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Transcript of Msc. Journal Publication
International Journal of Research &
Development Organisation ISSN-465-0175
Journal of Business Management
1
INFLUENCE OF ENTERPRISE RESOURCE PLANNING ON INVENTORY
MANAGEMENTIN PRIVATE PRIMARY SCHOOLS IN KENYA: A CASE
OF BRIDGE INTERNATIONAL ACADEMIES
ANDREW MUGAMBI
Jomo Kenyatta University of Information Technology, Msc Procurement &
Logistics
Dr. David Kiarie Mburu
Lecture, Jomo Kenyatta University of Information and Technology
Key words: Cost Management, Customer Satisfaction, Employee Productivity, Inventory
Management
ABSTRACT
Private Primary schools apply various techniques in the management of their inventories. The
practices adopted have a significant impact on returns, profitability and customer satisfaction.
This study was carried out at Bridge International Academies in Nairobi County. The main aim
of the research was to assess the influence of Enterprise Resource Planning (ERP) system on
inventory management in private primary schools in Kenya. The population sample size was 100
respondents and stratified sampling technique was used. Structured questionnaires containing
both open ended and closed ended questions were used to collect primary data. 82
questionnaires were filled and returned for analysis. The study employed Analysis of Variance
(ANOVA), correlation and regression analysis as methods of analysis. The study concluded that;
cost management, corporate supplier relationship, customer service and employee productivity
had a positive influence on inventory management in private primary schools in Kenya. Based
on the findings, the study recommended that the management of private primary schools should
appropriately manage payments for received items, capture and analyze inventory costs and
control their budgets effectively through embracing enterprise resource planning system in their
operations. There is need for management to form strong mutual beneficial relationships with
suppliers and ensure excellent services are delivered by suppliers through incorporating
International Journal of Research &
Development Organisation ISSN-465-0175
Journal of Business Management
2
enterprise resource planning in their day-to-day operations. To ensure customer satisfaction is
guaranteed, the management has to continuously monitor the business success through a
balanced scorecard through adoption of enterprise resource planning system. The study also
recommends that the management reduces waste and cut costs such as labor costs, increase
quality performance through recruitment of competent staff and ensure Information Technology
productivity through adoption of enterprise resource planning system in their operations.
INTRODUCTION
Inventory has been the subject of keen scrutiny since the dawn of commerce. Because items
sitting on a store shelf or in a warehouse literally represent unrealized sales dollars, retailers have
long experimented with ways to fine-tune their inventory practices. The eternal goal has always
been to hold just enough inventories to satisfy demand (Bradley, 2012).
These inventory basics still apply today, but what has changed is the dizzying pace of commerce,
its global reach and heightened consumer expectations driven by social shopping, online review
sites and comparison pricing on the Internet. There is little doubt that supply chain velocity has
steadily increased in recent years, in terms of how fast goods move from production to
consumption. One look at Amazon Prime’s popular two-day delivery service (through which
most of its orders are fulfilled), and it’s easy to see that week-long delivery times for Internet
orders are a thing of the past (Bradley, 2012).
At the same time that these forces are buffeting retailers (and by extension their suppliers),
technology is coming to their aid by helping them adapt to the new marketplace dynamics. The
adoption of technologies such as global inventory management systems and advanced planning
solutions supported by business process change, where needed are helping to grease the wheels
International Journal of Research &
Development Organisation ISSN-465-0175
Journal of Business Management
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of commerce and, therefore, the movement of inventory. The impact of inventory reduction on
profits is very direct, given that inventory cost is the largest component of working capital. And
yet inventory cannot be reduced at the expense of customer expectations, so the balancing act
remains. To cope, retailers and manufacturers need to rethink their inventory management
strategies, reinvent their inventory management operations and rewire their inventory
management systems (Bradley, 2012).
Emerging collaborative global inventory management systems are enabling manufacturers and
retailers to attain full visibility into their global inventory. Used in many cases with inventory
planning tools, global inventory management systems interact with ERP systems (both the
organization’s and its partners’) to provide a near-real-time, end-to-end picture of inventory,
wherever it resides (Hofman, 2012).
With a global inventory visibility capability, multi-echelon inventory optimization solutions
employ statistical algorithms and business rules to optimize inventory placement and order
fulfillment. Many of these technologies have existed for years, but today they are being
implemented to enable a complete, or “platform,” view of inventory in the global supply chain
by creating linkages between systems that were previously disparate islands. For instance,
inventory is traditionally tracked in different ways, depending on whether it is being transported
via sea, land or air, or is within the warehouse. But world-class retailers and manufacturers today
want to view inventory as one common object that can be tracked seamlessly from a command
center of sorts, using the same type of identification, across the supply chain (Hofman, 2012).
