Information technology aplications in business management within Kenyan companies:A survey of insurance firms in Nairobi, Kenya

Abstract

This study has been conducted to find out the extent to which computers are applied in business management in the private sector with the focus being on the Insurance industry in Kenya. The literature review discussed the utilization of computer based information systems in management. The management task has been looked at from the decision making point of view, the hierarchical levels within the management and the functional areas. The literature review gives a justification of the role of information technology in the different level of management and advancements of information technology over the last decade or so. A questionnaire was employed as the data collection instrument and was administered to the population of 39 Insurance companies, out of which 31 responded positively. Information technology usage was prevalent in all the firms sampled and majority of the firms had had computers over the last fifteen years or so. The findings of the study revealed that the widest application in business management was at middle level where the systems were used for tactical control followed by the lower management le~1 where it was used for . operational purpose. The use of IT at the strategic level was encouraging but relatively low. In the functional areas, IT usage within underwriting department was the highest and hence giving us an indication that the use of IT has moved from the back office (Accounting/historical) to the front office. The functional areas in order of intensity (from highest to lowest) include Accounting, claims, reinsurance and administration.

There was concurrence as to why firms adopted information technology and this included efficiencies, increase in data volume, need for improvement in customer care, need to increase processing speed and using IT to re-engineer old products and innovating new products. Inspite of the limitations, the findings of this study provide an interesting synopsis of the management areas in which computer based information systems are used. The findings can also act as indicators of the actual and potential demand for computer products and the producer of the products would be wise to keep pace with such studies. Recommendation for increasing IT usage in business management have been discussed and include an impetus in user training especially at the top management level. Suggestions for further in-depth research and a comparative study across different sectors have also been made.