A CRITICAL EVALUATION OF SAP HEALTHCARE INDUSTRY …
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1 A CRITICAL EVALUATION OF SAP HEALTHCARE INDUSTRY SOLUTION SYSTEM IMPLEMENTATION AS A SOURCE OF COMPETITIVE ADVANTAGE: A CASE STUDY OF CHITUNGWIZA GENERAL HOSPITAL ALBERT TENDAI CHIKATI (R093669Q) A DISSERTATION SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS OF THE DEGREE OF MASTER OF BUSINESS ADMINISTRATION 2016 GRADUATE SCHOOL OF MANAGEMENT UNIVERSITY OF ZIMBABWE SUPERVISOR: DR HAPANYENGWI
Transcript of A CRITICAL EVALUATION OF SAP HEALTHCARE INDUSTRY …
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A CRITICAL EVALUATION OF SAP HEALTHCARE INDUSTRY SO LUTION SYSTEM IMPLEMENTATION AS A SOURCE OF COMPETITIVE AD VANTAGE: A
CASE STUDY OF CHITUNGWIZA GENERAL HOSPITAL
ALBERT TENDAI CHIKATI (R093669Q)
A DISSERTATION SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS OF THE DEGREE OF MASTER OF BUSINESS ADMINISTRATION
2016
GRADUATE SCHOOL OF MANAGEMENT
UNIVERSITY OF ZIMBABWE
SUPERVISOR: DR HAPANYENGWI
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DEDICATION
This work is dedicated to wife Evernice and children Tariro, Tendai and Tavonga. To all
scholars in the field of business strategic planning, I believe this study is insightful.
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DECLARATION
I, Albert Tendai Chikati, do hereby declare that this dissertation is the result of my own
investigation and research, except to the extent indicated in the Acknowledgements, References
and by comments included in the body of the report, and that it has not been submitted in part or
in full for any other degree to any other university.
______________ ___________
Student signature Date
_______________ ____________
Supervisor signature Date
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ACKNOWLEDGEMENT
I would like to thank my supervisor, Dr. Hapanyengwi for the valuable guidance and help
throughout the research process.Special thanks to the management and staff at Chitungwiza
General Hospital, without whose contribution this study could not have been possible. I must
also acknowledge the material and moral support from my colleagues during the research
process.
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EXECUTIVE SUMMARY
Globally, SAP systems solutions are increasingly playing an important role transforming
business processes. More important hospitals with their complex and varied operations have
turned to the use of these enterprise resource planning systems. Chitungwiza general hospital
adopted the use of SAP in 2014. This study aimed at evaluating the impact of SAP system
implementation focusing on Chitungwiza general hospital. Consequently, this study aimed at an
examination of the factors that surround SAP implementation in particular its facilitators and
inhibitors and the overall impact on business areas such as SCM and accounting systems. This
study was conducted in Chitungwiza covering all hospital departments that have integrated SAP
solutions in their operations. Literature on SAP showed dearth in information concerning SAP
implementation in the health industry. To address the research objectives, he study employed the
mixed research methodology were qualitative (interviews) and quantitative (questionnaires) data
were solicited to meet the research objectives. This triangulation and the pilot study conducted
was instrumental in enhancing the validity and reliability of the findings. Data from the
questionnaires was coded, a dataset created and analyzed using the statistical package of social
sciences to analyse descriptive and inferential statistics. Content analysis was also used for data
analysis. The study findings revealed that SAP implementation has positively transformed
hospital business operations that include accounting, records management and customer services
management. Such changes, the research revealed have had a positive change on the profitability
and viability of the health institution. The research found that although the hospital has
prioritized SAP trainings challenges still exist concerning adequate resourcing of the SAP
implementation processes. Granted these challenges, this study suggests that in order to reap the
benefits of SAP implementation, adequate financing is extremely important. The hospital has to
provide the monitoring frameworks to enhance the implementation process. It is hoped that these
measures can enhance the implementation of SAP.
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TABLE OF CONTENTS
Contents Page
Dedication ....................................................................................................................................... ii
Declaration ..................................................................................................................................... iii
Acknowledgement ......................................................................................................................... iv
Executive summary ......................................................................................................................... v
Table of contents ............................................................................................................................ vi
List of tables .................................................................................................................................... x
List of figures ................................................................................................................................. xi
Abbreviations ................................................................................................................................ xii
Chapter 1 Introduction and Background ................................................................................. 13
1.1 Introduction ............................................................................................................................. 13
1.2 Background to the Study ......................................................................................................... 13
1.3 Statement of the Problem .......................................................................................................... 3
1.4 Research Objectives .................................................................................................................. 4
1.5 Research Questions ................................................................................................................... 4
1.6 Significance of the Study .......................................................................................................... 5
1.7 Summary ................................................................................................................................... 5
Chapter 2 Literature Review ....................................................................................................... 6
2.0 Introduction ............................................................................................................................... 6
2.1 The Concept of ERP and Competitive Advantage ................................................................... 6
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2.2 Evolution of ERP and SAP ....................................................................................................... 8
2.3 Rationale for Implementation of ERP..................................................................................... 14
2.4 ERP Importance in Healthcare Institutions............................................................................. 18
2.5 Costs of ERP System .............................................................................................................. 20
2.6 ERP Lifecycle and Implementation Processes ....................................................................... 20
2.6.1 Adoption Decision Phase ................................................................................................. 21
2.6.2 Acquisition Phase............................................................................................................. 21
2.6.3 Implementation Phase ...................................................................................................... 21
2.6.4 Use and Maintenance Phase............................................................................................. 21
2.6.5 Evolution Phase ............................................................................................................... 22
2.6.6 Retirement Phase ............................................................................................................. 22
2.7 ERP Success Measurement Model ..................................................................................... 24
2.8 Implementation Strategies .................................................................................................. 25
2.9 Conceptual Framework ........................................................................................................... 26
2.10 Summary ............................................................................................................................... 27
Chapter 3 Research Methodology ............................................................................................. 28
3.0 Introduction ............................................................................................................................. 28
3.1 Research Philosophy ............................................................................................................... 29
3.2 Research Approach ................................................................................................................. 29
3.3 Research Strategy.................................................................................................................... 30
3.4 Research Design...................................................................................................................... 30
3.5 Population and Sample ........................................................................................................... 31
3.6 Sample Size and Sampling Strategies ..................................................................................... 31
3.6 Sources of Data ....................................................................................................................... 32
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3.6.1 Primary Data .................................................................................................................... 32
3.6.2 Secondary Data ................................................................................................................ 33
3.7 Data Collection Procedures..................................................................................................... 33
3.8 Data Collection Techniques .................................................................................................... 34
3.8.1 Questionnaire ................................................................................................................... 34
3.8.1.1 Questionnaire Design ................................................................................................ 35
3.8.1.2 Pilot Testing of Questionnaires ................................................................................. 35
3.8.2 Interviews ......................................................................................................................... 36
3.8.3 Document Analysis .......................................................................................................... 36
3.9 Data Analysis and Presentation .............................................................................................. 37
3.10 Validity and Reliability ......................................................................................................... 37
3.11 Limitations to the Study ........................................................................................................ 38
3.12 Ethical Considerations .......................................................................................................... 38
3.13 Summary ............................................................................................................................... 39
CHAPTER 4 DATA PRESENTATION AND DISCUSSION ................................................ 39
4.1 Introduction ............................................................................................................................. 39
4.2 Response Rate ......................................................................................................................... 40
4.3 Respondents by Department ................................................................................................... 41
4.4 Working Experience in Respective Departments ................................................................... 42
4.5 Reliability Statistics Questionnaire Constructs ....................................................................... 43
4.6 Impact of SAP Implementation on Time Spent Serving Patients ........................................... 44
4.7 SAP Impact on Organisational Processes ............................................................................... 47
4.8 Dynamics and Challenges in SAP Implementation ................................................................ 57
4.9 Impact of SAP Modules and Levels of Satisfaction ............................................................... 62
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4.10 Summary ............................................................................................................................... 65
Chapter 5 Conclusions and Recommendations ........................................................................ 66
5.0 Introduction ............................................................................................................................. 66
5.1 Major Research Findings ........................................................................................................ 66
5.1.1 Effectiveness of SAP Implementation in Enhancing Competitive Advantage ................ 66
5.1.2 Impact of SAP Implementation on Accounting Profitability .......................................... 67
5.1.3 SAP Implementation on SCM Practices .......................................................................... 67
5.1.4 The Impact of SAP on Patient Management and Public Trust. ....................................... 67
5.1.3 Factors Enhancing SAP Implementation ......................................................................... 68
5.1.3 Factors Hindering SAP Implementation .......................................................................... 70
5.1.4 Benefits of SAP Implementation ..................................................................................... 71
4.2 Conclusion .............................................................................................................................. 72
4.3 Recommendations ................................................................................................................... 72
4.4 Areas for Further Research ..................................................................................................... 73
References ..................................................................................................................................... 75
Appendix 1: Questionnaire ........................................................................................................... 80
Appendix 2: Interview Guide........................................................................................................ 84
Appendix 3: PATIENT QUESTIONNAIRE ................................................................................ 85
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LIST OF TABLES
Table 2.1: Rationale for ERP Implementation .............................................................................. 17
Table 2.2: Summary of ERP Success Frameworks ...................................................................... 24
Table 3.1: Outline of Sample and Sampling Strategies ................................................................ 32
Table 4.1: The Questionnaire Response Rate ............................................................................... 40
Table 4.2: Interview Response Rate ............................................................................................. 41
Table 4.3: Percentage Distribution of Respondents by Working Experience .............................. 42
Table 4.4: Reliability Statistics ..................................................................................................... 43
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LIST OF FIGURES
Figure 2.1: SAP Functional Areas ................................................................................................ 10
Figure 2.2: SAP Easy Access Interface ........................................................................................ 12
Figure 2.3: SAP R/3 Business Processes ...................................................................................... 13
Figure 2.4: Conceptual Framework .............................................................................................. 27
Figure 4.1: Percentage Distribution of Respondents by Departments .......................................... 41
Figure 4.2 Comparison of Average Amount of Time in Minutes Spent Serving Client Before and
After SAP Implementation Across Departments .......................................................................... 44
Figure 4.3: Percentage Distribution Of Respondents Views on Impact Of SAP on CRM ........... 46
Figure 4.4 Percentage Distribution of Respondents Views SAP Impact On Better Reporting .... 47
Figure 4.5: Percentage Distribution of Respondents’ Views on the Impact of SAP On Access to
Reliable Information ..................................................................................................................... 50
Figure 4.6: Percentage Distribution of Respondents’ Views On the Impact of SAP on Business
Process Restructuring.................................................................................................................... 51
Figure 4.7: Percentage Distribution of Respondents’ Views on Impact of SAP on Redundant
Task and Internal Communication ................................................................................................ 53
Figure 4.8 Percentage Distribution of Respondents’ Views on the Impact of SAP on
Standardization of Processes......................................................................................................... 54
Figure 4.9: Percentage Distribution of Respondents Views On SAP impact on Adaptability ..... 56
Figure 4.10: Dynamics of SAP Implementation ........................................................................... 58
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Figure 4.11: Percentage Distribution of Respondents’ Views on SAP Implementation Challenges
....................................................................................................................................................... 60
Figure 4.12: Percentage Distribution Levels of SAP Satisfaction Per Department ...................... 63
ABBREVIATIONS
ERP Enterprise Resource Planning
ICT Information Communication Technology
MRP Material; Requirement Planning
SAP Systems Application Products
SCM Supply Chain Management
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CHAPTER 1
INTRODUCTION AND BACKGROUND
1.1 Introduction
Globally, healthcare institutions are facing unprecedented challenges and demands of the new
market environment making the focus on measuring and managing costs imperative. Sub-
Saharan African Health facilities, those in Zimbabwe included, are struggling not only with the
need to adapt to a new market environment but with the global burden of diseases. Hammond of
the International Finance Corporation (2007) reports that Sub Saharan Africa accounts for 11
percent of the world’s population, yet bears 24 percent of the global disease burden, having less
than 1 percent of the world health expenditure. Other defining characteristics of these countries
include higher doctor to patient ratio, shortage of medication and poor health facilities. These
challenges are multifaceted and the scarcity healthcare management systems have made their fair
share of contribution to this dire situation.
1.2 Background to the Study
SAP (2010) noted that the global financial crisis has put on the spotlight the importance of
efficiency, transparency and agility for organisations. The global financial situation together with
government policies which attempt to reduce the rapidly escalating healthcare expenses has not
helped the cause of healthcare institutions. These often translate into decreased revenue for the
hospitals which are already facing competition over patient resources as even medical insurers
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are tightening operations minimizing the period of costly hospital stays. Hongoro and
Kumaranayake (2000) noted that patients are no longer passive customers as there is increased
demand for information and quality services. To survive, health care institutions must find ways
of adapting to the changing environment to gain public trust which is critical for viability and
profitability.
Indeed, the healthcare system should be geared towards activities that are aimed at keeping
people healthy and restoring health when people are diseased. By the same token, the importance
of adequate resourcing cannot be ignored as better resourcing often translates into better service
delivery. In this period of change and challenges, solutions have emerged to not only counter
these issues but to usher in better ways of improving service delivery and attaining cost effective
optimum performance. Enterprises Resources Planning (ERP) software solutions, SAP included,
have been used in the healthcare service provision industry in integrating the diverse business
operations enabling the transfer of data among various business units. According to Hofmann
(2008), ERP applications such as SAP form a well structured and reliable information
technology backbone of big organizations worldwide.
Hospitals have used special ERP applications in a number of areas that include patient
management, logistics, finance and general management, meeting the specifications of each
hospital setting. The use of ERP SAP should result in a number of benefits accruing to the
implementing organisation. Within the healthcare service industry such benefits should range
from waiting periods of patients to improved business processes, better credit returns and better
synergy between the front office and the back office.
Chitungwiza hospital implemented SAP healthcare industry solution system in 2014 to improve
service delivery, enhance business viability and competitiveness. Chitungwiza is a public health
service provider. According to Al-Mashari (2003) argues that ERP when properly implemented
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can support process oriented businesses effectively as project failure may result in the damage of
the institution. It is important to continuously monitor the performance of any implemented
system to ensure that it provides adequate guarantees of survival and sustainability. Kumar and
Hillegersberg (2000) notes that the complexity of ERP, high costs and implementation
challenges often result in many organisations reconsidering their initial plans and remodeling
their enterprise system. The implementation of SAP by Chitungwiza general hospital comes at
the backdrop of the decline of healthcare delivery services which have reduced public trust in
public healthcare systems. The study shall explore the impact of SAP implementation processes,
challenges and opportunities with the view of helping stakeholders benefit from ERP improved
efficiency.
