North South University

Fall 2011

Internship (BUS - 498) report

ON
Impact of Business Process Re-engineering through Implementing ERP

and Productivity Measures

CONFIDENTIAL

Submitted To:

Mokhdum Morshed (MdM)

Asst. Proctor & Senior Lecturer
School of Business,
North South University

Submitted By:

Al Amin Redwanur Rahman

ID# 081 162 030
North South University
 LETTER OF TRANSMITTAL

December 11, 2011

Mokhdum Morshed (MdM)

Asst. Proctor & Senior Lecturer
School of Business,
North South University,
Plot - 15, Block B,
Bashundhara R/A, Dhaka - 1229

Subject: Submission of Internship Report on Impact of Business Process Re-

engineering through Implementing ERP and Productivity Measures.

Dear Sir,

As part of the requirement of Internship program, I am pleased to submit my Internship

report titled Impact of Business Process Re-engineering through Implementing ERP
and Productivity Measures. The report is prepared during and after my placement at
Eskayef Bangladesh Limited (SK+F) for the Internship program. During the attachment
period I took an in depth view of their operation and the organization itself.

The report mainly focused on process reengineering through ERP software, a topic
chosen by me and approved by you. Here I tried to find its effect on the employees
performance.

It was really an exciting experience to work at Eskayef Bangladesh Limited. The overall
working environment was very friendly. The internship program gave me the
opportunity to experience the corporate culture. I would like to thank you for guidance
you have provided throughout the report.

I sincerely hope that you will find the report satisfactory and I shall be most obliged to
clarify and defend my report.

Sincerely,

_______________________
Al Amin Redwanur Rahman
ID# 081 162 030
 DECLARATION

I hereby declare that the internship report on Impact of Business Process Re-
engineering through Implementing ERP and Productivity Measures prepared and
submitted by me after the completion of three months (September 04, 2011 to
November 30, 2011) of internship with Accounts department of Eskayef Bangladesh
Limited (SK+F).

I declare that the financial data that I have been provided by the organization and the
analysis of the financial data in this report will be kept confidential and will not be
shared with anyone except the organization and my intern supervisor.

I also declare that this paper is my original work and I have prepared this only for
academic purpose for my BBA program completion and thus may not be used for
commercial purpose.

_______________________________
Al Amin Redwanur Rahman

ID# 081 162 030

School of Business,

North South University

 ACKNOWLEDGEMENT

At first I would like to express my gratitude to almighty Allah who has given me the
opportunity to go through the total process of internship and to write a report in this
regard.

I would also like to express my appreciation to Mr. Kazi Mahbub Masud (General
Manager- Accounts) Mr. Md. Mozammel Hossain (Manager Accounts) for allowing me
to do the research and providing me the financial statements. I am in debt to Md. Abdur
Razzaque (Accounts Manager) and Mohammad Umamul Islam (Asst. Manager
Accounts) who have extended their wholehearted cooperation during my internship
period. I would also like to express my gratitude to all of the employees of Accounts
departments and who have filled out my survey questionnaire open heartily and gave
useful information.

I would like to take this opportunity to give my special thanks to Mr. Reajur Rahman,
Mrs. Afifa Hasan Faria, and Ms. Samantha Chowdhury from Eskayef who has helped
me tremendously for my research.

Lastly, I would like to acknowledge my deepest gratitude to the my course instructor

Mokhdum Morshed (MdM), Asst. Proctor & Senior Lecturer, School of Business, North

South University who helped me a lot with his expert advice regarding topic selection

and writing the report.

 CONTENTS

Executive Summary

Part 1 Report Preface

1. ORIGIN OF THE REPORT......................................................................................................................... 2
2. OBJECTIVES OF THE INTERNSHIP REPORT................................................................................ 2
3. SCOPE OF THE REPORT........................................................................................................................... 2
4. ORGANIZATION OF THE REPORT...................................................................................................... 3
5. TYPES AND SOURCES OF INFORMATION...................................................................................... 3
6. LIMITATION.................................................................................................................................................... 3

Part 2 Organization Overview

7. INTRODUCTION TO ESKAYEF.............................................................................................................. 5
8. BACKGROUND OF ESKAYEF................................................................................................................... 6
9. ABOUT ESKAYEF.......................................................................................................................................... 6
9.1 Mission Statement............................................................................................................................. 6
9.2 Vision Statement................................................................................................................................ 7
9.3 Objectives............................................................................................................................................... 7
10. MILESTONES OF ESKAYEF.................................................................................................................. 7
11. CORPORATE INFO AT A GLANCE..................................................................................................... 8
12. ORGANIZATION PERFORMANCE..................................................................................................... 9
12.1 Sales Performance.......................................................................................................................... 9
12.2 Financial Performance.............................................................................................................. 11
12.2.1 Liquidity Ratios................................................................................................................... 12
12.2.2 Profitability Ratio.............................................................................................................. 14
12.2.3 Solvency Ratio...................................................................................................................... 17
12.2.4 Activity Ratio........................................................................................................................ 20
13. Key Business Values.............................................................................................................................. 23
14. Business Structures............................................................................................................................... 24
14.1 Business Divisions..................................................................................................................... 24
14.2 Departments................................................................................................................................. 25
14.2.1 Central Product Management (CPM) Department.......................................... 26
14.2.2 Planning Department...................................................................................................... 26
 14.2.3 Purchase Department..................................................................................................... 27
14.2.4 Sales Department............................................................................................................... 27
14.2.5 Training Department....................................................................................................... 27
14.2.6 MIS Department................................................................................................................. 27
14.2.7 Medical Services Department (MSD)..................................................................... 28
14.2.8 International Marketing................................................................................................. 28
14.2.9 Finance and Accounts Department......................................................................... 29
15. Products & Prime Brands.................................................................................................................. 30
16. Value Chain (Business Operations).............................................................................................. 32
16.1 Primary Activities...................................................................................................................... 32
16.1.1 Procurement............................................................................................................ 32
16.1.2 Production................................................................................................................ 34
16.1.3 Storage....................................................................................................................... 36
16.1.4 Sales & product Delivery.................................................................................... 37
16.2 Support............................................................................................................................................ 38
16.2.1 Finance & Accounts.............................................................................................. 38
16.2.2 Administration....................................................................................................... 39
16.2.3 Marketing/ Commercial..................................................................................... 39
16.2.4 HRM............................................................................................................................ 41
17. Inventory Management System...................................................................................................... 44
17.1 Purposes and types of inventory...................................................................................... 45
17.2 The reasons for maintaining Inventory........................................................................ 48
17.3 Inventory Management Techniques................................................................................ 49
17.3.1 The ABC System..................................................................................................... 50
17.3.2 The economic Order Quantity Model............................................................ 51
17.3.3 Just-in-Time System.............................................................................................. 51
17.3.4 Materials Requirement Planning System..................................................... 51
17.3.5 Inventory Techniques Followed by Eskayef................................................ 51
17.3.6 Problem reflected on material purchasing.................................................. 52
17.3.7 TQM in Eskayefs Inventory management.................................................. 53
18. Health, Safety & Environment Policy.......................................................................................... 56
19. Corporate Social Responsibility..................................................................................................... 57
20. SWOT Analysis......................................................................................................................................... 58
 20.1 Strengths........................................................................................................................................ 59
20.2 Weaknesses................................................................................................................................... 60
20.3 Opportunities............................................................................................................................... 61
20.4 Threats............................................................................................................................................. 61
21. Industry Analysis.................................................................................................................................... 62
21.1 Industry Background............................................................................................................... 63
21.2 Major Players of the industry............................................................................................. 64
21.3 Success of the industry........................................................................................................... 66
21.4 Regulation and Restriction faced by the industry................................................... 68
22. Competitive Analysis............................................................................................................................ 69
22.1 Sales Performance..................................................................................................................... 69
22.2 Financial Performance............................................................................................................ 70
22.2.1 Liquidity Ratios...................................................................................................... 71
22.2.2 Profitability Ratios................................................................................................ 73
22.2.3 Solvency Ratios....................................................................................................... 76
22.2.4 Activity Based Ratios........................................................................................... 78

