Critical Success Factors of Enterprise Resource Planning Adoption by Water and Energy Companies in Mogadishu

Abstract

In this information age, organizations have digitized their operations and all their business transactions are mostly done through an integrated information system software packages called Enterprise Resource Planning (ERPs) to improve performance and to get sustainable competitive advantage. The objectives of this study were mainly two which were; to establish the ERP adoption rate and the critical success factors (CSFs), that were considered during the ERP adoption and implementation among the water and energy companies in Mogadishu, Somalia. The CSFs were the independent variables while the success rate of ERP adoption was the dependent variable. The main CSFs that were considered in this study were fourteen and they were organizational knowledge and legacy IT solutions, clear strategy, top management support, business process re-engineering and ERP customization, competent technical team, education and training, ERP system selection, user involvement, change management, risk management, organizational fit, project management, data accuracy. This study was anchored in mainly two theories which were; the TOE (technology, organization and environment) theory and the TAM (technology acceptance model) theory, where the former emphasizes on the technological, organizational as well as environmental factors to be considered during ERP adoption while the latter emphasizes on the consideration of the perceived ease of use and the usefulness of the ERP system. The study adopted a descriptive survey by use of questionnaires to collect primary data and interviews and observations to collect secondary data and also used statistical techniques and software to analyze the collected data. The target population was all of the water and energy companies in Mogadishu which were 120 and therefore a census approach was applied. The study mainly employed both descriptive and inferential statistics and focused mainly on regression analysis (mainly probability and logistical analysis) as well as descriptive analysis and the findings were presented in tables and model equation for the study was developed. Regression analysis was used to establish the influence of the dependent variable which is the ERP adoption success rate on the independent variables which were the CSFs. The findings of the study revealed that CSFs had a positive influence to ERP adoption success rate among the water and energy companies in Mogadishu, Somalia. Therefore, the study recommends that CSFs be considered during the ERP adoption.