1.3 Statement of the Problem
The Zimbabwean healthcare service industry is characterised by intense competition between
private and public service providers. Individuals now trust private hospitals compared to public
hospitals as the private hospitals provide better healthcare services and have better use of
electronic health systems which give them the competitive edge. The decline of public trust in
public health service providers is worrisome. To remain a public health institution of choice in an
industry with both private and public service providers, Chitungwiza hospital identified the
implementation of SAP healthcare industry solution system as a strategy to enhance service
delivery. The use of Information Communication Technologies (ICTs) is hoped to improve
service delivery. Khalil and Sleit (2012) argued that organisations are continuously learning how
to use ICT to improve operations and innovativeness thereby increasing effectiveness and
efficiency. The implementation of such measures should translate into benefits for the
implementing organization. Digitization of operations is important but the non-use of such
measures out of lack of familiarity or rejection compromises the ability of the organisation to
reap the benefits attendant. These benefits will remain elusive if adopted measures are not
constantly measured and assessed on the impact as well as against set goals. One way to do this
is to conduct studies on the impact of implementation of SAP which will then inform
management and help to improve service delivery.
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1.4 Research Objectives
The overall aim of this research is to evaluate and establish the impact on competitive edge
inherent in the implementation of SAP healthcare industry solution system using a case study of
Chitungwiza Hospital. Other specific objectives of the study are stated as follows;
1. To identify the factors that facilitates or militates against the successful implementation
of SAP healthcare industry solution system.
2. To investigate how SAP healthcare industry solution system SCM practices impact on
competitive advantage from literature.
3. To examine the role and impact of SAP healthcare industry solution system on patients, and
Chitungwiza staff management as well as public trust.
4. To assess the impact of implementation of SAP healthcare industry solution system on
accounting profitability (system).
5. To make recommendations in implementing SAP in health care industry?
1.5 Research Questions
The main research question is: “does implementation of an SAP on health care systems for
public healthcare have a positive impact on the competitive advantage?.” The research shall be
guided by the following sub research questions;
1. Which factors facilitate or militate against the successful implementation of SAP healthcare
industry solution system from literature?
2. What is the impact of SAP healthcare industry solution system SCM practices on competitive
advantage?
3. How are patients, management staff and public trust affected by implementation of an SAP
healthcare industry solution system?
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4. What is the impact of implementation of SAP healthcare industry solution system on
accounting profitability (net gain)?
5. What effective strategies can be implemented within the SAP healthcare industry solution
system to improve service delivery?
1.6 Significance of the Study
The importance of this study stems from the importance of better service delivery which is
considered important within the healthcare service industry. Health care service providers shall
benefit through this study as it seeks to explore their operations, examining challenges and
opportunities. This research shall help healthcare service providers through its recommendations
in the successful implementation of ERP SAP healthcare industry solution system which will
help them to attain competitive advantage over their rivals. The research shall produce ripple
benefits for the general public who are the end users of healthcare facilities. The research hoped
to identify ways of improving service delivery for the general public. The results of the study
shall increase awareness on the importance of provision of better services for customer
satisfaction within the healthcare service industry. The research undertaking demonstrates a
customer oriented approach to healthcare delivery and the importance on service providers to
continuously review their internal process. The findings of this study shall enrich the existing
body of knowledge much to the benefit of the academia and students who want to pursue studies
into the business aspect of healthcare.
1.7 Summary
The chapter made a case for the conduct of a study and presented the research problem. The
looked at the research design, research instruments, data collection procedures, data presentation
and analysis procedures. The research was justified methodologically and on the basis of its
uniqueness and contribution to business administration studies. The succeeding chapter takes a
survey of the existing body of knowledge.
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CHAPTER 2
LITERATURE REVIEW
2.0 Introduction
This chapter critically examines publications and articles that have enriched this study with
background in understanding of SAP enterprise resource planning system. The general overview
of literature of enterprises systems reveals core non-technical issues that negatively impact the
successful implementation of SAP enterprises resource solutions. There has been unprecedented
growth in the focus on success stories SAP resource enterprises solutions as a large number of
organizations fail to realise benefits from huge investment into complex resource enterprises.
Acknowledging that SAP is one of the several enterprises solutions that include Oracle and
Mincom, this chapter also examines key trends in ERP solutions, rationale for ERP solutions,
ERP systems implementation process, challenges in the implementation of ERP solutions and
theoretical framework. Finally, the chapter sums up with key findings from the literature
reviewed.
2.1 The Concept of ERP and Competitive Advantage
The review of literature demonstrated varied definitions on the term enterprise resources
planning. Olston (2004) defined ERP as a kind of information system the impacts tremendously
on organizational computing. They offer technological, process efficient, financial, strategic and
organizational benefits and diverse computing systems (ibid). Thus, ERP systems make use of
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information communication technology as software to help organisations to effectively and
efficiently execute their business operations. Minahan (1998) explicitly stated that
fundamentally, ERP is a complex software system that brings together and computerizes
business processes. Hoffman (2008) describes ERP as an automated spreadsheet that is capable
of calculating company’s resources such as inventory, cash and commitments.
For Koch et al (2001) ERP is nothing more that generic representation of the ways a typical
company does business. Thus ERP tries to integrate departments and functions across a company
onto a single computer system that meets the needs of different organizational units. Hoffman
(1998) considers ERP software as a set of applications that automate finance and human resource
departments. Komiega (2001) defined ERP as the combination of software, hardware, and
business processes, optimized to define a common solution for all aspects of a company’s
business from order entry to invoice and everything in between.
Miranda (1999) identified features of ERP to include the following:
� Modular integration as ERP has different areas of focus, these are tied together to form a
unified system.
� Single relational database which consolidate records
� Client/ server technology.
� Workflow capabilities which refer to the ability to transfer information to the right people
at the right point.
� Best practice and process reengineering
� Audit trail capabilities
� Powerful development toolsets
� Flexible chart of accounts
� Advanced reporting and analysis
� Web and internet capabilities
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In this regard, ERP refers to computerized business packages that help organisations to
harmonize their diverse operations. SAP is one such computerized business package that has
gained widespread use across diverse business interests. The ultimate goal in the adoption of
ERP systems is to enhance the competitive advantage of an organization. Buttle (2004)
highlights the importance of adoption of ERP systems as a competitive strategy arguing that as
all business is about strategy which seeks to give an organisation competitive advantage or
sustainable edge over competitors. Johnson et al. (2008) defined competitive strategy as an
attempt to change a company’s strength relative to that of its competitors in the most efficient
way and also to mould actions and decisions of managers and employees in coordinated,
company-wide game plan. Porter (1980) views competitive strategy as the search for a
favourable competitive position in an industry, the fundamental arena in which competition
occurs. Clearly competitive advantage is relational and examines how well placed is the
organization performing in comparison with its competitors. Three levels of strategy are
identifiable i.e. corporate, business and functional strategies. McNamara (2008) views corporate
strategy as the company’s overall direction while business strategy relates to the business unit or
product level. Functional strategy relates to approaches taken by department to achieve
objectives (ibid). Granted this, a strong nexus exists between ERP and competitive strategies
which organizations employ. This study seeks to examine SAP ERP implementation as a
competitive strategy for healthcare institutions within the framework of the various determinants
that affect the implementation of SAP ERP systems.
2.2 Evolution of ERP and SAP
ERP solutions have revolutionarised the business environment as the world has witnessed a new
era of high speed transformation affecting people and objects. Several studies trace the beginning
of ERP software solutions to manufacturing sector resource planning software (Yen et al.,
(2002), Klaus et al., (2000), Markus and Tanis, (2000), Koch et al., 2001). According to Yen et
al., (2002) ERP solutions gained widespread use as large packaged application software in the
1950s when the first business application to be introduced was Material Requirement Planning
(MRP). This software was limited in its applicability to business processes as it only dealt with
material handling specifically changing main timetable for products into period phased supplies
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for raw materials. The software was further extended in the 1970’s with the addition of further
applications resulting in the MRP11 systems. Thus, ERP solutions were being transformed to
ensure that they become responsive to business processes.
In the 1980s, ERP solutions continued to be transformed with more functions being added with
further developments in the 1990s. Kolodener et al (2008) have opined that the first ERP system
was introduced in the 1990s along with the term ERP in 1992 being derived from MRP and
MRP11 systems. As companies continued to face speedy and diverse changes within the
business environment both internally and externally, ERP solutions have been adopted over the
years to help businesses adjust to the new business dynamics. Bradford (2001) agrees and argues
that ERP systems have been implemented by many companies since the 1990s and have resulted
in the transformation of organizational computing by integrating business processes, data
distribution across the company and producing and accessing information in real time
environment.
In the beginning of the 1990s, MRP11 was further improved from simple focus on production to
incorporate other areas of business that include human resources management. Killian (2001)
noted that in the 1990s MRP11 transformed into two systems and business focus areas i.e.
customer oriented manufacturing management systems and enterprise resource planning. Several
other areas including finance and project management were also covered as many manufacturing
resource planning applications changed into ERP software (Killian, 2001).
As noted by many authors, the driving force in these changes was the need to create a single
integrated information system covering all organizational functions and processes under “one
company”, “one system”. In the 1970s this was largely a dream as there was lack of integration
across the organization. This resulted in the creation of loose patchwork of overlapping or
redundant systems that failed to fully respond to business operations. These systems were also
characterized by problems of high maintenance costs.
However, just like information technology, ERP systems have been experiencing rapid changes
over the years. ERP systems have increasingly been commercialised becoming commercial
packages as they are purchased and leased from software vendors than being developed from
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scratch in house (Markus and Tanis, 2000). Although changes have taken place and continue.
Boonstra and Govers (2009) maintain that ERP vendors still use the same basic model as
manufacturing resource planning for the manufacturing portions of their systems. These
commercial packages have increasingly connected and managed information flows across
organisation thereby integrating processes enabling users in decision making based on real time
information. ERP systems provide information services in various sectors and have evolved to
assist all business processes. They now cater for typical functions within an organization
assuming wide use in areas that include human resources, purchasing and supply, inventory
management and customer relationship management among other modules.
Figure 2.1: SAP Functional Areas
Source: Davernport (2000)
As the figure above shows, ERP systems allow focus on specific business tasks but links across
areas are possible. For instance, a delivery note form the delivery can be linked to the accounting
unit where it appears in the accounts of goods received by the organisation. According to
Bancroft (1998) ERP system focus areas are integrated and cover most functions required by
large organizations.
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ERP systems have been provided by a number of vendors and according to Piontek et al (2010)
up until 2007 major ERP system vendors are SAP, Oracle, People Soft, Baan Co, and JD
Edwards. These have supplied ERP solutions to address the complex nature of businesses to
improve organizational performance. Hoffman (2008) has noted that in the past few years, SAP
and Oracle have remained as the two large vendors shaping the ERP landscape across the globe.
However, other ERP systems vendors continue to exist and function as business organisations
although this study primarily focuses on SAP.
Thus, SAP system which is a version of many ERP systems has been a popular brand among
customers as it has the largest market share with over 280 500 customers in 188 countries (SAP,
2014). SAP has proved to be powerful and flexible system which provides detailed and accurate
information on business transactions helping in decision making. According to SAP (2014) SAP
is one of the leading ER software globally first launched by a Germany company in 1992.
The original goal for launching the software was to transform the information technology in the
world and change the way of doing business. Davernport (2000) notes that within only a decade
the clientele base of SAP had increased from zero to 17 500 and this surge continued for a long
period of time. The company has grown to cover almost every industry to include governments,
health institutions, service organizations and business companies. SAP business solutions have
remained highly popular in the world. Hayen (2007) opined that the increasing number of
sciences and technologies integrated into the system has made SAP a highly perfect tool for
business.
In 1992, SAP introduced SAP R/3 which is a third release of the software which was renamed
SAP ERP and other names in recent years. In this study SAP ERP different focus areas including
customer relationship management, finance, human resources and healthcare supply chain
management are considered to address the research questions.
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Figure 2.2: SAP Easy Access Interface
Source: Esteves et al (2003)
The figure above shows a SAP easy access interface being used by Chitungwiza general hospital.
Piontek et al (2010) noted that SAP R/3 is the most successful product among ERP solutions
assuming wide use across various industries in business administration. Like other ERP solutions
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it allows employees to acquire information on business performance immediately from a central
database once the information is input into the system.
SAP R/3 is intended to meet the specific needs of the organizations in its design allowing a
central database for all organizational information, data modules or focus areas applied in
relation to organizations’ demands and real time online system accessible for all employees.
According to Hayden this promotes transparency in terms of information flow within an
organization.
Figure 2.3: SAP R/3 Business Processes
Source: Helo (2006)
The figure above expresses SAP R/3 business processes covering many modules and different
functions for various organizational activities. Organisations initially implement SAP in core
functionalities of financials and controlling, materials management, production planning and
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sales and distribution while later they can introduce asset management and human resources.
Hoffman (2008) has noted that the selection of specific modules is subject to the type of industry
and the readiness and special business requirements of the implementing organization.
Chitungwiza hospital has simply embraced all the components of the SAP R/3 business focus
areas although the actual efficacy of each module area is ascertained through this research.
2.3 Rationale for Implementation of ERP
The use of ERP systems has continued to surge as the value proposition of adopting these
software packages entice organisations to heavily invest in these systems as the position
organisations for competitiveness. Skok and Doringer (2001) have summarized the major
impetus for the adopting of ERP systems to include globalization in the business environment,
standardization processes such as ISO 9000 and a trend for collaboration among software
vendors. Al-Mashari (2001) concurs and argues that there are several reasons why firms adopt
ERP systems that include standardization of processes and systems. The same author argues that
the selection of ERP system is dependent upon the industry type and size. For this study,
standardization of wide range of hospital activities and process has rendered the adoption of SAP
imperative in the realisation of competitiveness in business.
