1. Abstract Enterprise resource planning (ERP) systems have been the most popular business management systems in the 21st century, providing benefits of real-time capabilities, enhancing organizational competencies and seamless communication for business in both small and large organizations. Today, most universities have begun replacing their legacy systems with ERP initiatives to improve management and administration. Though they are credited with major prospects of re-engineering the work processes, these initiatives present some challenges to the management of these universities. This study focused on the challenges and prospects of ERP systems in the newly chartered public universities in Kenya. A review of previous studies on the challenges and prospects of putting in place this framework in public sector including universities was done. A descriptive survey research design was used to select the staff in all the 24 newly chartered universities in Kenya, while simple random sampling method was used in choosing 120 respondents who were heads of departments. A five point Likert scale questionnaire was used for data collection. A reliability estimate of 0.69 was realized for the instrument using Cronbach reliability coefficient. Data collected was analysed using descriptive statistics and presented in tables and charts. The study established that management support is vital for any organization to be able to successfully implement and use ERP systems effectively. In addition, inadequate preparation by the universities to manage change, failure to involve endusers during the implementation stage, failure by the system vendors to modify the system to conform to the requirements of these universities, failure by the institutions to re-engineer their business processes to match ERP requirements and lack of effective end-user training were also cited as the challenges facing the success of the ERP systems in the newly chartered universities. The findings further indicated successful implementation of the system will eliminate redundant tasks and lead to an overall reduction of operational cost. It will also lead to easier access to reliable data and information, improved customer relationship and the ability to produce better reports and information are some of the prospects that majority of the respondents believe the ERP system will provide. This study may be useful to public universities management by helping them gain better understanding on how to utilize information technologies. It also provides information that will assist them in making informed decisions on the best ERP implementation strategies to be employed. Lastly, the study will creates a forum for discussions on ways of solving ERP challenges currently being faced by the newly chartered public universities in Kenya.
Enterprise resource planning (ERP) systems have been the most popular business management systems in the 21st century, providing benefits of real-time capabilities, enhancing organizational competencies and seamless communication for business in both small and large organizations. Today, most universities have begun replacing their legacy systems with ERP initiatives to improve management and administration. Though they are credited with major prospects of re-engineering the work processes, these initiatives present some challenges to the management of these universities. This study focused on the challenges and prospects of ERP systems in the newly chartered public universities in Kenya. A review of previous studies on the challenges and prospects of putting in place this framework in public sector including universities was done. A descriptive survey research design was used to select the staff in all the 24 newly chartered universities in Kenya, while simple random sampling method was used in choosing 120 respondents who were heads of departments. A five point Likert scale questionnaire was used for data collection. A reliability estimate of 0.69 was realized for the instrument using Cronbach reliability coefficient. Data collected was analysed using descriptive statistics and presented in tables and charts. The study established that management support is vital for any organization to be able to successfully implement and use ERP systems effectively. In addition, inadequate preparation by the universities to manage change, failure to involve end-users during the implementation stage, failure by the system vendors to modify the system to conform to the requirements of these universities, failure by the institutions to re-engineer their business processes to match ERP requirements and lack of effective end-user training were also cited as the challenges facing the success of the ERP systems in the newly chartered universities. The findings further indicated successful implementation of the system will eliminate redundant tasks and lead to an overall reduction of operational cost. It will also lead to easier access to reliable data and information, improved customer relationship and the ability to produce better reports and information are some of the prospects that majority of the respondents believe the ERP system will provide. This study may be useful to public universities management by helping them gain better understanding on how to utilize information technologies. It also provides information that will assist them in making informed decisions on the best ERP implementation strategies to be employed. Lastly, the study will creates a forum for discussions on ways of solving ERP challenges currently being faced by the newly chartered public universities in Kenya.
A kind of information system known as Enterprise Resource Planning (ERP) is becoming more popular and useful in almost all industries specially in developing nations like Kenya.
ERP systems are application packages including several modules supporting all operation areas: planning, production, sale, marketing, distribution, accounting, financial, human resources, project management, stocks, service and maintenance, logistics and e-business. ERP software integrates and centrally manages the business functions of an organization (
The rise in popularity of ERP software and the evidence of continued ERP implementation in the public sector make it important for University management to understand the challenges for implementing ERP software. Enterprise Resource Planning systems have transformed the way organizations go about the process of providing information. They promise to provide on-the-shelf solutions to the information needs of organizations. Despite that promise, implementation processes are plagued with much publicized failures and abandoned projects (
A number of studies have been carried out worldwide in an effort to address the challenges facing ERP systems as well as identify its prospects. These studies include Jepng’eno
Available literature indicates that, so far, no study has attempted to address the challenges and prospects of ERP systems in the newly chartered public universities in Kenya, yet technology remains a key driver of business success in every industry.