Part 3 Research on ERP

23. Research Introduction......................................................................................................................... 82
24. Research Background.......................................................................................................................... 83
24.1 Introduction to Sage ACCPAC ERP................................................................................... 83
24.2 TRANSCOM ACCPAC ERP...................................................................................................... 84
24.3 Modules of ACCPAC used in Eskayef............................................................................... 84
24.4 Problems faced in TRANCOM ACCPAC ERP................................................................ 86
25. Objective of the study........................................................................................................................... 87
26. Significance of Study............................................................................................................................. 88
27. Hypothesis................................................................................................................................................. 89
28. Research Methodology........................................................................................................................ 89
29. Description of the variables............................................................................................................. 90
30. Sample Design.......................................................................................................................................... 92
31. Data Collection Method....................................................................................................................... 92
32. Data Analysis Method.......................................................................................................................... 92
33. Limitation of the research................................................................................................................. 93
Part 4 Data Analysis
34. FREQUENCY DISTRIBUTION........................................................................................................... 95
35. Correlation analysis............................................................................................................................ 124
36. RELIABILITY TEST.............................................................................................................................. 130
37. FACTOR ANALYSIS.............................................................................................................................. 134
37.1 SCREE PLOT............................................................................................................................. 136
38. CROSSTABS & CHI-SQUARE TEST.............................................................................................. 137
39. T - Tests..................................................................................................................................................... 147
40. ANOVA........................................................................................................................................................ 153
41. Regression Analysis............................................................................................................................ 157
42. MULTIPLE REGRESSION MODEL FOR PERFORMANCE................................................ 166

Part 5 Findings & Recommendation

43. Key Findings........................................................................................................................................... 169
44. Summary of the Findings................................................................................................................ 172
45. How process reengineering will affect Employee Performance............................... 173
46. Recommendation................................................................................................................................. 174
47. Conclusion............................................................................................................................................... 175
48. Bibliography........................................................................................................................................... 176

Appendix
Appendix I Financial Statements
Appendix II SPSS Outputs
Appendix III Blank Questionnaire
 Executive Summary

Eskayef Bangladesh Limited (SK+F) is one of the top pharmaceutical companies in

Bangladesh. Although it started operation in Bangladesh in 1985 under the name SK&F,

Transcom Comapany Limited acquired the ownership in 1990 and rebranded as Eskayef

Bangladesh Limited. Since then Eskayef is showing a positive financial and sells

performance. Quality of its medicines is well recognized. For this reason Eskayef have

achived approval from UKMHRA and TGA. Also it has been ranked by IMS as 5 th largest

pharmaceutical Company in Bangladesh.

Eskayef is operating its business successfully. That is why it has achieved about 30%

growth each year. It sales are increasing each year. At present Eskayef earns 43% gross

profit. However, compared to net profit, net profit is too low as it is calculated to be

about 6%. This huge gap between gross profit and net profit are basically for the

interest expenses. From this a clear picture is found about Eskayefs capital structure.

Eskayef has been depending too much on debt and it is incurring huge interest

expenses. However it appears reasonable when tax rate is considered. As a privet

limited company, Eskayef has to pay 37.5% corporate tax.

Eskayef uses ACCPAC which is an ERP system. However it doesnt fulfill the purpose of

ERP system as Eskayef uses only the Accounting module of the system. For this reason,

ACCPAC ERP is mostly limited to Accounts department and Warehouses.

From the research done on ACCPAC users, it has been found that they faces problem

while working on ACCPAC. Also they have to do manual works which could be
eliminated by ACCPAC. To overcome these problems, Eskayef is planning to implement

SAP as a new ERP system.

The research done on ACCPAC users showed that process reengineering is possible in

current work process. Through process reengineering, it will be possible to save work

time, minimize errors and eliminate unproductive works like manual data entry. It has

been found in the research that most of the ACCPAC users performance is dependent on

ERP system. As process reengineering through ERP will help them to work more

efficiently, a need for upgrading the current ERP has been created among the employees.

IT skills are crucial to get the maximum benefit from ERP. That is why Training should

be provided to all employees who are and will be bought under the coverage of ERP.

Through training they will be able to able to save time and their quantity of work will

increase.

It is found in the research that process reengineering through ERP has strong positive

correlation with Employee performance. Because of process reengineering, Employees

job knowledge and quantity & quality of work will increase. Thus employee

performance will increase.

 PART I
Report Preface
 1. ORIGIN OF THE REPORT
This report is prepared to fulfill the requirement for the completion of the Bachelor of

Business Administration (BBA), degree from the North South University. The internship

program is carried on to provide the students an on the job exposure and to match up

the theoretical concepts with the real life situation. I was placed at Eskayef Bangladesh

Limited (SK+F) for the internship program under the guidance of Mr. Mokhdum

Morshed, Asst. Proctor & Senior Lecturer at School of Business, North South University.

I joined Eskayef for a period of 12 weeks starting from September 04, 2011. As a

requirement of the completion of the internship program I had to submit the report,

which includes an overview of the organization and a research.

2. OBJECTIVES OF THE INTERNSHIP REPORT

Objectives of this intern report are

To provide an overview of Eskayef Bangladesh Ltd. and its structure.

To look at milestones and historical background of Eskayef.

Describe in detail about the operation of the organization

Briefly analyze the firms competitive position in the industry.

Conduct a descriptive research revolving the concept of business process

reengineering through ERP.

3. SCOPE OF THE REPORT

The report gives a narrative overview of the Eskayef and its operation in Pharmaceutical

Industry. The report also elaborates the internship research topic, which is the study of

business process reengineering through implementing ERP and its effects on the

performance of the employees.

 4. ORGANIZATION OF THE REPORT
The report consists of Five (5) parts. The first part, Report Preface, talks about the origin

and the background of this report. Organization Overview, which is the second part of

this report, deals with the organizational overview, its structure, and a brief about the

functioning of the organization. The third part, the research Background, involves

research procedures, a literature review on business process reengineering through

ERP, prospects, scope and limitation of the research. The fourth part is the thorough

analysis about how the performance of the employees is affected due to ER

implementation. The fifth and the last part of the report contain the findings of the

research, inferences and recommendations based on the study.