International Journal of Research &
Development Organisation ISSN-465-0175
Journal of Business Management
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Most private primary schools in Kenya recognize they don’t have systems in place to stop them
spending money on equipment they already have. Efficient inventory management in private
primary schools should be able to rapidly respond to customer requirements; at the same time
should be flexible enough to undertake any corrections when required, and do so without
adversely affecting operational efficiencies. The high level of integration found within the ERP
system should provide end-users with the highest level of visibility into materials transactions
within their schools, and assures the accuracy of the data relating to the inventory within the
warehouse (Sheila, 2010).
Bridge International Academies
Bridge International Academies is a chain of nursery and primary schools delivering high quality
education for just $5 a month (on average) in Kenya low income areas. Its mission is to provide
every child with the chance to have high quality primary education regardless of the family
income. Its headquarters is Located in Tulip House Mombasa road and has an employee capacity
of over 2000 workers. It is the largest chain of school academies in Kenya with over 400
academies and over 100,000 pupils.
Inventory Management has always been an important role for Bridge international academies,
the ERP system present at the school leverages research, technology, and data analysis in order
to standardize and scale the entire lifecycle of high-quality education delivery and to drive
continuous improvement across all aspects of operations including school inventory
management. This includes how academies are built and school monitoring its inventory.
International Journal of Research &
Development Organisation ISSN-465-0175
Journal of Business Management
5
Statement of the Problem
Inventory management is regarded as vital to the successful functioning of any business firm as
it is the lifeblood and the heart of any organizations system however lack of inventory
management system in most private primary schools leads their decline in operations
performance (Ballou, 2005). Inventory often represents as much as 30% of the total capital
invested in organizations as well as in private primary teaching institutions (Dobler, 2006). This
was confirmed by Sawaya (2006) who suggest that inventory may represent 33% of the
organizations assets and as much as 90% of the working capital. Vohra (2008) asserts that there
is need therefore to analyze the costs of maintaining certain levels of inventory as there are costs
involved in holding too much stock and costs involved in holding too little inventory since
substantial share of funds is invested in them and therefore E.R.P. systems makes it easy to
maintain the inventory levels especially in private primary learning institutions.
Private Primary schools in Kenya face problems of poor inventory management and this has
greatly affected rendering learning process through poor inventory management of learning
materials(Jude 2013). With the use of inventory management systems like E.R.P., managementof
inventory becomes flawless (Sheila 2010). According to a recent survey, the average primary
school district loses more than $80,000 each year because of lost or damaged inventory(Jude
2013). Additionally, well over half of the districts in the survey 59% still use manual systems to
inventory(Vohra, 2008).In all private primary schools, computers have significant impact in their
works. People rely on computer for efficient and effective way to handle different loads and task
International Journal of Research &
Development Organisation ISSN-465-0175
Journal of Business Management
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most especially for business who are working with, inventorying as well as accounting (Sheila
2010).
Objectives of the Study
i. To establish the influence of Cost Management on inventory management in private
primary schools Kenya.
ii. To assess the influence of Corporate Supplier Relationship on inventory management
in private primary schools in Kenya.
iii. To analyze the influence of Customer Satisfaction on inventory management in
private primary schools in Kenya.
iv. To determine the influence of Employee Productivity on inventory management in
private primary schools in Kenya.
Theoretical Review of Literature
A theory is an abstract generalization that offers a systematic explanation about how
phenomena’s interrelate (Young, 2009). A formal theory is syntactic in nature and is only
meaningful when given a semantic component by applying it to some content (facts and
relationships of the actual world as it is unfolding (Zima 2007). This study employed theory of
constraints which justifies cost management as a constraints, Theory Z of relationship
management which shows the benefits due to relationship between suppliers and organizations,
Contrast theory which highlights customer satisfaction factors.
International Journal of Research &
Development Organisation ISSN-465-0175
Journal of Business Management
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Theory of Constraints
Eliyahu M. Goldratt (1984) developed the Theory of Constraints in part to address the cost-
accounting problems in what he calls the "cost world." He offers a substitute, called throughput
accounting, that uses throughput (money for goods sold to customers) in place of output (goods
produced that may sell or may boost inventory) and considers labor as a fixed rather than as a
variable cost. He defines inventory simply as everything the organization owns that it plans to
sell, including buildings, machinery, and many other things in addition to the categories listed
here (Dave 2002).
