Research Project

Improvements in Employee Productivity by

the Implementations of ERP systems: A
Study through the banking sector

S.A. Afkar Ahmed

[Link]. – JK78306
CENTRE REF. NO. – BM/17/30/18

DEPARTMENT OF BUSINESS MANAGEMENT

BRITISH COLLEGE OF APPLIED STUDIES

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Acknowledgment
I would like to start the acknowledgement by thanking the almighty who has provided
this wonderful opportunity to perform this interesting task. The Author wants to thank
everyone who was helpful and provided their fullest support to achieve this complex
task. The Author wants to profusely thank the department head and the research
supervisor Ms. Thafani Rasheed who has provided extensive support and guidance
in completion of this research study. The lecturer had supported during class hours
and clarified all the doubts in extended sessions also.

I would also like to thank my parents, friends and all loved ones who have supported
me throughout the entire research study and without whose support, encouragement
and guidance this study would not have been completed. Thank you for believing in
me to achieve this target successfully and for the continuous support.

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Abstract

Enterprise resource planning (ERP) systems is becoming popular technological swift

in organizations all over the world. Despite to the high cost of implementation for
these systems, organizations all over the world are interested in implementing the
ERP systems after evaluating their benefits in the short and long terms. Enterprise
resource planning (ERP) systems helps to integrate the organizations business
functions allowing efficient information sharing across all business divisions. Through
the information sharing is achieved not only better coordination can be achieved but
also faster and efficient adjustment can be done to the potential risks and face the
business opportunities. As there are plenty of research concerning on the effect of
Enterprise Resource Planning (ERP) Systems on business performance. This
research study is focused on how the relationship of employee productivity by the
different benefits gained by the use of an ERP system within the banking industry.

The research is done focusing on 4 main research questions such as Does the
enhanced flow of Information gained by ERP contribute to employee productivity?,
Does the eased communication system improve the employee productivity?, Does
usage of the ERP improves the employee satisfaction leading to productivity in work?
And Does the ERP system improves the quality of work done by the employees and
leads to productivity? The population for the study was employees of private banks in
within the Colombo area and the study population comprised a total of 50 employees.
Non-probability sampling technique was used to draw a sample size of 30
respondents. The data collection instrument for this study was a tailor made
questionnaire developed by the researcher himself. Descriptive statistics and scatter
diagrams were used to present the results of the study. Correlation and regression
analysis were calculated using Statistical Package for Social Scientists (SPSS).

The key findings of the study are that Flow of information, Communication, Employee
satisfaction, Quality of work which can be gained by using an intergraded ERP
system will have a significant impact on employee productivity within the banking
sector of Sri Lanka. The study also recommends on how other banks and businesses
can achieve benefits and improve employee productivity by using ERP system and
adopting other technological tools.

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Table of Contents

Acknowledgment……………………………………………………………………………..2

Abstract………………………………………………………………………………...……..3

Table of Contents…………………………………………………………………………….4

List of Tables……………………………………………………………………………..…..7

Abbreviation…………………………………………………………………………………..8

1.0 Introduction……………………………………………………………………………….9

1.1 Background of the study……………………………………………………………..…9

1.2 Research Problem……………………………………………………………………..11

1.3 Research Questions………………………………………………………………...…12

1.4 Research Objectives………………………………………………………………..…13

1.5 Significance of the Study……………………………………………………………...13

1.6 Limitations of the Study………………………………………………………………..14

1.7 Outline of the Research……………………………………………………………….14

2.0 Literature Review……………………………………………………………………....15

2.1 Introduction……………………………………………………………………………..15

2.2 Impact of Digital Technology………………………………………………………....15

2.3 Digital Technology and Banks………………………………………………………..17

2.4 Enterprise Resource Planning (ERP)………………………………………………..18

2.4.1 History of ERP………………………………………………………………………..19

2.4.2 Advantages of ERP………………………………………………………………….19

2.4.3 Benefits for employees by ERP in Banks………………………………………....21

2.5 ERP Implementation and Employee Productivity…………………………………..22

2.5.1 Flow of Information and Employee Productivity………………………………….23

2.5.2 Enhanced Communication and Employee Productivity………………………….24

2.5.3 Employee Satisfaction and Employee Productivity……………………………....25

2.5.4 Quality of Work and Employee Productivity………………………………………27

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3.0 Methodology……………………………………………………………………………29

3.1 Introduction…………………………………………………………………………..…29

3.2 Conceptual Model……………………………………………………………………..29

3.3 Data Sources and Data Collection …………………………………………………..29

3.4 Data Sampling…………………………………………………………...……………..30

3.5 Data Reliability………………………………………………………………..………..30

3.6 Variable Definition……………………………………………………………………...30

3.6.1 Independent Variable………………………………………………………………..30

[Link] Flow of Information………………………………………………………………..30

[Link] Communication…………………………………………………………………....30

[Link] Employee Satisfaction…………………………………………………………….31

[Link] Quality of Work………………………………………………………………….....31

3.6.2 Dependent Variable………………………………………………………………….32

[Link] Employee Productivity………………………………………………………….....32

3.7 Operationalization……………………………………………………………………...33

3.8 Hypothesis to be tested…………………………………………………………….....34

3.9 Empirical Analysis…………………………………………………………….………..35

3.9.1 Descriptive Statistics………………………………………………………………...35

3.9.2 Scatter Diagrams…………………………………………………………………….35

3.9.3 Correlation Analysis…………………………………………………………………35

3.9.4 Regression Analysis………………………………………………………………...36

3.10 Summary……………………………………………………………………………....36

4.0 Data Representation and Analysis………………………………………….………..37

4.1 Introduction……………………………………………………………………………..37

4.2 Descriptive Statistics…………………………………………………………………..37

4.3 Graphical Illustration of the Relationship between Employee Productivity and the
relevant variables…………………………………………………………………………..38

4.4 Correlation Analysis……………………………………………………………………42

4.5 Regression Analysis………………………………………………………………......43

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4.5.1 Simple Regression Analysis…………………………………….………………….44

4.5.2 Multiple Regression Analysis…………..…………………………………………..45

4.6 Hypothesis Testing…………………………………………………………………….46

4.7 Summary………………………………………………………………………………..47

5.0 Discussion, Conclusion and Recommendation………………………………..……48

5.1 Introduction……………………………………………………………………………..48

5.2 Summary………………………………………………………………………………..48

5.3 Results and Discussion……………………………………………………………..…50

5.3.1 Flow of Information by using ERP and Employee Productivity…………………50

5.3.2 Enhanced Communication by using ERP and Employee Productivity………...50

5.3.3 Employee Satisfaction by using ERP and Employee Productivity……………..51

5.3.4 Quality of Work gained by using ERP and Employee Productivity……………..52

5.4 Recommendations for Future Research…………………………………………….53

List of References…………………………………………………………………………..54

Appendix 1 – Research Questionnaire……………………………………………….….58

Appendix 2 – SPSS Output………………………………………………………………..61

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List of Tables
Table 4.1 – Descriptive Statistics…………………………………………………………38

Table 4.2 - Correlation Analysis…………………………………………………………..43

Table 4.3 - Simple Regression Analysis…………………………………………………44

Table 4.4 - Multiple Regression Analysis………………………………………………..45

List of Figures
Figure 4.1 - Relationship between Flow of Information and Employee Productivity..39

Figure 4.2 - Relationship between Communication and Employee Productivity…….40

Figure 4.3 - Relationship between Employee Satisfaction and Employee

Productivity………………………………………………………………………………….41

Figure 4.4 - Relationship between Quality of Work and Employee Productivity…….42

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Abbreviations

CEO – Chief Executive Officer

ERP - Enterprise Resource Paining

EOQ – Economic Order Quantity

ATMS’s – Automated Teller Machine

SPSS – Statistical Package for Social Sciences

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Chapter One

1.0 Introduction

1.1 Background of the study

The development of technology has transformed the traditional business process and
the scope of businesses and industries. Technology has made a small retailer from
some part of the world to deal with another in the other corner of the globe. In
present context organizations should develop, adopt, change and proactively
concentrate on the developing technologies. Negligence to change and development
will make the business obsolete and lead to business shut downs. With several
technologies and devices being continuously introduced to the world Enterprise
Resource Planning (ERP) systems takes a special attention. An ERP system helps to
integrate the business processes across the business functions. ERP helps to
interconnect the business process such as inventory management, order
management, accounting, human resources, customer relationship management and
many other functions as one system.

Enterprise resource planning systems features automation and streamlined reporting

capabilities which updates the data to the overall system and helps to avoid the data
redundancy and ineffective decision makings. Businesses have been using a number
of simple and standalone technics to manage different processes, such as
QuickBooks, Excel Spreadsheets but with the business development it would
become time consuming and difficult to make decisions considering the information
which has to be derived from various sources and documents. Delay and ineffective
decision making will negatively impact the business and reputation (Raidl, 2017).
ERP systems functions from CEO to the executives to create, store, and use the
same data derived through common processes. Also the ERP systems secure and
centralized data repository, creating the confidence among everyone in the
organization that data is correct, up to date, and complete.

Technology, competition and customer requirement has made impossible to ignore

the impact of ERP in today’s business world. As enterprise data and processes are
gathered into ERP systems, businesses are able to achieve many benefits such as
improving the workflow and aligning the departments resulting in operational benefits.
The implementation of an ERP system will help to improve the reporting and planning
process. ERP system would follow an automated template system, allowing various

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departments to access information and derive data on a real time basis. ERP
systems helps to maintain all the information stored in a single location instead of
having data distributed throughout a number of separate databases. ERP systems
also helps make reporting easier and make necessary reports according to the
requirements. Further the advanced reporting features helps to easily respond to the
complex data requests easily.

ERP system used in the banking industry provides many benefits and solutions to the
banking and finance services. The ERP software used in banks contains a range of
small point solutions to large scale deployments with an integration of ERP in
banking sector. In the present generation of technology banking and financial service
institutions are changed into modern enterprises which are readily adaptable and
able to accommodate new or upcoming business processes and expand easily
because of the service enabled solutions provided by the ERP systems to the banks.
Implementation of an ERP system in banking industry will be a great foot in
expanding the business as ERP system will offer better profitability by lowering costs,
improved customer experience, compliance adherence and market share. Integrated
Banking ERP software would improves the agility, lead to innovation, improves the
accuracy, helps to provide the customer expected experiences and change the
business practice to operational excellence.

Usage of a technological support would be very much necessary for banks and
financial institutions as they deal cash and financial assets and an ERP system
would be a best solution. Using an ERP system will provide many benefits to the
banks and other financial institutions such as securing the transactions. Accessing to
the data, updating the data and many other controls can be implemented to the
system such that it would reduce the related risks and improve the ability to monitor
any risky and unauthorized accesses.