5. TYPES AND SOURCES OF INFORMATION

To have the project objectives accomplished the secondary data was necessary

preliminary. The organizational overview information was derived from various sources

including the annual reports of Citigroup, Citigroup website, the Financial Statements of

Citibank NA., Bangladesh etc. For the project part, both primary and secondary data

were referred to. An elaborated methodology for the research is discussed in the

relevant section of the report.

6. LIMITATION
Time for the project work had to be shared with the daily responsibilities as an intern.

Moreover, a lack of facilities (Internet access) greatly hindered the progression of

project work. Again the workload of other employees made me feel uncomfortable to

ask for queries.

 PART II
ORGANIZATION OVERVIEW
 7. INTRODUCTION TO ESKAYEF
Eskayef Bangladesh Ltd (SK+F) is a one of the leading pharmaceutical company in

Bangladesh. It is a member of the Transcom Company Limited. Since the very beginning,

the company was highly successful in generating increased demand for its products

which eventually justified local production. With qualified, trained and skilled

professionals on its staff and its unwavering standards of quality control, the company

has distinguished itself as one of the most respected names in the pharmaceutical

industry. SK+Fs manufacturing facility has transcended the frontiers after the

accreditation of UK MHRA (United Kingdom Medicines and Healthcare products

Regulatory Agency).

Eskayef Pharmaceuticals manufacturing facilities are spread across a 20-acre site

located in Dhaka, Bangladesh. The facilities comprise of a number of purpose-built

plants, including a new Oral Solid Dosage (OSD) plant. The site includes manufacturing

facilities as well as a research laboratory and a number of warehouses. The plant and

machinery of the facilities were procured and installed from Germany, Switzerland,

Sweden, Italy, United Kingdom (UK) and other countries.

It is growing more global since 2005 and exporting bulk pellets and finished products in

Asia, Africa, and Central America and also in the process of exporting in the European

countries. The company is also tied up with the Allergan Inc., one of the world leaders in

eye care solution. Current growth rate of Eskayef is 29 percent and ranked 5th among

the local companies.

 8. BACKGROUND OF ESKAYEF
Eskayef is the successor of Smith Kline & French in Bangladesh. Prior to 1990, Smith

Kline & French, a world-renowned multinational company, was operating in Bangladesh

under the name SK&F. The company was founded in 1985. In 1990, the merger between

SmithKline & French, USA and Beecham, UK took place. During the merger period,

SmithKline & French planned to discontinue its operation in Bangladesh. Transcom

group, also known as Transcom Bangladesh Limited, grabbed the opportunity and

acquired the ownership of SK&F. Later Transcom group re-branded the company as

Eskayef Bangladesh Limited (SK+F).

Ever since its inception, Eskayef maintained world-class management standards and

ensured product quality of an international level. Eskayef has grown over the years in

the highly competitive pharmaceutical market and achieved reputation both at home

and abroad.

9. ABOUT ESKAYEF
As mentioned earlier, Eskayef Bangladesh Limited is one of the top pharmaceutical

companies of Bangladesh. It is operative with a mission to save life from diseases and

has a vision to become one of the reputed pharmaceutical companies of this region. Its

mission statement, vision statement and objective are described below.

9.1 Mission Statement

Eskayef envisions a leading role for itself as a catalyst for improvement of the healthcare

environment. The company's mission is to maintain people's health and combat

disease to enhance the quality of human life so that people may live longer,

healthier and more meaningful lives.

9.2 Vision Statement

If there is one characteristic that has typified the Eskayef approach it is vision to be the

best of its natural & human resources. The vision of Eskayef is to establish our group &

country as respected & valued regional presence.

9.3 Objectives
Eskayef is planning for long-term perspective and design our policy for clarity,

responsibility and accountability.

10. MILESTONES OF ESKAYEF

Year Milestones
1985 SK&F started its operation in Bangladesh.

1990 Acquisition by Transcom Company Limited from Smith Kline & French.
1990 Re-branded to Eskayef Bangladesh Limited (SK+F) from SK&F.
2001 Eskayef added Agrovet (animal health) Division in business.
2002 Eskayef became the authorized distributor of Allergan Inc., a global leader in

eye care medicine, in Bangladesh

2004 Eskayef implemented ACCPAC ERP software.
2006 Establishment of Tongi Plant.
2007 IMS ranked as 4th largest pharmaceutical company in Bangladesh.
2008 Tongi Plant has achieved the approval of United Kingdom Medicines and

Healthcare products Regulatory Agency (UK MHRA), Department of Health,

UK.
2010 IMS ranked as 5th largest pharmaceutical company in Bangladesh.
2010 Plant of Eskayef Bangladesh Limited at Tongi has achieved approval from

Therapeutic Goods Administration (TGA), Australia

2010 Eskayef opens insulin plant with Novo Nordisk.

11.CORPORATE INFO AT A GLANCE

Company name : Eskayef Bangladesh Limited

Company logo :
Company slogan : Excellence through quality

Company type : Private limited company

Owner : Transcom Bangladesh Limited

Acquisition from : SmithKline & French

Acquisition In : 1990

Initial Name : SK&F

Re-Branded In : 1990

Factories : Mirpur (generic), Tongi (generic & cephalic)

Marketing office : Taneem Square, Banani, Dhaka

Commercial Dept. : Taneem Square, Banani, Dhaka

International Business : Taneem Square, Banani, Dhaka

Finance & Accounts : Gulshan Tower, Gulshan 2, Dhaka

AHND office : Gulshan, Dhaka

Annual Sales turnover : BDT 3000 million, US$ 44 million

Web address : www.skfbd.com

E-mail : info@skf.transcombd.com

Employees : 2600

IMS ranking : 5th largest in Bangladesh Pharmacy Industry

Prime brand : Losectil ( Omeprazole)

Business : Formulation, Consumer, Bulk Pellets, AHND

Distributor : Transcom Distribution Company Limited, (TDCL).

Depots : 23 Depots.

12. ORGANIZATION PERFORMANCE

Performance of an organization can be understood by analyzing its financial statements

and looking at operational performance. Sales performance and financial performance

of Eskayef will give a clear understanding the performance of Eskayef.

12.1 Sales Performance

From the very beginning Eskayef Bangladesh Limited is showing positive performance.

In the beginning the firm mostly concentrated on selling medicines to consumers. Later

Eskayef gave special focus on sales to institutions as well as exports. Also it expanded its

business to animal health products and nutrition products.

Eskayef has shown a steady growth in its sales performance. Based on the calculation of

sales amount till 2010, on average Eskayef has an annual 25% growth in its sales. The

graph below shows that just in 5 years sales amount of Eskayef has been doubled. The

bar of 2011 shows that keeping 3 months in hand, Eskayef have already topped the sales

amount by 3% from previous year.

FIGURE ORGANIZATION PERFORMANCE.1 SALES GROWTH OF ESKAYEF BANGLADESH LIMITED

Sales of Eskayef are contributed by Exports, Institutional sales & Sales through TDCL.

