Analysis of the Influence of Cloud-Based Enterprise Resource Planning (ERP) System Adoption on Operational Performance in Manufacturing Companies

Abstract

This study analyzes the impact of cloud-based Enterprise Resource Planning (ERP) adoption on operational performance in manufacturing companies. Using cross-sectional survey data from n=180 firms that have implemented cloud ERP in Indonesia, we evaluate key antecedents—process integration (PI), cloud flexibility (CF), data quality (DQ), training quality (TQ)—and user satisfaction (US) toward a composite Operational Performance (OP) outcome. Measurement reliability was assessed via Cronbach’s alpha, composite reliability (CR), and average variance extracted (AVE). Structural relationships were tested using ordinary least squares (OLS) as a proxy for PLS-SEM. Results show that PI, CF, DQ, TQ, and US exhibit positive and statistically meaningful associations with OP (R²≈0.32). Post-adoption analysis further indicates improvements in inventory turnover, on-time delivery, schedule adherence, and overall equipment effectiveness, along with reductions in lead time and scrap rate. The findings provide practical implications for manufacturing managers who aim to leverage cloud ERP to drive end-to-end process visibility and continuous improvement.