The goal of the ERP system is to integrate all departments and functions across an organization onto a single computer based information system. This single system, according to Hossein (
The wide spread penetration of IT has become a part of our social, business and economic fabric. Today, public universities in Kenya are looking for ways to integrate all their business processes in an effort to cut on operational costs, offer timely response to their clients and interact with their stakeholders’ real time. To meet these requirements, public universities in Kenya have resorted to use of ERP systems to automate their operations on a standardized platform in line with their strategic plans. With most studies laying emphasis on ERP systems in big businesses in Kenya, this study seeks to establish the challenges and prospects of ERP systems in newly chartered public universities in Kenya. The principal aim of the study is to establish the Challenges and Prospects of Enterprise Resource Planning Systems in the Newly Chartered Public Universities in Kenya by seeking answers to the following question; what are the challenges and prospects associated with Enterprise Resource Planning (ERP) systems in the newly chartered Universities in Kenya?
This study is significant in several respects. First, the implementation of ERP software has continued to grow in both public and private universities in Kenya. Thus, it is important that the public Universities management have relevant information that will help them make intelligent decisions on the best initiatives. Secondly, it is also important for the public Universities management to understand the issues with which they could be faced during ERP implementation, based on that, this study provides information that will assist them in making informed decisions on implementation strategies.
Thirdly, the study will creates a forum for discussions on ways of solving ERP challenges currently being faced by the newly chartered universities in Kenya.
An Enterprise Resource Planning System (ERP) is an information system that manages, through integration, all aspects of a business including production, planning, purchasing, manufacturing, sales, distribution, accounting, and customer service (
This study borrows the ERP definitions by David Caruso at Advanced Manufacturing Research, Incorporated and LaMonica as cited in Minahan (
Others are client/server technology, which is computer architecture wherein a server is networked to end-user desktop computers (clients) and drill down/audit trail capabilities, which refers to audit trails that provide the ability to review all of the history of changes to a record in the database (such as a requisition). ERP audit capabilities record activity by user name, date, time, and transaction. Drill-down permits the ability to reach the source document of a prior step in the process, such as detail for a journal entry. Features such as Flexible Chart-of-Accounts, which incorporates detailed information, while maintaining the overall reporting and budgeting structure; Advanced reporting and analysis, which equips decision makers with the tools to detect patterns and trends in order to make better decisions; Web enabling and internet capabilities, which facilitate transactions with the external world; Best business practices and process reengineering, which means that the software is modelled after best business practices and is also flexible enough to permit redesign of core operational processes; Workflow capabilities, which refers to the ability to push the flow of information through a business to the right people at the right point and Powerful development toolsets, which allow technical people to redefine menus and panels without changing the underlying programming codes are also included.
A number of studies have been done to assess the need for ERP systems in the academic industry in Kenya and beyond. Jepng’eno
Mwove and Kwasira (
An empirical study on one ERP system for twenty five universities of Saudi Arabia Universities by Awad (
Hurbean (
Lastly, Tortorella and Fries (
A university’s most valuable assets are faculty, programs and staff. Each has distinctive interests and characteristics within the same organization. For faculty, a university is a place to teach, conduct research, and write. For students, it is a place to learn, live, and entertain. For staff, it may share many features with corporate work, including management structure, hours, and human resources practices (
Bingi
Many successful cases of ERP system implementation have been reported, but equally, many companies have announced their ERP systems as failed systems. The failure of ERP systems or the inappropriate usage of the systems will definitely cause a huge loss for the organization and may even lead to bankruptcy (
The leadership as well as competence of these stakeholders will determine to a large extent the success of the project (
Heiskanen, Newman and Similä, (
ERP implementation is believed to reinforce administrative authority as a model of governance. For academics, this may lead to fear that use of a new system that results in increased transparency of their transactions would result in a loss of control. On the other hand, administrative staff may fear for their job security when redundant processes are eliminated work functions are automated across a university (
Also, as ERP systems are “large integrated packaged solutions” with dynamic complexity, it may cause difficulties with implementation for management and IT staff in universities, even those who might have comprehensive understanding of their own organizations (
Today’s business environment is dramatically changing, competitive business environment, expanding markets, and rising customer expectations are some of the big challenges faced by most of the organizations. In the last few decades, globalization, scientific and technological advances of mankind influenced the educational institutions to consider the role of technology in educational processes (Hutinski and Aurer, 2009: 265–272). Private universities have long realized this need and, therefore, they have made huge investments in modern Information Systems (IS). In Kenya, public universities are not equipped with modern IS with the newly chartered public universities being the most poorly equipped technologically.