TDCL is the authorized distributor of Eskayef in order to deliver medicines to

consumers. 3% sales are contributed by Exports, 12% is contributed by institutional

sales and rest 84% sales are made through TDCL. The comparative table below shows
the sales contribution of institutional sales, exports and TDCL sales to the total amount

of sales.

TABLE ORGANIZATION PERFORMANCE.1 Sales performance in different year

Sales Performance (in millions)

Year Institutional Exports TDCL Total Sales
2006 207.0 15.7 1354.6 1577.3
2007 279.2 50.7 1907.3 2237.2
2008 288.9 193.7 2017.2 2499.8
2009 319.5 65.3 2435.1 2819.9
2010 395.2 75.3 3267.7 3738.2
2011 407.4 63.3 3398.9 3869.6

Eskayef was able to double its total sales just in five years. The table above shows that in

2006 the total sales were BDT 1577.3 million and in 2010 sales amount of Eskayef has

crossed 37 hundred million BDT. Institutional sales amount have also doubled in these 5

years. In 2006 it was about BDT 207 million and in 2010 it reached BDT 395 million.

Eskayef were able to increase its exports last 5 years. Except in 2008, ach year it had

stable growth rate. In 2008, export increased at surprising rate. Total export was more

than BDT 193 million. Eskayefs regular sales through TDCL also increased in last 5

years.

After analyzing the sales data of Eskayef, it can be stated that Eskayef is performing well

in terms of sales revenue and it is very much successful in doubling its sales just in 5

years. Sales of Eskayef are increasing at 25% per year. Export volume and institutional

sales is also increasing every year.

12.2 Financial Performance

The best way to understand financial performance is the ratios of the organization.

There are 4 types of ratios to analyze financial performance which are

 Liquidity Ratios

Profitability Ratios

Solvency Ratios

Activity Ratios

These 4 Ratios of Eskayef Bangladesh limited is discussed below

TABLE ORGANIZATION PERFORMANCE.2 Ratios of different years

Eskayef Bangladesh Limited

Ratio Analysis
A. Liquidity Ratio 2008 2009 2010
1 Current Ratio 1.05 1.04 1.10
2 Quick Ratio 0.64 0.63 0.66
3 Cash Coverage 0.14 0.16 0.15
4 Net Working Capital Ratio 0.03 0.02 0.03

B. Profitability Ratio 2008 2009 2010

5 Gross Profit Margin 43.69% 43.26% 43.54%
6 Net Profit Margin 0.96% 3.24% 6.61%
7 Return On Equity (ROE) 2.68% 5.10% 6.86%
8 Return On Capital Employed 15.72% 9.42% 8.45%
9 Return On Assets (ROA) 0.77% 2.33% 4.07%

C. Solvency Ratio 2008 2009 2010

10 Solvency Ratio 1.40 1.84 2.46
11 Gearing/ Debt to equity Ratio 2.49 1.19 0.69
12 Equity Multiplier 3.21 2.19 1.69
13 TIE Ratio 1.76 1.88 4.11

D. Activity Ratio 2008 2009 2010

14 Net Asset Turnover 0.80 0.72 0.62
15 Inventory Turnover 2.10 2.60 2.55
16 Receivable Turnover 3.63 4.33 4.47
17 Average Collection Period 100.42 84.27 81.61

12.2.1 Liquidity Ratios

Liquidity ratios are used for measuring the liquidity of an organization. These ratios

provide information about firms ability to meet its short term financial obligations.

Liquidity ratios of Eskayef are given below:

1. Current Ratio:
 Current ratio measures the ability to pay the current or short term liabilities with

the current assets. Higher current ratio is appreciated by the short term

creditors. However, higher current ratio also means assets are idle and dont

generate income. Therefore firms always try to match current assets and current

liabilities. Therefore the best current ratio is 1 where current liabilities are

backed by equal amount of current assets.

FIGURE ORGANIZATION PERFORMANCE.2 GRAPHICAL REPRESENTATION OF CURRENT RATIO

Eskayef Bangladesh limited has current ratio of 1 for last 3 years. That means the

current asset and current liabilities are almost equal and Eskayef is very much

efficient in managing current liabilities with current assets. However, if current

asset gets stuck in A/R or inventories, Eskayef will face problem in meeting

current obligations.

2. Quick Ratio:

Quick ratio is more constructive than current ration in case of measuring

liquidity as it ignores inventory which is the least liquid current asset. This ratio

measures firms ability meet short term obligation if it is not possible to liquidize

the inventories.
 FIGURE ORGANIZATION PERFORMANCE.3 GRAPHICAL REPRESENTATION OF QUICK RATIO

Over last 3 years, Eskayef have maintained the quick ration stable at 0.65. That

means, ignoring the inventory, Eskayef has the ability to meet its 65% of its

current liabilities with its current assets.

3. Cash Coverage Ratio:

FIGURE ORGANIZATION PERFORMANCE.4 GRAPHICAL REPRESENTATION OF CASH COVERAGE RATIO

Cash coverage ratio measures firms ability to pay current obligations with its

cash, cash equivalents and marketable securities. Over last 3 years, Eskayefs

cash coverage ratio has remained stable between 0.14-0.16. That means 14%-

16% of the current liabilities can be backed by the cash, cash equivalents and

marketable securities. This ratio shows that most of the current liabilities of

Eskayef is backed by prepaid accounts, inventory & accounts receivables.

4. Net Working Capital Ratio:

 FIGURE ORGANIZATION PERFORMANCE.5 GRAPHICAL REPRESENTATION OF NET WORKING CAPITAL
RATIO

Net working capital ratio measures the amount of net working capital employed

compared to total asset of a firm. Eskayef working capital ratio is almost stable in

0.03. That means net working capital of Eskayef is equal to 3% of its total assets.

12.2.2 Profitability Ratio

Profitability ratios are used to assess a business's ability to generate earnings as

compared to its expenses and other relevant costs incurred during a specific period of

time. Profitability ratios of Eskayef are discussed below in brief:

5. Gross Profit Margin

FIGURE ORGANIZATION PERFORMANCE.6 GRAPHICAL REPRESENTATION OF GROSS PROFIT MARGIN

Gross profit is not an exact indicator of firms profitability. However it indicates

the financial strength of the firm. Without an adequate gross profit, firm will be

unable to pay its operating and other expenses. A stable gross profit margin is
 good for any firm. Over the last three years, Eskayef had gross profit margin of

43.5%.

6. Net Profit Margin

Net profit margin is the actual profit earned by the firm. Higher net profit margin

means higher profitability. Net profit ration measures the managements ability

to carry part of the sales revenue to the shareholders after paying all expenses

and taxes.

FIGURE ORGANIZATION PERFORMANCE.7 GRAPHICAL REPRESENTATION OF NET PROFIT MARGIN

Although Eskayef has a stable gross profit rate of over 43%, Net profit margin is

very low. Though net profit margin is increasing each year, in 2008 the net profit

margin was less than 1%, in 2009 it was 3.2% and in 2010 it was 6.6%. This

indicates that Eskayef has huge operational and interest expenses and it is not

efficient in its operation. Interest expense for expense is huge as it has about 60%

debt in its capital structure. The company can increase net profit if it minimizes

debt portion of its equity.