One of the major driving factor in the adoption of SAP ERP systems are convinced expectations,
such as reducing costs of information technology in the support of major business processes in
the long term. Various studies have noted that the standardization through the use of SAP ERP
systems is simpler and inflicts negligible effort in terms of information technology support to an
organization. Davenport, Prusak and Wilson (2003) have however warned that in actual practice,
the cost benefits often remain unrealized as a result of variations in the business environment
which stresses best practices and the failure to gauge the extent of user needs. There are also
other training hidden costs that are incurred which often reduce productivity as organizations
help employees to understand the complex ERP systems while they continue with their normal
business operations. Thus due care must be taken in selecting and implementation of SAP ERP
systems if goals of cost minimization are to be attainable.
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The introduction of SAP ERP software solutions allows the organization to automate a section of
a given aspect of its business operations thereby ensuring effective organizational performance.
Reed (2002) opined that the objective of any enabling technology is to enable an organization to
better achieve its business mission. In the pursuit of business excellence organisations, SAP ERP
systems are important for an organization. According to Weston (1998) SAP ERP can help an
organization in their business operations to realize their business mission and achieve
competitiveness for the approach they use to SAP ERP systems and use data generated from
SAP ERP. Towner cited in Weston (1998) rightly noted that ERP is a set of building blocks and
it is how those building blocks are put together that gives an organization an advantage. Clearly,
ERP enables organization in realizing their mission positioning them for competitive advantage.
In their study Al-Sehali (2001) identified the following as benefits to be attained through the
implementation of ERP solutions in an organization;
a. Easy access to reliable information
b. Removal of unnecessary data and procedures
c. Reduction of cycle times
d. Cost reduction
e. Adaptability in a rapidly changing business environment
Thus organisations implementing ERP solutions are able to benefit from one or all of the benefits
identified above, hence the rationale for the implementation of ERP systems. Poston and Grabski
(2001) have opined that ERP systems are expected to deliver two key benefits i.e. reducing costs
by improving efficiencies and enhancing decision making processes through the provision of
accurate data timeously.
Various studies have also reiterated how SAP ERP systems give the organization various units
access to uniform data across the organisation for effective organizational performance.
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According to Davernport (2000) since SAP utilizes a common database management system
across the organisation, it gives all the departments access to the same information within the
organization. Every department in the organisation enters information onto the same database
enabling the organisation to develop uniform data for decision making. In this regard this enables
the organisation to make decisions form the business point of view rather than departmentally
and coordinating the information manually (Bingi et al, 1999). Komiega (2001) agrees and
argues that one of the main reasons for the implementation of an ERP system is that it allows for
universal visibility of information across the organization.
The harmonization of organisational activities also allows the organization to deal with
redundancy within the organization through the use of a single database. Since the modules
under SAP, there is no need for repeated data entry between different organizational units. Al-
Sehali (2000) observes that once data has been entered by a department it can be accessed by
other departments thereby eliminating redundant tasks within the organization. By doing so there
is increasing standardization and efficiency within the organization as there will be a shorter
communication time across departments. Koch et al. (2001) noted that one of the major reasons
why companies implement ERP solutions are to standardize processes and human resources
information.
Interestingly, SAP ERP enable the organization to easily adapt to new process and requirements
within the business environment. With the SAP ERP system which is designed to speedily
respond to new business demands the organization will be well positioned to respond to the
changing dynamics of its business environment. Miranda opines that most ERP software
providers identify flexibility as one of the advantages of their software. Thus these providers
have worked to ensure that their services meet the changing business dynamics. This study also
sought to establish the extent to which the implementation of SAP ERP software by Chitungwiza
general hospital has empowered it to respond to its changing business environment.
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The question on whether SAP ERP solutions benefit has long been debated for over a loing
period of time now. Shang and Seddon (2002) classified types of managerial benefits deriving
information form 233 research publications. Resultantly their study reveals that organisations
studies realized benefits in at least two areas:
� Strategic area benefits;
� Operational area benefits;
� Managerial area benefits;
� Information communication technology area benefits; and
� Organizational area benefits
The table below shows some key areas on the rationale for the implementation of ERP system
solutions.
Table 2.1: Rationale for ERP Implementation
Key Driver Rationale Anticipated Benefit
Technology Powerful and Integrated
Systems.
- Greater flexibility.
- Lower Information technology costs.
Business Practice Improve ways of
accomplishing business
processes.
- Better operational quality.
- Greater Productivity.
Strategy -Short term cost benefits
gained via efficient systems.
-Long-term evolutionary
benefits gained via effective
use of the systems.
- Improved decision-making.
- Support business growth.
- Develop external linkages.
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Competition -Sustain growth in the
presence of competitors
adopting Enterprise Systems,
-Improved service delivery to
customers.
Source: Markus and Tanis (2000)
Thus despite the skepticism on the benefits of SAP ERP implementation, the astonishing uptake
of ERP systems by organisations over the past few decades is clear testimony that there is every
reason for an organization to implement ERP systems. Markus and Tanis (2000) noted that ERP
systems adoption continues to gain momentum globally, despite the difficulties encountered by
companies when adopting and implementing these systems. It then became imperative to
critically examine the ERP implementation process for a better understanding of SAP system
implemented by Chitungwiza hospital.
2.4 ERP Importance in Healthcare Institutions
Khalil and Sleit (2012) have argued that organisations including healthcare providers are
continuously learning how to use technology in their operations for effective and efficient
service delivery. Indeed like in any organizational setup, studies have revealed that there are
benefits in the computerization of health information. Within the healthcare delivery system,
there are various issues such as clinical tasks, administrative tasks, management of data on
patients and human resources. These activities need to be integrated to activities ensure
harmonization in different functions of the hospital. According to Jenkins and Christenson
(2001) apart from human resources benefiting from centralized scheduling, the billing,
laboratory, pharmacy and patient records can be synchronized internally. Hoffman (2008) has
opined that technology is propelling advancement in healthcare giving opportunities for the
implementation of best practises, use of evidence centred medicine, decreasing human mistakes,
increasing efficiency and creating health database. Thus ERP offers solutions to challenges in the
healthcare delivery system.
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Exceptional applications, such as patient management, patient logistics, hospital finance and
general management, have been developed so that the ERP system fits with the hospital setting.
There are a number of factors why hospitals vary from other industries, and these might have
consequences for the implementation and use of an ERP. Just like any other necessities of
hospitals are varied, they target curing and caring for patients, as well as training and educating
new doctors and nurses. Its true that the hospital processes are different in that they are highly
varied and more complex than procedures in several other industries (Yi et al., 2006).
Hospitals also have a diverse workforce which includes a wide band of professionals who
usually possess expertise, power and autonomy. These factors can impact on the ERP to be
implemented together with the dissimilarities in the nature of the processes may have
implications for the implementation and use of ERP within a hospital context. ERP is positioned
to drive the complete healthcare functionalities and all related activities including finance,
materials management, human resources, and decision support. Healthcare in counties will have
the capacity to change how care is administered, such in the future will become a global industry,
competitive, where patients will utilize the best service medically, practitioners and facilities in
the world. With the transformation into an ERP system, a healthcare organization has the
opportunity to perform in terms of service delivery.
Most professionals involved in patient attention have a diversity of relations with others involved
in the care of the same set of patients, and these relationships vary across practices and
individuals. The quality and efficiency of healthcare delivery is heavily dependent on the
efficacy of the daily routines for creating, accessing, modifying, and using these documents, and
so the shift from paper-based to system based charts is a high-stakes endeavour. Thus the
adoption of ERP solutions is an opportunity for the improvement of service delivery systems.
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2.5 Costs of ERP System
While research has identified many benefits in ERP adoption, there are also costs involved.
There are inherent problems in application of complex ERP systems which are manufactured
from thousands of database tables. These tables are critical in the functioning of the system and
properly allaying each table is demanding. As the table settings are decided, these business
processes are reengineered the ERP’s way (Koch et al., 2001).
Financial costs are inescapable for the implementing organisation. Reed (2002) noted that these
costs include expenses on software and support services, support arrangements, customization,
application, training, and change management. Koch et al. (2001) observed that there are costs
such as training costs, integration and testing, data conversion, data analysis, consultants ad
infinitum, replacing workers and consultant costs which are often ignored.
The implementation process of ERP is often time consuming although actual use of software
reduces time in carrying out business processes. During the implementation phase, there is a
disruption of normal organization activities and changes in employee schedules which are a form
of costs. Apart from losing time trying to adjust the electronic operations to organizational
requirements, the conformity of modules is a challenge on its own. There is also another related
challenge of overreliance on the software provider（Hossain et al. 2002）
2.6 ERP Lifecycle and Implementation Processes
Achieving competitive advantage through the implementation of ERP systems is a process.
Having conducted a rigorous review Esteves and Pastor (1999) found no consensus regarding the
ERP lifecycle phases and later proposed a framework in the study of ERP systems. The proposed
framework consisted of phases and dimensions which are important in identifying the origins
and impact of change within the organisation thereby facilitating research into the
implementation of SAP by Chitungwiza general hospital. Indeed there are several stages that the
ERP system undergoes during its lifespan within the implementing organisation. The following
are identifiable from Esteves and Pastor (1999): adoption decision phase, acquisition phase,
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implementation phase, use and maintenance phase, evolution phase and retirement phase. Below
is a consideration of the each of the phases.
2.6.1 Adoption Decision Phase
This phase involves management questioning the need for the adoption of a new ERP system
guided by an understanding of the challenges that the organisation is facing and the desire to
improve organisational strategy. According to Esteves and Pastor (2003) the decision phase
includes the definition of system requirements, its goals and paybacks and an examination of the
impact of adoption on at a business and organizational level. Thus this stage is a product of cost
benefit analysis at the business and organisational level
2.6.2 Acquisition Phase
Having examined the challenges and business needs, the management a selects an ERP package
from the existing pool of vendors. The product selection should best fit organisational
requirements minimising the need for customisation which may lead to extra costs for the
organisation. At this stage, the organisation selects a consulting firm that will assist the
organisation in the following phases especially the implementation phase. This will be guided by
factors such as prices, training and maintenance issues together with an analysis of the return of
investment in the chosen ERP solution.
2.6.3 Implementation Phase
According to Esteves and Pastor (2003) this stage consists of customisation and adaptation of the
selected ERP solution to the needs of the organisation. This process is usually spearheaded by
consultants who give guidance of implementation methodologies, expertise and training.
2.6.4 Use and Maintenance Phase
This phase is characterized by the use of the ERP package for the realization of benefits without
causing disruptions for the business and organization. Esteves and Pastor (2003) warns that one
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must be aware of aspects relating to functionality, usability and adequacy to the business and
organization processes. The implementation of the system should be such that there is proper
maintenance as malfunctionality can negatively affect the organization. Adjustments and
improvements are made to the system to optimize benefits.
2.6.5 Evolution Phase
Under this stage, the system is enhanced through integration of more focus areas into the ERP
system to add new benefits that may include customer relationship management, supply chain
management and expending the borders to external collaboration with other stakeholders.
2.6.6 Retirement Phase
The continued changes in information communication technologies can result in the
abandonment of the selected ERP system. The system may also be inadequate forcing managers
to substitute it the ERP system with other forms of information sytems that will better meet
organizational needs. Of the above phases, Akkermans and Helden (2002) identifies the
implementation phase as the most complex phase demanding management of big groups of
individual allotment resources, working to firm timelines and facing many unforeseen
developments. Livermore and Ragowsky (2002) highlight a number of challenges associated
with ERP implementations. To enhance understanding of the ERP lifecycle Esteves and Pastor
(2003) further identified four areas of concern for assessing the phases of the implementation
process discussed above namely product people, process and change management:
� Product
This area of concern deals with specific ERP software solution under consideration to include
issues like functionality and technical issues as hardware and software requirements. Indeed the
understanding of ERP capabilities to make an alignment with the business strategy is important
to determine whether the software is being effectively used to meet organizational need and how
it can be further applied to meet further goals of the company.
� Process
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Processes can also be examined to determine the effectiveness of the adopted ERP system as
each organization has its main proficiencies and functionality that must be buttressed by the ERP
solution. The ERP solution must also help decision making in the management of resources and
functions of the company. It should be able to reengineer processes to help the organization to
adapt to new business systems and functional requirements for better performance. The current
study sought to understand how the adoption of SAP by Chitungwiza general hospital has
affected organizational processes.
� People
This focus area relates to organisation’s human resources and available skills and roles in the
lifecycle of the ERP system. Skills required in the running of the ERP system should be
developed to reduce risk and manage complexity for smooth organizational change. This also
involves responding to contingencies, transforming practices and adapting to a new
organizational structure and culture which should be learnt within the organization. The current
study sort to understand how people have been affected by and affected the SAP implementation
cycle at Chitungwiza general hospital.
� Change Management
This dimension deals with the body of knowledge used to ensure that complex change usually
associated with big systems achieves the right outcomes in the right timeframe and at the right
costs (Holland and Davies, 1998). Change management aims at creating acceptance and
readiness to a new system allowing the company to rip benefits from the introduction of change.
The current research was also interested in examining how change management was handled in
the implementation of SAP at Chitungwiza general hospital. The following section considers
some common challenges in the implementation of ERP systems.
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2.7 ERP Success Measurement Model
Several studies point to quality and impact as the main attributes of determining the success of
ERP implementation as an information system (DeLone and Mclean, 2002). DeLone and
Mclean developed an integrated, multi-dimensional, and inter-related information systems
success model. In the original framework of Information Systems Success, DeLone and McLean
(DeLone & McLean, 1992) described the excellence of systems with two measurements, namely,
system quality and information quality; a third called service quality was added later. This study
integrates the three areas of superior systems identified by Delone and Mclean (2002) as
enhancers of organizational competitiveness.
The lack of uniformity among researchers regarding the conceptualization and operationalization
of ERP benefits and impacts has been a major challenge in assessing the success of ERP
implementation. Among these, studies conducted (DeLone & McLean, 1992) affords the most
all-inclusive list of measures used in evaluating ERP systems influences concerning to the
employee and organisation. Gable and colleagues (Gable et al., 2003) authenticated a few of
these processes in the framework of ERP. They also measured aspects from other frameworks
for assessing ERP systems and benefits. In order to ease understanding of the research goals, the
ERP success dimensions suggested by Seddon, Staples, Patnayakuni, & Bowtell (1999) are dealt
with in the perspective of this research in the table below.
