarities to conventional process and outcome controls exercised by managers. But FoucaultÕs analysis is at the level of society, rather than an organization. From his historical analysis, he sees that power in society has moved from a sovereign king as the source of power to power embedded in the operation of the state, which ap- plies to everyone, even those with authority over others. Power is exercised through surveillance, that is, the gaze, such that each individual exercises surveillance and dis- ciplinary power over themselves (Foucault, 1980a). This connection to governance helps us understand how the nature of organizational control changes in the presence of the continuous gaze of an ES. Third, there is a close relationship between knowledge and power. The knowledge that they are being observed is what generates disciplinary power in individuals in the form of self-discipline. In addition, the knowledge gained from surveillance gives observers power over the observed. Thus, knowledge and power are intertwined as knowledge produces power and power produces knowledge (Foucault, 1980b). Knowledge as a source of power is important for understanding how employees are empowered through their use of an ES. Finally, truth and power are related through ‘‘regimes of truth’’, which are the rules negotiated at local levels according to which truth and falsehood are distin- guished and power becomes associated with truth (Foucault, 1980b). Each society has its regime of truth, e.g., centered on the scientific production of knowledge and truth, which determines the types of discourse that are accepted as truth (Fou- cault, 1980b). At an organizational level, the installation of an ES may change the organizationÕs ‘‘regime of truth’’, for example by privileging discipline and control over clever and creative responses to problems. 2.4. Enterprise systems Early research on ES focused on this new IT artifact itself and how it differed from the legacy systems it was replacing (Klaus et al., 2000). This led to an under- standing of why organizations adopted ES, finding that organizations are motivated to purchase such systems because, among other benefits, they expect enhanced infor- mation capture, increased transparency and better information flow (Bernroider &
  8. 8. 8 M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 Koch, 1999; Besson & Rowe, 2001; Markus & Tanis, 2000; Newell, Huang, Galliers, & Pan, 2003; Ross & Vitale, 2000). As ES implementation challenges became apparent, a significant portion of ES re- search turned to investigating the factors contributing to successful implementation (e.g., Akkermans & van Helden, 2002; Brown & Vessey, 2003; Holland & Light, 1999; Hong & Kim, 2002; Scott & Vessey, 2002) because, without successful imple- mentation, organizations incurred enormous costs while failing to achieve the ex- pected benefits. These studies typically examined findings from conducting case studies of successful and unsuccessful implementations. While some critical success factors are typical of any large-scale IT implementation, e.g., top management sup- port, others arise from the integrated nature of an ES. For example, research studies found that impediments (Pan, Newell, Huang, & Cheung, 2001) and tensions (Strong & Volkoff, 2004) arose as groups within organizations attempted to agree upon the common processes and data elements that form an integrated system. As these groups negotiated these commonalities, some were able to exert more power and control over their future than others (Scott & Wagner, 2003). As various ES implementation process issues emerged in these cases studies, re- search began to focus more explicitly on specific problematic issues and on under- standing the implementation process over time. One such emerging issue is the difficulty of organizational learning and knowledge transfer as employees attempted to learn and use an ES effectively in their organizations (Lee & Lee, 2000; Robey, Ross, & Boudreau, 2002; Volkoff, Elmes, & Strong, forthcoming). Other studies have explored the implementation process itself. For example, in a case study involving several implementation phases in one organization, Luo and Strong (2004) explored the pattern of differences in the focus on re-engineering busi- ness processes as compared to changing the ES to match existing processes among these implementations. Using an interpretive case study, Scott and Wagner (2003) explored the process of negotiating change over time by examining connections among which work practices are abandoned, which are transported over time, and which are created. They took a theoretical approach and used Actor-Network theory to understand the achievement of order resulting from negotiations over time about the future of work using an ES. Several studies examine the various phases through which an ES implementation proceeds and identify the problems encountered and risks faced in different environments and phases (Krumbholz, Galliers, Coulianos, & Maiden, 2000; Markus & Tanis, 2000; Soh, Sia, & Tay-Yap, 2000; Sumner, 2000). While current research continues to investigate the problems, contradictions, ten- sions, and risks that emerge during the ES implementation process, studies are start- ing to explore the outcomes of ES implementation, that is, ES-enabled organizational changes, both intended and unintended, that are emerging in organi- zations. Studies of ES-enabled organizational change, like the study described in this paper, build on the foundation of existing ES research that has uncovered and stud- ied various problems and contradictions during implementation and investigated the need for negotiations as organizations attempt to resolve contradictions and tensions that are inherently not resolvable (Pan et al., 2001; Scott & Wagner, 2003; Strong & Volkoff, 2004).
  9. 9. M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 9 Our study focuses on emerging changes in control and empowerment in organiza- tions as enabled by an ES. Before describing our study, we review the few papers that examine ES consequences related to control and empowerment. 2.5. Studies of ES, control, and empowerment Fundamental changes in organizations may arise from the opportunity for in- creased managerial control through the improved visibility of operations and ac- cess to information afforded by an ES implementation. While ES implementation studies noticed this potential, focused investigation of such changes has drawn lit- tle research attention with a few notable exceptions (Hanseth, Ciborra, & Braa, 2001; Sia, Tang, Soh, & Boh, 2002; Tang et al., 2000). Sia et al. (2002) examined the potential for both increased panoptic control and employee empowerment through ES implementation at a hospital in Singapore. They defined panoptic control as ‘‘the heightened workplace visibility through embedded system access or workflow dependencies’’ (Tang et al., 2000, p. 503). In theory, according to the authors, the underlying ES characteristics can enable increases in both panop- tic control and empowerment. ES can enhance control because of their ability to track workplace behavior and make it easier for managers and peers to observe worker activities. They can empower workers by making information more visible, obviating the need to seek information from others, and potentially enabling workers to be better informed to make decisions at local levels. Sia et al. (2002), however, found greater evidence for increases in panoptic control than empowerment, which they attributed less to the technology itself than to institu- tional and organizational conservatism, a desire to do things the ‘‘old way’’, and paternalistic cultural values. By contrast, in their study of SAP implementation at the European fertilizer divi- sion (HAE) of Norsk Hydro, Hanseth et al. (2001) found that despite the standard- ization, streamlining, and integration of business processes inherent in the ES, which should have made it an ideal control technology, the actual result was a loss of con- trol. In attempting to establish common work practices across various divisions (and thus making it easier to monitor and control the processes from head office), various irreconcilable local differences required that the ‘‘universal’’ solution evolve into spe- cific site ‘‘variants.’’ In addition, users extracted data from the ES and put it into lo- cally created ‘‘extension’’ applications using Lotus notes or spreadsheet software, not visible to headquarters. Borrowing a term from Giddens (1999), the authors characterized an ES as a manifestation of the ‘‘juggernaut’’ of the modern world – ‘‘a runaway engine of enormous power, that, collectively as human beings, we can drive to some extent but that also threatens to rush out of our control in directions we cannot foresee’’ (Hanseth et al., 2001, p. 46). These two studies are inconclusive but do suggest that the implementation of an ES is likely to impact organizational control systems in significant, and often contra- dictory, ways. They support our interest in investigating further the sometimes con- tradictory changes in organizational control we observed at our field site.