Because of the competition and customer demand banks have introduced and
practices many different options in banking such as the Net Banking, Tele Banking,
ATMs, and many other in which the constant monitoring of these operations
becomes very essential for the banks. Using of an ERP will be helpful to constantly
track every one of these operations and operators with no and reduced mistakes.
Providing the best and accurate service has become important for banks as that the
usage of ERP will be helpful to provide real time balance and updates for the
customers. Also maintaining ERP at banks with cloud servers it will be helpful to
store large amount of data safely in an organized manner readily available for access

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and retrieving data with a short span of time. The ability to access data can turn to be
competitive advantage and useful for the customers to make decisions easily and the
customers will be always attached to the bank as they get a number of benefits and
be able to make plans on the interest, up and coming billings.

As the previously conducted researches have explained the benefits that are gained
by implementing ERP for both the employees and the employer. The benefits to the
employees can be considered as a major driving force of the organization which will
improve the productivity of the business. Employees always prefer to work at the
organizations that provide job satisfaction and a peaceful environment to work and
provide the best to the organization. Using the appropriate technologies would be an
easy method attract the employees and gain their maximum potentials by the
organizations.

1.2 Research Problem

Business need to focus on improvements in every concern of the business and must
adapt to new technologies as it has become a need. The technological development,
globalization and internet has all been a driving force for the customers to gain more
knowledge and organization must also be perform fulfilling the needs and wants of
the customers to be competitive and survival in the market. Improving employee
performance is a vital concern as employees function as the human capital of the
organization contributing to both success and loss of a business.

Banks consists of many activities such as lending services, pawning, deposits,

money transmissions and also dealing with customers. Application of an ERP
system will help them to synchronize and integrate their widespread financial
processes, human resource management, and support services easily across their
branches as a network. Customized ERP software applications for banking and
financing activity can practically touch all functional areas that define an effective
banking system. ERP systems work as open-architecture that runs on most hardware
and operating system, uses of common database systems, common resource
planning software throughout the organization and making the process and banking
function easy (Joshi, 2017).

Many banks across Sri Lanka and internationally have switched to the ERP systems
understanding the benefits which can be gained over the years. Usage of an ERP
system would provide definite benefits and help to even improve in the future. JP
Morgan Chase, UBS, Barclays and Deutsche Bank have adapted to SAP solutions

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an international market leader for ERP systems and specialized on finance industries
(Joshi, 2017). Bank of Ceylon is one of the major state owned banks in Sri Lanka
selected OpenArc ‘SkyLease’ software solution for computerization of leasing
operations over the branch network connecting more than 500 branches. OpenArc
solutions was able to successfully convert all the manual data records to SkyLease
fully computerized environment and helped the bank to expand their leasing business
by multiplying the leasing portfolio more than 10 times over a short period of time.
OpenArc was able to integrate their SkyLease product with the DFCC bank and with
their core banking systems. It was also a most successful implementation of a local
software solution in the Bank (Openarc, 2017).

It is evident that Banks has been adapting to the technological changes and has also
started to update their processes with ERP systems of their necessity and other
software’s according to the needs. Research in the past has been done related to
ERP systems such as identifying the comprehensive marketplace and factors
affecting the budget of and ERP. However as there are no many researches done in
Sri Lanka on identifying the improvements in employee performances by usage of
ERP system in within the Sri Lankan banks. This research attempts to identify the
improvements in employee’s performances by the employee benefits that are gained
by the usage of ERP systems within the banking sector.

1.3 Research Questions

 Does the enhanced flow of Information gained by ERP contribute to employee

productivity?

 Does the eased communication system improve the employee productivity?

 Does usage of the ERP improves the employee satisfaction leading to

productivity in work?

 Does the ERP system improves the quality of work done by the employees
and leads to productivity?

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1.4 Research Objectives

 To determine whether the enhanced flow of Information gained by ERP
contributes to employee productivity.
 To determine whether eased communication process helps to improve the
productivity.
 To assess whether the employee satisfaction gained by ERP systems makes
them productive.
 To assess whether the increased quality of work build the employee efficiency

1.5 Significance of the Study

The rapidly changing environment with technological enhancements delivers many

benefits in return for both business and customers. Banks will have to readily change
with the technological changes to provide better customer service by understanding
their needs and gain competitive advantage. The use of an Integrated Banking ERP
Software would help to create agility, innovation, drive insight to plan with accuracy,
deliver customer expected experiences and make the normal banking activities with
efficiency and operational excellence. As this research is done as an attempt to
identify how the benefits of ERP contributes to improve the employee productivity.
Therefore the conclusions drawn from this study would benefit in many ways. Firstly
Banks and other business who do not maintain a central database for data storage
such as an ERP system will be able to know about ERP systems and how it make
the business process easy, convenient and efficient. This study will also show how
the benefits gained by ERP systems will have a potential impact to build the
employee productivity. Managers of business who use ERP can also get the
maximum use of an ERP system and improve the employee productivity to increase
their commitment towards the business and skill levels of them. Many small scale
businesses that do not use or adopt the technological advancement can get an
understanding of how ERP will simplify the process and also how it will increase the
business profits. Finally findings of the study would help further research and
investigations on Enterprise Resource Paining (ERP) systems.

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1.6 Limitations of the Study

Productivity of employees can be identified using several measures but this study
was done with concentrating only some of the related measures. As there are several
indicators to measure the dependent variable, this study included only some of those
variables and the use of different indicators for the dependent variable may provide
different findings. Although there are many banks in Sri Lanka, the sampling was
included only at private banks that use a central database system like ERP within the
Colombo area. The sample size will be restricted to 50 employees engaging in the
sales process. The sample size is not adequate for analyzing the research problem
and the accuracy of information provided by the sample respondents will be used for
data analyzing. However, inaccurate information provided by the respondents may
mislead the research study as conclusions are derived from the data entered. The
study was also confined only to private banking industry with Colombo area, thus
banks whose data could not be collected are excluded from the study.

1.7 Outline of the Research

The research report is organized into five main chapters as stated below,

Chapter One of this report will provide an overall introduction of the whole research.
Also brief descriptions on the areas such as the background of the study, research
problems, research objectives, research questions, significance of the study and
limitations of the study are provided.

Chapter Two focuses on the review of previous literatures related with the study
written by different authors in the past and also explaining the important concepts
and theories related to digital technology, enterprise resource planning and employee
performances.

Chapter Three of this report explains the research methodology consisting the areas
such as the research framework, variables used in the study, hypothesis developed,
selected sample, data sources and the collection of data.

Chapter Four of the report provides the results of the data analysis and the
conclusions derived.

Chapter Five of the report includes the findings of the research, discussions and
overall conclusion of the research. Implications of the study and certain
recommendations for future researches have been also provided.

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Chapter two

2.0 Literature Review

2.1 Introduction

This chapter discusses and reviews the previous studies carried out by various
authors in the past with relation to the theories digital technology, enterprise resource
planning and employee performances. This chapter is divided in to sub parts such as
initially explaining the literatures related to impact of digital technology. Then the role
of digital technology and in banks has been explained. The next chapter includes full
brief of Enterprise Resource Planning (ERP) system including the history of ERP to
benefits of ERP gained by the employee by using ERP system. Finally all the
variables that were selected such as flow of information, communication, employee
satisfaction and quality of work have been discussed and how they contribute to
employee productivity is also discussed.

2.2 Impact of Digital Technology

The development of technology and communication has helped enhanced the world
with its activities. Internet and globalization can be identified as the vital drivers that
make everything easy and possible. Digital technology can be identified as all types
of electronic equipment and applications that information in the form numeric codes
usually the binary code which would be represented by strings of only two numeric
characters (Harmon, 2018).

The combination of big data and predictive analytics with the digital technologies are
making a significant change upon the practices of individuals, organizations and also
at international levels (Fenwick & Edwards, 2015). The development of the digital
technology helps to change the form of the processes and open up many innovative
concepts that would ease the businesses and humans. With many of trends in the
developing digital technology Internet of Things (IoT) holds a vital promise of easing
the machine-to-machine communication and enabling smart devices (Mohan, 2017).
Internet of Things can be identified as a combination of technologies with sensors
that help to gather and communicate data from one machine to another.
Implementing technology in the business will make the business operations effective
and lead to many other benefits for the business (Vitez, 2018).

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Business can transform the manual and time taking basic business process such as
payroll, accounting and record keeping in to computer and effectively manage the
processes with less human effort and improved accuracy. Many business support
software’s and technological equipment’s have been introduced to ease the business
the business process and improve efficiency. With the effective use of technology
business can maintain the business secrets and consumer information in safe way
and that is accessible at any time. Business technologies and software programs
have become user friendly and require less background of information technology to
use the existing tools and features (Vitez, 2018).

Implementing technology in the business will improve the communication process of

the business in productive way (Morley, 2018). Business by using the different types
of communication methods can improve the inter office communication,
communication with the customers in the market, receive consumer feedback
through social media and will be able to react according to the market changes easily
and proactively work accordingly. With the developed communication methods
business can access to data easily and retrieve real time information by everybody
will improve the decision making of the business (Morley, 2018).

According to Vitez (2018), businesses can increase their employees' productivity

through the effective use of technology. There are many new technical equipment
and business software’s that are available in the market which can be used to
process more business information than the manual methods with less employee
efforts. The implementation of technology in the business will reduce the employee
efforts in the business functions and reduce the additional cost of the business.
Business now can use the appropriate technological that will benefit the business,
improve the profitability of the business and also the business by using task
management software’s can identify the actual time spent on work by the employees
and monitor the progression towards the goals accordingly (Terzis, 2018). Through
making analysis and focus on employee work and performance organization can
work on setting the goals and targets and when there are shortcomings in the labor
force they can take corrective decisions.

Further the usage of technology in the business will help to enhance the business
operations and broaden the customer base by the ability of easily entering new
economic markets (Vitez, 2018). Businesses can extend the sales to new regions
and international markets and improve the sales without just attending the local
market demand. Business website and social media would be better options to enter

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in order to market and sell the products in several different economic markets.
Websites and social media use would represent a low cost option that consumers
can access with ease and whenever they need to purchase goods or services.

Business with the use of technology can gain the benefit of outsourcing the business
functions to other businesses in the national and international business
environments. Outsourcing helps the businesses to lower the costs and focus on
improving the quality of the output and service. Technical support and customer
service can be the main two common functions that the companies can outsource
and outsourcing can also be an option considered when the business they do not
have the proper facilities, resources or sufficient manpower available. Outsourcing
technology also allows businesses to outsource function to the least expensive areas
possible and market the goods at a low cost and improve the sales and profits.

2.3 Digital Technology and Banks

The developing technologies such as the artificial intelligence, block chain, the
Internet of Things, open banking APIs and robotic process automation will have a
vital impact in the banking ecosystem and in and every process and making changes
in the way people will bank and the manner in which institutions that will deliver he
financial services (Marous, 2017).