Throughput accounting recognizes only one class of variable costs: the truly variable costs, like
materials and components, which vary directly with the quantity produced (Goldratt 2004). The
theory is related to cost management in that it allows a company to use its constraints as leverage
by which it can improve its subject system. A constraint is anything that limits a company's
ability to achieve a higher level of performance; usually this translates ultimately into
impediments to profits (Doldratt, 2004)
The underlying premise of theory of constraints is that organizations can be measured and
controlled by variations on three measures: throughput, operational expense, and inventory.
Inventory is all the money that the system has invested in purchasing things which it intends to
sell. Operational expense is all the money the system spends in order to turn inventory into
throughput. Throughput is the rate at which the system generates money through sales (Goldratt,
2004).
International Journal of Research &
Development Organisation ISSN-465-0175
Journal of Business Management
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Finished goods inventories remain balance-sheet assets, but labor-efficiency ratios no longer
evaluate managers and workers. Instead of an incentive to reduce labor cost, throughput
accounting focuses attention on the relationships between throughput (revenue or income) on one
hand and controllable operating expenses and changes in inventory on the other. This theory
tackles cost management and its effect on inventory management (Goldratt, 2004)
Theory Z of Relationship Management
Professor Ouichi (1982) revolutionized organizational theory by proposing Theory Z, a theory
that workers were motivated by long-term employment, collective decision making, individual
responsibility, evaluation and promotion, and the feeling that the company had holistic concern
for them as an employee Fundamentally, buyers and sellers have entered into relationships with a
predetermined set of assumptions and these assumptions drive the wrong behavior on both sides.
When relationships begin and are managed in such an antagonistic manner, value is lost. We
believe that most sourcing/supply chain professional shave the wrong end point in mind and
therefore end up leaving a significant amount of unrealized value on the table. When the end
point is the best contract supported by well-defined Service Level Agreements (SLAs), the
behavior from both sides is defined and constrained by the contract (Dalip, 2007)
The contract should be nothing but a step along the way to establishing mutual value creating
relationships where both parties are focused on generating a significant amount of value for each
other. Some of the best value-creating activities for an organization are capable of being
accomplished after the contract is signed by starting with a focus on a “Mutuality of Interest.
International Journal of Research &
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Journal of Business Management
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Both sides, the supplier and buyer organizations, need to be cognizant of this “Mutuality of
Interest” so that the benefits are realized from the beginning and throughout the relationship The
most mature organizations have seen the benefits of this approach to Strategic Sourcing. There is
a proactive push and fundamental change being made to foster development of the skills
necessary to manage the activities essential to capturing the promised “Mutual” benefits and to
identify additional “Mutual” benefits of a partnership between supplier and buyer organizations
(Dalip, 2007)
Contrast Theory
Contrast theory was first introduced by Hovland, Harvey & Sherif (1987). Dawes et al (1972)
define contrast theory as the tendency to magnify the discrepancy between one’s own attitudes
and the attitudes represented by opinion statements. Contrast theory presents an alternative view
of the customer post-usage evaluation process than was presented in assimilation theory in that
post-usage evaluations lead to results in opposite predictions for the effects of expectations on
satisfaction. While assimilation theory posits that customer will seek to minimize the
discrepancy between expectation and performance, contrast theory holds that a surprise effect
occurs leading to the discrepancy being magnified or exaggerated (Kamery 2003)
International Journal of Research &
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Journal of Business Management
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Conceptual Framework
The conceptual framework provides a clear concept of the areas in which meaningful
relationship are likely to exist (Cargan 2007). In the study, the conceptual framework will look at
the relationship between E.R.P system and inventory management in private primary schools in
Kenya.
Figure 1: Conceptual framework
Employee Productivity
One element of IT productivity
Is intensity of labor and quality effort
Efficiency gains on working
Inventory management in
Private Primary Schools in
Kenya
Track Inventory
Forecasting demand
Summarize inventory
records
Customer Satisfaction
Is key performance indicator
Indicate a company’s success
Used in monitoring a business
Cost Management
Manage payment
Capture and analyze inventory cost
Help business control budget
Corporate-supplier Relationship
Drive growth and profitability
Suppliers deliver excellent services
Form strong mutually beneficial relationships
International Journal of Research &
Development Organisation ISSN-465-0175
Journal of Business Management
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Research Gaps
Realizing the influence of E.R.P. system is a major challenge. Many organizations’ nationally
and internationally have found that implementing E.R.P. is more complex, expensive, and time-
consuming than originally expected. Problems encountered include supplier resistance, security
concerns, system integration costs, and the non-readiness of organizations’ (both buyers and
suppliers) to adopt the fundamental changes required. The aim of this study is to find out the
influence of E.R.P. system on inventory management in private primary schools a case study of
Bridge international academies.