  10. 10. 10 M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 3. Research setting The research reported in this paper presents findings from a three-year case study at a global organization (ACRO) undergoing a multi-year, multi-phased ES imple- mentation. ACRO is a global leader in the design, assembly, and post-sales service of certain high-precision industrial products. While ACROÕs corporate headquar- ters, engineering design, and assembly operations are concentrated along the entire East Coast of the United States, component production and after-sales service plants are scattered throughout North America, Europe and Asia. With 20,000 employees and world-wide distributed operations, coordination and control issues are a major concern of ACROÕs top management. In order to address these issues, in 1998 ACRO embarked on a multi-phase, multi-year plan to implement ES software from SAP, configured as a single instance, throughout the company. The first two phases consisted of relatively small, localized projects, and helped the company gain experience with both the software and the implementation pro- cess. We started our observations in 2000, shortly before Phase 3 go-live. This phase focused on component production and assembly operations, and entailed imple- menting a full set of SAP modules including Finance, Production Planning, Sales Or- der Management and Materials Management. Before Phase 3 ended, the company started work on Phase 4, which focused on extending the functionality to support the maintenance and repair operations. In Phase 5, the last of the phases that we ob- served, the system was implemented in the engineering design units and introduced functionality to monitor progress of the companyÕs multi-year research and develop- ment projects by measuring earned value. The advantage of starting our observa- tions when we did is that the company had learned a great deal about ES implementation during the earlier phases, so the issues being encountered pertained more to the organizational impacts of the system than to the implementation process itself. We collected data at five different locations. Corporate headquarters is situated at a large industrial site that houses the main R&D facility, as well as some production and warehouse operations. A second location has the main production and assembly plant and product test facilities. We also visited two different after-market service locations, and the separate site that housed the large (more than 200 people) ES implementation team. 4. Research methodology Data collection and analysis employed grounded theory methods (Glaser & Strauss, 1967). The choice of methodology was based on the research problem: our objective was to discover the organizational impacts associated with the imple- mentation of an ES, and to understand how these organizational changes arise. We needed to employ a methodology that could uncover rich information, and that did not limit us to looking for impacts suggested by theory. A case-based methodology is recommended for exploratory research that tries to understand how a process un-
  11. 11. M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 11 folds (Yin, 1994). Grounded theory specifically rejects a priori theorizing and allows for discovery of descriptive and explanatory theories that arise directly from empir- ical observations (Glaser & Strauss, 1967). To the extent that Glaser and Strauss di- verged in their approach to grounded theory methodology after the publication of their original book, we have taken a Glaserian approach. 1 We take the position that IT-enabled organizational change is an emergent and dialectical process that evolves from the sequence of social interactions that occur over the course of system implementation and use. This perspective demands that we collect data from multiple sources (Klein & Myers, 1999). Epistemologically, our approach is interpretive rather than either positivist or critical (Howcroft & Truex, 2001; Klein & Myers, 1999). 4.1. Data collection For each of the three implementation phases studied we collected data through observations, interviews and informal conversations. We made 155 trips (approxi- mately one trip per week over three years) and conducted 71 formal interviews (some of which were group interviews) with 60 different people. In addition to these formal interviews we attended meetings, observed testing and training sessions, sat in the ‘‘war rooms’’ during go-live, shadowed people as they solved implementation prob- lems, and collected documents, such as training material and handouts at meetings. We also conducted informal interviews during our visits, engaging in casual conver- sation in the war rooms, before and after meetings, and during testing and training sessions. In addition we had the opportunity to listen in on group conversations, both casual and formal. With a few exceptions, formal interviews were taped and transcribed. The remaining data were captured in field notes taken on site and written up after each visit. Data collection for each phase started before go-live, and continued through the early days of use, to a period of stable use, more than a year after go-live. The purpose of longitudinal data collection was to ensure that we understood the start- ing point so we could better gauge what had changed once the ES was imple- mented. It was also valuable for developing good personal relations with our informants. At the start of each phase we identified 6–8 key informants through our corporate contacts. We looked for people who were users, but who were actively involved in the implementation. In addition to conducting formal interviews with the informants 1 The main difference between the Glaserian and Straussian approaches lies not in the underlying motivation and core analytic procedures, but in the relationship between the researcher and the phenomena under study (Locke, 1996; Locke, 2001). In particular, Strauss and his coauthors suggest structured interrogation of the data through a sequence of different types of coding and a specific set of questions. Glaser, on the other hand, prefers to take a more passive approach, where the researcher does not initiate the questions, but rather responds to the data. While some have suggested that this assumption of neutrality is inherently positivistic, we do not assume a single reality, but attempt to let the different voices in our data speak for themselves.
  12. 12. 12 M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 at several different times over the course of the implementation, we shadowed them as they worked and spoke informally with them often. In most cases our key infor- mants were power users (individuals who were selected to help test the system before go-live, become familiar with its operation, and train other users), since they were the only users involved from before go-live to full operation. They represented all the areas that were going to be affected by the new software, and those chosen generally had significant experience with the organization, often in a variety of positions. Most had been with the company for more than a decade and many for much longer than that. These people were ideal as key informants, not only because of their knowledge of the company, the software, what it could do, and how to use it, but also because they were primarily users, with a ‘‘business’’ rather than an ‘‘IT’’ perspective. Their involvement in testing and training over protracted periods of time allowed them to reflect on how the new system fit with the organizational processes. We were never ‘‘participants’’ in the implementation, but over the course of our three-year association developed close relationships with the key informants. Obser- vations were made by shadowing them over the course of a visit as they attended meetings, worked at their desks or in the war room (during go-live), and conducted testing or training. During a testing session, for example, we would sit behind them as they worked through a test script. Often they encountered problems that needed to be resolved by the ES team before they could move forward, and as they waited, they were happy to chat with us. In many cases they seemed to appreciate having someone external to the operation who would listen sympathetically to their con- cerns and to whom they could freely express their frustrations and satisfactions with the system and the implementation process. They also introduced us to other users whom we then interviewed. In addition, during the downtime before and after meetings or training sessions there were many opportunities to engage in conversation, not just with the key informants, but with the other attendees, who became accustomed to our presence. By shadowing the key informants, we came in contact with many members of the organization, and this association provided us with credibility, so that other users spoke freely in front of us. In addition to the multiple interviews and regular conversations with the 21 key informants, we formally interviewed 39 other users, ranging from managers to shop floor employees, and spoke casually with many others, including members of the ES implementation team. Table 1 gives a breakdown of the interviewees by phase, role, and location. While all of the authors participated in data collection, either singly or in pairs, one of the authors took primary responsibility for Phase 3 and the manu- facturing plants, and another took primary responsibility for Phase 4 and the repair and maintenance operation. During Phase 5, one author took responsibility for the subproject devoted to measuring earned value while all three authors spent time fol- lowing the implementation in the R&D operations. Initial interviews, lasting anywhere from 30 to 60 min, employed an interview pro- tocol that addressed some broad themes using open ended questions (see Appendix A for our initial interview protocol). These themes, suggested by our initial research objectives, included existing job processes and responsibilities (focusing on current
  13. 13. M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 13 Table 1 Distribution of interviews across phases, locations and roles # of times each person was interviewed Phase 3 Location 1 6 key informants 1 manager 2 times 3 power users 3 people · 2 times 2 users 2·2 6 non-key informants 1 manager 1 5 users 5·1 Phase 4 Location 1 2 key informants 1 power user 2 1 user 2 4 non-key informants 4 users 4·1 Location 2 6 key informants 6 power users 5 · 3, 1 · 1 8 non-key informants 1 manager 2 3 power users 2 · 2, 1 · 1 4 users 2 · 2, 2 · 1 Location 3 10 non-key informants 3 managers 3·1 2 power users 2·1 5 users 5·1 Phase 5 Location 4a 7 key informants 5 power users 1 · 3, 2 · 2, 2 · 1 2 users 1 · 1, 1 · 2 11 non-key informants 9 power users 3 · 2, 6 · 1 2 users 2·1 Totals 21 key, 39 non-key 6 managers 8b 29 power users 52b 25 users 31b a While most of the operations related to Phase 5 occur at Location 4, several of these individuals also spend time at Location 1, and some of the interviews occurred at Location 5, where the ES team was located. b Because some of the individuals were interviewed together, there were only 71 separate interviews conducted to obtain these 91 person-interviews. task structure, flexibility and communication patterns) and expectations regarding how the new software would alter these. Our objective during these interviews was to get base-line information on the pre-ES organization. Subsequent interviews fol- lowed up on the same themes and the changes that had been encountered, and in- cluded new questions suggested by information from previous interviews. Field notes and interviews were transcribed, with coding and analysis occurring through- out the data collection process.