Table 2.1: Summary of ERP Success Frameworks
Number
IS Success Dimension Framework
In The Context of this Research
1. How is effectiveness of the system to be judged?
Enterprise Systems success measures validated by Gable et al. (2003). The 4 success measures are based on two dimensions namely, impact (Individual and Organisational) and Quality (Information and System). The active users of the Enterprise Systems would judge the Enterprise Systems based on these two dimensions with the past performance of the organization as well as the stated goals of the organisation.
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2. From whose perspective is effectiveness being judged?
All users who use the Enterprise Systems actively to complete their day-to-day jobs. These include senior, operational, administration, and technical users.
3. What is the system being evaluated?
One or more modules of an Enterprise Systems. In this research the two Enterprise Systems evaluated are Oracle Financials module from Oracle Corporation and SAP R/3 (all modules) from SAP.
4. What is the purpose of evaluation?
To learn the effects of system use on its users. It is proposed that an increased understanding of these effects on the user, will contribute to a successful future Enterprise Systems upgrade or implementation.
5. What time frame is employed?
Long-term. Both the Enterprise Systems selected in this research have been implemented for at least 2 years.
Source: Davenport (2000)
Other researchers have recommended other ways of measuring the success of the ERP system
implemented using the payback method. A well applied ERP system has been estimated to see
“payback” in 12 to 18 months. Real project management can shrink this timeline. According to
Al-Sehali (2000) the success of ERP solution is measured on how quickly benefits are reaped
from the system. Hence, the shorter the application the earlier an company can get a return on
investment. However, there are challenges as return on investment does not quantify intangible
costs and benefits.
2.8 Implementation Strategies
Studies have revealed that ERP systems are divided on modular basis which do not necessarily
have to be implemented all at once. According to Bingi et al. (1999) most organisations follow a
phase in approach under which a module is implemented at a time. Some of the software vendors
including SAP support this strategy. Other strategies commonly used are based on scope and
function with Davenport (2000) proposing a matrix with two extremes i.e. the incremental and
big-bang strategy. Under the incremental approach the organization implements the system and
26
associated business changes in small pieces while the big-bang strategy involves implementing
everything at once.
Another strategy identifiable based on function is the best of breed strategy which involves
implementing software for different functions. The software packages may be linked through
programming interfaces but may have different databases. Miranda (1999) observes that this
implementation strategy reduces the risk of overall failure while enhancing overall functionality
of the ERP solution adopted. However the strategy has challenges of lack of harmonization of
functions which can create redundancy through repetitive data entry. For Koch et al (2001) this is
franchising as independent ERP modules are fitted in each unit connecting shared processes.
Sherman (2000) views this strategy as using ERP as a transaction engine and incorporating extra
modules.
Lastly, software vendors and implementation consultants usually solemnize their prior
knowledge into a strategy that serves as the outline for an ERP implementation. Kale (2000),
indicates that such procedure is not necessarily the best efficient one but it guarantees success
under optimum environments. Currently, there are so plentiful ERP implementation strategies as
consultants.
2.9 Conceptual Framework
The content of ERP, which in this case is SAP, is important in the implementation of the
healthcare solution system. The implementation system in turn produces results or outcomes
which point to the success or lack thereof in the implementation of the healthcare solution
system. The implementation of the SAP healthcare system is influenced by stakeholders as
discussed above who include in this case the diverse human resources at Chitungwiza hospital
and patients. Another factor which also influences the implementation process is the context of
the healthcare system which can either inhibit or facilitate the implementation process. Below is
a diagrammatical presentation of the conceptual framework to be used for this study.
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Figure 2.4: Conceptual Framework
Source: Hedman and Kalling,( 2002)
2.10 Summary
It may be argued from the review of literature that various factors contribute to the successful
implementation of ERP system for the realization of competitive advantage. Most scholars
agreed on the rationale for ERP implementation and factors necessary for the successful
implementation of the ERP system. There was also convergence on factors that may militate
against the successful implementation of ERP systems. In this context, ERP solutions allow
increased communication within the organization which positions the organization
competitively. The high costs of implementation are a challenge to the adoption of ERP
solutions. The healthcare institutions stand to benefit through the implementation or ERP
solutions and this study aimed to assess whether SAP implementation by Chitungwiza general
hospital has brought competitiveness. The succeeding chapter examines the methodology in
adopted in the conduct of the current study.
Marketing Customer Service
Sales Production
Human Resources
ERP
System Procurement
Accounting Inventory
28
CHAPTER 3
RESEARCH METHODOLOGY
3.0 Introduction
The preceding chapter extensively examined the concepts of Enterprise Resources Planning and
SAP gaining understanding of their importance for business processes. General implementation
issues and challenges were considered to gain a holistic picture of the study topic using multiple
sources of data. In this chapter, methodological and procedural issues regarding the study are
described. The purpose of this chapter is to present the research paradigm and strategy including
the research methods and techniques embraced and used. The chapter also presents the mixed-
method research focus that the research followed rationally considering the research questions
29
and context. It contains a description of the population, sample, instrumentation, data collection
and how data was analysed to answer the research questions. Aspects relating to the use of
interviews, document analysis, and the questionnaire as the data collection methods are also
covered. Challenges encountered during data collection and adopted solutions are also
considered in this chapter.
3.1 Research Philosophy
Research philosophy relates to different views of the world and the way in which data about a
phenomenon should be acquired, analysed and applied. Two dominant research philosophies are
identifiable as positivism and intepretivism. According to Denzin and Lincoln (2011) positivists
believe in the isolation and observation through manipulation of reality with variations on a
single independent variable to identify causal relationships. Interpretivists on the other hand
believe in the study of the phenomenon in its natural setting with the acknowledgement of
researcher bias (ibid). This study follows the intepretivism philosophy as there was no
manipulation of the variable but observation of phenomena in a natural setting.
3.2 Research Approach
According to Trochim (2006), two main research approaches are identifiable namely deductive
and inductive. Creswell and Clark (2007) argue that in deductive research the researcher moves
from top down, from theory to hypothesis and to data to add to or contradict theory. In disparity,
in inductive research the researcher moves from bottom up building themes and generating
theories from the research (ibid). Inductive is moving from the specific to the general while
deductive begins with general and ends with the specific. This study followed a mixed approach
as it integrates the deductive and inductive approach. This was premised on the understanding
that several theories have already been generated on the subject which the study sought to prove
or disprove. Again to understand all the dynamics of SAP ERP solutions, the inductive approach
was not going restrict the researcher to previous generated theories but allow the generation of
new ones.
30
3.3 Research Strategy
In responding to the research questions, this research combined qualitative and quantitative
strategies in data collection and analysis. Babie (1998) has differentiated between qualitative and
quantitative research by positing that considers social meanings as they are constructed by
respondents while quantitative looks at measurement and counts of things. Quantitative research
more often results in statistical analysis while qualitative research is conducted in a natural
setting examining meanings which respondents attach to things and developing common themes
from behaviours. In quantitative research, the methods are well planned, structured and formal
because the findings play an important role in decision-making (Saunders et al. 2007).
Quantitative research makes use of structured close-ended questions that have predetermined
response possibilities in questionnaires or surveys and are distributed to a vast number of
respondents according to Hair et al (2005). The use of both strategies enriched this study as the
researcher shall be able to acquire qualitative meanings attached (through interviews) to ERP
SAP solutions implementation as well as derive meanings through quantitative questionnaire
research findings.
3.4 Research Design
Denzin and Lincoln (2011) view research designs as strategies of inquiry within the quantitative,
qualitative and mixed approaches that provide specific direction for the conduct of the research.
Trochim (2006) opines that a research design is a master plan of methods and procedures used
for data collection and analysis of data. This study followed a case study research design.
According to Saunders et al. (2012), a case study is a design for doing research involving
empirical investigation of a particular phenomenon using various sources of evidence. The use of
different kinds of data by different methods from several sources gives broader coverage for
better understanding of the study area than would achieved by single source. Trochim (2006)
defines a case study as an empirical inquiry that investigates a phenomenon within its real
context especially when the linkage between the phenomenon and its setting is not clearly
defined. How the implementation of SAP ERP solution has been affected and affected
Chitungwiza general hospital remained unknown before the conduct of the study. Hair et al.
31
(2006) agrees and opines that the case study allows an investigation to maintain the all-inclusive
and important features of real life procedures such as organizational and managerial processes.
Within this study, the case study approach was considered useful as SAP contextual
implementation conditions are critical with the researcher having no control over the process. It
was incumbent upon the researcher to collect data from different sources and maintain the
integrity of the data.
3.5 Population and Sample
The population of the study consisted of all Chitungwiza general hospital employees estimated at
around 350. The sample used in this study was drawn from the large population of management,
employees and customers of Chitungwiza general hospital with the aim of allowing the research
to make inferences about the entire population. It would have been daunting task to cover all the
employees due to time and financial constraints. Kumar (2005), notes that all items in any field
of inquiry make up a universe or a population. The population for the study includes all the
employees of Chitungwiza general hospital and the patients who have visited the healthcare
facility since the inception of the SAP healthcare industry solution system in 2014.
3.6 Sample Size and Sampling Strategies
According to Saunders et al. (2012) sampling is the process of selecting a representative subset
of observations from a population to determine the characteristics of the random variable under
study.A sample of 110 technical and management staff was drawn from the entire population of
Chitungwiza general hospital on non-probability sampling strategy i.e. purposive sampling so as
to target people with relevant expertise. In addition the study also targeted 40 respondents from
patients who visit the institution to inquire about their service delivery experiences using a non-
probability sampling strategy i.e. convenience sampling. There are two major sampling
procedures i.e. probability and non-probability sampling. The choice is dependent upon the
purpose of the study. Under probability sampling every unit of the population has an equal
chance of being selected while the use of non-probability sampling allows researcher’s
subjective judgements. According to Hair et al (2006) judgement sampling is a non-probability
32
sampling that implies that the sample is selected on the basis of specific criteria set beforehand
judged to be of importance to the study. Interviews shall also be conducted with 5 key
informants to give a total sample of 155 consistent with other studies. The sample used for the
study making sure that it is a true representation of the hospital’s community. The introduction of
SAP ERP solutions impacts directly on these stakeholders justifying their inclusion in the study.
Below is a tabulation of the sample and the sampling strategies to be used.
Table 3.1: Outline of Sample and Sampling Strategies
Sample Characteristics Sampling technique
Research instrument to be used
Extracted number of Respondents
Patients visiting the Hospital
Convenience sampling
Questionnaire 40
Technical and Management Staff
Purposive sampling Questionnaire 110
Key Informants e.g. senior management
Purposive sampling Interview guide 5
Source: Field Study Survey 2015
3.6 Sources of Data
In responding to the research questions raised in chapter one, the researcher relied on primary
and secondary sources of data.
3.6.1 Primary Data
Various methods can be used to collect primary data which include observations, experimenting,
verbal and written ways of communication. Cresswell and Clarck (2007) has pointed to some
methods to include personal; and telephonic interviews and focus group discussion. The choice
of the methods is influenced by the nature of the research. For the purposes of this research,
primary data is raw data which was obtained through questionnaires administered to staff at
33
Chitungwiza general hospital. The study to a large extent is based on primary data collected
through questionnaires and face to face interrogations with selected respondents.
3.6.2 Secondary Data
Secondary data is data that is used for a purpose other than for which it was originally obtained.
According to Saunders et al (2012) it may be descriptive, raw or summarized. The researcher
also used secondary sources of data to obtain information and these included books, newspapers,
journals, internet websites, and annual reports of Chitungwiza general hospital. The secondary
sources were used to complement the findings of the study, development of the research
instruments and the review of literature. Secondary sources were consulted especially relating to
ERP solutions and related variables underpinning the theoretical framework and also the
methodology of the research. Internet based sources were used and some of the search words
used include;
� Enterprise Resource Planning System
� SAP
� Enterprise Resource Planning
� ERP system
� Evaluation
� Effects
The researcher tried different word combinations of the above words using Google as the search
engine.
3.7 Data Collection Procedures
The research was a process in which steps were taken to administer and collect data from
subjects who constituted hospital staff. The first step involved making appointments with
research subjects while the second step required distribution and administering research
34
instruments on the sample. Distribution of questionnaires to respondents was done by the
researcher in person upon which participants were given a week to complete the questionnaire.
The researcher also phoned the interviewees to make appointments with the management. Below
are some data collection measures and issues that were considered.
3.8 Data Collection Techniques
There are a number of reasons that justify the use of personal interviews and questionnaires to
gather primary data. At the same time, there are also a number of surveys that can be used to
conduct research to gather primary data and the selection of one over others is a product of a
number of considerations that include;
� The amount and quality of data to be collected
� The time available for the data available
� The cost of the study
� The use of the various survey types, Cant et al (2005).
The researcher aiming at a descriptive single time case study took into account the above stated
factors and primarily depended on the questionnaire method. Personal interviews were used as an
add-on to the questionnaire to enrich the research findings.
3.8.1 Questionnaire
The questionnaire was used as the primary research instrument for this study. The questionnaire
was used as a data collection instrument to gather primary data. The researcher used a structured
questionnaire which contained well formulated questions and fixed response alternatives that are
aimed at addressed the research objectives. The instrument was designed using items developed
by the researcher and others borrowed from other previous studies. The questionnaire was made
up of questions dealing with subjects the researcher wanted to gain information from to address
the research questions. The researcher used a structured questionnaire with both open ended and
35
closed questions. It allowed respondents to provide their own insights while confining them is
some areas that were being investigated.
3.8.1.1 Questionnaire Design
In designing the questionnaire, the researcher took cognisant of a number of factors. These
factors are guided by the goals of questionnaire design which Denzin and Lincoln (2011)
identify as;
� To enhance the significance and accuracy of data collected
� To enhance contribution and cooperation of respondents
� To ensure easy collection, collation and analysis of data.
The review of literature was instrumental in the design of the questionnaire through the provision
of guidelines in the crafting of the statements in the questionnaire and adoption of some
statements from previous studies. The research used the Likert scales in the development of
responses to the questions. Pedhuzur et al (1991) opine that the seven point likert scales are the
most frequently used. For this study, the Likert scale was used for the following reasons
identified by Denzin and Lincoln (2011) including the following;
� They reduce the response bias amongst respondents
� They are important in evaluating attitudes, beliefs, opinions and perceptions
� It enables standard comparisons amongst responses
� Answers are easy to code and analyse directly.
3.8.1.2 Pilot Testing of Questionnaires
Designing a questionnaire is complex process. Denzin and Lincon (2011) warn that no matter
how careful one can be in designing a questionnaire the possibility of errors on it are imminent.