The only study that has been done that is close to current study is Ravi (2013), on investigating
the influence of ERP systems environment on business process agility, the findings of the study
revealed that Enterprise resource planning systems have contributed to simplification,
standardization, integration, and automation of processes, but their influence on the firm's ability
to build agility is ambiguous. Integration of processes and information across functional
boundaries, according to the study, contributed to improvement in the speed of execution and
enhances the ability to re-configure process components. Integration across hierarchical levels in
the case organizations has resulted in improved visibility, centralization of control and improved
decision making, which indirectly contributed to process agility.
E.R.P systems play a great role in businesses in the world today. Businesses in the government
are not an exception. This study will investigate how much E.R.P. has been embraced in Bridge
international academies and what effect it has on inventory management function. In summary
International Journal of Research &
Development Organisation ISSN-465-0175
Journal of Business Management
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the major aim of this study was to bridge the gap between theory and practice. There is need to
understand why some things sound good on paper but difficult to implement in practice and this
study looked at Bridge international academies.
International Journal of Research &
Development Organisation ISSN-465-0175
Journal of Business Management
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METHODOLOGY
This study adopted a descriptive research design. According to Stephan (2001) descriptive
research entails the description of the characteristics that help describe, show, and summarize the
data in a meaningful way. A descriptive study was undertaken in order to ascertain and be able to
describe the characteristics of the variables of interest in a situation (Kothari, 2008). The goal
was to offer a profile of the phenomena of interest from specific perspective.
In this study the target population was 335 staffs who are directly and indirectly responsible for
inventory management and consisted of Accountants, Academy managers and Administration
staffs in Bridge International Academies.
The sample size for this study was drawn from all departments involved directly or indirectly in
inventory. According to Mugenda and Mugenda (2008) a sample size for a population of less
than 500 should be 30% of the total population. The sample size was calculated at 30% of the all
bridge international Head office staff which is 335 this giving a sample size of 100 respondents.
The main instrument of data collection was questionnaires. Questionnaire is a research tool that
has a predesigned list of questions used for communication with the respondents.
Data collected was analyzed using both quantitative and qualitative data analysis approaches.
Data from closed and open-ended questions in the questionnaire was coded and entered into the
computer using statistical package for social science (SPSS) version 20. The study used ANOVA
to test the level of significance of the variables on the dependent variable at 95% level of
International Journal of Research &
Development Organisation ISSN-465-0175
Journal of Business Management
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significance. The study also used correlation to establish the relationship between the variables.
Regression analysis is a quantitative research method used when the study involves modeling
and analyzing several variables, where the relationship includes a dependent variable and one or
more independent variables to provide meaningful and accurate conclusions of the phenomenon
under study (David, 2005). The researcher used regression analysis, as it was able to relate
dependent variable with multiple independent variables to bring out meaningful and reliable
conclusions as shown in the equation below.
(𝑦 = 𝛽o+𝛽1𝑋1 + 𝛽2𝑋2 + 𝛽3𝑋3 + 𝛽4𝑋4 + 𝜀)
Where:-
y= Dependent variable (Inventory Management in Private Primary Schools)
X1=Independent variable (Cost Management)
X2= Independent variable (Corporate Supplier Relationship)
X3= Independent variable (Customer Satisfaction)
X4= Independent variable (Employee Productivity)
𝛽1 − 𝛽4 = Regression coefficient for each independent variable
𝜀 −Random or stochastic term
Descriptive analysis such as frequencies and percentages were used to present qualitative data in
form of frequency distribution tables and graphs such as bar charts and pie charts on major
research questions to enable easier understanding and interpretation using inferential statistics
while open ended questions were analyzed qualitatively, arranged thematically and presented on
narrative form to draw conclusions and recommendations.
International Journal of Research &
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Findings
Analysis of Variance
From the ANOVA statistics, the processed data which is the population parameters, had a
significance level of 0% which shows that the data is ideal for making a conclusion on the
population parameters as the value of significance (p-value ) is less than 5%. The calculated
value was greater than the critical value (3.164>1.987) an indication that there were significant
difference between inventory management in private primary schools in Kenya and cost
management, corporate supplier relationship, customer satisfaction and employee productivity
respectively. The significance value was less than 0.05 indicating that the model was significant.