  14. 14. 14 M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 4.2. Data analysis The central tasks in a grounded theory approach are to identify descriptive con- cepts within the data and to uncover the ways these concepts are related to each other. The primary activities used to accomplish these tasks include coding the data, making constant comparisons of incidents, both to each other and to the emerging theory, and memoing (Glaser & Strauss, 1967; Locke, 2001). Analysis starts early in the data collection process and evolves as the research progresses. At first, the data are examined line by line and coded in a way that names each incident (open coding). At this stage most of the codes are ‘‘substantive’’ and labeled by words taken from the protagonistsÕ vocabulary (Glaser, 1978). In this study the first few interviews were coded by all three researchers. We then met to discuss the codes, to ensure we all used the initial labels to mean the same thing. After that each interview was coded by the researcher who conducted it, since being able to recall the body language used to generate the words on a page helps to keep the interpretation of the words aligned with the speakersÕ intentions. As we each added to the initial list of codes, we shared the labels and their intended meanings with each other. Our final list includes 53 codes. As open coding progressed, memos were written to propose potential relationships, and codes were organized into trees. At the same time as substantive codes are emerging, researchers should look for theoretical codes that conceptualize how the substantive codes relate to each other. Glaser (1978) indicates that while these codes may have their origin in the disciplin- ary training of the researcher, they only earn their way into the final analysis if they fit the data in the same way that the substantive codes do. He asserts that the grounded theorist needs to ‘‘know many theoretical codes in order to be sensitive to rendering explicitly the subtleties of the relationships’’ in the data (Glaser, 1978, p. 72). He lists 18 coding families as an aid to researchers, but reminds them that these families are neither exhaustive nor mutually exclusive, and urges research- ers to combine coding families and spawn new families in whatever ways make sense in the context of the data. GlaserÕs approach is in contrast to that of Strauss, his for- mer co-author, who advocates a more formal activity of axial coding to follow open coding. Glaser finds axial coding overly restrictive, with questions emanating from the researcher rather than the data (Locke, 2001). In following a Glaserian approach, we combined three coding families, namely his ‘‘Six CÕs’’ family (causes, contexts, contingencies, consequences, covariances and conditions), the ‘‘type’’ family, and the ‘‘degree’’ family. Thus as the core coding cat- egories of ‘‘visibility’’ and ‘‘discipline’’ started to emerge from the data, we looked for the different types of each, the conditions and contexts surrounding each type, and the consequences. For example, as discussed in our results section, we discovered that changes in visibility of information might occur along four different dimensions, namely visibility of information from other functional areas, visibility of information from other geographic locations, visibility of new forms of historical data, and vis- ibility of all of this information in real-time. We also looked for the range of out- comes, such as visibility either increasing or decreasing, and the job contexts in which the different changes were occurring.
  15. 15. M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 15 Discovering these relationships and building up the theoretical codes is done through a process of constant comparison. By comparing data incidents with each other and noting similarities, the categories become more clearly defined. Differences help identify the properties of each category, and the conditions under which they arise. Data incidents also need to be compared to the emerging theoretical codes to ensure that the latter are a good fit. Theoretical sampling is used to ensure that the full breadth of emerging possibil- ities is explored and each category is ‘‘saturated’’. Since the purpose of an ES is to integrate across functional boundaries, we started by deliberately choosing infor- mants from different functional areas. Since the emerging category ‘‘discipline’’ usu- ally refers to different levels in an organizational hierarchy, we interviewed managers, salaried and hourly paid workers. To uncover the effects of different contexts, we looked at the differences between an assembly plant, the after-service facilities, and the research and development organization and between two after-service facilities (one of which was considered a more successful implementation than the other). Once the categories ‘‘visibility’’ and ‘‘discipline’’ emerged, we paid special attention to the earned value functionality, as it focused specifically on enabling a group of individuals to monitor R&D project progress. As substantive and theoretical coding progresses, it moves from ‘‘open’’ coding, where every line is examined, to ‘‘selective’’ coding, where the researchers focus on data that illuminates the emerging categories. Thus those parts of the interviews and field notes that related to our main categories were used to elaborate the emerg- ing theoretical concepts. We also turned to the literature on management control, discipline and visibility to see how prior research fit with our findings. In conducting a grounded theory study, various tensions need to be managed (Locke, 2001). While total immersion in the data helps to keep the emerging concepts grounded, it inhibits the ability to keep them in perspective. The researcher must stay close to the text, but also make abstractions to a higher level of generality. Further- more, researchers are urged to suspend knowledge of existing concepts and proposi- tions, while at the same time remaining theoretically sensitive so they can conceptualize their data. The advantage of having three researchers with very differ- ent backgrounds and raised in different intellectual traditions was that no precon- ceived ideas could enter the analysis without the scrutiny of a different mindset to ensure that the inclusion of a theoretical concept had earned its place by fitting with the data. In addition none of the three of us had a background in managerial control beyond general knowledge, and it was only after the data led us to our understanding of visibility and discipline in an ES-supported environment that we turned to un- cover what had been written about these topics in the literature. 4.3. From data to results Once we had established the core categories of visibility and discipline and satu- rated our understanding of the various ways in which they were manifested in the data, we turned to understanding them from a theoretical perspective. What we learned from the field suggested an examination of the literature on managerial
  16. 16. 16 M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 control, particularly work that discussed control and IT, and the writings of Max Weber and Michel Foucault on discipline and control in organizations. In a grounded theory study the literature is not used as the starting point, but one more source of data and a stimulus of theoretical sensitivity (Glaser, 1978, p. 31). While we found much in this literature that could be folded into our results, we also uncovered some contradictions that required more careful consideration. From this analysis two theoretical concepts emerged, panoptic empowerment and reflective conformity, which are critical aspects associated with the introduction of an ES into an organization. These two concepts capture the contradictions we ob- served in the organizational changes related to managerial control. 5. Results Below we present the analysis of our data that led to the two theoretical concepts. In particular, we highlight the contradictory observations regarding our two core categories. In Section 5.1, we present data showing that increases in visibility brought about by the ES simultaneously empowered workers and increased control. In Section 5.2, we present data on how the integrated nature of the ES increased dis- cipline and conformity to rules and procedures while at the same time demanding greater reflection on local, integrated, and future work practices. 5.1. Visibility of information As we conducted interviews and made observations at ACRO, we saw how the salient characteristics of an ES, namely its ability to integrate business processes through a common, shared database, available in real time, increased the visibility of information. Through increased visibility users experienced various types of changes in both empowerment and control. 5.1.1. Visibility and empowerment The ES increased the visibility of cross-functional, global and historical informa- tion and provided this information in real time. One group of employees experienc- ing increased visibility to cross-functional information was customer service representatives. We can see a lot of other functional areas that we couldnÕt see in our [legacy] database. We have access to certain shipping records and even financial records [such as] invoice records and billing records that [previously] we were not able to view, [and for which we] had to call on other areas. (Customer service representative). 2 2 At the request of the reviewers, we have edited the quotations for clarity, and in particular removed process-specific jargon. This particular quote combines statements made by the interviewee at two different times.