7. Return of Equity
 Return on equity (ROE) measures the rate of return on the ownership (Owners

Equity). The ratio measured firms ability to generate profit for each unit of

shareholders equity.

FIGURE ORGANIZATION PERFORMANCE.8 GRAPHICAL REPRESENTATIO OF ROE

Return on equity is low for Eskayef Bangladesh Limited. It returned only

2.68% in 2008, 5.1% in 2009 and 6.86% in 2010 on owners equity. Return

generated by the company is pretty low compared to return on term deposits.

However the return on equity is increasing each year.

8. Return on Assets

Return on Assets (ROA) ration measures the amount of return generated by

utilizing the companys assets. Similar to the ROE, Return on Eskayefs asset is

too low.

FIGURE ORGANIZATION PERFORMANCE.9 GRAPHICAL REPRESENTATIO OF ROA

 In 2008 the ROA was less than 1%, 2.33% in 2009 and 4.07% in 2010. Though

the rate is increasing it is still too low. Main reason is that net profit is low as

the company has to pay huge amount of interest on its debts.

9. Return on capital employed

FIGURE ORGANIZATION PERFORMANCE.10 GRAPHICAL REPRESENTATIO OF RETURN ON CAPITAL

EMPLOYED

Return on capital employed compares earning with the capital invested in the

company. Eskayefs return on capital employed is increasing every year. In

2008, ROCE was 1.62%, in 2009 it was 3.76% and in 2010 it was 5.88%. ROCE

is increasing as the net profit is increasing each year.

12.2.3 Solvency Ratio

The solvency ratio measures the size of a company's after-tax income, excluding the

non-cash depreciation expenses, as compared to the firm's total debt obligations. It

provides a measurement of how likely a company will be to continue meeting its debt

obligations (Solvency Ratio).

10. Solvency Ratio

Solvency ratio measures the companys ability to meet long term obligations.

Higher value of this ratio means that the company is highly solvent to pay its

long term debts. However it might lead to idle capital.

 The ratio is usually calculated as follows:

The solvency ratio of Eskayef is shown in the bar graph.

FIGURE ORGANIZATION PERFORMANCE.11 GRAPHICAL REPRESENTATIO OF SOLVENCY RATIO

Eskayef has a growing solvency ratio. In 2008, solvency ratio was 1.40%, in

2009 it was 1.84% and in 2010 it was 2.46%. Solvency ratio is increasing

because the after tax net profit is increasing and long term debts are

decreasing each year.

11. Debt to Equity Ratio

Gearing ratio is a measurement of a company's financial leverage calculated

by dividing its total liabilities by stockholders' equity. It indicates what

proportion of equity and debt the company is using to finance its assets.
 FIGURE ORGANIZATION PERFORMANCE.12 GRAPHICAL REPRESENTATIO OF GEARING RATIO

Eskayefs debt to equity ratio is decreasing each year. That ratio was 2.49, 1.19

& 0.69 in 2008, 2009 & 2010 respectively. The ratio is decreasing because

Eskayef is repaying its long term debts. That is decreasing the debt amount

and increasing the equity amount.

12. Equity Multiplier

Equity multiplier is a way of examining how a company uses debt to finance

its assets. Equity multiplier ratio is also known as the financial leverage ratio

or leverage ratio.

FIGURE ORGANIZATION PERFORMANCE.13 GRAPHICAL REPRESENTATIO OF EQUITY MULTIPLIER RATIO

Eskayefs equity multiplier was 3.21 in 2008, 2.19 in 2009 and 1.69 in 2010.

The reason of decreasing the equity multiplier is the increase of equity in each

year.

13. TIE Ratio

TIE ratio is used for measuring a company's ability to meet its debt

obligations. It is calculated by taking a company's earnings before interest and

taxes (EBIT) and dividing it by the total interest payable on bonds and other

contractual debt. It is usually quoted as a ratio and indicates how many times
 a company can cover its interest charges on a pretax basis. Failing to meet

these obligations could force a company into bankruptcy.

FIGURE ORGANIZATION PERFORMANCE.14 GRAPHICAL REPRESENTATIO OF TIE RATIO

Eskayefs EBIT ratio is increasing. In 2008 it was 1.76, 1.88 in 2009 and 4.11

in 2010. Reason the TIE ratio is increasing because EBIT is increasing each

year and Eskayef is paying off its debts. Because debt is decreasing, interest

expense is decreasing as well.

12.2.4 Activity Ratio

Activity ratios help investors evaluate a firms ability to effectively and efficiently

manage its operations and assets. The most commonly used activity ratios are

described below:

14.Net Asset Turnover

Asset turnover is a financial ratio that measures the efficiency of a company's use

of its assets in generating sales revenue or sales income to the company.

 Figure ORGANIZATION PERFORMANCE.15 Graphical representation of Net asset

turnover

Asset turnover ratio of Eskayef is decreasing each year. In 2008 it was 0.8,

0.72 in 2009 and 0.62 in 2010. The reason why asset turnover ratio is

decreasing is because Eskayefs asset is increasing. However the sales are not

increasing at the same rate.

15.Inventory Turnover

A ratio showing how many times a company's inventory is sold and replaced

over a period.

Figure ORGANIZATION PERFORMANCE.16 Graphical representation of Net asset

turnover
 Inventory turnover ratio of Eskayef is increasing. That means the Eskayef is

becoming more and more efficient in selling its products. Also inventory

holding period is decreasing.

16.Receivable Turnover

Receivable turnover is an accounting measure used to quantify a firm's

effectiveness in extending credit as well as collecting debts. The receivables

turnover ratio measures how efficiently a firm uses its assets.

Figure ORGANIZATION PERFORMANCE.17 Graphical representation of

receivable turnover

Eskayefs receivable turnover is increasing. That means Eskayef has become

more efficient in collecting receivable and creating new receivables.

17.Average Collection Period

Average collection period is an approximate amount of time that it takes for a

business to receive payments owed, in terms of receivables, from its

customers and clients.

 Figure ORGANIZATION PERFORMANCE.18 Graphical representation of average

collection period

Average collection period is decreasing for Eskayef. In 2008 it was 100 days,

84 days in 2009 and 82 days in 2010. That indicates that Eskayef have become

efficient in receivable collection. However, the firm still needs almost 3

months to recover credit sales.

13. Key Business Values

Eskayef is committed for protecting patients' health, answering public healthcare needs

and acting responsibly in all aspects of its business. The major element of their

commitment is ensuring the quality of their products.

The company put patients first. It wants to create values for all patients, including those

who cannot afford treatments. As it is one of the top 5 pharmaceuticals in Bangladesh, it

can help to make high-quality medicines more widely available by making them more

affordable. Therefore, Eskayef facilitate patient access to medicines, by making them

available at cost or through special patient access programs.

Patients and healthcare providers must know that Eskayef, in addition to meeting

regulatory requirements for product safety and efficacy, does everything it can do to

communicate any potential concerns based on clinical trials and other research. Often

that communication appears directly on the medicine's label or in its package insert

(datasheet), describing any undesired effects and other risks and providing directions

on how to avoid potential problems.