It is for this reason that a pre-test of the questionnaire was done to refine the instruments and
ensure that it measures what it is intended to measure. Denzin and Lincoln (2011)defines
36
pretesting as a procedure that involves a trial administration of the questionnaires to a group of
respondents to identify and deal with fundamental problems in the questionnaire design and the
general survey design. The pretesting of the questionnaire also helped the researcher to identify
and eliminate misinterpreted questions, ambiguous questions or instructions that were too long.
The questionnaire was pilot tested at Chitungwiza general hospital involving respondents who
were not part of the final respondents.
3.8.2 Interviews
The researcher conducted personal interviews with senior management. A personal interview is a
two way communication method initiated by an interviewer to gather information required from
the respondent. Cant et al (2005) has argued that this process is advantageous as it is personal
and the researcher can clarify difficult concepts to the respondents thereby enhancing the
accuracy of the data provided. Personal interviews were used and this enhanced the interaction
between the researcher and the interviewee. The researcher benefited from the value of personal
interviews which give depth of information and details can be secured which can exceed data
gathered by self-administered questionnaires.
3.8.3 Document Analysis
Saunders et al. (2012) is of the view that documents refer to any record (written) that contains
information about human behavior, social conditions and social processes. Denzin and Lincon
(2000) suggest that document analysis could provide background information to some of the
actions of the respondents, which might be difficult to detect using questionnaire and interviews.
Documents can also help to explain the gap between official policy and practice on the ground.
Thus, the use of documents in this study was meant to offer the researcher additional insights
into the role of entrepreneurial skills in transforming the economy. Furthermore, documents were
analysed in this research to avoid errors of interpretation by checking current observation with
actual practice on the ground. To this end, hospital records and other documents related to SAP
implementation were used.
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3.9 Data Analysis and Presentation
Saunders et al. (2012) has rightly noted that in research there is need to ensure that a data
analysis method fits the research design. The data analysis shall start after data collection and
shall range from simple frequencies to more complex data analyses. Quantitative techniques
shall be used to quantify variations, predict causal relationships and describe the characteristics
of the population while the qualitative techniques shall be used to describe and explain
relationships, describe individual experiences and group norms. The data shall be analyzed using
Statistical Package for Social Sciences (SPSS). The data analysis stage shall include interrelated
operations to summarize and rearrange the data. This will be done after editing, coding and
processing of data. Data shall be presented using graphs and tables.
3.10 Validity and Reliability
To attain credibility for the research findings, the research had to be designed and conducted in a
way that the phenomenon under study is accurately identified and described. Kumar (2005) has
advised that it is imperative for the researcher to be conscious of the problems and
insufficiencies related to selected research methods so as to minimize the errors and to increase
the quality of the study. Errors may include measuring errors due to imperfect measuring
methods e.g. the measuring instrument and how it is used. This takes two forms i.e. low validity
and low reliability while it is important to attain high validity and reliability.
To this end, the researcher used methodological triangulation (use of interviews, content analysis
and questionnaires) and instrument triangulation to enhance the validity and reliability of this
study. Babbie (1998) describes reliability in research as a matter of whether a particular
technique applied repeatedly would yield the same test results each time. Simply put reliability is
a measure of consistency with which an instrument produces the same test results again and
again. Pedhazur et al (1991) refers to validity as “appropriateness, meaningfulness and
usefulness of specific inferences made from test score” The aim is to establish whether the
measures used are appropriate to the scientific enquiry that was set for the investigation.
Triangulation and the pilot study to be conducted shall enhance the validity and reliability of the
study.
38
3.11 Limitations to the Study
In carrying out this study the researcher anticipates the following limitations;
1. Restriction to one organisation hence difficulty in generalizing findings.
2. Bias of the interviewee which may affect the research findings
3. Bias of the respondents which may affect the research findings
4. Time and resources constraints
To counter these limitations, the researcher shall maintain objectivity and use triangulation to
deal with respondents’ bias. The researcher shall draw a manageable sample in line with
resources available and time.
3.12 Ethical Considerations
In carrying out this study, the researcher shall be bound by the University’s research guidelines.
Kumar (2005) has pointed to a number of ethical issues that shall also guide the researcher as
follows;
� Clear communicating the aims of the research
� Ensuring informed voluntary consent
� Clearly stating the institution represented
� Clearly explaining what the research is about and who will benefit what from the research
� Giving adequate guarantees of confidentiality
� Providing feedback and access to results
These ethical issues shall guide the researcher throughout the research process.
39
3.13 Summary
This chapter considered the research methodology in particular the research methods and data
collection instruments used. The chapter highlighted the data gathering techniques used and the
reasons for selecting the questionnaire method and the interviews in addressing the research
questions. Data management procedures such as editing and coding were also considered
together with aspects of reliability and validity of the research findings. The ethical issues
surrounding the research were also examined. What follows in the next chapter is a presentation
and discussion of the research findings.
CHAPTER 4
DATA PRESENTATION AND DISCUSSION
4.1 Introduction
The preceding chapter considered the methodology adopted in addressing the research objectives
raised in chapter one. The research objectives raised from chapter one form the basis of this
current chapter which focuses on the presentation of the research results and their interpretation.
Views from different stakeholders that are management, general staff, and customers were
40
considered and presented in this chapter. Themes were developed to aid in the presentation of the
results guided by the research objectives and research questions. This chapter begins with
background description of statistics then inferential statistics that show the relationship between
variables.
4.2 Response Rate
The results that follow show background characteristics of respondents who were involved in the
study. The questionnaire was the major data collection instrument complemented by the
interviews and document analysis. The questionnaires were distributed to staff in different
departments and patients who visited the hospital at the time of the conduct of the study.
Table 4.1: The Questionnaire Response Rate
RESPONDENTS ISSUED COMPLETED % RESPONSE
Employees 110 93 84
Patients 40 25 65
Total 150 118 79
Source: Field Study Results 2016
A total of 110 questionnaires were administered to the employees and 93 were successfully
completed and returned. This represents a study response rate of 84 percent which is high enough
to warrant validity of the study findings. This is in line with Saunders et al (2000) who put
forward that any response rate that is 50% and above would warrant validity of the study
findings.
Out of the 40 questionnaires distributed to patients 25 were successfully completed and returned
in time while some respondents failed to return the questionnaires. The response rate was
however favourable at 65 as shown in table 4.1 above. The patients who failed to respond were
41
very busy to the extent that they missed to meet the deadline for collection. The patients who did
not respond were just too reluctant and ignorant to the extent that they did not understand the
importance of the research and some were just uncooperative.
Interviews were also conducted with senior management from all the participating departments.
The table below shows the frequency distribution of interviews conducted.
Table 4.2: Interview Response Rate
Designation Targeted Actual Relative
Percentage
Senior Heads of Departments 5 Male 3 100
Female 2
Total 5
Source: Field Study Results 2016
The overall response rate from the interviews was 100 percent as all the interviews were
conducted as had been planned as shown in table 4.2 above. All the senior management
respondents were available at the time of the conduct of the study and their insights enriched this
study.
4.3 Respondents by Department
Chitungwiza general hospital rolled out SAP system to cover most of the hospital operations so
as to improve service delivery for competitive positioning. As such the study covered all the
departments that have embraced SAP system as shown by the number of respondents drawn
from each department as indicated in the figure below.
Figure 4.1: Percentage Distribution of Respondents by Departments
42
Source: Field Study Results 2016
Figure 4.1 above shows that most of the respondents (43 percent) were drawn for the information
technology department while a significant 29 percent was drawn from the finance department.
The information technology department was responsible for the implementation of the SAP
system at Chitungwiza general hospital and were well positioned to inform the study as they had
hands-on experience with implementation, monitoring and evaluation of the performance of the
system. Records and clinical departments which are other critical touch points for SAP within
the hospital setup made a significant contribution of 15 percent and 9 percent respectively to the
total number of respondents. This meant that the study was able to capture the critical areas of
SAP implementation in a hospital environment.
4.4 Working Experience in Respective Departments
The years spent at the hospital were critical for the study as there was need to assess the impact
of SAP on business operations. This demanded an understanding of the state of affairs prior to
the implementation of SAP and after the implementation of SAP at the hospital. A cross
tabulation was run and the following results obtained as shown in the table 4.3.
Table 4.3: Percentage Distribution of Respondents by Working Experience
43
Frequency Percentage
Less than 2 years 11 10
2-5 years 19 17.5
6 -10 years 63 57.5
above 10 years 17 15
Total 110 100
Source: Field Study Results 2016
Table 4.3 above shows that most of the respondents (57.5 percent) had between 6 and 10 years’
experience within their respective departments sector which implies that respondents had spent
ample time at the hospital positioning them well to comment as experience enhances their
credibility in issues on the implementation, monitoring and evaluation of SAP.
4.5 Reliability Statistics Questionnaire Constructs
This section seeks to test the reliability of the questionnaire in addressing the research questions
raised for this study. This is important if the questionnaire is to meet the objectives of the study.
Table 4.4: Reliability Statistics
Construct Cronbach’s Alpha Number of items Items dropped
SAP
Implementation
Process
0.5397 8 None
44
Module Satisfaction 0.7903 9 None
SAP Successful
Implementation
0.8690 11 None
SAP
Implementation
Challenges
0.8897 10 None
Source: Field Study Survey Results 2016
The table 4.4 above shows the results of item analysis conducted for all the variables. From the
table above SAP implementation process had the lowest Cronbach‘s coefficient of 0.5397 and
SAP implementation challenges had the highest coefficients of 0.8897. Module satisfaction had a
Cronbach’s alpha coefficient of 0.7903 while SAP successful implementation had a coefficient
of 0.869. All these coefficients are sufficiently large which suggest high degree of internal
consistency of measurement without dropping any items as they were all correlated to the other
observed variables. No item was dropped for all, suggesting a high correlation between the items
in each construct. Thus all the questions measure the constructs which they were expected to
measure and further analysis of the responses was done.
4.6 Impact of SAP Implementation on Time Spent Serving Patients
At the heart of SAP implementation in the hospital environment is the improvement of service
delivery in particular reducing the amount of time patients are served at any given touch point.
This study sought to understand this important dimension that even affects the competitiveness
of the business establishment. The figure 4.2 below shows the results that obtain from the study.
Figure 4.2 Comparison of Average Amount of Time in Minutes Spent Serving Client
Before and After SAP Implementation Across Departments
45
Source: Field Study Survey 2016
The results that obtained from the study revealed a positive transformation in the amount of time
spent serving a client at across all departments at Chitungwiza general hospital following the
implementation of SAP. This resonates well with Khalil and Sleit (2012) who argued that
organisations including healthcare providers are continuously learning how to adopt and use SAP
technology in their operations for effective and efficient service delivery. Improved service
delivery is also considered a vehicle for the realization of competitive advantage and the
reduction as the hospital significantly reduced the maximum amount spent serving a client from
120 minutes to about 34 minutes with the average amount of time being spent with a single client
being significantly reduced from 43 minutes to about 7 minutes. Such a remarkable reduction
had positive impact on the patient management and building public trust as one of the
interviewees opined that;
The hospital has improved service delivery by dramatically reducing lag time for our
patients. Long winding queues especially at the outpatients department particularly
where patients make payments are now a thing of the past. This has gone a long way in
enhancing customer satisfaction which has a ripple effect on the competitive positioning
of the hospital and improving the image of the hospital as a public service entity in line
with the organisation’s mission thrust.
46
The above statement goes to demonstrate that the adoption of SAP was indeed a strategic move
that enabled Chitungwiza general hospital to move towards enhancing patient management and
gaining public trust. Client management and gaining public trust are enhancers of competitive
strategies and Chitungwiza general hospital has rightly identified patients as the pinnacle for the
viability and profitability of the organization. From the data, it emerges that the hospital has its
internal policies and main thrust which is clearly defined which center around patients and the
hospital staff. The data also reaffirm the emphasis on customer relations which most of the
respondents also considered to be important in the hospital’s mission statement. Indeed the figure
4.3 below further cements the impact of SAP on client relationship management which is central
to Chitungwiza hospital competitive positioning efforts.
Figure 4.3: Percentage Distribution Of Respondents Views on Impact Of SAP on CRM
Source: Field Study Survey Results 2016
The data shows that 26 percent of the respondents strongly agreed that SAP implementation has
helped to illuminate the practice of CRM at the hospital. Meanwhile,12 percent of the
respondents also agreed that a SAP adoption clearly demonstrate the practice of CRM at the
hospital and a commitment to promote CRM activities. Commitment from the organisation has
been considered a critical element for the success of the CRM strategy. Buttle (2004) has argued
that there is need for commitment on the part of the organisation to build long term relationship
47
and this will help to build trust and understanding in the way either part i.e. the hospital and the
customer. The study data demonstrate that the hospital has made commitments towards CRM
through adoption of SAP which has at its core functions commitment to enhance cooperation and
long term relationships with patients. These long term relationships with clients are important in
the realization of competitive advantage by the hospital.
4.7 SAP Impact on Organisational Processes
Across organisations, reporting plays an integral role in the performance and accountability of
business practices. Reporting is a managerial function that enables the organisation to enhance
trust with key stakeholders especially the public under public service entities. Timeous reporting
becomes critical in the realisation of public trust and Chitungwiza hospital has made tremendous
strides towards this goal as revealed by the research findings. Shang and Seddon (2002) in their
classification of the managerial benefits derived from SAP implementation identified
information communication benefits especially in the area of reporting. When asked on the
impact of SAP on their reporting, most respondents pointed to a positive change as shown by the
figure 4.4 below.
Figure 4.4 Percentage Distribution of Respondents Views SAP Impact On Better Reporting
48
Source: Field Study Survey Results 2016
The data shows that 42 percent of the respondents strongly agree that the implementation of SAP
is critical in enhancing the quality of reporting in the functions within the organization.
Meanwhile, about 16 percent agreed while 10 percent were uncertain on the impact of SAP in
their reporting activities and enhancing the nature of their reporting. According to the data, the
majority of respondents supported that SAP implementation had in great measure impacted
positively in the production of better reports which in turn goes a long way in strategies that are
geared towards enhancing the competitiveness of the organisation. The role of reporting is
important as it provides the impetus for customer management and accountability functions
which in turn builds trust for the effective implementation of the competitive advantage
strategies. This is supported by Wong and Sohal who noted that the way in which employees of
an organisation perform their tasks, can lead to trust and this will in turn impact on the
commitment from the customer and resultantly customer loyalty. Thus the affirmation by the
respondents of the role of SAP in betterment of reporting in the organization’s competitive
positioning strategies shows that Chitungwiza general hospital is well positioned to realise
success in its competitive advantage strategy.