  17. 17. M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 17 Being able to view shipping or other order status information allowed them to re- spond immediately to customer requests rather than having to call the assembly plant for status information before getting back to the customer. In addition, view- ing financial data related to a customer, e.g., invoicing and billing records, allowed them to answer these types of questions from customers instead of referring them to the Finance Department, the previous standard practice. With this increased visibil- ity of information, customer service representatives were empowered both to per- form tasks without having to go to someone else for additional information and to be more responsive to the customer, which they viewed as an important part of their job. The increased visibility of global information was a benefit to materials planners, who are responsible for ensuring that the correct parts are available when it is time to assemble the product. You can look at all your orders you are working with, you can look at all your inventories, across [the whole company], not only just here in our area. . .. Whereas before, we didnÕt have access to information like that. We had to go to either our spares group, call [one of the plants] or other places, where at a flick of a button [now] you can grab that information. (Materials planner, plant 1) With the old legacy system, they had system access only to the local inventory. To access global inventory, they had to call other plants and beg for parts. The ability to search for parts from the world-wide inventory when there was a critical shortage made their job much easier. It increased their control over the part shortage process and their sense that they were empowered to access and use world-wide inventory. It also provided better part availability to production, which reflected well on the job performance of the materials planners. With this visibility of global inventory infor- mation, materials planners also had authority via ES transactions to access and use this inventory. Access to historical data was similarly empowering, as users could perform more analysis, allowing them to do better planning. A lot of people are just ordering one part for every one required. Now weÕll be able to use historical data to plan ahead. . . . It will reduce purchase order costs. (materials planner in a second plant) The integrated nature of the ES also helped to keep historical information in a more accessible form. While the system was still too new to have collected much his- torical data at the time of our interviews, users anticipated being able to trace move- ments of goods and equipment over time. . . .this is going to improve the process, in that weÕll have more history on our tools, where they are located, where theyÕve been, who they belong to. . . .weÕve got a hodgepodge of tooling out there that [the client] comes back to us and says ‘‘Hey, where is all of our tooling?’’ We donÕt know. . . .At least now with the system [we will have that information]. (Manufacturing Engineer)
  18. 18. 18 M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 In these quotes, we see visibility of information directly supporting job roles and empowering employees to perform better at these roles, or even expanding those roles. In addition to increasing visibility of data across functions, around the world, and back in time, the new system provided data in real time. Because outcomes and pro- cess performance were now visible in real time, people were alerted sooner to issues requiring attention either in their own work, or in the work of their colleagues or subordinates. An employee who worked in one section of the plant, but who recog- nized that products had to flow through various processes to get to him, and through other processes after they left him, noted that SAP relieved time pressures. SAP has relieved a lot of that [time] pressure, because everything is identified immediately. ItÕs identified when itÕs received, itÕs identified when itÕs being ready to start, itÕs identified when itÕs sitting or ready to go to inspection, itÕs identified a lot faster. (Inspector) The idea that responding to real-time data relieves time pressure may seem incon- gruous, but shop-floor workers and materials planners previously spent a lot of time looking for parts and for partially assembled products, e.g., whether they were still out for repair or waiting in the inspection area, and checking whether something was ready for the next step. The system provided this status and location information in real-time alleviating time spent checking on things. Employees could also see parts and products in earlier stages and were more able to anticipate when they needed to perform their tasks. This visibility was empowering because it provided employees with more control over their jobs. As seen in the above analysis, from the viewpoint of individual employees, in- creased visibility of information has an empowering effect. In the cases of increased visibility of other functional areas, to global operations, and to historical data, the consequence was that the users felt more empowered to perform a task, irrespective of whether it was an explicit part of their job, without having to go to someone else for additional information. Overall, increased visibility of information made their jobs easier and they were more in control of their tasks because they knew what was happening, and they had to ask others for assistance less often. Thus, increased visibility of information enabled by the ES increased employee empowerment. The ES, of course, was not perfect in increasing visibility of information. There were situations in which visibility decreased, for example, when the complexity of the ES contributed to difficult and time-consuming searches for information, when some information previously available in legacy systems was not converted to the ES, and when the required common data definitions and editing constraints matched the needs of some local units better than others. The decreased visibility of most interest from an empowerment perspective arose from the abstract representation of concrete physical objects in the system. Like any information system, an ES ‘‘informates’’ business processes – generates information about the underlying organizational processes, making them more transparent or visible – but it does this by representing physical reality in symbolic form (Zuboff, 1988). As Zuboff discusses, abstraction can be challenging at any time by requiring