Eskayef discloses data from international clinical trials no matter what the outcome

indicates. They conduct sophisticated pharmacy vigilance programs to identify new

adverse events, address them and communicate them quickly to regulatory agencies as

well as to healthcare professionals and patients.

In addition to exacting manufacturing standards, Eskayef does everything it can to

protect patients from counterfeit products.

14. Business Structures

14.1 Business Divisions

Eskayef Bangladesh limited has 5 business divisions which are described below.

1. Finished Products

Finished products division is the core business division of Eskayef Bangladesh

Limited. This division is responsible for making planning, producing and

marketing of finished products like tablets, capsules and indictable items. Backed

by strong technical and marketing teams, Eskayef was able to offer 149 products

in 55 therapeutic segments.

2. Bulk Products
 In this division, Eskayef produces Timed Release Blended Pellets. These are the

products which are made by blending different medicine ingredients. However,

these pellets are not finished product and these are used as raw materials in

production process. Eskayef produces and supplies these pellets to other

companies as raw material. Eskayef is the first and only pellet manufacturer in

Bangladesh.

3. Animal Health and Nutrition Products

Eskayef stepped in agrovet business in 2004 and added AHND (Animal Health &

Nutrition Development) division. At present Eskayef manufactures 28 animal

health and nutrition products in 57 dosage forms and markets them throughout

Bangladesh.

4. Export

Eskayef Bangladesh Ltd. has been showing a significant outcome in exporting

medicines to many countries. Eskayef Bangladesh Ltd. has started supplying

medicines in 16 countries like Germany, UAE, Nepal, Bhutan, Sri Lanka, Myanmar,

Vietnam, Ghana, Iraq, Indonesia, Kenya, Guatemala, Belize, Yemen, Macau and

Somalia.

5. Marketing of International Brands

This division works to build partnership with international pharmaceutical

companies and achieve license to market their products. At present, Eskayef is the

sole agent in Bangladesh for marketing the ophthalmic products of Allergan Inc, a

global leading pharmaceutical company based in Ireland. Also Eskayef have started

insulin plant with Novo Nordisk.

14.2 Departments
 Eskayef operate its business through extensive departmentalization as needed. This is

for specified effectiveness of the tasks. The business activities of SK+F is directed,

controlled and monitored from the head office of Eskayef Bangladesh Ltd. located at

Plot No.31, Road No.53, Gulshan North C/A, Gulshan - 2, Dhaka 1212. Being a leading

Pharmaceutical company in the country it employs good number of people in different

departments to keeps its business thriving.

The Following major departments coordinate the activities of SK+F in Factory:

Production Department
Quality Control
Quality Assurance
Administration

The following major departments coordinate the activities of Eskayef in Head Office:

TABLE BUSINESS STRUCTURES.3 Different departments at Eskayef

Medical services department Market Research & Statistical Cell

Planning department Purchase Department
Medical services department Sales department
MIS department Finance and Accounts department
International marketing & fine chemicals department
Sales education and training department
Central product management (CPM) department

14.2.1 Central Product Management (CPM) Department

CPM stands for Central Product Management that takes care the total marketing of a

product. It includes

i) selection of new product

ii) design of new product

iii) design of packaging

iv) Introduction of the product to the market and others

 14.2.2 Planning Department

The planning department ensures smoothness of total operation of Eskayef. It is

concerned with the following:

i) The production planning and

ii) Raw material procurement.

iii) Inventory Planning

Based on sales forecast from the CPM planning department breaks up the yearly sales

forecast to monthly basis and develop the planning of production, purchase and stock

maintenance. It also initiates the negotiation of purchase. It refers the suppliers

quotations to the purchase departments.

14.2.3 Purchase Department

The purchase department is concerned with all the purchases of the company. Apart

from purchasing it keeps the record for tracking the costs of the company. This

department works in coordination with planning department for negotiation and price

fixing.

14.2.4 Sales Department

The sales department has been completely separated from marketing department. It

sets the forecast in coordination with marketing department and upon fixation of the

sales it is the responsibility of the sales department to realize the yearly sales volume

forecasted.

14.2.5Training Department
Training department is to provide the training to the medical representatives of the

company. This training is necessary to improve the quality of job-related function. The

curriculum of training varies from group to group.

 14.2.6 MIS Department
The MIS department is the department that takes care of total automation of SK+F. It

supports the hardware and network of the company and the factory. It maintains the

automation regularly and keeps the pace with the global IT. The MIS department also

maintains the radio-link between the factory and the head-office.

Though separately dealt before, recently software department has been incorporated

with MIS department. This software section is to work for developing software solutions

like inventory application, managing sage accpac & organization website etc. as per

organizational requirements. The facilities of MIS department are available round the

clock for 24 hours.

14.2.7Medical Services Department (MSD)

MSD stands for Medical Services department. It is creating easy relationship through

using the professional linkage with the doctors, the ultimate customer of the

pharmaceutical companies.

This is a supporting department that provides services (e.g., slide preparation, providing

different journals, books etc.) to the health professional on different issues and receives

feedback from them. The main purpose of this department is to make a good

relationship with the doctors. Doctors are prescribing to the patients. So making good

relation with the doctors is very important for all the pharmaceuticals company. It

arranges seminars on different issues such as diseases and their cures in different parts

of the country.

14.2.8International Marketing
It is to be noted that SK+F has started marketing its product internationally. This

department is concerned with the international promotion and marketing of SK+F

finished products and basic chemicals. It analyzes country analysis in terms of health
status, economy, market and its growth, legal bounds of entering the market with its

product etc to find the feasibility to market its products. It has started supplying

medicines in 16 countries:

TABLE BUSINESS STRUCTURES.4 Countries where product are exported

Germany Sri Lanka Iraq Belize

UAE Myanmar Indonesia Yemen

Nepal Vietnam Kenya Macau

Bhutan Ghana Guatemala Somalia

14.2.9 Finance and Accounts Department

There are three sections in this department.

Treasury section

Accounts section

Cost and budget section

Treasury Section:

The purpose of the Department of Treasury is to collect state taxes, to invest, control

and disburse state monies, to protect the credit of the state and its municipalities, to

prescribe and audit the accounting systems for county and municipal governments, to

develop and maintain a uniform method of appraising real and personal property upon

which property taxes are assessed, and to escheat unclaimed personal property.

Accounts Section:

Accounts section is responsible for maintaining all accounts. Account section records all

transaction and maintains receivable & payable accounts, Revenue & expense account

all other accounts balance.

Cost and budget Section:

It prepares the budget and calculates the product cost. The annual budget preparation

starts at October. Budget review is done quarterly (internally) and half-yearly (by the

top management). It compares the budgeted and actual sales and expenses and

prepares reports on them.

15. Products & Prime Brands

Eskayef products are well known not only in local market but also to the foreign

countries. Because of good product quality, Eskayef have achieved approval from United

Kingdom Medicines and Healthcare products Regulatory Agency (UK MHRA), Health

department of UK and Therapeutic Goods Administration (TGA) of Australian

Government.