The use of technology gives the potentials to increase efficiency, decrease costs and
enhance the customer experience and further through the use of technology the
ways of service delivery can be changed. The implantation of digital technologies can
be seen as a common practice among the different banks as it has become a
requirement with today’s generation.

The banking industry over past decades was based on the branches, computer
supported operations, ATMS’s and the cards. With the significance of the digital
technology the banking processes and operations have started to work outside the
branch, physical bounds and on to mobile devices with advanced data analytics and
allowing for customized services each and every end user as per the satisfaction and
requirement (Marous, 2017). The efficient us of the technology with the financial
solutions and non-financial solutions will help to offer the service in better manner
and could significantly change the entire structure of banking in the future.

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2.4 Enterprise Resource Planning (ERP)

Enterprise resource planning (ERP) systems can be defined as a single system that
integrates all the core processes that is needed to run a company. In other words
ERP systems is a connected and an common interface that connects the different
business units such as human resource, sales and finance enabling to work through
the data that shares is shared from a single source which will deliver updated and
real time information (Raidl, 2016).

ERP systems provide many benefits that a business can gain by implanting ERP and
these benefits are divided into five major categories such as the operational benefit,
managerial benefit; strategic benefit, IT infrastructure, and organizational benefit
(Shang and Seddon, 2002). ERP systems has been helpful to achieve many benefits
such as maintaining appropriate inventory balances, shortening cycle times, lowering
additional costs, and improving supply chain practices (Olhager and Selldin , 2007).
One of the most significant features of an ERP system is that as all the information of
the business of different functional areas is stored in one database, the speed the
data transfers within the business and retrieving data has been made fast and
effective (Metaxiotis and Liagkouras, 2017). Through the central database, ERP
systems declines the data redundancy helps to manage the authorized users of
access.

Enterprise resource planning (ERP) systems have turned to be a vital technological

improvement helping the modern business to operational efficiencies and supporting
to achieve and drive them to their strategic goals (Mishra, 2008). Many businesses in
the last decade around the world have made huge investments in enterprise systems
due to the benefits and potentials it creates to a business. An Enterprise system
would be inclusive of enterprise resource planning, customer relationship
management, supply chain management, product lifecycle management and e-
procurement software (Shang and Seddon, 2002).

ERP helps organizations to meet the challenges of globalization with a

comprehensive, integrated application suite that includes next-generation analytics,
human capital management, financials, operations, and corporate services. With
support for industry-specific best practices, ERP helps organizations improve
productivity, sense and respond to market changes, and implement new business
strategies to develop and maintain a competitive edge (Mishra, 2008).

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2.4.1 History of ERP

Though the ERP systems has now evolved to the highly capable solutions now the
history of ERP solutions starts from the history of ERP begins with the economic
order quantity (EOQ) model which was found by the engineer Ford Whitman Harris in
1913. EOQ is a paper-based manufacturing system for production scheduling and
managing the raw materials. After decades of using EOQ, Black and Decker used
material requirements planning (MRP) solution that combined EOQ concepts with a
mainframe computer in 1964. Later in 1983 material requirement planning was
updated with manufacturing resource planning (called MRP II). MRP II featured
modules such as key software architectural components and integrated core
manufacturing components including purchasing, bill of materials, scheduling, and
contract management. It was the very first time that many different manufacturing
tasks were integrated into a common system. ERP systems has evolved through the
1970s and 1980s, as concepts similar to MRP II which were developed to handle
business functions beyond production, finance, customer relationship management,
and human resources data. Later in the year 1990 analysts have named the new
business management software’s as the enterprise resource planning as it was able
to It was able to deal with other business functions like engineering, finance and
accounting, HR and project management (Joshi, 2017).

Eventually ERP technology evolved to connect with the internet and many new
features and functionalities were developed majorly the embedded analytics. Also
another vital improvement of ERP was the cloud storage. ERP software with a cloud
storage help to derive data also away from the companies’ location. The cloud ERP
system lowers both operational expenses and capital expenses as it eliminated the
need for companies to purchase external software and hardware or hire additional
technical employees. The next generations of ERPs are also being made that any
organization such as small scale or a large scale organization can shift to an ERP
system with less capital investments and identify new business opportunities. ERP
systems in the future are also going to fuel the business opportunities (Oracle, 2018).

2.4.2 Advantages of ERP

ERP system will also help to improve the data quality and the data security.
Comparing to the manual record keeping process and other traditional approaches,
the ERP system helps to improve the quality of data by improving the underlying
processes, real time updates and access controls. Also adding restrictions to data
access and retrieving improves the data security and helps to make sound decisions
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for the business. ERP system also helps to lower the operational costs of the
business by using of real-time collection of data. Payments made for many other
different applications for different purposes with costly subscriptions can be reduced
as ERP system makes businesses to use a single platform and eliminates the need
for excess software’s.

ERP systems also contribute in improving the customer relations. ERP system helps
to provide quality customer service by the speedy and easy access to accurate
customers’ information and history. Employees dealing with the customer can directly
access the customer history and respond to them with the shorter span and improve
the relationship of the organization with the customer. Further the ERP will reduce
the complexity within the business and introduce perfectly designed system of
workflows as required by the organization as per the nature of the goods and scale of
the business. The structure made by ERP will make human resource chain more
efficient and improve the organizational productivity as resources will not be wasted.

ERP system also helps to improve the supply chain management of the businesses.
Using necessarily designed ERP software to manage the supply chain can help to be
more responsive and make more decisions regarding demand forecasting, inventory
management and procurement etc. Streamlined supply chain management will also
contribute in innovative production methods and styles which will in overall help to
reduce costs of the business and also to develop new products that will give a
competitive advantage to be different form the competitors.

Another major benefit of the ERP system is that it helps to maintain the required
regulations according to the statues requirements. ERP system will have a complete
update of the data every time and track on the data which will ease the regulatory
compliance. ERP will be helpful to identify the batch number, product code, the
customer and the payments details easily making the decision making process easy
and can be done in a shorter span with accurate information (Kripaa, 2013). ERP
systems in financial sector will also contribute to ensure the consistent performance,
exceptional operational efficiency, offers multiple solutions to easily generate and
interpret data, as well as to generate accurate reports at a variety of data points and
maximizes integration across operations and organizational roles (Sage , 2015).

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2.4.3 Benefits for employees by ERP in Banks

Apart from the organizational benefits by using an ERP system there are also many
benefits which can be gained by the employees by using ERP system such as the
increase the transparency of employees, improve the competence of the employees
and possibility of working away from the office (Barnes, 2017).

Improvement in the employees transparency is that as it is not that easy to identify

how much work has the employee have done successfully completed for a day, but
using of an ERP system will show real time data which has been completed and by
whom. The improved transparency of employee’s time and work will reduce efforts of
departments and improve the quality of work done. ERP system improves the
competence and confidence of the employees in a hidden manner that employees
working with the ERP systems which improves the overall organizational productivity
and efficiency. When employees are more efficient and productive, they become
more confident in their ability to complete their tasks on a timely and correct manner.
When the process becomes easier to manage, employees end up improving their
competency and confidence levels in performing tasks.

Also as ERP systems requires training for the employees who are expected to use
the system as all the employees will not be competent enough. The training and
development programs done will improve the employee’s technical skills as
additional to their job performance. The training programs will help the employees to
learn more about job duties, and also have the opportunity to further clarify aspects
of their job that they may have missed. Also the additional trainings provided for the
employees will help to improve the overall skill capital of the business.

The incorporation of the cloud storage technology by the ERP systems makes the
information access easy and improves the data quality. Easy access of the data
makes the employees to work flexibly from home and out of the town with access to
the internet. Improving the flexibility of work will result in better outputs from
employees and avoid the lag in work caused by their physical absence in the
workplace. Also the mobile functionality created by the internet and ERP will be
helpful to maintain a better work life balance and employee turnover would decrease
by time.

Another major benefit for the employees of using an ERP system would be that they
could easily reduce the compliance risks and maintain the industry required
regulations properly. As ensuring the industry compliance and maintaining the

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government regulations has become a difficult task with present context, it would be
made easy by using an ERP system which will help to meet the compliance
standards for tracking and reporting information and also In order to protect customer
confidential data and to generate comprehensive financial reports.

2.5 ERP Implementation and Employee Productivity

Productivity can be termed as a main driving force behind the company’s growth and
profitability. Productivity can be identified as a measurement in between the inputs
and outputs over a period of time. When the outputs are equivalent to the inputs, the
worker can be considered productive and when a worker can increase the output
gradually it can be identified as an improvement in employee productivity (Sheahan,
2017).

According to a poll conducted on the website of Panorama Consulting Solutions

(2013) it was found that easing the burden on employees is one of the key reasons
why organizations across the globe implement ERP systems. The benefit of making
an employee’s job easier would be due to the productivity. Employees would not be
performing inefficient business processes, would be able to communicate with ease
cross-functionally and can also be able to access data with no concern for its validity.
And a productive employee benefits the organization every time he or she comes into
work (Panorama Consulting Solutions, 2013).

The main purpose of finance company would be to increase the profits of the both
the company and the clients having a mutually beneficial relationship engaging in
certain process such as maintaining mutual funds, stocks, equity, investments, etc.
increasing the sales and customer will not be methods to increase the profits but also
by having seamless operations and process workflow would help reduce costs and
increase the turnaround time. As risk and transactions can happen in a blink of an
eye in the financial sector it becomes a necessity of maintaining the customer’s,
transactions data and information. Banks by having a central database for all level of
processes and information storage would simplify the process of report generation,
tracking, analysis, automated expense management and monitoring productivity
goals. ERP systems would help to automate the regular transaction performed
manually saving time and avoiding data duplicity (Sage , 2015). ERP system at
banks would offers full data integration, ensuring accuracy, access and reports, all of
which are available in real time will help make them productive and provide better
customer service.

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2.5.1 Flow of Information and Employee Productivity

In any organization, transferring of the data could be a headache procedure and

when different data is required by different departments at the same time and when
any delay occurs in transferring data would leads to business inefficiency and
improper decision making (Saudi ERP , 2017). There are many benefits by
implementing an ERP Systems and one such benefit is the as access to real-time
data (Global Shop Solutions, 2014). ERP systems have made it easy and smooth
now data could be accessible to all departments easily and the decision makers will
also be able to access the data at any time and once it is updated. The real-time data
can also be inclusive of all kinds of data entered from different departments such as
the customer transactions with branch, loans and repayment and pawning services.

ERP systems may differ depending on the system but would generally improve the
collaboration within the business and banks. ERP working with the function of a
centralized database make the ERP system unique and significant from all other
technologies available. The ERP will have information of all functional areas and
corporate information is saved in a single database. The common database provides
the businesses a single source of truth to work from and eventually reducing the
errors brought on by working with the incorrect data leading to unnecessary costs.
Through the central database, ERP systems decline data redundancy and the data
will also be kept only in one location where all authorized users would have access
(Metaxiotis & Liagkouras, 2017).

