Information Technology Systems and Logistics Management by Oil Companies in Kenya

Abstract

Firms are facing rapid competition in achieving efficiency and effectiveness in managing logistics to realize on-time delivery for products and services. Technology is perceived to be a critical component in achieving this goal. The study was set out to achieve the following objectives: to establish the extent to which oil companies in Kenya are using information technology systems; to determine the benefits that oil companies in Kenya get from using information technology systems; to determine the challenges faced by oil companies in the implementation of information technology systems; and to establish the relationship between information technology systems and logistics management of oil companies in Kenya. This study utilized a descriptive research design. The population for this study involved the oil companies in Kenya. The sample size involved 32 oil companies. The study utilized primary data collated from personnel in the IT department. Data was analyzed using descriptive and inferential statistics. It was found that IT systems were implemented to a great extent by oil companies in Kenya. The IT systems commonly utilized by these firms included Enterprise Resource Planning, e-procurement, Electronic Data Interchange, Just-in-Time and Radio Frequency Identification Systems. The benefits realized from the use of IT systems in managing logistics were improved efficiency, sharing information, real-time processes and minimized supervision costs. Further, it was found that inadequate finances, lack of technical skills, inadequate training programmes and lack of a good user interface were the key impediments that faced oil companies in implementation of IT systems. It is recommended that oil companies should invest more in modern technologies and innovation and hence improve information sharing and impact positively on coordination of logistics management. It would advisable for future researchers to investigate all oil companies in Kenya and establish if there are unique IT systems used by other oil companies in managing logistics not captured in this research.