Enterprise resource planning system adoption and organizational performance of manufacturing firms in Kenya
Abstract
Enterprise resource planning (ERP) system has been one of the most popular business
management systems, providing benefits of real-time capabilities and seamless
communication for business in large organizations. The adoption and of the system has
however not been measured by many firms in regard to organizational performance hence
the need for the Study. This study had two objectives. First to determine drivers for ERP
adoption by manufacturing firms in Kenya. Second was to determine the relationship
between ERP system adoption and organizational performance for manufacturing firms
in Kenya. This was largely motivated by the need to understand the relationship between
adopting the system and organizational performance by manufacturing firms in Kenya
where no conclusive research has been done before. In undertaking the study,
manufacturing firms in Kenya were targeted. The primary data was collected using
questionnaire from Finance, ICT team, supply chain, Factory and production team and
top management. The analysis was done by using frequencies average, standard
deviations and regression analysis and the findings were presented using tables,
frequencies, charts and narratives. Through the study, the findings stipulated that the
majority of the respondents agreed to a very great extent that the firm‟s competition from
other companies; cost saving and other financial reasons, business innovations, business
strategic positioning were the major drivers that motivated the organization to adopt the
ERP system as indicated by scores. The findings on organizational performance also
deduced that the majority of the respondents agreed to a very great extent that the firms
have better return on investment, improved data security, improved decision making
process and reduced cost of production. The study concludes that respondents were
highly experienced owing to the accumulation of knowledge and skills throughout the
working life and the level of education was medium to high. The study also concludes
that majority of the firms were limited companies and locally owned. On adoption of the
system, the study concludes that most manufacturing Firms have adopted the ERP
System with virtually all modules implemented.
Publisher
University of Nairobi