Several research studies have identified various prospects associated with ERP systems in organizations. O’Leary (
The primary goal of ERP is to improve and increase information flow within an organization (
The research study adopted a descriptive survey research design. Descriptive research design provide a comparative approach to the ERP systems in automating and integrating management practices of public universities in Kenya. This methodology also helped the researcher in using comparative statistical methods to analyse the research subject in the newly chartered public universities. The population for this study comprised all the heads of departments in all the 24 newly chartered public universities in Kenya. A simple random sampling technique was employed in the study. This method of sampling was chosen since it allows individuals to be chosen at random and not more than once to prevent a bias that would negatively affect the validity of the result of the experiment.
The research study relied on both primary and secondary data sources. Primary data was gathered using structured five point scale Likert questionnaire. In addition to the primary data, secondary data from journals, white-papers and e-books was also used to provide comparative perspectives to the study.
Validity and reliability was taken into consideration in the study in order to determine its objectivity, level of trustworthiness and credibility. This study made use of face validity where a panel of experts gave their input as to whether the instrument met the criterion while Cronbach’s alpha (α) values were computed to test reliability where a score of more than 0.7 is considered acceptable. Scrutiny of the study by colleagues, peers and my supervisors was also used to gather and challenge assumptions made. Data was analysed using descriptive statistics, and factor analysis.
The researcher summarized the findings in line with the variables and objective of the study. This was followed by drawing of relevant conclusions. Lastly, recommendations for pertinent actions were suggested.
Respondents who worked in various departments were requested to give a rating on their level of agreement on ERP challenges in their departments. The variable had five indicators. The descriptive results are summarized and presented in
80
3.0000
80
3.4000
80
3.0000
80
3.4500
80
3.6000
80
3.3000
80
3.6500
80
3.2500
80
3.6400
80
3.2000
80
3.9000
80
3.6000
Source: Survey Data (
A mean score of 1 to 2.5 represented strongly disagree, 2.6 to 3.5 represented neutral while 3.6 to 5 represented strongly agree. According to the findings the following ERP challenges indicators had a mean of 3.6 and above meaning the respondents had a strong agreement with them.
ERP Challenges
The organization was not prepared to manage change. | 3.6000 | |
End-users were never involved during the implementation. | 3.6500 | |
The ERP software was not modified to meet our needs. | 3.6400 | |
Our institution did not map or re-engineered our business processes to match the ERP processes. | 3.9000 | |
There was no effective end-user training. | 3.6000 |
This therefore indicates the challenges of ERP systems in the newly chartered universities are mostly due to inadequate preparation by these universities to manage change, failure to involve end-users during the implementation stage, failure by the system vendors to modify the system to conform to the requirements of these universities, failure by the institutions to re-engineer their business processes to match ERP requirements and lack of effective end-user training.
6 and less than 36 shows that the respondents were neutral, that is they neither agreed nor disagreed They are listed below:-
The implementation project manager had no relevant skills in project management. | 3.4000 | |
The project had no skilled consultants. | 3.0000 | |
The project had no support of head of departments. | 3.0000 | |
Top management was not kept abreast of the project status. | 3.4500 | |
The project team was not knowledgeable about ERP and business processes. | 3.3000 | |
The implementation had no top management (executive level) support. | 3.2500 | |
There was no clearly defined scope for the implementation project. | 3.2000 |
Source: Survey Data (
On the overall opinion of the respondents regarding ERP challenges, majority of them 70% as indicated in figure 1 agreed that the challenges are indeed prevalent in their departments.