Through the use of a central database it will reduce hesitations during projects and
task as all employees within the organization would have access to the data they
need. Further their will be a lesser requirement of merging the information across
various systems and sources because all the necessary data would be compiled,
stored, shared and could be easily accessed through a single system with complete
and secured data files with the help of an ERP system. Banks can also easily avoid
the data redundancy and human errors at times when the same customer information
is entered over and over again into several different systems. According to
Ranganathan and Brown (2006) with the use of a centralized data storage system
which is provided by an ERP system will result in an integrated database for multiple
functions across different business units thus providing the employees with direct
access to required real-time information’s.

Having a system of central database of information for both banks and businesses
would help in developing the systematic analysis and improves the reporting
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methods. As the ERP system could record and store all the data entered can also
function as an excellent business intelligence tool. ERP software makes it always
easier and faster with relation to generate various reports that would take days of
research and compilation within the span of minutes. ERP systems also provides a
customized dashboard that the employees can see the reports whenever they enter
into the system. These reports would include all necessary statements related to
deposits, withdrawals, loans etc. The ability to have access to these reports quickly
enables the employees and staffs to make better decisions more quickly. ERP will
help to avoid the relying on the IT staff to generate the reports that employees
require while working. Through the ERP it can also maintain access levels ensuring
only relevant staff see valuable company data and help to maintain the business data
(O'Shaughnessy, 2016).

2.5.2 Enhanced Communication and Employee Productivity

Communication is a crucial factor for running a business and in making business

related decisions. Lack of proper communication between employees, managers,
suppliers, and customers will make the affect the business in growing and in
achieving its full potentials. Technology has played a vital role in reducing
communication barriers and helps to get easily connected with each other. Integrated
ERP software would help in improving the internal communication and external
communication despite the fact of how many locations, departments or employees an
organization has. As the entire organization uses one central database to insert and
store data making every employee to work with the exact same updated information
at real-time (Khoury, 2015). ERP software contributes in minimizing the
miscommunication problems that could arise within organizations and can help to run
the task smoother, on time, and more profitably.

Maintaining effective communication within the organization will make a real

difference to the business. Proper communication provides the employees the ability
to understand the direction and the target of the business and motivate them to work
towards the same goals making the employee efficient and even productive. Lack of
clear and regular communication can make the employees disengaged and less
committed. As the ERP system could store all the data in one central location, it will
make the employee’s access to latest business information easily and effortless.
Providing communication transparency and credibility will reduce the chances of
giving people the wrong information and help to reduce the unnecessary tension and
misstatements between departments and employees.

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As the ERP software can also tracks information about the external and internal
customers will help to tailor and target the messages to individuals and departments,
based on their preferences and job roles. Being able to understand about the
employees’ need will make the communications process more effective and result
oriented. Also with the ERP and its mobile functionalities it enables the
communication with both the employees outside the office location and the office-
based employees too information’s related to business objectives and news. ERP
helps to provide the employees the feel of motivation by making them aware of the all
the information and making the organization united (Leung, 2016).

Having all the information at the fingertips by the use of integrated solutions helps the
employees see real time business data on interactive dashboards and to create all
required reports easily. Such features provided for the employees will empower
them, give freedom while working and enhances communication within the business.
When the employees feel like internal communication is a natural part of the working
day it will make them more effective and committed towards achieving goals and
targets.

Further certain ERP systems have an automatic connection with third-party submittal
software. It reduces the efforts of reentering all of the specific data into a homegrown
program instead with a simple push of the export button can bring every detail related
to it easily. This improves the internal and external communication and helps to make
better analysis on real time and avoid the delay in process time. With the use of ERP
the control changes and approvals, automatic collaboration with third-party submittal
software’s helps everyone be updates and able to deliver services correctly and
timely will help to reduce the miscommunication opening the potentials for the profits
to greatly increase.

2.5.3 Employee Satisfaction and Employee Productivity

Employee satisfaction is the term used to define the employees that are happy,
contented and fulfilling their desires and needs at work. There are many factors that
contribute to the employee satisfaction such as treating all employees with respect
and equality, providing regular employee recognition, empowering the employees,
improving employee engagement and positive management within a success
framework of goals, measurements, and expectations (Heathfield, 2018).

The use of an ERP system can substantially increase each employee’s workload
while improving both the quality of output and the satisfaction levels the employees

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find in their jobs. Employees tend to enjoy their work when the job roles are clearly
defined and this inevitably contributes to the organizational performance (Davies,
2016). Improving and streamlining the tasks and processes will help the employees
to get done more work in less time, improving in the business reputation, speedy
delivery times, and to provide excellent customer service.

A common issue at organizations is the duplication of work and data due to the poor
planning, organizing and many people do not seem to have a specific role. This also
occurs when the firms try to expand without planning ahead and when the different
departments focus on their own actions without a central strategy. ERP system helps
to achieve employee satisfaction by properly defining the job roles so that every
member of staff knows what they and their colleagues are supposed to do. Also the
employees will also be able to know how exactly their job will contribute to the firm’s
overall process and progress. This will also make the employees to improve their
commitment towards the business and will give a feeling that their service is valued
by the organization (Davies, 2016).

ERP systems also make the data input and the process of tracking work quiet easy.
ERP helps to makes the interdepartmental processes simpler and faster by
eliminating the paperwork. As the traditional working methods require heavy manual
consideration and the offline communication in between the departments may cause
unnecessary errors and problems in achieving organizational goals. Many errors
such as the unable to provide better customer experience manage the customers
properly and retain them. The use of ERP will help to automate manual tasks and
create a transparent system, which reduces unnecessary pressure among
employees and helps to achieve the organizational targets easily.

Further facilitating the ERP system with the Banks will help in reducing the
inaccuracies occurred and also the additional work such as correcting errors will no
longer be a burden to the staff. With lesser error rectification work for past activities
and transactions, the employees can focus on processing newly received transaction
and enquiries from customers. Employees will also be motivated when working with
less inaccuracy and when they will not have to work twice on the same issue.

As ERP systems contribute towards a better and smooth running workplace

employees can enjoy the work every day and make productive results. Reduction in
the stress and tension will give a positive impact on the workers’ physical and mental
health, and result in higher productivity and performance and also helps in reducing
the employee turnover rate and retain the valuable employees. As employee well-
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being and the level of satisfaction of the employees play a vital role in any operation
of the business. ERP system will thus help to achieve both increasing the
organizational productivity and help to effectively improve employee job satisfaction
(Synergix, 2018).

2.5.4 Quality of Work and Employee Productivity

Quality of work can be defined as the output which is done efficiently and with little
direction and continuous supervision. The employees to perform quality work they
build their own skills such as the professionalism, strong work ethic, self-motivation,
positive attitude and confidence. Business can take number of actions to improve the
quality of output of an employee which will eventually improve the employee
productivity. Building employee the commitment, managing and controlling mistakes,
training employees and usage of proper technology and the use of quality circle’s will
helps to improve the overall quality of work done within a banking industry (Inc,
2010).

The use of integrated ERP system will help to improve the quality of work done by
each employee in the banking sector and help in improving the productivity in
measures like reducing the errors done while dealing with transactions, helping to
learn things easily and increase the number of transactions done within a limited
time. ERP helps to avoid many human made errors and avoid the negative
consequences occurred such as the customer inconvenience and frustration, delay in
process, additional cost and time involved in rectifying them (Indivia, 2017).

As the ERP systems are designed to help the process of managing and analyzing
data it will help to improve the scheduling processes. ERP reports will help the
employees to see a breakdown of previous transactions, as well as a history since
day 1 at real time. This functionality will help to reduce the error done while dealing
with customers and streamline future operations efficiently. Further by the use of
ERP system will help when an error does occurs the ERP solution will ensure all your
team are on the same page with central communications that allow any staff member
to instantly access order and fulfilment data to quickly address any problems and
solve customer complaints before they arise.

The use of ERP systems will make the learning process easy and quick which will
improve the overall quality of work done by an employee. Employees will be able to
improve their personal technical skills and abilities by practicing to work with ERP
systems and other technical equipment. As the world is changing towards the

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technology business must also improve its skill capital to face the future efficiently.
As banks have already started to implement the latest possible technologies to
satisfy the customers and maintain the competitive advantage it would be vital to
have a technically skilled and learning employees.

ERP will also help to improve the number of transactions done at a limited time and
earn many customers by providing the best and accurate results within a short time.
The ERP will enable the employees to join up multiple areas of the banks into one
program and allows managers and end users to have access to an overall database
that covers customer’s information, deposits, loans and auxiliaries. The availability of
a single system allows management to easily drill down to see how efficient and
productive individual employees are, using precise, accurate data from each
department. As a result, organizational performance together with staff efficiency can
be increased and also gain more customers (Claire, 2013).

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Chapter Three

3.0 Methodology

3.1 Introduction

This chapter of research study focuses on the discussion of the methodology and
framework of the research which tends to identify the impact in employee
performance by the ERP implementation within the banking sector of Sri Lanka. This
chapter would discuss about every components with related to the conceptual
research framework, data sources, data collection, data sampling and validations.
This chapter also includes the definitions of the variables, definitions of the variables,
operationalization, hypothesis testing, empirical analysis and finally the summary of
the chapter.

3.2 Conceptual Model

Flow of Information
Benefits of ERP Systems

Communication
Employee

Productivity
Employee Satisfaction

Quality of Work

3.3 Data Sources and Data Collection

The objective of this study is to analyze the impact of employee productivity by the
use of ERP in the banking industry in Sri Lanka. Primary data was collected by the
issuance of close ended questionnaires to the target respondents. A single
questionnaire was created and administered for the entire research study. Based on
the convenience of the researcher, 50 employees of private sector banks within the
Colombo area were selected as the target audience.

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3.4 Data Sampling

The sample includes the private banks within the Colombo area which use the
central database system of ERP. Non-probability sampling technique was applied in
this research study as the sample was selected based on the researcher’s
convenience. The sample size consists of 50 employees working in the bank.

3.5 Data Reliability

The Cronbach Alpha method of internal consistency is used to compute the reliability
of the measures of the variables of the study using the various questionnaire items
administered to the respondents. Cronbach’s alpha1 of 0.879 was measured on
scale, well above 0.7 implies that the instruments were sufficiently reliable for
measurement. The Cronbach Alpha for each variable such as the flow of information,
communication, employee satisfaction and quality of work was measured on scale as
0.850, 0.845, 0.864, 0.856 and 0.848 respectively.