49
The data in figure 4.4 shows that the majority of the respondents strongly agree that the reporting
is one of Chitungwiza general hospital emphasis point which has a bearing in the successful
implementation of the competitive advantage strategy. According to the data, the majority of the
respondents supported that reporting mechanisms had been placed by the hospital and this shows
that the hospital has recognized the importance of such mechanisms in gaining trust and handling
conflicts that are attendant between the patients and the hospital. This is consistent with Kotler
and Keller (2006) who opined that organizations that encourage feedback and disappointed
customers to complain are positioned to achieve greater returns. Indeed conflict handling is an
essential ingredient of the hospital’s competitive strategy without which competitive positioning
initiatives may fail to achieve the goals of creating lasting relationships with customers. Given
this, Chitungwiza general hospital with its emphasis on provision of adequate guarantees of
feedback mechanisms addressing customer problems, is well placed to provide customer
satisfaction which enhances competitive positioning strategies and ultimately profitability and
sustainability.
A further consideration of the data in the figure 4.4 below also asserts the importance of SAP in
reporting through the provision of reliable information which helps in positioning the
organization competitively. 19 percent and 15 percent of the respondents strongly agreed and
agreed respectively that the implementation of SAP has improved the hospital’s ability to
generate reliable information which is an integral part of the organization’s strategies to enhance
the competitiveness of Chitungwiza hospital. This is consistent with Buttle (2004) who contend
that if staff is well informed about the nature of operations and are actively involved they
become active and take ownership of competitive advantage strategies positioning the
organization for the attainment of competitive advantage. Thus a significant percentage of the
respondents argued that the reliable information forms an integral part of the organization’s drive
to achieve competitive advantage.
50
Figure 4.5: Percentage Distribution of Respondents’ Views on the Impact of SAP On
Access to Reliable Information
Source: Field Study Survey Results 2016
However, from the figure 4.5 above most of the respondents considered the hospital as not
having put adequate guarantees to ensure that there is provision of reliable information across the
organizational functions which are a critical component of a successful competitive advantage
strategy. About 33 percent and 25 percent of the respondents disagreed and strongly disagreed
respectively to the hospitals ability to provide access to accurate and reliable information across
the organization which would enhance the competitive advantage of the hospital. As also argued
in chapter two, trust and commitment are considered to be products of the provision of reliable
information within the organisation and between the organisation and its customers as it will help
in building trust within customers.
More interestingly, the implementation of SAP at Chitungwiza general hospital has not
automatically translated into provision of reliable information which acts against the successful
implementation of the competitive strategy. One respondent to the interview commenting on this
laxity in provision of reliable information opined that;
The implementation of SAP paves way for business process reengineering as the adoption
of enterprise resource planning solutions requires an examination of the various
51
components of business operations. The parameters of which comes first between
business process reengineering and enterprise resource planning are not always clearly
defined in most instances. This has been a major challenge in the implementation of SAP
at Chitungwiza general hospital and this has meant that while most businesses have
synchronised with ERP, there remain other processes that are still being done in the
traditional way.
The observation above is cemented by the respondents views as they obtained from the study in
the figure below.
Figure 4.6: Percentage Distribution of Respondents’ Views On the Impact of SAP on
Business Process Restructuring
Source: Field Study Survey Results 2016
The figure 4.6 above demonstrates that most of the respondents were of the view that the
implementation of SAP had resulted in business process restructuring as the traditional activities
paved way for the successful implementation of the ERP system. This demonstrates that hospital
management is taking a more holistic approach to redesign and repackage business processes and
their relationship with technology. According to one interviewee
52
the process of adoption and implementation of SAP at the hospital was marred by conflict
and suspicion as there was no effective communication on the goals of the new system. In
fact the implementation phase which was spearheaded by external consultants failed to
clarify and allay any fears that the workers harbored towards the adoption of SAP and
this militated against the smooth transition into the SAP era.
This confusion is however not peculiar to Chitungwiza general hospital alone as Martin and
Cheung (2000) note that some organisations use ERP systems to promote a BPR yet others are
forced into business process reengineering during the implementation of ERP systems
implementation. For Chitungwiza general hospital, the later was the case as the hospital had to
transform some of its operations to jell with the implementation of SAP.
Apart from enhancing the quality of information and reliability of information, SAP
implementation is expected to remove redundant tasks and internal communication challenges
which militate against the competitive positioning of organisations. Needless to say, the
organization has also done well in these critical areas of its competitive strategy through
emphasis on critical success areas such as reduced redundancy tasks and improved internal
communication as indicated by figure 4.7 below. The data indicate that most respondents, about
39 percent of the respondents, agreed that the organization has put more emphasis on ensuring
that there are redundant activities are eliminated while measures are in place that promote
internal communication efforts for the success of competitive positioning efforts. Meanwhile,
about 26 percent of the total respondents also agreed that there were measure that promote the
internal communication and reduce redundancy at Chitungwiza general hospital positioning it
well for the realization of competitive advantage. In literature review of chapter two, removal of
redundancy was considered a crucial factor in the successful implementation of the competitive
strategy as it helps in efficiency and better service delivery.
53
Figure 4.7: Percentage Distribution of Respondents’ Views on Impact of SAP on
Redundant Task and Internal Communication
Source: Field Study Survey Results 2016
Indeed, from the figure 4.7 above, a significant 23 percent disagreed that the implementation of
SAP has had a positive impact on removing redundancy and enhancing internal communication.
As Shang and Seddon (2002) have observed within the organization there is interdependency of
task, people, roles, departments and functions the enable the organization to provide a client with
a product or a service. It is in this context the respondents may have perceived certain functions
and roles as being redundant under the new SAP dispensation. While SAP helps in the removal
of redundant activities with its goals being to improve inefficient business processes, reorganize
business functions and ultimately improve position in the industry there are activities that cannot
be removed in the name of eliminating redundancy. Kotler and Keller (2006) aptly note that
business processes are made up of people who conduct them, the tools they use and procedures
they track and information between several people, groups and sub activities. Thus at
Chitungwiza general hospital, it is understandable that such a significant 23 percent of the
respondents may see challenges with respect to redundant activities yet in actual fact these
seemingly redundant activities are critical in any business setup as not every activities can be
dispensed with through the implementation of SAP.
54
The removal of redundancy within the organization is important in the standardization processes
of an organization. Koch et al. (2001) rightly noted that one of the major reasons why companies
implement ERP solutions are to standardize processes and organizational information. The figure
4.8 below shows the results obtaining on the impact of SAP of standardization of processes at the
hospital.
Figure 4.8 Percentage Distribution of Respondents’ Views on the Impact of SAP on
Standardization of Processes
Source: Study Survey Results 2016
The figure 4.8 above shows that most of the respondents (28 percent) strongly agreed and (37
percent) agreed with the view that Chitungwiza general hospital has successfully synchronized
processes that are related to SAP implemented modules which position it to satisfy its customers
and gain competitive advantage for profitability. This standardization by the organization has
successfully synchronized its operations dealing with bureaucratic processes that may militate
against customer satisfaction. Meanwhile 9 percent and 11 percent disagreed and strongly
disagreed respectively with this view. Bureaucratic tendencies ultimately result in customer
dissatisfaction which then militates against the success of the competitive positioning strategy.
The goals of synchronization which the hospital, according to the data has managed to address
then becomes important in the success of the competitive advantage initiatives. This resonates
55
well with Fickel (1999) who has argued that SAP technology integrates front office e.g. customer
service and back office e.g. operational functions of the organisation. Thus synchronization helps
in bringing convenience to customers which has a bearing on competitive advantage strategies.
The implementation of SAP by Chitungwiza general hospital has enabled the hospital to
consolidate its front office operations and back office operations. This has enabled one stop
services for the customers thereby ensuring that the organisation is efficient in meeting the needs
of its customers. The interviews with senior management were more instructive as one of the
respondents argued that;
The hospital has been able to ensure more productive time on patients facing activities
and more productive staff time that improves the overall performance of the
organisation. Bureaucratic activities have traditionally suffocated the hospital creating
leakages financially and incapacitating the organization in terms of sustained revenue
generation.
There has been efficient coordination between the various units of the hospital which has
improved the efficiency of the organisation. According to Jenkins and Christenson (2001) apart
from human resources benefiting from centralized scheduling, the billing, laboratory, pharmacy
and patient records can be synchronized internally. Respondents also reported improved data
mining which enable segmentation of patients which help the organisation to focus on clients
that owe the hospital more money which will better position the organisation for
competitiveness.
Respondents pointed to a number of challenges in the implementation of SAP as a competitive
strategy that include poor or inadequate information management system for data mining.
Although information technology is not SAP, it is critical as a facilitator for effective
competitive strategy which enhances the ability of the organization to achieve competitive
advantage. Ndubisi and Wah (2005) have argued that technology helps the organisation to
communicate up to date information to customers removing uncertainty and creating trust
thereby enabling the customers to maintain the valued relationship with the organisation. Thus
56
from the above it has been glaring that the organization has not been able to adequately provide
its competitive strategy.
The complexity of hospital operations often militate against the successful implementation of
competitive positioning strategies. Yin (2006) has aptly noted that hospital processes are
different in that they are highly varied and more complex than procedures in several other
industries. Chitungwiza general hospital has however been able to deal with these challenges as
shown by the figure 4.9 below.
Figure 4.9: Percentage Distribution of Respondents Views On SAP impact on Adaptability
Source: Field Study Survey Results 2016
Respondents also considered the use of SAP to be important as an enabler of Chitungwiza
general hospital’s adaptability. In chapter two, SAP implementation was identified as a crucial
factor in successful competitive positioning in the literature reviewed. Evans et al., (2004)
considered SAP technology, particularly that technology which attempts to manage all customer
touch points and facilitate the integration of various database systems to provide a single picture
of the customer to be indispensable in the competitive strategy. Up to 48 percent and 12 percent
of the respondents strongly agreed and agreed respectively that the use of SAP system solutions
formed one of the critical areas of the hospital’s competitive strategy. SAP is apart from
57
increasing customer touch points which enhances the interaction between the organisation and its
customers also enables the organization to better respond to changing business dynamics. This is
supported by Hoffman (2008) who opined that SAP technology is propelling advancement in
healthcare giving opportunities for the implementation of best practises, use of evidence centred
medicine, decreasing human mistakes, increasing efficiency and creating health database. The
ready availability of information allows key management decisions to be made thereby ensuring
better responsiveness to internal and external changing business dynamics. This enhances the
hospital’s ability to attain competitiveness and ensure that long term patient management and
trust. The observation by one interviewee was instructive on the implications of SAP
implementation on adaptability;
SAP as a system is an important tool that is helping to change behaviours at Chitungwiza
general hospital. In its philosophy, SAP implementation is a strategy for transforming
behaviors and its adoption is central to better adaptability as any organization has to be
responsive to internal and external influences.
Thus, the adoption of SAP has worked for Chitungwiza general hospital’s adaptability although
some significant percentage of respondents (16 strongly disagreeing and 17 disagreeing) failed to
see the benefits in this regard,
4.8 Dynamics and Challenges in SAP Implementation
A number of factors have been identified to be integral in the successful implementation of SAP
systems solutions and this study sought to understand the implementation process at
Chi8tungwiza general hospital with the view of identifying enhancers and debilitating factors
which will act as the basis for strategic recommendations for competitive positioning. Indeed the
hospital has implemented the ERP solution system as in the evolution phase of the
implementation process as discussed in chapter two. An understanding of the nature of the
implementation dynamics is important for building on best practices and correcting flaws in the
implementation processes. This will help the hospital to focus its competitive advantage
strategies and the figure 4.10 below shows results obtaining with regards to the implementation
dynamics of the ERP solution system.
58
Figure 4.10: Dynamics of SAP Implementation
5
4953
47
64
23
69
35
55
79
17
0
10
20
30
40
50
60
70
80
90
Yes
Somewhat
No
Source: Field Study Survey Results 2016
Most respondents disagreed that in its implementation of SAP systems solutions, Chitungwiza
general hospital had put adequate guarantees for successful implementation of SAP in line with
four areas namely product, people, process and change management as identified by Esteves and
Pastor (2003). Concerning the product, literature has identified the need for consideration to
include issues like functionality and technical issues as hardware and software requirements.
Again there is need for an alignment of SAP system solution with the business strategy as it is
important to determine whether the software is being effectively used to meet organizational
need and how it can be further applied to meet further goals of the company. From the figure 4.9
above, most of the respondents (55 percent) were not satisfied with the modifications that were
made to the SAP system solutions in tandem with their organizational functions. In addition, a
significant 35 percent of the respondents also expressed dissatisfaction with the level of
engagement of the SAP system solution vendor whose knowledge of the product is often
considered critical in the successful implementation of ERP solutions. This may militate against
the realization of the full benefits of SAP implementation at Chitungwiza general hospital.
59
With regards to people in the implementation mix, most of the respondents had reservations
concerning the effective engagement of employees, end users and even the role of management
in the implementation process. The importance of increased focus on the organisation’s human
resources and available skills and their roles in the lifecycle of the ERP system cannot be
overemphasized. Most of the respondents (53 percent) as shown by the figure 4.9 argued that
there was no effective end user involvement while 49 percent of the respondents were concerned
about the failure of management to continuously update staff on project status. In addition,
respondents also argued that the implementation process was not adequately supported by
departmental heads yet the implementation seemed to be well backed by skilled consultants as 40
percent of the respondents did not doubt their heavy involvement in the project. This may
militate against the successful implementation of the SAP system solution as there is need for
internal buy-in for ownership and sustainability guarantee.
With regards to change management, Chitungwiza general hospital has not properly addressed
this important dimension of SAP system implementation. Dong and Ivey (2000) have identified
two forms of top commitment in the implementation of ERP solutions namely commitment to
resource and commitment to change management. Indeed due care was taken in the development
of the skills that areas required in the running of the ERP system should be developed to reduce
risk and manage complexity for smooth organizational change as most respondents agreed that
rigourous SAP end user training had been undertaken as part of the SAP implementation process.