Similarly respondents were also requested to give a rating on their level of agreement on ERP prospects in their departments. The variable had five indicators. The descriptive results are summarized and presented in
ERP Prospects
|
|
Mean |
Eliminate/ Reduce redundant tasks. |
80 |
4.3000 |
Overall reduction of operational costs. |
80 |
3.3000 |
Redesign business processes. |
80 |
2.3000 |
Easier access to reliable data and information. |
80 |
3.7000 |
Improved customer relationship or supply chain management. |
80 |
4.2000 |
Improve internal communication. |
80 |
3.6000 |
The ability to produce better reports and information needed |
80 |
3.9000 |
Integration of all business processes in the university. |
80 |
3.8000 |
Increase standardization of processes. |
80 |
3.7000 |
Aggregate |
|
|
Source: Survey Data (
5 represented strongly disagree, 26 to 35 represented neutral while 36 to 5 represented strongly agree According to the findings the following ERP prospects indicators had a mean of 36 and above meaning the respondents had strong agreement with them
Eliminate/ Reduce redundant tasks. |
80 |
4.3000 |
Easier access to reliable data and information. |
80 |
3.7000 |
Improved customer relationship or supply chain management. |
80 |
4.2000 |
Improved internal communication. |
80 |
3.6000 |
The ability to produce better reports and information needed |
80 |
3.9000 |
Integration of all business processes in the university. |
80 |
3.8000 |
Increase standardization of processes. |
80 |
3.7000 |
Majority of the of the respondents believe that the prospects associated with the ERP system will be realised, these are; elimination of redundancy, easier access to data and information, improved customer relationship or supply chain management, improvement of internal communication, ability to produce better reports and information needed, integration of all business processes and an increased standardization of processes.
6 but less than 36 shows that the respondents were neutral, they neither agreed nor disagreed They are listed below:-
Overall reduction of operational costs. |
|
3.3000 |
Redesign business processes. |
|
2.3000 |
Source: Survey Data (
When the respondents were asked to give their overall opinion on whether the ERP prospects could be realised in the near future, only 40% of them believe so while majority 60% did believe in their departments achieving the prospects.
This paper presents review of challenges and prospects of ERP system in the newly chartered universities in Kenya. The findings of this paper are based on analysis of both primary and secondary data. This research article highlights the challenges and prospects of ERP system in the context of developing nations like Kenya. All the universities studied were chartered lest than five years ago, meaning they are still struggling to stand on their own as fully fledged universities.
The university management and users can benefit from this study by identifying those key challenges to make the implementation procedure smooth without any disruption. Further ERP vendors can take inputs from this study to change their implementation approach. A well-designed and properly integrated and properly implemented ERP system allows the most updated information to be shared among various business units, thereby resulting in incredible cost savings and increased efficiency and provide competitive advantages. Of course, focussing and working on these challenges will improve the situation on successful ERP system implementation in public universities in Kenya.
The outcome provides important insights for the researchers and practitioners who are interested in implementing Enterprise Resource Planning systems, how best they can utilize their limited resources and to pay adequate attention to those factors that are most likely to have an impact upon the implementation of the ERP system. It also helps organizations to better understand the prospects of ERP systems and make the right decision on its investment.
The focus of the study was on the challenges and prospects of ERP systems in newly chartered public universities in Kenya. The study established that among the respondents, majority strongly agreed that management support is vital for an organization to be able to successfully implement and use an ERP system effectively. In addition, inadequate preparation by the universities to manage change, failure to involve end-users during the implementation stage, failure by the system vendors to modify the system to conform to the requirements of these universities, failure by the institutions to re-engineer their business processes to match ERP requirements and lack of effective end-user training were majorly cited as the challenges facing the success of the ERP systems in the newly chartered universities.
The findings further indicated that majority of the respondents agree that the system will eliminate redundant tasks and lead to an overall reduction of operational cost. Further, easier access to reliable data and information, improved customer relationship and the ability to produce better reports and information are some of the prospects that majority of the respondents believe the ERP system will provide.
The research was focusing on the challenges and prospects of ERP systems in the newly chartered public universities in Kenya. The researcher recommends that similar or related studies should be conducted in other sectors of the economy to determine the challenges and prospects of ERP systems in those sectors. The study established that issues surrounding the implementation, user support and adoption of the right ERP solutions are complex and can be expensive. The study further recommended that more research should be conducted to clearly present measures that should be undertaken to encounter the challenges associated with implementation, management and use of these electronic solutions especially because the newly chartered university are still struggling to attract the best calibre of skilled professionals to run and manage their systems.