SWOT Analysis And Enterprise Resource Planning For ICT

Strengths; as indicated/ mention in the table, the company has an internal advantage of a well dedicated team who work in the ICT department to ensure there is effective and efficient operation of all the equipment. Given the fact that the company is well established, it also provides a specific financial reserve for the department to monitor and maintain its operations accordingly. As a result of a reliable financial base, the department is able to make use of the latest technological equipment and in turn, improves the output in terms of quality and efficiently. The company is also located in an urban area where reliable supply of power and strong network coverage (Nicolaou, 2004, p.92).

Weaknesses; the organization does not have an effective linage of communication for the various departments. This affects the ICT department when it comes to relevant data needed for processing. The room provided for the ICT department is not large enough for free ventilation. The department is highly vulnerable to external attacks. Basing on the fact the machines and equipment being used are very expensive, the maintain ace costs are also high (Umble et al., 2003)

Opportunities. The department takes advantage of the growing demand of ICT in the accomplishment of business and transaction tasks. The company can also partner with other advanced ICT organization to train its staffs and improve on the general operational effectiveness.

Threats. High dynamic changes in ICT leaves the company at a high threat due to possibility of outdated technology that my drive away clients (E-business/ E-commerce clients) to other up to date websites. It is also most likely that that the confidential information may be attacked by malerwa/ virus

The purpose of this study is to clearly and critically investigate the impact of Enterprise resource management (ERP) tool on the performance of an organization. The study signifies the importance of using ERP tool, disadvantages involved/ weaknesses and suggest the possible remedies for the study. This is because ERP tool has become one of the most important relevant tools in the effective management of an organization. The software provides an automated monitoring advantage where all the organizational departments and operations can diversely be managed in a simple platform. The study will therefore provide recommendation basing on the problems established by research finding by different authors. With different findings from various literature reports, reliable and dependable recommendations will be made/ established.

Summary of the SWOT analysis

For the last decade, there has been a significant change in the technological hemisphere which has led to a rapid and dynamic changes in the business world. Organizations have adopted/ are adopting the latest management tools to help in the simplification of tasks and reduction of the operation costs, which among others include the Enterprise Resource Management tools. Enterprise resource planning is one of the most current and diversified technologies that are being employed by businesses to help in effective management and monitoring of various departments in the company. An approximation of 90% of large organizations/ companies employ ERP technology in their operations, medium companies are also adopting such technology as it has proved to be one of the best management tools. ERP system has basically provided three main factions among other subsidiary functions, which are; timely management of company information, mechanizing of the commercial process, and development and improvement in the supply chain by use of electronic communication and electronic business. Other relevance may include cost reduction, easy monitoring of large markets, and information clearance among others (Esteves, & Pastor,2001, p.7).

However, for an effective implementation of ERP, there is need for a significant resource level accompanied by a dedicated and committed expertise in an organization. In other words, it is one of the biggest and costly projects that companies ever launch as some organizations fail to successfully accomplish such tasks (Caglio, 2003, p.140).

Reflecting on the level of importance of the tool, various researchers have been invoked into its study, analysis and evaluation to establish its effectiveness. However, most of the research findings indicate that the tool has a positive impact on the performance of an organization if effectively used though it has some weaknesses that come along with it. Research studies by O’Leary (2000) indicate that ERP tool has a great impact on the performance of the accounting department in an organization. According to him, ERP has a diversified function that considerably reduces the complex and integrated tasks into a simple and manageable work load. He compared the performance of the organizations using ERP to those that are not using the tool and according to the findings, organizations employing ERP are more cost effective and efficient management as compared to those that are not using the tool. The researcher in this case demonstrated that ERP improving the performance effectiveness of most organizations mostly the large organization that have bulky and complex tasks. In relation to human efficiency, accountants are error prone in their work and with such limitations, companies/ organizations experience losses and structural breakdown to mismanagement and misallocation of resources. In other words, comparing the performance of ERP to the usual manpower needed for the operations of enterprises, employing the software the use of the utility tool is much better and efficient in terms of cost and effectiveness

Enterprise Resource Planning (ERP)

Bradford & Florin (2003) conducted a research on 15 companies located in Finland to evaluate the degree of uniformity of the information management system on accounting department. Their report indicated that there is a small improvement in the management accounting and also improved the control techniques. According to them, Enterprise resource planning tool works best when it is accompanied by strategic enterprise management (SEM) implying that for ERP to perfectly perform the diversified functions, it needs to be used simultaneously with SEM

According to Hunton, Lippincott & Reck, (2003), ERP simply brings a change in the nature of the management methodology in regard to the operational tasks held by the expertise. He discovered that the tool brings about a change a change in the management tasks of the accountants in that the most of the raw information is internally processed and internalized and what comes out is a well-organized information that can be used for further forecast and other important uses. In this case, they say tool reduces the work load that needed more accounts to a few personnel to handle the bulk task. Besides a reduction in the manpower required for handling a specific task, the tool also proves more efficient in its usage as compared to human resource

Zhang, Lee, & Banerjee (2003, January), in there research, they found that there is still a high level of rigidity among accountant and organizations in adopting the new technological advancement (ERP). This is because the basic changes from the ordinary tools and human resource requires highly skilled expertise management methods. Moreover, even the basic differences in the functions played are not very different. Companies that are rigid to technological dynamism are still using the ordinary management techniques. From their report, thy found that such companies have generally not adopted most technological changes (Dechow, & Mouritsen, 2005, p.6610).