  19. 19. M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 19 a new level of intellectual effort. In an ES the difficulty is compounded by the de- mands of integration. Abstractions that have meaning in one part of the business may not, in fact, provide useful information in another functional area. At ACRO, the problematic effects of abstraction were experienced by materials planners and handlers as they moved from a world of physical parts labeled with colored status tags to a world of bar-coded parts whose status was stored in the system. For exam- ple, while they thought of repair parts in terms of characteristics such as time in ser- vice, the system tracked parts as part of a production batch, a repair order, or a purchase order: it stocks [items that] are time controlled and serial number controlled. . the warehouse by a batch number. And it is just an arbitrary number that is assigned to it. (materials planner) Part of the problem was that in an ES, the artifact, e.g., an item out for repair, stopped being treated like a physical entity, and was instead represented as a piece of data. For the materials planners the specific representation chosen, namely a num- ber associated with a sales or service order, was not particularly useful. Abstracting the movement of a physical object in this way might be useful to finance or sales, but materials handler were more interested in looking at information related to specific parts, regardless of the sales or service order to which they were attached. At ACRO, to overcome gaps in the information available to them, users started to keep private spreadsheets of data that were not readily available in a form that suited their specific needs. Thus, for cases of reduced visibility, employees developed work- arounds to ensure their ability to do their job efficiently. As such, these employees took responsibility for remaining empowered to do their job. 5.1.2. Visibility and control The same ES-provided information that empowered employees also enabled man- agers to exercise tighter control over employees. By providing visibility in real-time to all operations, the ES at ACRO served as a near-perfect panopticon for manage- ment – an excellent mechanism for increasing control. Visibility of global, cross- functional and real-time information was clearly useful to senior management since it supported their already legitimate control over the entire firm. This was especially helpful for establishing better outcome control over production and service facilities in Europe and Asia. One of the goals for the ES was to provide more visibility of and control over re- search and development activities and costs performed under contract to others. In the ES, each contract was set up as a project where labor hours, other costs, and per- cent completion were recorded against the project plan. The rules for tracking con- tract progress and costs were designed by a new organization at ACRO, the Earned Value Group, and embedded in the ES. The ES provided increased outcome control by computing earned value, which compares project completion rates to project expenditure rates. While the establishment of the earned value group was not ‘‘caused’’ by the ES, it was only through the additional information provided by
  20. 20. 20 M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 the ES that this group and the contract project leads were able to manage and con- trol the research and development activities and costs. Outcome control increased at ACRO, both through a reduction in the time needed before outcomes could be examined – information was now available in real time – and because the information was visible to a wider group of people, both peers and managers. Outcomes were no longer the weekly or monthly reports that were compiled for management after the fact, but were the daily, hourly or instan- taneous data that were monitored by a broad audience. For example, finance began to review outcomes daily. The ES provided the information needed to follow-up on anything unusual. In addition to daily reports, reports could be run at the comple- tion of any set of work activities to provide immediate outcome control. For exam- ple, a cost manager had increased ability to exercise real-time cross-functional outcome control: [SAP] has the ability to put in standard labor. . . hours and then you can run reports to see where you are on a daily basis. ItÕs not the end of the cycle. You can say, ‘‘Okay, this module is finished, so how many hours was it?’’ And itÕs over your threshold, you can go to the floor very quickly and say ‘‘You were 400 times over on your hours. I need to know what happened.’’ . . .[I]f you wait at the end of 30 to 60 days, youÕre going to go, ‘‘Oh my, I donÕt know what they did.’’ The above instance demonstrates cross-functional control as a manager responsi- ble for costs can immediately check on outcomes that do not match planned out- comes. At ACRO people on the floor were aware that others had this visibility, and discussed it in terms of ensuring data accuracy and proper procedure: . . ..itÕs basically coming down to inventory. You have to have proper inventory levels. What you say you have you should have and what you donÕt have you shouldnÕt have. ItÕs that simple. . . .. WeÕve been doing a lot of inventory adjust- ments. Our financial people donÕt see those today, because thereÕs no dollar val- ues on them. TheyÕre not getting feeds from SAP, but come [next go-live], theyÕre going to. (long-time materials planner) At the time of this quote, finance was not seeing inventory changes in real-time because the system was not yet associating costs with every inventory transaction, but the materials planners knew this was coming in the next phase. When asked what the financial people were going to see after the next go-live, the materials planner re- sponded that finance would see every plus and minus inventory adjustment. This enhanced visibility by managers and fellow workers to real-time data about operations increased disciplined action among workers. For example, The material is coming in a timely manner now. You canÕt have what you call ‘‘in transits’’ hanging out there forever. There are reports that are drawn now that show exactly whatÕs in transit over. . .. four days now, and everybody is driving to clean that stuff up . . . (MRP controller) When asked who looked at those reports, the user responded:
  21. 21. M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 21 Everybody. Everybody in materials, from higher management down and it comes down through [my boss], who would generate that down to me . . . Such increased information visibility served to conflate process and outcome con- trol. Interim outcomes – realistically every step of a process and not just final out- comes – were being monitored. Every step in the process could be controlled in the same way outcomes had been controlled – by comparing results to a standard or goal – and this could be done in real-time. Outcome control was no longer exer- cised periodically, but continuously, and was no longer concerned only with planned outcomes, but also with the process itself. Thus, we saw the emergence of continuous outcome control, that is, outcome control that was exercised continuously rather than periodically and included elements of process control as the result of individual process steps being controlled as outcomes. While most of the changes in control observed at ACRO were increases in con- trol exercised by managers and peers, we did observe two instances of some loss of control. The first was a side-effect of increased empowerment. For inventory plan- ners, access to global inventory information was empowering and allowed these workers to perform their jobs better and to better meet organizational goals. They now had authority to use information directly related to the performance of their job. There was, however, some loss of control as they lost sole authority over their local inventory. Global inventory visibility violated the highly rationalized nature of an ideal bureaucracy by supporting an organizational goal of optimal use of world-wide inventory, yet still measuring production performance at the local plant. The other instances of loss of control were due to decreased visibility caused by difficulties of reversing transactions in SAP which made changing entries difficult or impossible. This meant that in certain circumstances it was easier not to enter the information while it was still subject to change, even where that information might have been helpful for planning purposes. A user responsible for writing up work orders explained: . . .[in the old system] you could save [what you typed in] and . . . you were able to change it – well in SAP you canÕt do that, youÕve got to save it and you canÕt go back and revise what you did, itÕs all grayed out and you canÕt change it. So itÕs tough. . . .. Since the people performing this function found this unacceptable and confusing to those reading the work scope instructions, they developed a workaround. What [weÕre] learning to do is to type the work scope into a Word document and then . . .. save the Word document and right when [weÕre] ready to release it, [weÕll] cut and paste it over to SAP, so if there is a change in work scope [we catch it] before [we] release it. That is, they delayed entering information into SAP until they were more confi- dent of its accuracy, thus reducing the timeliness of the information and the visibility of that information.