3.6 Variable Definition

3.6.1 Independent Variable

[Link] Flow of Information

ERP system helps to make synchronized reporting and automation. With ERP
employees are not required to maintain separate databases and spreadsheets that
have to be manually merged to generate reports and the ERP solution will allow staff
to pull reports from one system. ERP helps to keep the data in one central location
where all authorized users will have access and data retrieving would be easy and
accurate (Metaxiotis & Liagkouras, 2017). Flow of information can also be identified
as the reduced dependability for getting information by one department to another.
The indicators used for flow of information Is real time data, easy to access and data
accuracy derived from Mishra (2008) and Shang and Seddon (2002).

[Link] Communication

Communication and data transmission is vital for every business. It would be

pointless to making decisions without proper information as it will not add any value.
As ERP works with data in one location it will contribute in minimizing the
miscommunication problems that could arise within the organizations and can help to

1
Values presented in Cronbach Alpha which are extracted for the analysis from SPSS output. Original
software output (SPSS) has been attached in the appendix.

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run the task smoother, on time, and more profitably. Also according to Milan (2017),
ERP systems will enhance communication by eliminating the geographic barriers,
increasing transparency and regardless of department and their physical location
teams will be able to collaborate in real time data. The indicators used to measure
the variable communication are internal communication, external communication and
top management communication derived form (Elragal and Al-Serafi, 2011).

[Link] Employee Satisfaction

Employee satisfaction is the term that is used describe how satisfied are the
employees with elements like their jobs, their employee experience, and the
organizations they work for. Employee satisfaction can also be identified as a key
metric that can help determine the overall health of an organization and regular
surveys must be done to measure employee satisfaction and track satisfaction trends
continuously. As ERP systems provides a number of benefits such as defining job
roles, building employee skills, reducing the extra burden, avoiding additional work,
providing independence and relevant information to work improves the satisfaction
levels of employees and contribute to employee productivity. Measures used to
identify employee satisfaction are defined job roles, clearer standard operating
procedures, reduction of excessive work and reduction workers’ stress and tension
are extracted from Davies (2016) and Synergix (2018).

[Link] Quality of Work

Quality of work can be identified as the output which is done efficiently and with little
direction and continuous supervision in one aspect. Activities like building employee
the commitment, managing and controlling mistakes, training employees and usage
of proper technology and the use of quality circle’s will helps to improve the overall
quality of work done. The use of an integrated ERP system will help to improve the
quality of work done by each employee help to make better decisions with real time
information. According to Mishra (2008) the meaures used to identify quality of work
are quality of work Is error rate, shortened learning time, increased transactions
process.

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3.6.2 Dependent Variable

[Link] Employee Productivity

Productivity can be termed as a main driving force behind the company’s growth and
profitability. Productivity can be identified as a measurement in between the inputs
and outputs over a period of time. Businesses can increase their employees'
productivity through the effective use of technology. ERP system at banks would
offers full data integration, ensuring accuracy, access and reports, all of which are
available in real time will help make them productive and provide better customer
service. Fact based decisions, increase in the output, reduction in stress, increase in
quality of output, reduction in overtime working are the certain measures used to
identify employee productivity.

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3.7 Operationalization

Variables Indicators Measures

Independent Variables

1. I think through the use of ERP

systems I have access to real
time data.
 Real time data 2. I think ERP systems have
Flow of Information  Easy to access made data retrieving process
 Data accuracy easy and quick.
3. I can assure also that data
accessed through ERP system
aren’t inaccurate.
4. I feel ERP system makes the
communication with other
 Internal
departments and teams easy.
Communication
5. I think ERP system improves
 External
Communication the communication process
Communication
with the customers.
 Top management
6. I believe ERP system help the
Communication
communication with top
management.

 Well Defined Job 7. I feel ERP avoids data

Roles duplication and provides
 Clearer Standard specific job roles.
Operating 8. I believe ERP helps to create a
Employee Procedures (SOP) transparent system and
Satisfaction  Reduction of reduces the unnecessary
excessive work pressure on the employees.
 Reduction 9. I feel that ERP plays a role in
workers’ stress and reducing the excessive work of
tension employees.

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10. In my opinion ERP reduces

the workers’ stress and
tension.

11. I think the ERP system helps

to reduce the error rate while
 Error rate
working.
 Shortened learning
12. I feel ERP makes learning
time
Quality of Work easy and quick.
 Increased
13. I feel with the usage of ERP
transactions
many transactions can be
process
processed with fewer
workforces.

Dependent Variable

14. I believe ERP helps to make

 Fact based better decisions.
decisions 15. I think ERP helps in
 Increase in the maximizing the output.
output 16. I think ERP system helps to
Employee
 Reduction in stress reduce the unnecessary work
Productivity
 Increase in quality pressure.
of output 17. I think ERP system helps to
 Reduction in improve the quality of output.
Overtime working 18. I believe ERP helps to reduce
working on additional hours

3.8 Hypothesis to be tested

From the objectives of the above study, the following hypothesis can be formed.

H1: The enhanced flow of information by the ERP has positive relationship with
employee productivity.

H2: The improved communication by the ERP has positive relationship with employee
productivity.

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H3: The increased employee satisfaction by the ERP has positive relationship with
employee productivity.

H4: The increased quality of output by the ERP has positive relationship with
employee productivity.

3.9 Empirical Analysis

3.9.1 Descriptive Statistics

A descriptive analysis has been used to provide simple summaries on about the
sample and measures. Descriptive analysis includes the mean, standard deviation,
maximum values and minimum values of the different variables which were tested.
The average value of the each variable will be presented as mean. Standard
deviation denotes the variation of the variable form the average, further a low
standard deviation could be due to the closeness of the mean and a higher standard
deviation is due to the distance from the mean.

3.9.2 Scatter Diagrams

The relationship between employee productivity and the other variables such as the
flow of information, communication, employee satisfaction and quality of work within
the banking sector of Sri Lanka is illustrated with the support of scatter diagrams.
Scatter diagrams helps to measure the changes in employee productivity against
each variable among the sample size. Also the regression line in scatter plot it is
easy to determine the association of two variables through the slop of line.\

3.9.3 Correlation Analysis

Correlation analysis can be identified as statistical tool that is used to evaluate the
strength and the direction of the different variables. The most common type of
correlation coefficient used is the Pearson Correlation Coefficient. It’s used to test for
linear relationships between the variables. Correlation analysis in this study is used
to check for the multicollinearity among the dependent variable and the independent
variable. Dependent variable in this study is the employee performance and the
factors such as the flow of information, communication, employee satisfaction and
quality of work are independent variables.

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3.9.4 Regression Analysis

Regression analysis can be identified as the statistical technique which is used to

evaluate the relationships between dependent and independent variables. By the
Usage of a regression analysis organization can easily determine the degree to
which particular independent variables are influencing dependent variables. This
research employs regression analysis to measure the effect in employee productivity
by the different benefits gained by the use of an ERP system. A simple regression
analysis is employed to measure the effect of employee productivity due to each
independent variable such as the flow of information, communication and quality of
work. Also a multiple regression analysis is been used to identify the relationship
between one continuous dependent variable and two or more independent variables.

3.10 Summary

The methodology chapter provides a summary of the process and procedures that
has to be followed while conducting the research study. This chapter includes areas
such as the conceptual framework, data sources and data collection, data sampling
and validation, definitions of the variables and operationalization, hypothesis testing
and finally the empirical analysis. Results of the issued questionnaire is analyzed and
discussed in the following chapter.

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Chapter Four

4.0 Data Representation and Analysis

4.1 Introduction

This chapter consists of the relevant data representation and analysis of the data in
order to draw meaningful conclusions on the impact of employee performance due to
the benefits gained by the use of Enterprise Resource Planning (ERP) in the banking
industry of Sri Lanka. The data for this study was collected by issuing questionnaires
to the employees in the banking industry. Descriptive statistics of the variable
employed in the study has also been presented in this section. Correlation analysis
and regression analysis has been used to interpret the relations between employee
performance and the different benefits gained by the use of ERP. Scatter diagrams
have also been used in this chapter to explain the relationship between the employee
performance and the different use of ERP. This chapter also includes the test of each
hypothesis that was developed earlier and the results of hypothesis testing along with
regression analysis.

4.2 Descriptive Statistics

A descriptive analysis has been reported in the following table (table 4.1) to provide
simple summaries on about the sample and measures. The following table includes
the mean, standard deviation, maximum values and minimum values of the different
variables which were tested. The average value of the each variable is presented as
mean. Standard deviation of the following table denotes the variation of the variable
form the average, further a low standard deviation could be due to the closeness of
the mean and a higher standard deviation is due to the distance from the mean.

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Table 4.1 – Descriptive Statistics2

Descriptive Statistics
Std.
Minimum Maximum Mean
Deviation
Flow of information 3.00 5.00 4.2979 .55439
Communication 2.67 5.00 4.2504 .59243
Employee satisfaction 3.00 5.00 4.3482 .56248
Quality of work 3.33 5.00 4.2625 .51567
Employee Productivity 3.00 5.00 4.3429 .52735
Note: The sample size of the study was 30. Employee Productivity was the dependent
variable, while Flow of information, Communication, Employee satisfaction, Quality of work
was considered as the independent variables. Measures of the variable for flow of information
Is real time data, easy to access and data accuracy. Measures of the variable for
communication is internal communication, external communication and top management
communication. Measures of the variable for employee satisfaction is well defined job roles,
clearer standard operating procedures, reduction of excessive work and reduction workers’
stress and tension. Measures of the variable for quality of work Is error rate, shortened
learning time, increased transactions process and measures of the variable for employee
productivity are fact based decisions, increase in the output, reduction in stress, increase in
quality of output, reduction in overtime working.

According to above table 4.1, the respondent has stood between agree and strongly
agree that the benefits such as flow of information, communication, employee
satisfaction and quality of work gained by the ERP systems contribute to improve the
employee productivity. Overall the respondents has stood between agree and
strongly agree in each of the benefit gained by the use of ERP and believes it
contributes to the improvements of the in employee productivity. Table 4.1 implies
that, all respondents agree that the benefits of using ERP systems will contribute in
improving the employee productivity.

4.3 Graphical Illustration of the Relationship between Employee

Productivity and the relevant variables

The relationship between employee productivity and the other variables such as the
flow of information, communication, employee satisfaction and quality of work is
illustrated with the support of scatter diagrams in each section. Each of the scatter
plot helps to measure the changes in employee productivity against each variables
among the sample size. Also in addition to the scatter plots a regression line has also

2
Data presented in the Table 4.1 are values which are necessary for the analysis and are extracted
from SPSS output. Original software output (SPSS) has been attached in the appendix.

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been displayed in the diagram. With the regression line it is easy to determine the
association of two variables through the slop of line.