This is shown in table 1.
Table 1: Analysis of Variance
Model Sum of Squares df Mean Square F Signific
ance
1 Regression 1.477 4 0.376 3.164 .029b
Residual 33.4 44 0.339
Total 34.877 48
Regression analysis
Adjusted R squared is coefficient of determination which tells us the variation in the dependent
variable due to changes in the independent variable. From the findings in the table below the
International Journal of Research &
Development Organisation ISSN-465-0175
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value of adjusted R squared was 0.766 an indication that there was variation of 76.6% on the
inventory management in private primary schools in Kenya due to changes in cost management,
corporate supplier relationship, customer satisfaction and employee productivity at 95% level of
confidence . This shows that 76.6% changes in inventory management of private primary schools
in Kenyacould be accounted to changes in cost management, corporate supplier relationship,
customer satisfaction and employee productivity. R is the correlation coefficient which shows
the relationship between the study variables. This is shown in table 2.
Table 2: Model Summary
Model R R Square Adjusted R Square Standard Error of the
Estimate
1 .881a .784 .766 .12214
Regression coefficients
The findings revealed that holding cost management, corporate supplier relationship, customer
satisfaction and employee productivity to a constant zero, inventory management in private
primary schools in Kenya would stand at 0.864; a unit increase in cost management would lead
to an increase in inventory management in private primary schools by a factor of 0.375. A unit
increase in corporate supplier relationship would lead to an increase in inventory management in
private primary schools by a factor of 0.396. A unit increase in customer satisfaction would lead
International Journal of Research &
Development Organisation ISSN-465-0175
Journal of Business Management
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to an increase in inventory management in private primary schools by a factor of 0.431 and unit
increase in employee productivity would lead to an increase in inventory management in private
primary schools by a factor of 0.455. The study further revealed that cost management, corporate
supplier relationship, customer satisfaction and employee productivity were statistically
significant to affect inventory management in private primary schools, as all the p value
(significance) were less than 0.05%. The study also found that there was a positive relationship
between inventory management in private primary schoolsand cost management, corporate
supplier relationship, customer satisfaction and employee productivity. The above findings are in
line with David (2005) assertion that regression analysis is able to relate dependent variable with
multiple independent variables and provide meaningful and accurate conclusions of the
phenomenon under study. This is shown in table 3.
Table 3: Regression coefficients
Model Unstandardized
Coefficients
Standardized
Coefficients
t Signifi
cance
B Standard
Error
Beta
1 (Constant) .864 .369 2.529 .017
Cost Management .375 .099 .201 3.361 .011
Corporate Supplier
Relationship
.396 .142 .216 2.347 .004
Customer Satisfaction .431 .136 .342 3.614 .016
Employee Productivity .455 .097 .375 5.241 .033
International Journal of Research &
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Journal of Business Management
18
The established regression equation was
Y = 0.864 + 0.375 X1 + 0.396 X2 + 0.431 X3 + 0.455 X4
Summary of Findings
On cost management, the study revealed that a unit increase in cost management would lead to
an increase in inventory management in private primary schools by a factor of 0.375 at a
significance level of 0.011.The study also established that, the organization managed payments
for received items as shown by a mean of 4.76 and a standard deviation of 0.54, the organization
captured and analyzed inventory costs as shown by a mean of 4.58 and a standard deviation of
0.61, and the organization controlled its budget effectively as a result of embracing enterprise
resource planning system in its operations as shown by a mean of 4.39 and a standard deviation
of 0.46. The above findings are in line with the findings by Madeurne (2015) who posited that
enterprise resource software auto signs all required accounting information including cost of
goods, inventory assets and sales income, even down to what tax codes are needed to be
associated with the product, thus management of inventory is critical to controlling costs and
ensuring smooth operations of business.
On corporate supplier relationship, the study revealed that a unit increase in corporate supplier
relationship would lead to an increase in inventory management in private primary schools by a
factor of 0.396 at a significance level of 0.004.The study also established that, the organization
formed strong mutual beneficial relationships with suppliers as shown by a mean of 4.52 and a
standard deviation of 0.43, the adoption of enterprise resource planning system in the
organization facilitated growth and profitability as shown by a mean of 4.38 and a standard
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deviation of 0.40, and adoption of enterprise resource planning system enabled excellent services
to be delivered to the organization by suppliers as shown by a mean of 4.26 and a standard
deviation of 0.29. The above findings are in line with the findings by Wikipedia (2010) that
supplier relationship is about developing two- way, mutually beneficial relationship with your
most strategic supply partners that deliver greater levels of innovation and competitive advantage
than could be achieved by operating independently.