  22. 22. 22 M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 At ACRO, we observed increases in outcome and process control due to informa- tion visibility, with only rare instances of decreases in control. Overall, the ES served as a mechanism for increasing organizational control. For senior management and financial controllers especially, the ES became an ideal control mechanism – just as ES vendors and advocates have advertised. Unexpectedly, this happened at the same time that workers were experiencing greater empowerment. 5.2. Implications of integration ‘‘Discipline’’ is the code we used whenever people talked about ‘‘doing what they were supposed to do’’ – adhering more closely to predefined operating processes. As we analyzed the data coded under this core category we discovered that heightened levels of discipline were closely related to the integrated nature of an ES. At the same time, integration demanded that employees reflect on business processes. 5.2.1. Disciplined action We have already seen how increased visibility of information enhances outcome control. The integrated nature of an ES further supports control in two ways: (1) di- rect process control by embedding process rules and procedures into the system and controlling which actions must be, can be, and cannot be performed, and (2) infor- mal/internal controls by promoting a mindset of disciplined actions. Over time, many users became aware that the process rules and procedures embedded in the ES profoundly influenced how they were expected to perform their job. For example, a user responsible for the movement of material talked about get- ting prompted if some procedure remained incomplete: Before if every part wasnÕt kitted, it didnÕt stop anything. It didnÕt have a flag come up and say, ‘‘Hey, you didnÕt kit specific material.’’ As weÕre moving for- ward, everything has to show that itÕs in the ‘‘withdrawn category,’’ and itÕs kitted. If users ignored these flags, then they were stopped further down in the process when the system would not let them confirm that a specific set of activities was com- plete. The integrative nature of an ES supported cross-functional and real-time vis- ibility of data, but it also required that tasks be done properly and in a timely manner, and that data be both correct and complete. In a continuation of the pre- vious comment the user added: If a section of that [product] is now saying ‘‘Hey on these sheets, this is billed,’’ it needs to reflect that in the system. And. . .. one of the things we do, is we make sure that it does. If it doesnÕt, we need to get it corrected or you canÕt do what they call confirm the network. Which is to go into the system and say, ‘‘Yes this is confirmed and everything is there and that assembly is built.’’ A user performing the same function in a different plant summed it up succinctly as follows:
  23. 23. M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 23 If you are not doing your job the way you are supposed to, the system will catch you. . .. SAP creates a standard process for everyone to follow. . .. There is a set order to do things. Embedding rules and procedures into the software is the traditional concept of using IT to increase control. The system controls what users are allowed to do. Orli- kowskiÕs (1991) study of IT-enabled control examined CASE tools into which the organizationÕs development methodology was embedded. While in principle these users could take other actions (Giddens, 1984), in practice they were required to fol- low the steps in the methodology as they did their work (Orlikowski, 1991). Simi- larly, the ES has defined procedures and sequences, which users must use to accomplish their tasks. Furthermore, the integrated nature of an ES highlights any failure to follow procedures as mis-steps in one area stall further progress in another area. In addition to software features that alert users to errors and omissions, and embedded procedures that ensure correct process, users of an ES are further con- strained to follow official procedure through carefully controlled authorizations that limit access to transactions. With integration everybody works off the same database, so anyone could, in theory, have access not only to view all data but also to make changes. While cross-functional visibility may have many benefits, there are risks in allowing cross-functional transaction access. As a consequence, authorization to perform each transaction must be assigned to specific roles. At ACRO the lack of flexibility this imposed on users was frustrating at times, not least because these con- straints often had the effect of slowing down production. A middle manager pre- sented the following scenario: Before ERP implementation occurred, I had the ability to go into the system and [determine availability. . .. In] just a couple of keystrokes, I could get the material pulled appropriately with all the right codes, with all the right avenues and send somebody on the road to pick it up and get it here within an hour or two maybe at the most. Now. . .. I donÕt have that authorization anymore, itÕs a buyer/planner function, IÕve been told I canÕt have a buyer/planner code. . .. This manager went on to explain how he personally used to have the ability to find a part, place an order to have it pulled from inventory, and have it en route to where it was needed within minutes. Under the new set of role-based authoriza- tions he had to find other people to perform these transactions as he was not autho- rized to perform them despite his position as a manager. This had the effect of delaying arrival of the necessary parts for hours, disrupting production. The combination of embedded procedures, separation of roles, and transactions authorized only to selected roles increased disciplined action and process control. In the above examples, only the material buyer/planner role and the spares manage- ment role had authority to approve requests for inventory. A middle manager on the shop floor could no longer both request and approve parts by himself. This increased control over inventory, a stated goal of ACRO, at a cost of occasional delays in production.
  24. 24. 24 M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 In addition to these structures for enforcing discipline, the ES system generally encouraged a culture and a mindset where the discipline of following the process properly was valued. One exchange between two employees responsible for control- ling the bill of materials suggests that while users were frustrated by some of the con- straints put on them by the new system, some were starting to support the need for greater discipline imposed by the system: [S]ystem functionality. . .says you must have all this data prior to issuing a pur- chase order. . .for decades. . .we placed purchase orders with almost noth- ing. . .and it was a factor of speed. . . This system is forcing us to do things which quite frankly donÕt fit with the business. . . (First individual) The second individual countered that updating purchase orders in the old way had a detrimental effect on quality, and the need for speed did not justify ignoring correct procedures: TheyÕre forcing people to do what is [proper]. Like today youÕre saying you can go in and change your purchase order or issue a purchase order with very lim- ited information on it. Is that right? I do not think so. I think when youÕre talk- ing quality, youÕre talking quality, when youÕre talking [about data that affects] finance, youÕre talking finance, and all that [purchase order information] should be there. (Response from second individual) Given the integrated nature of an ES, data entered in one area immediately affects other areas. Unlike before ES at ACRO when different parts of the organization were more loosely coupled and buffered from the effects, increased integration and the authorizations that controlled who could do what increased the cost of errors. Reversing an entry involved undoing all the ripple effects, not just changing an entry on a screen. Not only was reversing a process inherently complex, it might also have involved a variety of individuals, each of which had authorization to perform a sub- set of the transactions involved. Such problems raised the need for more faithful and accurate execution of processes, and limited the scope for process variation. Further- more, the need for both increased data accuracy and more timely data was an under- lying motivation for increased discipline. Overall at ACRO, we noticed a growing sense that disciplined behavior became increasingly important after the implementation of the ES. In general a greater understanding of the integrated nature of organizational processes, and how the ES links them together, led to recognition of the importance of following prescribed processes. The notion that processes should be done in a particular way was a reflec- tion of how an ES serves to rationalize the organization by inculcating the value of discipline in everyday task behaviors. As one materials user stated, ‘‘I think things are starting to be done the way that they should’’. 5.2.2. Reflection on work practices At the same time as users were conforming to embedded processes, they were also reflecting on how the system supported the network of business processes they were engaged in. Reflecting on work practices is an important part of how practitioners
  25. 25. M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 25 address and solve problems (Schon, 1983). Our interviews provided examples of in- ¨ creased reflection on local, integrated and future work practices involving the ES. We focus on the latter two, reflection on integrated and future work practices, since these are the unexpected findings. The integrated processes in the ES encouraged workers to reflect on work prac- tices outside their local area. For example, in the following excerpt a troubleshooter from the receiving area of one plant explained how he unraveled problems that oc- curred in his area, and how he tried to get users in other areas to realize that errors made in one place had an impact elsewhere. I think a lot of it was people didnÕt understand what information they were inputting, how it was affecting somebody else. A lot of what happens in [inspection], when they route a part out, we donÕt see the problem until it gets back to receiving. . . . Well once you got into understanding how to fix it, why was it happening in the first place? Well actually because [inspection] was inputting the wrong information. So we would have to go back and say ‘‘Hey look, donÕt do that, because in the end, weÕre going to catch it back here’’ (inspector) The ES would not receive a part into the system unless all the records for that part matched, i.e., the bar code on the part as it was received had to match the bar code of the part requested. At ACRO after go-live, the receiving well of plants started to fill up with parts the ES rejected and no one knew what to do about that. To solve these problems the workers went through the pile of parts, determined the problems, and the initial source of the problem, as indicated in the quote above. Gradually, by explaining to all how the system worked and what they needed to do, the rejects in receiving declined to almost nothing, and for those that occurred, the workers in receiving knew how to resolve the problems. As one receiving inspector noted: So what weÕve had to do is learn what the other department was going through in order to, how we can solve our problem to fix their problem at the same time. . . So weÕve done a lot of going back and forth trying to understand just overall just how the whole process works. And that has helped. We are able to catch the problems before they even happen anymore. . . . And we have to com- municate back and forth a lot, you know, just so everybody understands how everything is going to work. This increased reflection and understanding of the new integrated processes went beyond just the receiving area. For example, the site implementation manager noted: WeÕre trying to log what area is experiencing the problem and then the root cause, we want a narrative of what area created the problem. The reason weÕre doing that is so that we can utilize this information and weÕll be able to see that the individuals that generate the network or the sales order are causing these problems that donÕt become apparent until three or four weeks later and the inspector has the problem.