According to Holland and Davies (1998) the dimension of change management is usually
designed to deal with the complex change usually associated with big systems achieves the right
outcomes in the right timeframe and at the right costs. Yet for Chitungwiza hospital, the
complexity of its operations might have militated against the successful handling of change
management. Most of the respondents 64 percent were of the view that the hospital had not put
in place adequate change management strategies that are required in ensuring acceptance and
readiness for a new system allowing the hospital to competitively position itself.
In this regard, further challenges in the implementation of SAP system solution at the hospital
are identifiable. One of the interviews had this to say on the challenges in the implementation of
SAP system solutions at Chitungwiza general hospital;
60
The road in the implementation of SAP was marred by a lot of challenges relating to
redundancy of technology at the hospital, financial constraints and gaps in human
resources which are critical in the implementation of SAP. Again as a public service
provider the organization had to contend with the public to which the organization was
not always well prepared.
Bearing this in mind the following outcome obtained from the study concerning the challenges
that confronted the organisation’s SAP implementation process.
Figure 4.11: Percentage Distribution of Respondents’ Views on SAP Implementation
Challenges
Source: Field Study Survey Results
A meaningful contribution to the hospital viability and profitability is strongly related to the
ability of the hospital to effectively implement and manage the implementation of SAP system
solution. The research found out however that there are problems with the general
implementation of SAP as a significant number of respondents (15 percent) could not agree
while 52 percent of the respondents were neutral that the SAP implementation schedule was
61
reasonable. The fact that most respondents were neutral concerning the implementation schedule
supports the notion highlighted above that there was laxity in information sharing across the
organization of the goals of SAP and the nature of the implementation process.
Although most of the respondents were of the view that the hospital’s emphasis on SAP
implementation is reflected through its provision of training to its staff on various module
components, the research revealed that the human resource factor which is critical in the success
of the SAP system solution had not been adequately addressed. While prioritization on staff
training is imperative in SAP implementation process there is need for the any organization to
evaluate its human resources in relation to SAP and proffer training accordingly to position the
organization for the success of the competitive strategy. One may opine that human resource
evaluation resulted from the realization of the need to increase the awareness among company
staff on the SAP system solutions. Trainings are also important for the inculcation of
organizational culture within employees which smoothens the road to the attainment of
competitiveness. According to Esteves and Pastor (2003) many organisations fail to collect
information to determine the usefulness of their training programs yet Chitungwiza hospital
should be commended for its prioritization on trainings. Training should cover all aspects of the
competitive advantage strategy that would include the information communication technology
used in the implementation of the SAP. Thus Chitungwiza hospital has been able to build
capacity within its staff that is able to interact with SAP modules which positions it for a
successful competitive strategy.
The figure 4.11 above demonstrates that poor funding is a problem that is affecting the
successful implementation of SAP. Most respondents (61 percent) disagreed that the SAP
implementation process was adequately resourced. Although top management supported the SAP
implementation process, this did not automatically translate into adequate financing of the
process. Dong and Ivey (2000) noted that active participation of top management is important for
62
the adequate financing of the project, to taking fast decisions and promoting organizational wide
acceptance of the project.
Closely related the SAP implementation process was also not adequately staffed as 53 percent of
the respondents argued that the implementation process was not adequately staffed. Further
complicating the human resources component of the implementation process was the fact that
low levels of morale existed among the employees as 20 percent and 43 percent of the
respondents disagreed and were indifferent concerning the levels of morale among the
employees. Thus the implementation of SAP has not had a positive impact on the morale of the
employees which is a major concern for the viability and sustainability of the SAP
implementation process.
Poor management of public reaction and lack of adequate technology were the other challenges
that were identified in the implementation of SAP as 43 percent and 24 percent respectively
alluded to the fact that the hospital had no adequate guarantees for the management of public
reaction and technological capabilities. As such, these challenges threaten to undermine the
implementation of SAP which inhibits the profitability and sustainability of the ERP solution.
4.9 Impact of SAP Modules and Levels of Satisfaction
Although the study specifically intended to assess the impact of implementation of SAP
healthcare industry solution system on accounting profitability, an examination of its impact on
all the implemented modules was inescapable. The figure 4.12 below demonstrates the results
obtaining from the study.
63
Figure 4.12: Percentage Distribution Levels of SAP Satisfaction Per Department
Source: Field Study Survey Results 2016
From the figure 4.12 above, despite the challenges described in the preceding section, high levels
of satisfaction are evident across most of the departments making a case for the continued use
and adaptation of SAP system solutions. Worthy to note is how the SAP system has positively
improved sales and invoicing and finance and accounting for the hospital. Most of the
respondents (70 percent) were very satisfied with the impact of SAP on sales and invoicing
operations while an equally high percentage of respondents (67 percent) were also very satisfied
with the implementation of SAP in finance and accounting. Granted this, one can argued that the
SAP implementation process has significantly improved accounting profitability as the two
64
departments whose activities are closely related to accounting profitability have recorded
positive changes. Further supporting this supposition are the views of one of the interviewees
that;
SAP implementation has enabled the hospital to effectively generate revenue by acting as
a stop leak valve to the leakages that had characterised the traditional dispensation. The
standardization of operations has had the profound effect of eliminating corrupt
tendencies that had derailed the organisations financial goals. Customer bill processing
and credit follow ups have been made easy with the introduction of SAP.
In addition SCM practices have been revolutionarised in line with global standards which
strategically position the organisation for competitiveness. One key informant highlighted that
before the introduction of SAP there were poor commodity management practices at
Chitungwiza general hospital while inventory management and demonstrations where
characterized by misuse of products. In this regard such activities militated against the
competitive positioning of the health institution. However, a dramatic shift is evident as 31
percent of the respondents were very satisfied with warehouse management under the SAP era
while 51 percent were also very satisfied with the logistics and materials management practices
under the SAP era. SCM has become particularly important in economies that are usually
permeated by financial crises, negligent financial sector and imbalanced global competitiveness.
Kannan and Tan (2010) concur and further assert that competition is no longer between
companies but among supply chains. It then becomes imperative for organisations to know their
SCM strategies and those of their competitors to find the benchmark for their solutions. In this
regard Chitungwiza is well positioned to realise competitive advantage through SCM practices.
Lastly in relation to customer services management, the study further reveals a positive change
in the interactions between the hospital and its clients. Respondents pointed to a number of
benefits which the organization has derived from the implementation of SAP. One of the patient
respondents opined that
65
SAP has enabled us to receive better and faster services since 2014. As a regular with
this hospital there has been a remarkable change in the time that I usually spent
accessing drugs at this hospital.
The above, is consistent with Du Plessis (2005) who noted that customer relationship
management is based on an organization’s efforts to create long term, mutually beneficial
relations with customers. This means that Chitungwiza hospital has been successful in the
implementation of its customers service management under SAP as it has been able to ensure
customer satisfaction by creating long term relationships which will ensure benefits of SAP.
4.10 Summary
This chapter served to present the empirical findings emanating from the field study. Themes
were developed as tools of analysis in addressing the research questions raised from chapter one.
The results were presented starting with the descriptive presentation of the findings followed by
the inferential analysis on the determinants of the performance of the SAP as a competitive
strategy. According to Cronbach’s Alpha coefficients (reliability coefficients), all the constructs
have confirmed as reliable variables that can be taken in the further analysis. The following
chapter critically considers the research findings drawing conclusions and recommendations for
future research and policy formulation and interpretation
66
CHAPTER 5
CONCLUSIONS AND RECOMMENDATIONS
5.0 Introduction
The purpose of this chapter is to discuss the findings of the current research presented in chapter
four. The current research was undertaken with the view of establishing the role of SAP
implementation on business competitiveness within the health delivery sector. The raison d’être
of researching on SAP implementation is to attain increasing understanding of factors that
influence the success of SAP implementation for successful competitive positioning. It then
became imperative to examine determinants of successful implementation of SAP to identify
best practices. Major findings concerning these facets of SAP implementation are considered.
Conclusions are made while suggestions to the health sector and other stakeholders are made.
5.1 Major Research Findings
This section critically considers some of the research findings as guided by the objectives of the
study.
5.1.1 Effectiveness of SAP Implementation in Enhancing Competitive Advantage
The current research established that SAP is a potential rather than the panacea for the attainment
of competitive edge within the health delivery sector. This was so as most respondents opined
that despite adapting SAP systems, this has not automatically translated into benefits for the
organization. This has been so as the hospital continues to face challenges of undercapitalization
as the study revealed. However, there are prospects of improvement as respondents revealed that
the bank has derived benefits related to customer satisfaction which are critical enhancers of
competitiveness. Again several factors that act to the advantage of Chitungwiza hospital have
been identified.
67
5.1.2 Impact of SAP Implementation on Accounting Profitability
The research established that SAP system implementation has positively improved sales and
invoicing and finance and accounting for the hospital positioning the hospital for accounting
profitability. Most of the respondents (70 percent) were very satisfied with the impact of SAP on
sales and invoicing operations while an equally high percentage of respondents (67 percent) were
also very satisfied with the implementation of SAP in finance and accounting. The study
revealed that SAP implementation process has significantly improved accounting profitability as
the two departments whose activities are closely related to accounting profitability have recorded
positive changes.
5.1.3 SAP Implementation on SCM Practices
The study revealed that SAP implementation had a positive impact on SCM practices at the
hospital. The introduction of SAP has enabled the hospital to deal with SCM challenges relating
to poor commodity management practices and inventory management problems relating to
misuse of products. The research reported a dramatic shift in SCM fortunes as 31 percent of the
respondents were very satisfied with warehouse management under the SAP era while 51 percent
were also very satisfied with the logistics and materials management practices under the SAP
era. Thus Chitungwiza general hospital has been able to realized the benefits of SAP
implementation on SCM practices.
5.1.4 The Impact of SAP on Patient Management and Public Trust.
the study further reveals a positive change in the interactions between the hospital and its clients.
Respondents pointed to a number of benefits which the organization has derived from the
implementation of SAP. The implementation of SAP has enabled the hospital to consolidate its
front office operations and back office operations which has improved service delivery and
patient management. This has enabled one stop services for the customers thereby ensuring that
the organisation is efficient in meeting the needs of its customers and building public trust.
Improved service delivery is also considered a vehicle for the realization of competitive
advantage and the reduction as the hospital significantly reduced the maximum amount spent
68
serving a client from 120 minutes to about 34 minutes with the average amount of time being
spent with a single client being significantly reduced from 43 minutes to about 7 minutes. These
are indicative of the important role that SAP implementation has had on the ability of the
hospital to effectively manage patients and building of public trust.
5.1.3 Factors Enhancing SAP Implementation
1. Information gathered under the study revealed that there are a number of factors that have
been acting for the viability of SAP implementation strategy. The dedication of staff
primarily focusing on SAP implementation is one of the strengths of SAP implementation
strategy.
2. Data obtained demonstrated that top management directives are a critical component of
SAP implementation strategy strategy. Most of the respondents concurred that the
organisation has emphasized on top management directives as a critical success factor for
the organization’s SAP strategy. The data indicate that most respondents, about 69
percent of the respondents, strongly agreed that the organization has put more emphasis
on ensuring that there are management directives in place that promote SAP efforts. Top
management directives were considered critical for setting the pace and their buy in is
critical in the provision of resources in the implementation of the SAP implementation.
3. The implementation of SAP has been propelled by the significant emphasis on provision
of continued training to staff in on critical SAP modules. This may be considered a
benefactor of the presence of top management the support of top management which has
aided in the provision of resources for the implementation of SAP. Indeed, the SAP
implementation process discussed in chapter two highlighted the importance of training
of employees to build capacity and strength in SAP in all departments of the hospital set
up. This is important as Berndt et al. (2009) noted that for the successful implementation
of SAP, the organisation requires the right culture, strategy and leadership. Thus the
trainings have facilitated in creation strategic focus, giving leadership and the creation of
organisational culture that centres on SAP. One may argue that human resource
evaluation resulted from the realization of the need to increase the awareness among
69
company staff on the SAP system solutions. Trainings are also important for the
inculcation of organizational culture within employees which smoothens the road to the
attainment of competitiveness.
4. Most of the respondents were of the view that hospital’s emphasis on SAP is reflected
through its provision of training to its staff on SAP. Indeed due care was taken in the
development of the skills that areas required in the running of the ERP system should be
developed to reduce risk and manage complexity for smooth organizational change as
most respondents agreed that rigourous SAP end user training had been undertaken as
part of the SAP implementation process. Indeed, it is not enough to have dedicated staff
but there is need for well informed staff to which the hospital has done fairly well
through the provision of continued training in SAP and attendant technologies.
Chitungwiza general hospital has prioritised on measure such as regular and systematic
training that facilitate SAP implementation.
5. The emphasis on customer touch points has been one of Chitungwiza general hospital’s
main thrust which positions it for the attainment of competitiveness within the health
delivery sector. Most of the respondents agreed that the organization has mechanisms that
handle conflicts which help the organisation to meet the expectations of its customers.
Thus the hospital has put in place mechanisms that emphasize the centrality of customers
in the SAP strategy.
6. Chitungwiza hospital has been able to synchronize its operations which are a factor
which enhances the SAP implementation strategy for competitive advantage. Most of the
respondents strongly agreed with the view that Chitungwiza hospital has successfully
synchronized processes that are customer oriented which positions it to satisfy its
customers. About 23 percent of the respondents also agreed that the organization has
successfully synchronized its operations dealing with bureaucratic processes that may
militate against customer satisfaction. Bureaucratic tendencies ultimately result in
customer dissatisfaction which then militates against the success of the SAP
implementation and the competitiveness of the organisation. Thus Chitungwiza has been
able to deal with the bureaucratic trap that often entangles most organizations.
70
7. Closely related, Chitungwiza has also been highly rated for the provision of one stop
shop customer information services and simplified transactions. Apart from preventing
bureaucracies such service provision even helps to eliminate queues within the hospital
premises which aids in the attainment of customer satisfaction. According to the data
most respondents strongly agreed and agreed respectively that Chitungwiza hospital has
been able to harmonize customer information and simplify transactions which promote
customer satisfaction. The satisfaction of customers is critical in the implementation of
the SAP as a competitive strategy which enhances the realisation competitive positioning.