Eskayef produces are diversified in many categories. Eskayef produces over 450

products under 5 different categories which are Generic, Cephalosporin, Sterile &

Infusion, Pellets Agrovet (animal health & nutrition) products. Eskayef also sells eye

care products of Allergan Inc of Ireland which is one of the reputed eye care solution

provider. Eskayef have set up plant for insulin production with Novo Nordisk which is a

well-recognized insulin producer. Eskayef have already finished test production & all

sorts of product test and now it is waiting to launch insulin products.

Eskayef has more than 150 brands in its product category. Multiple product line exists in

form of tablet, capsule, syrup, drops, powder or premix under each brand. Different

versions also exist for every product line. For example, Losectil, a prime brand of
Eskayef, belongs to generic product category and sold in form of tablet, capsule and

powder for suspension. Again Losectil tablet and capsule each has two versions which

are 20mg and 40mg.

Eskayef produces medicine for flue, Asthma, epilepsy, cardiac therapy, hypertension,

Diabetics, ulcer, emetic, gastric, anti bacterial, Sex hormones and many others as a form

of tablets, capsules, Syrups and pediatric drops, inhaler and sterile. As mentioned

earlier, Eskayef also produces animal health and nutrition products. Products of this

category are normally sold in form of powder, suspension and premix. Eskayef also sales

customized agrovet products as per customer demands.

Information about few top brands of Eskayef is given below:

TABLE PRODUCTS & PRIME BRANDS.5 List of top products of Eskayef

Sl. Brand Name Generic Name Product Segment

1. Alben Albendazol Anthelmintic
2. Dinaflex Fexofenadine HCL Anti-Histamine
3. Etorix Etorecoxib Anti-Inflammatory
4. Expoten Expectorant Cough Syrup
5. Flucloxin Flucloxacillin Anti-Bacterial
6. Handirub Chlorhexidine Gluconate Solution Antiseptic & Disinfectants
7. Losectil Omeprazile Anti-Ulcer
8. Milam Midazolam Maleate Anti- Bacterial
9. Naprox Naproxen Anti-Inflammatory
10. Neosaline Glucose, Sodium & Potassium Chloride Oral Dehydration Saline
11. Oradin Loratadine Anti-Astamine
12. Peptil H Ranitidine Anti-Ulcer
13. Ridon Domperidone Prokinetic
14. Roxim Cefixim Anti-Bacterial
15. Solvit Multivitamin + Mineral Vitamins
16. Starin Cefpodoxime Proxetil Micro Anti Bacterial
17. Tamen Paracetamol Analgesic/Antipyretic
18. Triject Ceftriaxone Anti Amoebic
19. Xinc Zinc Sulfate Zinc Supplementation
20. Zithrox Azithromycin Anti-bacterial

Products of pharmaceutical company are not fixed item. They change over time as

changes occur in the industry. Research takes place on a continuous basis to improve the

product and its quality. Through research companies brings new medicine and new
version of old medicine to the market. Whenever new medicines are discovered, they

are marketed as new brand or new product. Some company markets new version of old

products as same old product but most companies market them as new product. Same

thing goes for Eskayef. It continuously researches for developing new products or

upgrade the current products. Eskayefs top 3 brands of last 3 years is shown in below

TABLE PRODUCTS & PRIME BRANDS.6 Top 3 Brands of Eskayef

In Terms of Sales Quantity In Terms of Sales Amount

Year 1st 2nd 3rd
1st 2nd 3rd
2006 Dexpoten Ostocal Tamen Losectil Sk-Cef Flucloxin
2007 Dexpoten Losectil Ostocal Losectil Quinox Dexpoten
2008 Dexpoten Ostocal Losectil Losectil Oradin Dexpoten
2009 Dexpoten Losectil Xinc Losectil Dexpoten Sk-Cef
2010 Dexpoten Losectil Xinc Losectil Dexpoten Flucloxin

16. Value Chain (Business Operations)

Value chain is the complete process of adding or creating values. Value is added to

products or created for the customer. Eskayef creates value as a form of medicine for the

customers. Any value chain contains two part; Primary activities & Support Activities. In

next two sections primary and support activities are described.

16.1 Primary Activities

Primary activities are the main part of value chain. Value is actually created or added

through the primary activities. Activities that are related or required to create or add

value is known as primary activities. Primary activities of Eskayefs value chain are

described below:
 16.1.1Procurement

Procurement is the process of collecting necessary resources required for creating

value. In case of Eskayef, procurement means purchasing or collecting raw materials and

packing materials which are necessary for medicine production.

16.1.1.1 RAW MATERIAL PROCUREMENT PROCESS

Almost all raw materials and ingredients for Eskayef medicine is purchased and

imported from outside of the country. Eskayef is strict about the quality and hence it

ensures the entry of quality raw materials. It has appointed TEA Holdings limited,

another concern of Transcom group, as its importing agent. Importing agent is

responsible for collecting quality raw materials for Eskayef Bangladesh Limited.

Import process starts with the requisition for raw materials. Upon approval of the

requisition, Purchase order is sent to the importing agent. Before than an LC is opened

and the raw materials are brought under insurance coverage.

After opening the LC and the insuring the raw materials, necessary documents along

with the purchase order are sent to the importing agent. Then the agent imports,

receives and then delivers the raw materials to the plant or raw material storage. Upon

completing all the steps, TEA Holdings, the importing agent, sends and claims the bill.

When the importing agent delivers the raw materials to the plant or to the raw material

storage, a team from quality control or QC checks the imported raw material. If they find

satisfactory result, they approve the entry of raw material and recommend for payment.

With the recommendation, payment is made to the agent which is the final step of the

import process. If the QC doesnt find satisfactory result, raw materials are sent back to

the importer and insurance money is claimed to cover up the loss.

 16.1.1.2 PACKAGING MATERIAL PROCUREMENT PROCESS

The very first step of packaging material procurement process is determining the nature

of required packaging materials. Then requisition for packaging material is prepared

price quotation is invited from different vendors and suppliers. Generally purchase

order is given to the supplier with lowest quotation. But it may not be the case if the

supplier provides low quality materials.

After receiving the purchase order, supplier delivers the required raw materials with the

delivery note or delivery challan. In the delivery challan or note, suppliers mention the

amount to be paid in their account. Most of the time supplier charges the VAT on behalf

of the company. If not, Eskayef pays in own VAT and adjusts with the suppliers account.

When the supplier delivers the packaging materials to the storage or to the plant, QC

department checks the quality and receives the product if the quality is satisfied. Also

they issue a delivery Received Receipt (RR) to the accounts & finance department

recommending the payment to the supplier.

16.1.2 Production

Production stage starts after the procurement stage. Production stage starts with

production decision. Steps of production are described below in brief.

16.1.2.1 PRODUCTION DECISION

In the beginning of each accounting period, Eskayef Bangladesh Limited forecasts the

demand for different products and makes decisions about the production volume. Later,

considering different factors like raw material availability, shipping time of purchased

raw material, storage condition, storage cost and safety stock, production schedule is

prepared for each product.