Figure 4.1 - Relationship between Flow of Information and Employee Productivity

The relationship between flow of information and employee productivity has been
illustrated by the above scatter plot. The Y axis is the dependent variable employee
productivity and the X axis represents the independent variable flow of information.
As per the diagram there is a positive relationship between the employee productivity
and flow of information because the plots are upwards rising from left side to the right
side. Accordingly with improved flow of information it contributes to increase the
employee productivity. Also by the regression line in the scatter plot it indicates the
positive relationship in between the employee productivity and flow of information.
Further the upward sloped regression line thus confirms it.

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Figure 4.2 - Relationship between Communication and Employee Productivity

Figure 4.2 represents the scatter plot which explains the relationship between
communication and employee productivity. The Y axis is the dependent variable
employee productivity and the X axis represents the independent variable
communication. As per the diagram there is a positive relationship between the
employee productivity and communication because the plots are upwards rising from
left side to the right side. Accordingly with improved communication by the use of
ERP it contributes to increase the employee productivity. Also by the regression line
in the scatter plot it indicates the positive relationship in between the employee
productivity and communication. Further the upwards sloped regression line thus
confirms it.

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Figure 4.3 - Relationship between Employee Satisfaction and Employee Productivity

The above scatter plot presents the relationship between employee satisfaction and
employee productivity. The X axis represents the independent variable employee
satisfaction and the Y axis is the dependent variable employee productivity. As per
the diagram there is a positive relationship between the employee productivity and
employee satisfaction because the plots are upwards rising from left hand side to the
right hand side. Accordingly the improved employee satisfaction by the use of ERP
systems contributes to increase the employee productivity. Also by the regression
line in the scatter plot it indicates the positive relationship in between the employee
productivity and employee satisfaction. Further the upward sloped regression line
thus confirms it.

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Figure 4.4 - Relationship between Quality of Work and Employee Productivity

Figure 4.4 presents the scatter diagram, displaying the relationship between the
quality of work determined by the ERP and the employee productivity. X axis
represents the quality of work while the Y axis represents the employee productivity.
Through observing the diagram, it can be witnessed that most of the observations
are plotted throughout the diagram and indicates a positive relationship between the
quality of work and the employee productivity. In addition to the scatter plot the above
diagram also exhibits a regression line as well. Further the upward sloped regression
line thus confirms the positive relationship between the quality of work and the
employee productivity.

4.4 Correlation Analysis

Correlation analysis can be identified as statistical tool which is used to evaluate the
strength and the direction of the different variables. The most common type of
correlation coefficient used is the Pearson Correlation Coefficient. It’s used to test for
linear relationships between the variables. Correlation analysis in this study is used
to check for the multicollinearity among the dependent variable and the independent
variable. Dependent variable in this study is the employee performance and the

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factors such as the flow of information, communication, employee satisfaction and

quality of work are independent variables. Also a bivariate correlation matrix is used
for this purpose.

Table 4.2 - Correlation Analysis3

Flow of Employee Quality of

Communication
Information satisfaction work

Employee Pearson
.609 .498 .781 .546
Productivity Correlation

Note: The sample size of the study was 30. Employee Productivity was the dependent
variable, while Flow of information, Communication, Employee satisfaction, Quality of work
was considered as the independent variables. Measures of the variable for flow of information
Is real time data, easy to access and data accuracy. Measures of the variable for
communication is internal communication, external communication and top management
communication. Measures of the variable for employee satisfaction is well defined job roles,
clearer standard operating procedures, reduction of excessive work and reduction workers’
stress and tension. Measures of the variable for quality of work Is error rate, shortened
learning time, increased transactions process and measures of the variable for employee
productivity are fact based decisions, increase in the output, reduction in stress, increase in
quality of output, reduction in overtime working.

The above table (table 4.2) represents the bivariate correlation coefficient of the
different variables of the study of employee productivity. The Pearson’s correlation
between employee productivity and other variables such as the flow of information,
communication, employee satisfaction, quality of work are at 0.609, 0.498, 0.781 and
0.546 respectively. Accordingly there is moderate relationship in between the
variables flow of information, communication and quality of work against employee
productivity and there is a strong relationship between the employee satisfaction and
the employee productivity as the Pearson correlation coefficient is 0.781. Overall the
above table explains the positive relationship between the variables flow of
information, communication and quality of work against the dependent factor of the
study employee productivity.

4.5 Regression Analysis

Regression analysis can be identified as the statistical technique which is used to

evaluate the relationships between dependent and independent variables. By the
Usage of a regression analysis organization can easily determine the degree to
which particular independent variables are influencing dependent variables. This

3
Data presented in the Table 4.2 are values which are necessary for the analysis and are extracted
from SPSS output. Original software output (SPSS) has been attached in the appendix.

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research employs regression analysis to measure the effect in employee productivity

by the different benefits gained by the use of an ERP system. Initially a simple
regression analysis is employed to measure the effect of employee productivity due
to each independent variable such as the flow of information, communication and
quality of work. Also a multiple regression analysis has been used to identify and
explain the relationship between one continuous dependent variable and two or more
independent variables.

4.5.1 Simple Regression Analysis

Table 4.3 - Simple Regression Analysis4

Flow of Employee
Communication Quality of work
Information Satisfaction
β coefficient 0.609 0.498 0.781 0.546
t-statistics 3.914 2.926 6.382 3.322
ρ value 0.001 0.007 0.000 0.003
2
Adjusted R 0.347 0.248 0.595 0.271
2
R 0.371 0.219 0.610 0.298
F-statistics 15.322 8.563 40.735 11.036
Significance of
0.001 0.007 0.000 0.003
F-statistics
Note: The sample size of the study was 30. Employee Productivity was the dependent
variable, while Flow of information, Communication, Employee satisfaction, Quality of work
was considered as the independent variables. Measures of the variable for flow of information
Is real time data, easy to access and data accuracy. Measures of the variable for
communication is internal communication, external communication and top management
communication. Measures of the variable for employee satisfaction is well defined job roles,
clearer standard operating procedures, reduction of excessive work and reduction workers’
stress and tension. Measures of the variable for quality of work Is error rate, shortened
learning time, increased transactions process and measures of the variable for employee
productivity are fact based decisions, increase in the output, reduction in stress, increase in
quality of output, reduction in overtime working.
*Significance is at the 0.05 level.

According to above table (table 4.3) the adjusted R2 value of flow of information is
0.347 and there is a positive (β coefficient = 0.609) relationship between the
employee productivity and the flow of information and statistically significant at 95%
confidence level (ρ<0.05). The adjusted R2 value of communication is 0.248. There is
a moderate (β coefficient = 0.498) relationship between the employee productivity

4
Data presented in the Table 4.3 are values which are necessary for the analysis and are extracted
from SPSS output. Original software output (SPSS) has been attached in the appendix.

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and the flow of information and statistically significant at 95% confidence level
(ρ<0.05). The variable employee satisfaction also reported a strong positive (β
coefficient = 0.781) relationship with employee productivity and is statistically
significant (ρ<0.05) with the adjusted R2 value at 0.595. Quality of work also reported
a strong positive (β coefficient = 0.546) relationship with employee productivity and is
statistically significant (ρ<0.05) with the adjusted R2 value at 0.271. The regression
model validates the results of the scatter diagram. The significance of F-statistics for
all variables are found statistically significant at 5% significance level (ρ<0.05).

4.5.2 Multiple Regression Analysis

Table 4.4 - Multiple Regression Analysis5

β coefficient t-statistics ρ value

Flow of Information 0.351 2.134 0.044

Communication -0.0254 -1.320 0.200

Employee Satisfaction 0.645 4.812 0.000

Quality of Work 0.224 1.364 0.186

Adjusted R2 0.663

R2 0.713

F Statistics 14.296

Significance of F-statistics 0.000

Note: The sample size of the study was 30. Employee Productivity was the dependent
variable, while Flow of information, Communication, Employee satisfaction, Quality of work
was considered as the independent variables. Measures of the variable for flow of information
Is real time data, easy to access and data accuracy. Measures of the variable for
communication is internal communication, external communication and top management
communication. Measures of the variable for employee satisfaction is well defined job roles,
clearer standard operating procedures, reduction of excessive work and reduction workers’
stress and tension. Measures of the variable for quality of work Is error rate, shortened
learning time, increased transactions process and measures of the variable for employee
productivity are fact based decisions, increase in the output, reduction in stress, increase in
quality of output, reduction in overtime working.
*Significance is at the 0.05 level.

According to the Table 4.3, the adjusted R2 is 0.663 the significance of F-statistics for
the model is found statistically significant at 5% significance level (ρ<0.05), ratifying
the overall validity of the model. The value of F- statistics for the regression model
can be identified as 14.296. Flow of information seems to be significant as ρ = 0.044

5
Data presented in the Table 4.3 are values which are necessary for the analysis and are extracted
from SPSS output. Original software output (SPSS) has been attached in the appendix.

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and the coefficient is positive (β = 0.351) which indicates that flow of information by
the ERP systems makes a potential impact on employee productivity.
Communication seems to be significant as ρ = 0.200 at 95% confidence level and the
coefficient is negative (β = -0.0254) which indicates that flow of information by the
ERP systems makes a insignificant impact on employee productivity. Employee
satisfaction with β coefficient at 0.645 and ρ = 0.000 implies that there is a positive
relationship between employee satisfaction and the employee productivity. Quality of
work seems to be significant as ρ = 0.186 and the coefficient is positive (β = 0.224)
which indicates that improved quality of work by the ERP systems makes a
insignificant impact on employee productivity at 95% confidence level.

4.6 Hypothesis Testing

H1: The enhanced flow of information by the ERP has positive relationship with
employee productivity.

As per the output reported in Table 4.3, a positive (β coefficient =0.609) relationship
found between flow of information and employee productivity. The ρ value, less than
0.05 lets the researcher to reject the null hypothesis and accept H1. Therefore it could
be concluded that at 5% significance level, flow of information will have a positive
impact on the employee productivity.

H2: The improved communication by the ERP has positive relationship with
employee productivity.

With relation to the statistical analysis reported in the Table 4.3 employed to test the
hypothesis, there is positive (β coefficient =0.498) relationship between
communication and employee productivity and is significant at 5% significance level
(ρ<0.05). Hence the researcher can reject the null hypothesis and accept the H2.

H3: The increased employee satisfaction by the ERP has positive relationship
with employee productivity.

A strong positive relation is found between employee satisfaction and employee

productivity as reported in the Table 4.3 (β coefficient =0.781). The ρ value is less
than 0.05. Hence, the researcher can reject the null hypothesis and make conclusion
that at 5% significance level, employee satisfaction will have a significant impact on
the employee productivity and accepts the H3.

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H4: The increased quality of output by the ERP has positive relationship with
employee productivity.

With reference to the statistical analysis reported in Table 4.3, there is positive (β
coefficient =0.546) relation between quality of output and employee productivity. The
ρ value is less than 0.05. Hence, the researcher can reject the null hypothesis and
make conclusion that at 5% significance level, quality of work will have a significant
impact on the employee productivity and accepts the H4.