5.1.3 Factors Hindering SAP Implementation
1. Although respondents also considered the use of information technology to be important
as an enabler of Chitungwiza general hospital’s strategy it was clear that the hospital has
not been able to provide adequate guarantees in terms of trendy software which militates
against the competitive advantage strategy. Respondents pointed to a number of
challenges in the implementation of SAP as a competitive strategy that include poor or
inadequate information management system for data mining. Although information
technology is not SAP, it is critical as a facilitator for effective competitive strategy
which enhances the ability of the organization to achieve competitive advantage.
2. The study also pointed to poor end user involvement as another limitation in the
implementation of SAP at the hospital. Most of the respondents (53 percent) as shown by
the figure 4.9 argued that there was no effective end user involvement while 49 percent of
the respondents were concerned about the failure of management to continuously update
staff on project status. In addition, respondents also argued that the implementation
process was not adequately supported by departmental heads yet the implementation
seemed to be well backed by skilled consultants as 40 percent of the respondents did not
doubt their heavy involvement in the project.
3. In addition, a significant 35 percent of the respondents also expressed dissatisfaction with
the level of engagement of the SAP system solution vendor whose knowledge of the
71
product is often considered critical in the successful implementation of ERP solutions.
SAP vendor involvement helps in generating ideas for effective SAP implementation.
5.1.4 Benefits of SAP Implementation
The study managed to point to a number of benefits that have accrued to the Chitungwiza
hospital as a result of the implementation of SAP. The advantages are stated as follows;
1. The bank has been able to satisfy existing customers through SAP which has enabled the
hospital to segment the customers and focus especially on those who owe the hospital
more money. Customer satisfaction has then acted as a pillar for the growth of the
hospital thereby increasing prospects for growth through sustained revenue generation.
2. The creation of long term relationship has positioned the organisation for sustainability
and competitiveness within the sector although the position is yet to be firmly
established.
3. Respondents also commended the SAP strategy for helping in ensuring customer
satisfaction and loayalty. This has enabled the organisation to even survive the most
turbulent times within the Zimbabwean health industry.
4. The hospital has also benefited in terms of revenue generation and profitability through
the implementation of SAP.
5. The SAP system has also acted as a springboard for the expansion of the organisation’s
operations into areas that had not been neglected before.
6. The hospital has also benefited through increased brand visibility as a result of the
implementation of the SAP implementation. This will result in enhanced brand resonance
and long-term brand success emanating from bonds created with the customers which
improves brand associations.
7. The implementation of SAP has enabled the organisation to consolidate its front office
operations and back office operations. This has enabled one stop services for the
72
customers thereby ensuring that the organisation is efficient in meeting the needs of its
customers. There has been efficient coordination between the various units of the hospital
which has improved the efficiency of the organisation.
4.2 Conclusion
In view of the empirical data presented, analyzed and discussed leading to the findings of this
study revealed that SAP offers an opportunity for the competitiveness of the hospital. In order to
translate this potential into tangible benefits that include customer satisfaction and effective SCM
operations there is need to continuously monitor existing SAP strategies as this will enhance the
competitive edge of the hospital. Factors militating against the success of the competitive
advantage strategies such as low technological uptake have to be eliminated if the goals of SAP
are to be attained.
4.3 Recommendations
In light of the findings of the study, the following recommendations are proffered for the
improvement of SAP as a strategy to enhance business competitiveness:
1. Although generally most of the respondents expressed satisfaction with the introduction
of SAP and its resourcing, some interview respondents expressed concern with the lack
of consistence in the provision of resources to SAP activities. These resources include
information communication technology for SAP activities. Thus this research
recommends that there is need for adequate logistical support for SAP activities as the
success of the SAP strategy hinges upon adequate provision of resources to the
department.
2. The study also noted laxity in terms of incentivising activities and motivating staff for
high morale that will generate interest and motivation among top clients and employees
respectively. A motivated staff compliment will go a long way to cultivate relations with
company clients even explaining the hospital’s packages to these clients.
73
3. The poor uptake of new technological inventions by the bank was also a problem noted
by most respondents. It has been demonstrated that information communication
technology underpins the success of the SAP implementation as it acts as a conduit
between the organisation and its clients. There is need to improve uptake of trendy SAP
software so as to increase access to hospital services if the hospital is to position itself
competitively against its competitors.
4. The absence of a robust monitoring, evaluation and research system was another
deficiency which the research established. Although the organisation had regular training
programs on SAP, the same could not be said with regards to SAP research that would
inform policy, hence the interest in this study which the management exhibited. The
study recommends that there is need to constantly monitor and evaluate SAP strategies
that are being employed by the hospital. Reviews are necessary to ensure that the
strategies are still consistent with the goals which the organisation has set for the SAP
strategy.
4.4 Areas for Further Research
This study was only focussed on the implementation of SAP at one institution in Zimbabwe.
However, it could be expanded to cover other organisations in Zimbabwe. The study also
majored on establishing issues surrounding the implementation of SAP as a competitive
measure. This can also be widened to include the design aspect of the SAP implementation
strategy.
The study may help to increase on the awareness of the effects of ERP. Indeed organizations are
in situations of deciding on adopting or not to adopt may benefit from this current study. The
broadening of the study is interesting as investigating a large number of organisations will allow
more statistical generalizations. In this regard there is need for a standardized questionnaire as a
data collection instrument. Since in the best knowledge of the researcher very limited studies
have been done in this area, this study has laid the foundation to a new research in the subject
area. Thus further studies building upon this foundation can conduct a case study of two or more
companies and make a more rigorous investigation on the effects of SAP implementation on
74
organizational processes and also examining the implementation projects and its effects of SAP
investment.
75
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APPENDIX 1: QUESTIONNAIRE
University of Zimbabwe
Introduction My name is Albert Chikati. I’m studying towards a Master of Business Administration at the University of Zimbabwe. As part of requirements for the fulfillment of this programme, I am conducting a study titled “ A Critical Evaluation of SAP Healthcare Industry Solution Systems Implementation as a Source of Competitive Advantage: A Case Study of Chitungwiza General Hospital”. You have been identified as one of the respondents and therefore, ask for your cooperation in filling this questionnaire. Your participation is purely voluntary and all information gathered through this questionnaire will be treated with strict confidentiality and used purely for academic purposes only. SECTION A: GENERAL INFORMATION
1 In which department do you work? (Tick where appropriate)
IT Clinical Finance Records Pharmacy
2 Sex Male Female
3 Age ………………………
4 Highest level of education
O’ Level A’ Level Certificate Diploma Undergraduate degree Post graduate degree Other (Specify)
5 Job level Senior Management Middle Management Supervisor or foreman Low level worker
6 For how long have you been working in this position? …………………….. years
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SECTION B
7 On average how long (in minutes) did it take for you to process a client record?
Before SAP After SAP
Please respond to the following statements by indicating the extent to which you agree or disagree as per the given choices. 5 4 3 2 1
S
tron
gly
agre
e
Agr
ee
Unc
erta
in
Dis
agre
e
Str
ongl
y di
sagr
ee
8 Due to SAP Implementation, my organization has
a. ability to produce better reports b. reduced redundant tasks and enrich internal communication d. easier access to reliable information e. improved adaptability f. improved standardization of processes g. restructured business processes h. improved supply chain management i. improved customer relationship management
Not
Im
plem
ente
d
Ver
y S
atis
fied
Sat
isfie
d
Uns
atis
fied
Ver
y U
nsat
isfie
d
9 Indicate your organization level of satisfaction with modules below
a. Finance and accounting b. Human resources c. Payroll d. Logistics and materials management e. Project management f. Customer services management g. Sales and Invoicing h. Warehouse management i. Quality management
82
Yes
S
omew
hat
No
10 Are the following statements true for your organization SAP implementation?
a. Top management supported the implementation process.
b. Implementing team was knowledgeable about SAP and business processes.
c. Top management was continuously updated on project status.
d. End users were involved in the implementation process
e. Implementation was supported by heads of department
f. The organization had change management strategies
g. the implementation was backed by skilled consultants
h. Project implementation scope was well defined
i.SAP vendor was involved in the implementation
j. SAP software was modified to suit organisational needs
k. There was rigorous SAP end user training
Yes
S
omew
hat
No
11 Are the following statements true regarding your organization
SAP implementation challenges?
a. SAP implementation was adequately staffed.
b. SAP implementation was adequately funded
c. There is a good return on investment
d. The organisation was prepared for public reaction to SAP implementation
e. The organisation was technologically prepared to implement SAP.
f. Do you consider SAP implementation to be a success?
g. SAP implementation induced the for new computer proficiency skills set among employees
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h. Did the organization leader change as when SA was introduced?
i.Was employee morale boosted by SAP implementation?
j. Was SAP implementation schedule reasonable?
5.1 In selecting SAP did the organisation consider other ERP systems? Yes No
5.2 What problems where encountered, if Any?................................................................................
5.3 What would have been done differently?....................................................................................
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APPENDIX 2: INTERVIEW GUIDE
Introduction
My name is Albert Chikati. I’m studying towards a Master of Business Administration at the University of Zimbabwe. As part of requirements for the fulfillment of this programme, I am conducting a study titled “ A Critical Evaluation of SAP Healthcare Industry Solution Systems Implementation as a Source of Competitive Advantage: A Case Study of Chitungwiza General Hospital”. You have been identified as one of the respondents and therefore, ask for your cooperation in filling this questionnaire. Your participation is purely voluntary and all information gathered through this questionnaire will be treated with strict confidentiality and used purely for academic purposes only. Name of Interview :_____________________________________________________
Position in Organisation :_____________________________________________________
Number of years in the organisation
1. When did SAP implementation start?
2. In what phase are you now?
3. Which SAP modules have been implemented by the organisation?
4. What was the major drive behind the SAP investment?
5. To what extent have SAP modules been customised to suit organisational needs?
6. Have organizational processes been changed to suit the SAP system?
7. Has the hospital’s image and market position been influenced by the SAP implementation?
8. There are some of the categories and business aspects usually affected by SAP implementation as
identified through literature (Accounting and costs, logistics and commodities management,
customer relationship management, information management, organizational culture . Within
each aspect the respondent should answer the following questions according to their knowhow.
a. What were the expected effects of SAP implementation?
b. Which expected effects have been achieved?
c. Which expected effects have not been achieved?
d. Which non-planned effects have been achieved?
9. Are there SAP performance measurement mechanisms that have been put in place by the organisation?
10. What challenges have been faced in the implementation of SAP? 11. What changes can be made to improve SAP implementation?
Thank you for your time and contributions
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APPENDIX 3: PATIENT QUESTIONNAIRE
University of Zimbabwe
Introduction
My name is Albert Chikati. I’m studying towards a Master of Business Administration at the University of Zimbabwe. As part of requirements for the fulfillment of this programme, I am conducting a study titled “A Critical Evaluation of SAP Healthcare Industry Solution Systems Implementation as a Source of Competitive Advantage: A Case Study of Chitungwiza General Hospital”. You have been identified as one of the respondents and therefore, ask for your cooperation in filling this questionnaire. Your participation is purely voluntary and all information gathered through this questionnaire will be treated with strict confidentiality and used purely for academic purposes only.
BACKGROUND CHARACTERISTICS
1. Name of Health Centre__________________________________________________
2. Surburb______________________________________________________________
3. Date of Interview _____ _____ ____ ____ _______________
Day Month Year
SECTION A: KNOWLEDGE AND PERCEPTIONS
101. Do you know SAP Healthcare industry solutions introduced at this hospital? 1. Yes 2. No
102. If Yes to Question 101, who informed you about the system?
103. Have you ever used the services at this hospital before 2014? 1. Yes (If yes skip to 105) 2. No
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104. If Yes to question 103 is there an improvement in services delivery at the hospital?
____________________________________________________________________________________________________________________________________________________
105. What services were you seeking at the hospital?
1. Health education
2. Contraceptives
3. Family planning
4. Medical attention
5. Other (specify)__________________
106. How frequent do you visit the hospital?
1. Regulary
2. Rarely
107. Do you find services offered at the hospital efficiently administered?
SECTION B: TIME AND CONDITION OF SERVICE
201. What time did you arrive at the hospital? ____
202. Were you served? 1. Yes Skip to Q.204 2. No
203. If No, why not? 1. Hospital was closed 2. Provider was not at the hospital 3. Provider had no available appointments 4. Provider refused to see client 5. Other:_____
204. If you were not served, were you given an appointment for later date? 1. Yes 2. No
205. What procedures did you go through before receiving support? 1. Paperwork 2. Other:______ 3. None
206. Approximately how long did you wait from the time you arrived until you met with a provider? 1. Less than 5 minutes 2. 6–15minutes 3. 16–30minutes 4. More than 30 minutes
207. Do you think that your waiting time was reasonable? 1. Didn’t wait 2. Reasonable/short 3. Too long
208. What was the length of your stay with provider? 1. Less than 10 minutes. 2. 11—30 minutes 3. 31—1 hour 4. More than 1 hour
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209. What was the sex of the service provider? 1. Female 2. Male
210. Who exactly did you meet (service provider)? 1. Doctor 2. Cashier 3. Administrator 4. Nurse 5. Other________________
211. Did they greet you in a welcoming manner? 1. Yes 2. No
212. Were you asked the purpose of your visit? 1. Yes 2. No
213. How did they react to your response? __________________________________________________________________________Code (1= reaction acceptable/ appropriate; 2= reaction unacceptable or inappropriate)
214. What advice were you given?_______________________________________________________________________________________________________________________________________________Code (1. Client told what to do 2. Client helped identify options 3. Client left to determine course of action)
215. Do you think your concerns were seriously considered? 1. Yes 2. No
216. Were you asked if you had any questions? 1. Yes 2. No
217. Did the provider answer all your questions? 1. Yes 2. No 3. Partially
218. Did you feel free to ask any questions to the provider? 1. Yes 2. No If No why not?_________________________________________________________
219. Did you feel comfortable asking the provider questions? 1. Yes 2. No If No, why not?
220. Do you feel that sufficient time was spent with the provider? 1. Yes 2. No If no, why not?___________________________________________________
221. Were you booked for a next appointment? 1. Yes 2. No
222. Overall, were you pleased with what you received from your visit?
1. Yes 2. No 3. Partially
223. Would you recommend your peers to visit this centre? 1. Yes 2. No
224. Is there anything else you would like to add regarding your visit?
______________________________________________________________________________________________________________________________________________
THANK YOU VERY MUCH FOR YOUR TIME AND HELP!!