  26. 26. 26 M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 While the materials inspectors had problems generated by other areas, these inspectors also came to realize that their work could generate problems for others. As one materials inspector noted: What I do affects the whole process. If I mess it up from the start, materials is messed up, warehouse is messed up, . . . At another service plant they initially attributed the receiving problems and other problems to the ES. When the ES would not accept received parts, they used various workarounds including re-ordering the parts to get the parts they needed. The result was excessive and out-of-control inventory costs – the opposite of the benefit expected from the ES. When they heard about the success at the other plant, they realized they needed to learn the system better and to understand how it worked. Some might argue that these findings of increased reflection on work practices in the ES environment were temporary; and as soon as everyone understood what they needed to do, reflection would stop. Our observations did not support this explanation. The assembly plant continued to explore ways to make better use of the ES to improve the assembly and inventory planning processes. In an inter- view two years after Phase 3 go-live, a process engineer discussed several changes to ES-related work practices that would improve their use of the ES. For example: So weÕve had some meetings over this and they would like a change now where it will allow them to approve a plan with multiple parts. . . This idea for better use of the ES in the future and the other ideas he mentioned are process improvements that would not have been possible without the ES. The ES provided an infrastructure that enabled workers to reflect on what additional sup- port could be provided and to request changes, enhancements, or add-ons. There have been on-going formal and informal discussions of improved future work pro- cesses and IT support for these. Even workers at plants that initially had many problems with the ES started to reflect on the future possibilities enabled by the ES: I would like to see the parts flowing through the facility a lot quicker, get rid of all the holdups. I would like to see the parts that donÕt need inspection not have to go to inspection because that just creates a bottleneck, everywhere. (a mate- rials handler) Furthermore, this reflection extended across plants: ACRO is doing one thing that is real good, is getting the business units together. I spent two weeks with [two other repair plants], talking about com- mon issues and common reports, so that now that weÕre all up and weÕve got some level of experience and weÕve made it through that first knowledge, now weÕre going back and as a group sitting down and trying to look at what are common issues. (controller)
  27. 27. M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 27 While we observed increased reflection, not all workers engaged in such reflection. Because the ES was complex and difficult to understand, reflection on work in the context of the ES was not easy. Some workers did not engage in problem-solving but rather depended on the power users to do work for them or waited for someone to explain to them what to do. Furthermore, the reflection stimulated by the ES was sometimes narrowly focused on solving problems in current ES-related work prac- tices. In summary, what we did observe was that, despite an increase in the level of conformity to specified processes imposed or encouraged by the ES, this new sys- tem simultaneously demanded, and often elicited, an increased level of reflection on how the processes related to each other, and on ways to alter and improve them to achieve organizational objectives. 6. Discussion Our observations, far from resolving the question of whether an ES enhances con- trol or empowerment, suggest instead that it enhances both at the same time. Simi- larly, based on our observations, we note a simultaneous increase in both conformity to and reflection about business processes. Paradoxes of this nature are an inherent part of organizational life (Lewis, 2000). By exploring these tensions rather than try- ing to eliminate them, we can illuminate the complexity and avoid oversimplifying organizational reality. Various strategies exist to address apparent paradoxes (Lewis, 2000; Poole & Van de Ven, 1989). These range from trying to resolve the paradox by identifying how the competing elements reflect different levels of analysis and/or moments in time, or transcending the paradox by reframing the way we view the two sides so they can be synthesized. Acknowledging the interdependence of two opposing concepts rather than focusing on their distinctions permits a richer understanding of complex phe- nomena (Jackson, 1999). In the discussion that follows, we propose a concept we call ‘‘panoptic empowerment’’ as a means of transcending the tension between control and empowerment. Following this we propose a second concept, ‘‘reflective confor- mity’’, as a means of transcending the tension between conforming to the ES while simultaneously reflecting on its use, and discuss why these elements not only can, but in an ES environment, must coexist. 6.1. Panoptic empowerment The simultaneous increase in control and empowerment occurs through the medi- ating effects of information visibility. Workers are empowered, not because they have more authority, but because they have more information, which in turn gives them greater control over factors that affect the way they execute their jobs. This same access to information allows for a certain degree of job expansion. Visibility is, however, a two-edged sword, and at the same time an ES enables individuals to see more and do more, it also makes them more visible to others. Control in- creases in part from the creation of a panopticon, where individuals are likely to
  28. 28. 28 M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 be disciplined in their behavior and to engage in high levels of self control because their actions can be watched by others. Furthermore, real-time information visibility reduces the time cycles over which outcome control can be exercised, effectively con- flating outcome control with process control. The contradiction between control and empowerment arises when control is viewed in the bureaucratic sense of a supervisor exercising power over a subordinate, and empowerment is viewed as the transfer of power from managers to workers. If instead of this zero-sum view of power we take a Foucauldian perspective, then empowerment and control can coexist more comfortably. By making actions of employees visible in real-time and enabling continuous real-time control of outcomes and processes, an ES fits well with FoucaultÕs understanding of disciplinary power and control (with some limitations, which we discuss below). Work cannot be done without the ES, which generates the paperwork or data movement necessary for the next step in the process. As each step is completed, the system records who executed the transactions and when. All this process and out- come status information is stored in the shared database, available to anyone with access at any time. As with the panopticon, since employees know their actions are being recorded, disciplinary power will be in effect whether anyone is observing or not. Furthermore, even if users are not observed in real-time, the information is available in complete detail at a later time, so that process and outcome controls can be exercised whenever convenient. As a panopticon, the ES serves to perpetuate and re-enforce existing managerial power and control in organizations, similar to the re- sults observed by Sia et al. (2002). Thus, our findings of increased outcome and pro- cess control are consistent with conventional literature and consistent with the expected benefits of an ES, which is designed and sold as a mechanism for increased organizational control. The question then becomes: How do we theoretically explain the simultaneous finding of increased empowerment? An ES differs in three potentially critical ways from the ideal panopticon. First, the mechanism of observation is less visible. In the panopticon, the window in the observation tower reminds prisoners constantly that they could be under observa- tion. While employees know the ES is recording everything, the gaze is less visible – the system is not primarily for observing employees, but for doing work – so they are not constantly reminded that they are being watched. Potentially, this could weaken the disciplinary power and self-control of a panopticon, and could increase a willingness to act independently. Second, while there is no escape from the gaze in an ideal panopticon, there is some room to hide with an ES. Although there is complete visibility of any informa- tion entered into the ES (and usually, to do oneÕs job, there is no choice but to enter it), individuals sometimes withhold information until the last moment. While process controls can reduce such activity (it is clear when information has not been entered), outcome control is diminished until the information is available. Third, the ideal panopticon provides hierarchical visibility in only one direction (only observers have visibility), and no horizontal visibility (the observed cannot see each other) (Foucault, 1977). An ES goes well beyond panoptic visibility – every- one can see everything in the common database – to provide a network of cross-func-