4.7 Summary

This chapter presents the data and analyses using correlation analysis and
regression analysis in order to draw conclusions about the benefits gained by the
ERP systems and their relationship with employee productivity. Descriptive statistics
of the study and the results of correlation analysis and regression analysis are
reported in this chapter. Scatter diagrams have also been used in this study as an
attempt to graphically describe the relations between employee productivity and the
relevant variables such as the flow of information, communication, employee
satisfaction and quality of work. The main concern was on the banking industry to
arrive at precise estimations. All hypotheses which were developed earlier are tested
and the results of the hypothesis tests are also reported in order to draw conclusions.

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Chapter Five

5.0 Discussion, Conclusion and Recommendation

5.1 Introduction

The purpose of this research is to study the impact in employee productivity by the
benefits gained by the use of ERP systems especially in the banking industry of Sri
Lanka. The findings of the study are outlined according to the objectives and aims of
the study. In this chapter the findings are based on the responses from the
questionnaires which were filled and information gathered on the research questions.
The researcher provides discussions on the findings of the research with comparison
to the findings in the literature review based on the research objectives which is
already stated in the chapter one of this study. Further, conclusion and
recommendations are also provided in this chapter in which the researcher believes
that, the recommendations provided will add value to the body of research which can
be further enriched by other eminent researchers over the years.

5.2 Summary

The purpose of the study is to identify the impact in the employee productivity by the
benefits gained by using ERP systems within the banking industry of Sri Lanka. The
researcher adopted a descriptive research design making the main focus industry
was the Banking Sector. The study was guided basically by the following research
questions.

 Does the enhanced flow of Information gained by ERP contribute to employee

productivity?
 Does the eased communication system improve the employee productivity?
 Does usage of the ERP improves the employee satisfaction leading to
productivity in work?
 Does the ERP system improves the quality of work done by the employees
and leads to productivity?

The population for the study was the employees who are in touch and uses the ERP
systems especially in the banks. The study population was comprised for a total of 50
employees engaging with ERP systems. The researcher has used sampling
technique of non-probability sampling to draw a sample size of 30 respondents. Data
was collected through the issuance of questionnaires and which were entered into

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the Statistical Package for Social Sciences (SPSS) software to easing the process of
analysis and making conclusions. This study also employed descriptive statistics,
scatter diagrams with correlation and regression analysis to analyze the relationship
between employee productivity and other independent variables which were
measured. Hypothesis testing was tested by employing regression analysis which
was vital in making a sense of the data. The analyzed data is also presented in forms
of tables and figures according to the researchers need.

The first research question is to identify whether the enhanced flow of Information
gained by using an ERP system in the bank helps the employees to improve their
productivity. The main measures used to test this were the ability to access real time
data, accuracy of the data and eased access to all employees working. All most all
respondents have agreed that the flow of information makes a greater impact on
employee productivity. As when the information is readily available employees can
manage the process, risk and streamline the activities efficiently. The second
question was based on to identify whether the improved communication process has
made significance in employee productivity. Internal communication, external
communication and top management communication were some measures used to
identify the employee responses and most employees have moderately agreed that
the communication contributes to improve the productivity.

Third research question focused on whether the employee satisfaction gained by

using ERP systems improves the employee productivity. Third research question got
results from the employees stating that employee satisfaction plays a significant and
has strong relationship with the employee productivity. Well defined job roles, clear
standard operating procedures (SOP), reduction of excessive work and reduction of
workers’ stress and tension were the measures which were used to test the variable
of employee satisfaction. The fourth research question was focused on to identify
whether the quality of work has a relationship with employee satisfaction. Errors
done, shortened learning time and increased transactions done within a limited time
being the measures employees have reported for a positive relationship between the
employee productivity and quality of work.

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5.3 Results and Discussion

5.3.1 Flow of Information by using ERP and Employee Productivity

As reported in table 4.3, a positive relationship if found between employee

productivity and the flow of information which is gained by the use of ERP system
within the banking industry. In other words ERP systems contribute to easy flow of
information which results in improved productivity of the employees. Findings indicate
that certain measures of flow of information are access to real time data, accuracy of
the data accessed and the eased access contributes to improve the employee
productivity by providing the right information at the required time. Also according to
Shang & Seddon (2002) employees can enjoy the above mentioned benefits
contributing to achieve quality improvements to achieve overall operational
efficiencies and improve the productivity of employees.

Availability of information can be identified as an important factor in any business

and with related to the banking sector information is very vital as they deal with funds
and financial instruments. Accessibility of information can be identified as core to do
any banking activities. Information is vital to make decisions, do transactions and to
do all other daily banking functions. When the employees have access to real time
data and accurate data it will improve the speed of employee working and helps to
productivity of the employees. Also according to Metaxiotis & Liagkouras (2017) ERP
systems helps to decline the data redundancy and duplications. Also having the data
in one location with approved access will make the decisions effective and improves
the speed of business functioning by avoiding the time spent on waiting for the right
information. The collaboration and real-time access to data will also influence to
manage the customers properly increasing the banks reputation for quality service
and better customer service (Lorincz, 2017). The instant access to data enables to
quickly retrieve data any time without having to constantly wait for an email to arrive
with the requested information from other employees with having a customer waiting
at the table.

5.3.2 Enhanced Communication by using ERP and Employee Productivity

As reported in table 4.3, a positive relationship if found between employee

productivity and the enhanced communication by the use of ERP system within the
banking industry. In other words ERP systems help in easy communication in the
bank which results in improved productivity of the employees. Findings indicate that
certain measures of communication were simplified internal communication, external

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communication and communication with the top management. ERP software

contributes in minimizing the miscommunication problems that could arise within
organizations and can help to run the task smoother, on time, and more profitably.

As the respondents accepted that communication plays a positive role in improving

the employee productivity, Leung (2016) also states that with the help of ERP it is
easy to provide the employees the feel of motivation by making them aware of the all
the information and making the organization united it will positively contribute to the
organization. Through the use of ERP software effectively it will help to remove the
barriers related to interdepartmental communication inside companies and avoid the
delay in time and cost involved to gain information and rectifying them. Also Khoury
(2015) says that ERP system will bring the entire organization together as one unit
with a single central database and reduces the time in finding information and eases
the availability of information across different departments. Also with ERP all
employees can stay with updated and well informed, since real time bank data is
made visible to the entire organization and internal communication is no longer an
issue. Making a solid foundation with the help of IT solutions will improve the
performance of the team and the work efficiently of employees (Khoury, 2015).

5.3.3 Employee Satisfaction by using ERP and Employee Productivity

As per the output reported in table 4.3, a strong positive relationship is found
between the employee satisfaction gained by ERP system and employee productivity
which implies that, employee satisfaction will improve the productivity of the
employees in the banking industry.

The findings indicates that when employees are satisfied it contribute to their overall
productivity and the measures used to find them was defined job roles, clear
standard operating procedures (SOP), reduction of excessive work and reduction of
the employees stress and tension. These finding were also agreed with Davies
(2016) and says that best method to increase the employee satisfaction is by defining
job roles which can be done efficiently by an ERP system. Defining the job role with
the help of ERP will make every employee knows what they and their colleagues
what is supposed to be done. Also by helping them to understand how it exactly
contribute to the firm’s overall strategy will make them even productive and improve
the employee commitment which can be achieve by an ERP system.

Having a clear standard operating procedure will through ERP software will automate
the manual tasks done and creates a transparent system, which reduces

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unnecessary pressure among employees. When employee is satisfied and happy

with the work done and the organization it will automatically improve the productivity
as an return to the benefits they enjoy. Also facilitation of the ERP system it would be
easier to reduce the inaccuracies, additional work done on correcting those errors
can be avoided will no longer is a burden to employees. With reduced error
rectification work for past orders, employees can focus on processing newly received
orders from customers, which avoids them from working overtime and increases the
employee satisfaction (Synergix, 2018).

5.3.4 Quality of Work gained by using ERP and Employee Productivity

As reported in table 4.3, a positive relationship can be found between employee

productivity and the improved quality which is gained by the use of ERP system
within the banking industry. In other words an ERP system contributes to improve the
quality of work done and as a result it also improves the employee productivity.
Measures used to identify quality of work were errors done, shortened learning time
and increase in the number transactions done within a limited time. Also according to
Shang & Seddon (2002) employees can also enjoy the above mentioned benefits
contributing to achieve quality improvement, build employee skills and improve the
productivity of the employees.

Quality of the work can also be improved with an ERP system as banks will be
implementing and practicing standard procedures and maintain accurate data will
improve the quality of output banks productivity (Lauderdale, 2003). Also building
employee the commitment, managing and controlling their mistakes, training
employees and usage of proper technology and the use of quality circle’s will helps to
improve the overall quality of work done within a banking industry say Inc (2010). As
ERP can provide a complete integration of the system not only across departments
but also across organization under the same management will help to implement and
maintain the quality of output easily. Further the ERP will bridge the information gaps
across the bank and will only focuses on key issues such as productivity
enhancement, customer service, cash management, customer management, and
quality control. ERP can be dientified as a powerful tool for maintaining the quality
and building the employee productivity.

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5.4 Recommendations for Future Research

All academic studies have limitations and certain scope for improvements. Similarly,
this study also includes some such limitations encountered. Though there are many
banks operating under both private and public ownership in Sri Lanka, the sample
included only the employees of private banks which uses maintains a central
database of ERP within the Colombo area. Future researchers should focus on larger
quantitative data from a larger sample pool with a larger physical area which can
instill more confidence in the findings. Limitations with the data collection brought in
inaccurate information by the respondents, increasing the chances of misleading the
study. The use of an optimized data collection technique and increasing the focus on
the relevant data would be recommendation for the future researchers to overcome
the above limitation. Sri Lanka being a developing country with booming economy
will have to adopt many technologies and increase its speed to meet the global
requirements and achieve business gains. Hence, further research with related to
ERP and other technologies that enhances the business activities would be highly
recommended.

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Appendix 1 – Research Questionaire

Dear Respondent,

Being a student of Business Management I am conducting a research on the topic of

Improvements in Employee Productivity by the Implementation of an
ERP system. This survey is done as part of the research that, I am currently
carrying out for the completion of Higher National Diploma (HND).

Kindly please spend 4-6 minutes of your valuable time and fill up this questionnaire to
make the survey successful.

Your kind participation in this survey will be greatly appreciated. All information you
provide will be a strong contribution for the research and strictly be used only for
academic purposes.

Thank you,
Afkar Ahmed

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Neither
Strongly Disagree Strongly
Disagree Agree
Disagree Agree
or Agree

1. I think through the

use of ERP systems
I have access to real 1 2 3 4 5
time data.

2. I think ERP systems

have made data
retrieving process 1 2 3 4 5
easy and quick.