On customer satisfaction, the study revealed that a unit increase in customer satisfaction would
lead to an increase in inventory management in private primary schools by a factor of 0.431 at a
significance level of 0.016.The study also established that, the organization embraced enterprise
resource planning system to continuously monitor the business success through a scorecard as
shown by a mean of 4.63 and a standard deviation of 0.33, the adoption of enterprise resource
planning system determined the organization’s dominance in the market as shown by a mean of
4.50 and a standard deviation of 0.24, and adoption of enterprise resource planning system in the
organization formed the basis of key performance indicator in regards to inventory usage and
cost performance as shown by a mean of 4.27 and a standard deviation of 0.28. The above
findings are in line with the findings by McDaniel (2005) who opined that customer satisfaction
is seen as a key performance indicator within businesses and is often part of a balanced
scorecard. In a competitive market place where businesses compete for customers, customer
satisfaction is seen as a key differentiator and increasingly has become a key element of business
strategy.
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On employee productivity, the study revealed that a unit increase in employee productivity
would lead to an increase in inventory management in private primary schools by a factor of
0.455 at a significance level of 0.033.The study also established that, the organization gained
efficiency through reduction of waste and costs such as labor costs in inventory operations as
shown by a mean of 4.85 and a standard deviation of 0.41, the organization successfully reduced
labor effort and increased quality performance as shown by a mean of 4.53 and a standard
deviation of 0.50, and adoption of enterprise resource planning system formed the basis for
information technology productivity as shown by a mean of 4.44 and a standard deviation of
0.23. The above findings are in line with the findings by Kraiser & Young (2009) who suggested
that sub-optimization often occurs because of lack of proper rewarding system, for example,
managers may be rewarded for the reported profits but not for healthy inventory. As a result
sales companies tend to increase inventory level in order to increase customer service and avoid
stock outs. High receivables and high inventories lock up cash in working capital. However, this
issue can be resolved by providing proper incentives and making “people aware that there is
more to sales than booking the deal’’
The findings revealed that holding cost management, corporate supplier relationship, customer
satisfaction and employee productivity to a constant zero, inventory management in private
primary schools would stand at 0.864.The study also established that, the organization tracked
inventories in real time using bar coded labels as shown by a mean of 4.52 and a standard
deviation of 0.46, the organization forecasted demand as shown by a mean of 4.48 and a standard
deviation of 0.54, and also the organization searched for inventory records and summarized them
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to whatever level of details required as shown by a mean of 4.41 and a standard deviation of
0.49. The above findings are in line with the findings by Mpwanya (2005) who posited that the
main aim of inventory management is to ensure that organizations hold inventories at the lowest
cost possible while at the same time achieving the objective of ensuring that the company has
adequate and uninterrupted supplies to enhance continuity of operations through proper
forecasting of demand. Similarly, a study by Lee & Centinkaya (2005) indicated that
organizations increasingly employ systems such as enterprise resource planning in an effort to
control inventory levels in their operations.
Recommendations
Based on the findings, the study recommends that the management of private primary schools
should appropriately manage payments for received items, capture and analyze inventory costs
and control their budgets effectively through embracing enterprise resource planning system in
their operations. There is need for management to form strong mutual beneficial relationships
with suppliers, facilitate growth and profitability and ensure excellent services are delivered by
suppliers through incorporating enterprise resource planning in their day-to-day operations. To
ensure customer satisfaction is guaranteed, the management has to continuously monitor the
business success through a balanced scorecard, expand the company’s dominance in the market
and come up with key performance indicators to measure inventory usage and cost performance
through adoption of enterprise resource planning system. The study also recommends that the
management reduces waste and cut costs such as labor costs, increase quality performance
International Journal of Research &
Development Organisation ISSN-465-0175
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22
through recruitment of competent staff and ensure Information Technology productivity through
adoption of enterprise resource planning system in their operations.
Further areas of research
This study sought to find out the influence of enterprise resource planning system on inventory
management in private primary schools in Kenya. The study found out that corporate supplier
relationship had the highest significance on inventory management in private primary schools in
Kenya while employee productivity had the lowest significance on inventory management in
private primary schools in Kenya. The study thus recommends further research on factors
influencing employee productivity on inventory management in private primary schools in
Kenya and influence of customer satisfaction on inventory management in private primary
schools in Kenya.
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International Journal of Research &
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