  29. 29. M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 29 tional, global, and real-time visibility. It is this violation of the ideal panopticon that provides the possibility for empowerment. The employees at ACRO clearly saw this visibility of information as empowering, and took actions based on this additional information. They also used this visibility to follow up on anomalies in their own work that they believed might have been caused elsewhere. These results contrast with Sia et al.Õs (2002) ES study, in which similar opportunities for empowerment due to visibility were available, but where the nurses studied viewed these opportu- nities as extra work, which they refused to do. Some might argue that the increased empowerment we observed is not ‘‘true’’ empowerment because managers have not given some of their authority and re- sources to employees. In fact, few of the actions that employees had been enabled or empowered to do were previously done by their supervisors or managers. Rather than a transfer of power as envisioned in the traditional empowerment literature, we saw an increase and a spread of knowledge that was empowering. Some of this knowledge was previously held only in local legacy systems, e.g., inventory informa- tion and order and invoice status information, while other knowledge was previously either non-existent or not in an easily usable form, e.g., historical and real-time data. From a Foucauldian view, then, there was an increase in knowledge and thus an in- crease in the power to do things. In this way, an ES can be empowering without transferring power from managers to employees – allocation of power need not be viewed as a zero-sum game. Furthermore, Foucault would argue that power is not held by individuals in any case, so cannot be ‘‘transferred’’, but instead is a property of the system as a whole. While this information provides empowerment, it also provides the opportunity for peers and other managers, not just hierarchical managers, to exercise control. The effect of everyone being able to gaze upon everyone else in real-time changes the nature of control in organizations from hierarchical to multi-directional. The transparent environment also fosters an organizational culture that promotes disci- pline. The theoretical concept ‘‘panoptic empowerment’’ captures this combination of empowerment and simultaneous, multi-directional visibility. 6.2. Reflective conformity The demands arising from the integrated nature of an ES simultaneously require conformity to specific operating processes and increased reflection on how the sys- tem supports those processes. Conformity is not enforced through hierarchical con- trol, but through the disciplinary power inherent in the rules and procedures embedded in the ES. Since in an ES these rules and procedures integrate organiza- tional activities more closely, conformity is essential so that actions taken in one area do not interfere with operations elsewhere. This systemic set of constraints creates a ‘‘regime of truth’’ – a discourse that values disciplined action over individual heroism to meet production goals. At the same time the realities of organizational life cannot all be programmed into the embedded processes, particularly those that must serve the conflicting objectives of different functional areas. This challenge combined with the inherent complexity of how an ES might be used to support variants to standard
  30. 30. 30 M.B. Elmes et al. / Information and Organization 15 (2005) 1–37 procedure requires deliberate reflection. Furthermore, the opportunities that an ES presents can only be exploited if the users reflect on the possibilities. In the literature, conformity is associated with reduced reflection. For example in her study of IT-enabled control, Orlikowski (1991, p. 38) noted that ‘‘. . . workers be- come less competent as knowledgeable agents as they become less able to reflect on their means of production and the knowledge embedded therein’’. After implemen- tation of a system with embedded procedures, Orlikowski observed deskilling of workers and little reflection on work processes, and speculated that this would cause future problems as the firm became less able to adjust its practices as the environ- ment changed. In her study, embedded rules and procedures in combination with informal controls had the effect of both instilling discipline and reducing reflection. In stark contrast, in our study we observed examples of increased reflection. While much of this reflection was directly related to solving problems related to the use of the ES, such reflection was also the start of reflection on better work practices in the future. Since reflection is especially important for non-routine problems and for pro- cess improvements over time, whether or not an ES contributes to more or less reflec- tion by workers on their work practices is an important concern. Our observations support the critical importance of reflection on work practices in an ES environment. Specifically, without reflection and increased understanding of the new integration of work across functions, the ES does not function well. Those workers who did only what the system asked without understanding the impacts on other areas contributed to an out-of-control inventory situation. Other workers la- bored to understand the system and how its integrated nature affected work across organizational boundaries. They also followed prescribed procedures, but through their reflections were able to contribute to increased inventory control. These are contradictory observations – the ES works well as a control system only to the extent that workers take control of their work and of the system. We capture this contradiction in the term ‘‘reflective conformity’’, our second theoretical con- cept. The net result is that while the ES can contribute to less reflection due to the embedded processes, it ultimately requires increased reflection to achieve the control benefits. Conformity to specified processes is enforced by an ES through built-in error checks and flags, and role-specific authorizations to perform transactions. These fea- tures create the system-embedded governance structure that Foucault saw as the nexus of power and control. Without such constraints, the enhanced information vis- ibility would empower individuals to perform tasks well outside the scope of their roles. In fact power users who have broad authorizations can end up performing tasks for any part of the plant. The need to maintain conformity arises because every action in an integrated system has ripple effects far beyond the initiatorÕs location. Integration also demands that transactions be completed in specific sequences, and failure to execute all steps as expected can create roadblocks for other users. This same integration and its associated complexity simultaneously generates a need for more reflection. While the constraints imposed by embedded procedures might be assumed to ensure that a user can automatically follow prescribed proce- dures without much reflection, this is not always the case. No finite set of embedded