In general, research findings indicate that Enterprise Resource Planning (ERP) brings about a change in the cultural, structural, technological, and functional operational methodology in enterprises. For an organization to achieve a positive and effective results from the use of ERP, there should be a considerable change in the structural and functional management and operation of the company (Bajwa, Garcia, & Mooney, 2004, p.88). The accounting team/ department should be well conversant with the new tool that is being adopted, otherwise, the whole project may not work out leading a failure. This is because the system basically relies on data and if the team handling it is not well established in the field then, it will imply inappropriate use hence errors. Basing on the research findings, there absence been less achievement of the ERP goals on situations where the management accountants were excluded or involved in a later stage of the implementation of the project (Calisir, & Calisir, 2004, p.510). The management accountants avail the necessary information/ data need in the processing. On situations of poor coordination of the different organizational departments to produce clear data to be entered into the system may also lead to a failure in the tool. In other words, the tool requires a diversified a well-coordinated departmental structure to feed the data from the different departments. As mentioned before, ERP works integrated format with other applications/ software. Managing operations from different departments and this explains the need for the effective departmental coordination (Somers, & Nelson, 2001, p.10)

Executive summary

Enterprise resource management (ERP) tool has played a very vital role in the development and management of enterprises with reduced operational costs. The tool has positively changed the operations of most organizations. This is because ERP tool has become one of the most important relevant tools in the effective management of an organization. The software provides an automated monitoring advantage where all the organizational departments and operations can diversely be managed in a simple platform. Amongst the various roles, the few can be indicated in;

Reduction in the total time spent in data collection. Research findings show that management accounts highly recommend the use of ERP in data collection. Moreover, the tool even accept diversified data during the collection. This makes the whole process short during the information capturing (Al-Mashari, Al-Mudimigh, & Zairi, 2003, p.360). Another advantage of the tool is that it simplifies data processing. A minimal time is used for data processing, analysis and interpretation as compared to the non-use of ERP. The tool has a designed automated processing features that enables it to generally process, and analyses provided data in a short period of time with a help of a human resource/ expertise who are competent in its usage (Soh, Kien, & Tay-Yap, 2000, p.60).

The ERP tool plays a great role in making of commercial decisions taken by the organization. As logically arranged from the first advantage, the software helps in collecting of the data, process and interpreting with the help of expert team. The interpreted information gained from the ERP directly influences the business decision taken by the organization. This is mostly played by the management accounts. They help interpreting the information gained from the ERP tool in the commercial decision of the organization (Gupta, 2000, p.116).

Focusing of internal reporting. The use of ERP improves the general monitoring of company performances, controlling and evaluation. With the help of the tool, the expert team can closely manage all the company activities effectively. With the latest mode of technology being used to design the tools, several other applications/ software’s can be merged to work in an integrated format to allow the system track the ongoing operations in relations to the set objectives and schedule. It has been made simple by the implementation of the ERP in that the cost and expenditure of a proposed project can be forecasted. This provides an easy way to management accounting (Wright, & Wright, 2002, p.110).

Literature review

The development and adaptation of new enterprise management tools especially ERP requires high experienced staff to handle the tasks that are associated. This explains the cause of failures by various organizations (Mabert, Soni, & Venkataramanan, 2000, p.50). The expert team are sometimes not fully well conversant with the usage of the tool which results into improper usage. The data analysis also requires a technical skill for the interpretation of the information. For any organization to successfully achieve its goal, the management accounts department should have among others; technical skills kills in relation to their roles in the team, an understanding of commercialization, good communication skills and a high level of honesty and trusteeship. Having experts less these quality is likely to fail the project (Hitt, & Wu, 2002, p.82)

As discussed in the introduction, its implementation is one of the biggest projects companies ever undertake implying that the process is so costly in term of its execution ERP also mainly focuses on cross-functional analysis, interpretation and evaluation. In other words, for the management tool to be implemented, cross-functional data should be availed which makes the process complicated and unique in term of usage. This was irrelevant without the use of the ERP (Bradley, 2008, 180)

Conclusion

As clearly stated earlier, most research studies say that ERP has greatly contributed to the improvement of the performance process, monitoring, and quality evaluation of companies. It has a direct link to the improvement of the organization. The studies also clearly indicates that the use of the too help the organization to reduce on the operational costs as the tool tends to simplify the complex tasks that would require a big number of expertise into a small and manageable task load that can easily be handled by a smaller team, moreover, the level of efficiency attained while perfectly using the system is high.

However, it was also found out that ERP can be very costly in its implementation. Is requires demands for particular qualities that should constitute the staff implementing it as clearly explained in the weaknesses. A large and reliable financial source is also required to manage the integrated and complex operations that occurs. It is therefore very important for firms and organizations to thoroughly evaluate their capabilities in relation to requirements of the system before beginning any implementation project concerning ERP. Poor departmental coordination as mentioned as one of the causes of failures of ERP projects, firms should ensure the recruitment of well-versed staff for the different departments to ensure effective coordination and flow of information from different departments for easy data collection, compilation and process.

References

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