3. I can assure also

that data accessed
through ERP system 1 2 3 4 5
aren’t inaccurate.
4. I feel ERP system
makes the
communication with
1 2 3 4 5
other departments
and teams easy.
5. I think ERP system
improves the
communication
1 2 3 4 5
process with the
customers.
6. I believe ERP
system help the
communication with 1 2 3 4 5
top management.

7. I feel ERP avoids

data duplication and
provides specific job 1 2 3 4 5
roles.

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 Research Project

8. I believe ERP helps

to create a
transparent system
and reduces the
1 2 3 4 5
unnecessary
pressure on the
employees.
9. I feel that ERP plays
a role in reducing
the excessive work 1 2 3 4 5
of employees.
10. In my opinion use of
an ERP systems
helps to reduce the
1 2 3 4 5
workers’ stress and
tension.
11. I think the ERP
system helps to
reduce the error rate 1 2 3 4 5
while working.

12. I feel ERP makes

the learning process
1 2 3 4 5
easy and quick.

13. I feel with the usage

of ERP many
transactions can be
1 2 3 4 5
processed with
fewer workforces.

14. I believe ERP helps

to make better 1 2 3 4 5
decisions.

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 Research Project

15. I think ERP helps in

maximizing the
1 2 3 4 5
output.

16. I think ERP system

helps to reduce the
unnecessary work 1 2 3 4 5
pressure.

17. I think ERP system

helps to improve the
1 2 3 4 5
quality of output.

18. I believe ERP helps

to reduce working
1 2 3 4 5
on additional hours.

Appendix 2 – SPSS Output

Descriptive Statistics

Descriptive Statistics

N Minimum Maximum Mean Std. Deviation

Flow_of_Information 28 3.00 5.00 4.2979 .55439

Communication 28 2.67 5.00 4.2504 .59243
Employee_Satisfaction 28 3.00 5.00 4.3482 .56248
Quality_of_Work 28 3.33 5.00 4.2625 .51567
Employee_Productivity 28 3.00 5.00 4.3429 .52735
Valid N (listwise) 28

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 Research Project

Correlations

Correlations

Flow_of_Info Communicati Employee_S Quality_of_ Employee_P

rmation on atisfaction Work roductivity

Pearson ** * ** **
1 .718 .476 .595 .609
Correlation
Flow_of_Information
Sig. (2-tailed) .000 .010 .001 .001

N 28 28 28 28 28
Pearson ** ** ** **
.718 1 .525 .720 .498
Correlation
Communication
Sig. (2-tailed) .000 .004 .000 .007
N 28 28 28 28 28
Pearson * ** * **
.476 .525 1 .459 .781
Employee_Satisfacti Correlation
on Sig. (2-tailed) .010 .004 .014 .000
N 28 28 28 28 28
Pearson ** ** * **
.595 .720 .459 1 .546
Correlation
Quality_of_Work
Sig. (2-tailed) .001 .000 .014 .003
N 28 28 28 28 28
Pearson ** ** ** **
.609 .498 .781 .546 1
Employee_Productiv Correlation
ity Sig. (2-tailed) .001 .007 .000 .003

N 28 28 28 28 28

**. Correlation is significant at the 0.01 level (2-tailed).

*. Correlation is significant at the 0.05 level (2-tailed).

Simple Regression

a
Variables Entered/Removed

Model Variables Variables Method

Entered Removed

Flow_of_Inform
1 b
. Enter
ation

a. Dependent Variable: Employee_Productivity

b. All requested variables entered.

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 Research Project

Model Summary

Model R R Square Adjusted R Std. Error of the

Square Estimate
a
1 .609 .371 .347 .42628

a. Predictors: (Constant), Flow_of_Information

a
ANOVA

Model Sum of Squares df Mean Square F Sig.

b
Regression 2.784 1 2.784 15.322 .001

1 Residual 4.724 26 .182

Total 7.509 27

a. Dependent Variable: Employee_Productivity

b. Predictors: (Constant), Flow_of_Information

a
Coefficients

Model Unstandardized Coefficients Standardized t Sig.

Coefficients

B Std. Error Beta

(Constant) 1.853 .641 2.891 .008

1
Flow_of_Information .579 .148 .609 3.914 .001

a. Dependent Variable: Employee_Productivity

a
Variables Entered/Removed

Model Variables Variables Method

Entered Removed

Communication
1 b
. Enter

a. Dependent Variable: Employee_Productivity

b. All requested variables entered.

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 Research Project

Model Summary

Model R R Square Adjusted R Std. Error of the

Square Estimate
a
1 .498 .248 .219 .46609

a. Predictors: (Constant), Communication

a
ANOVA

Model Sum of Squares df Mean Square F Sig.

b
Regression 1.860 1 1.860 8.563 .007

1 Residual 5.648 26 .217

Total 7.509 27

a. Dependent Variable: Employee_Productivity

b. Predictors: (Constant), Communication

a
Coefficients

Model Unstandardized Coefficients Standardized t Sig.

Coefficients

B Std. Error Beta

(Constant) 2.460 .650 3.787 .001

1
Communication .443 .151 .498 2.926 .007

a. Dependent Variable: Employee_Productivity

a
Variables Entered/Removed

Model Variables Variables Method

Entered Removed

Employee_Satis
1 b
. Enter
faction

a. Dependent Variable: Employee_Productivity

b. All requested variables entered.

Model Summary

Model R R Square Adjusted R Std. Error of the

Square Estimate
a
1 .781 .610 .595 .33543
a. Predictors: (Constant), Employee_Satisfaction

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 Research Project

a
ANOVA

Model Sum of Squares df Mean Square F Sig.

b
Regression 4.583 1 4.583 40.735 .000

1 Residual 2.925 26 .113

Total 7.509 27

a. Dependent Variable: Employee_Productivity

b. Predictors: (Constant), Employee_Satisfaction

a
Coefficients

Model Unstandardized Coefficients Standardized t Sig.

Coefficients

B Std. Error Beta

(Constant) 1.158 .503 2.302 .030

1
Employee_Satisfaction .732 .115 .781 6.382 .000

a. Dependent Variable: Employee_Productivity

a
Variables Entered/Removed

Model Variables Variables Method

Entered Removed

Quality_of_Wor
1 b
. Enter
k
a. Dependent Variable: Employee_Productivity
b. All requested variables entered.

Model Summary

Model R R Square Adjusted R Std. Error of the

Square Estimate
a
1 .546 .298 .271 .45026

a. Predictors: (Constant), Quality_of_Work

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 Research Project

a
ANOVA

Model Sum of Squares df Mean Square F Sig.

b
Regression 2.237 1 2.237 11.036 .003

1 Residual 5.271 26 .203

Total 7.509 27

a. Dependent Variable: Employee_Productivity

b. Predictors: (Constant), Quality_of_Work

a
Coefficients

Model Unstandardized Coefficients Standardized t Sig.

Coefficients

B Std. Error Beta

(Constant) 1.963 .721 2.722 .011
1
Quality_of_Work .558 .168 .546 3.322 .003

a. Dependent Variable: Employee_Productivity

Multiple Regression

a
Variables Entered/Removed

Model Variables Variables Method

Entered Removed

Quality_of_Wor
k,
Employee_Satis
faction,
1 . Enter
Flow_of_Inform
ation,
Communication
b

a. Dependent Variable: Employee_Productivity

b. All requested variables entered.

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 Research Project

Model Summary

Model R R Square Adjusted R Std. Error of the

Square Estimate
a
1 .844 .713 .663 .30601

a. Predictors: (Constant), Quality_of_Work, Employee_Satisfaction,

Flow_of_Information, Communication

a
ANOVA

Model Sum of Squares df Mean Square F Sig.

b
Regression 5.355 4 1.339 14.296 .000

1 Residual 2.154 23 .094

Total 7.509 27
a. Dependent Variable: Employee_Productivity
b. Predictors: (Constant), Quality_of_Work, Employee_Satisfaction, Flow_of_Information,
Communication

a
Coefficients

Model Unstandardized Coefficients Standardized t Sig.

Coefficients

B Std. Error Beta

(Constant) .265 .575 .461 .649

Flow_of_Information .334 .156 .351 2.134 .044

1 Communication -.226 .171 -.254 -1.320 .200

Employee_Satisfaction .604 .126 .645 4.812 .000

Quality_of_Work .229 .168 .224 1.364 .186

a. Dependent Variable: Employee_Productivity

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 Research Project

Reliability Testing

Case Processing Summary

N %

Valid 28 100.0
a
Cases Excluded 0 .0

Total 28 100.0

a. Listwise deletion based on all variables in the

procedure.

Reliability Statistics

Cronbach's N of Items
Alpha

.879 5

Scale: All Variables

Case Processing Summary

N %

Valid 28 100.0
a
Cases Excluded 0 .0

Total 28 100.0

a. Listwise deletion based on all variables in the

procedure.

Reliability Statistics

Cronbach's Cronbach's N of Items

Alpha Alpha Based on
Standardized
Items

.879 .879 5

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 Research Project

Item Statistics

Mean Std. Deviation N

Flow_of_Information 4.2979 .55439 28

Communication 4.2504 .59243 28
Employee_Satisfaction 4.3482 .56248 28
Quality_of_Work 4.2625 .51567 28
Employee_Productivity 4.3429 .52735 28

Inter-Item Correlation Matrix

Flow_of_Inform Communication Employee_Satis Quality_of_Work Employee_Prod

ation faction uctivity

Flow_of_Information 1.000 .718 .476 .595 .609

Communication .718 1.000 .525 .720 .498
Employee_Satisfaction .476 .525 1.000 .459 .781
Quality_of_Work .595 .720 .459 1.000 .546
Employee_Productivity .609 .498 .781 .546 1.000

Inter-Item Covariance Matrix

Flow_of_Inform Communication Employee_Satis Quality_of_Work Employee_Prod

ation faction uctivity

Flow_of_Information .307 .236 .149 .170 .178

Communication .236 .351 .175 .220 .156
Employee_Satisfaction .149 .175 .316 .133 .232
Quality_of_Work .170 .220 .133 .266 .148
Employee_Productivity .178 .156 .232 .148 .278

Item-Total Statistics

Scale Mean if Scale Variance Corrected Item- Squared Cronbach's

Item Deleted if Item Deleted Total Correlation Multiple Alpha if Item
Correlation Deleted

Flow_of_Information 17.2039 3.339 .723 .615 .850

Communication 17.2514 3.188 .743 .687 .845
Employee_Satisfaction 17.1536 3.418 .662 .654 .864
Quality_of_Work 17.2393 3.502 .696 .572 .856
Employee_Productivity 17.1589 3.406 .733 .713 .848

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 Research Project

Scale Statistics

Mean Variance Std. Deviation N of Items

21.5018 5.111 2.26082 5

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