Eskayef Bangladesh Limited purchases most of the raw materials from the outside of the

country. For this process, SK+F have some fixed suppliers how are approved from Drug

Administration Authority of Bangladesh for supplying quality raw materials.

Eskayef doesnt produce some of its product at its own plant. Those products are

produced at other pharmaceutical companys product. For example, Eskayef produces

some of the injectable and inhaler products at the plant of Beximco Pharma and Reneta

Limited under business deal. This deal also enables Beximco Pharma and Reneta

Limited to produce some of their products at the plants of Eskayef Bangladesh Limited.

16.1.2.2 PRODUCTION PROCESS:

There are five steps in production process. The steps are:

1) Unit & Amount determination

2) Ingredients Mixing

3) Blistering

4) Primary Packing

5) Secondary Packing

Unit & Amount Determination:

The very first step of production process is unit & amount determination. What amount

of ingredient will be used for production is determined here. Its a very curtail steps

because without the right quantity of ingredients medicine may be ineffective or

harmful to the human & animal body. In this step, total number of unit to be produced is

determined.

Ingredients Mixing:

In this step ingredients are mixed for the production process. Mixing process is different

for different products. For some products ingredients are mixed in different production
steps and for some products all ingredients are mixed together. Eskayef has different

kinds of mixing machines installed in their plants in order to ease the mixing process.

These machines break down the ingredients to smallest molecule.

Blistering:

Next step of production is blistering. In this step mixed ingredients are brought under

moulds and different types of shapes are given to the medicines. Name of the company is

also engraved on the medicine in this step. In case of suspension or powder, shape is not

given in this step. However, those suspensions product are dried here and then dried

mixture is converted to powder.

Primary Packaging:

After the blistering process, product is sent to the primary packaging section. In this

step products are wrapped with plastic or aluminum foil. Types of foil depend on the

types of product.

Products that are light sensitive are mostly wrapped in aluminum foil and products

which are not light sensitive are wrapped in plastic foil. Generally 10 units of medicine

are packed in a single foil but it may vary depending on design and size. Up to this point

everything is done automatically by the production machines.

Secondary Packaging:

After the primary packaging, products are sent for secondary packaging. In this step,

primarily packaged products are packed in different size boxes. Generally each box

contains 10 units of primary packaged pack. Later those boxes are again packed in

master carton and prepared for storage & delivery.

 16.1.3Storage

Eskayef has several storages for keeping finished goods and raw materials. Eskayef

mainly keeps the storages for keeping the raw materials as the finished goods are given

to TDCL for distributing all over the country. However, after production finished goods

have to keep in the storages as it takes few days or a month before TDCL takes away the

inventories. In Eskayef, Storages works as with Sales department and the accounts

department. Storages provide the updates of inventory to the Accounts department and

sales department so that those two departments can do their works.

16.1.4Sales & product Delivery

Eskayef makes two kinds of sales. One is institutional sales and another is retail sales.

Institutional sales include sales to different organization like NGOs, hospitals,

government institution & other institutes. Export to different country also falls into the

institutional sales. Retail sales include sales to the pharmacies and other mediums

which makes Eskayef product close to the consumers location. Retail sales are basically

done for the common people of the country. Because of the retail sales, people can gain

access to Eskayef product from anywhere in the country.

Eskayef does not directly make retail sales. It basically focuses on institutional sales. For

retail sales Eskayef appointed Transcom Distribution Company Limited (TDCL), which is

another company from TRANSCOM Group, as distributor. TDCL is responsible for

distributing the products throughout the country and making retail sales. Also TDCL is

responsible for collecting receivables from the customers. In exchange of this service,

TDCL charges 12% commission on trade price.

This way, Eskayef can focus more on capturing institutional market share as it does not

have to think about local sales and distribution process because TDCL does that on

behalf of the company. Only one thing that Eskayef does is marketing and sales

promotion.

As mentioned earlier, Eskayef focuses mostly on institutional sales. In order to make

institutional sales, company often bids for the contract. When the company wins a bid,

they make a contract to supply a particular amount of certain product. Again, there are

some local and foreign organization & institute who makes direct orders for medicine.

After getting contract or purchase order, Eskayef prepares for the delivery. Unlike retail

sales, Eskayef takes care of distribution and delivery of institutional sales. It has its own

car to deliver the products to the customers storage or to the port.

16.2 Support

Support activities are the secondary activities that are not directly involved in value

adding process but provide support to the value chain. Support activities of Eskayefs

value chain are given below:

16.2.1Finance & Accounts

Finance & Accounts department provides the necessary support to operate the business

by doing 7 things which are

1) Managing accounts receivables.

2) Managing accounts payables.

3) Managing VAT & Tax receivables & payables

4) Managing Inventory

5) Managing assets & liabilities

 6) Keeping track of all income & expenses

7) Understanding financing needs & managing financing sources

Finance and accounts department finds out the cost incurred for production and

determines the price for sale. While determining the sales price, it considers the long

term and short term profit for the organization.

Apart from this, accounts department updates the asset & liability accounts. It charges

depreciation to related assets and prepares loan amortization schedule.

Depreciation Policy at Eskayef

Depreciation at Eskayef is charged on straight-line method. Depreciation is charged

month wise from the date of acquisition. Following rates are applied for charging

depreciation.

TABLE VALUE CHAIN (BUSINESS OPERATIONS).7 Depreciation rates of assets in Eskayef

Assets Rates

Plants & Machine 10%

Factory Building 2.50%

Air Conditioner & Refrigerator 10-20%

Furniture & Fixers 10%

Office & Computer Equipment 10-20%

Motor Vehicle 20%

16.2.2 Administration

Administration is basically deals with policy making about how to operate and how to

do things in the organization.

 16.2.3 Marketing/ Commercial

Unlike other consumer good products, pharmaceutical products or medicines are not

advertised or promoted directly to the consumers. Instead products are advertised and

promoted to the doctors, physicians, pharmacists and other parties who have direct or

indirect influence on consumers.

16.2.3.1 ADVERTISEMENT

Eskayef does two types of advertisements. One is to increase company image & brand

value and other is to create awareness about its products. Advertisement are mostly

posted on Health, Medicines & medical issue related magazines, newspapers and issues

published from different medical college and other medical institutes. Also Eskayef

often advertise on national dailies for recruitment and other purposes.

16.2.3.2 SALES PROMOTION:

Sales promotions are mainly done to increase the sales. Sales promotions of Eskayef are

not done to the consumers. Instead sales promotions are done to the Doctors, physicians

& medicine sellers at pharmacies. Unlike other consumer products, sales promotions in

Pharmaceutical industry are done on a regular basis. It has become an essential &

regular part of promotion and significant portion of promotional & advertisement

expense is generated from this account.

Sales promotion to doctors & physicians are done in a form of providing free samples.

When Eskayef brings a new, modified or upgraded product, it offers some free samples
to the doctors and physicians. This way those doctors and physicians can know about

the product and prescribe the medicines to the patients.

Sales promotions to pharmacies are done in a form of product bonus. For example, a

pharmacy owner gets one bonus box if he buys 100 boxes of medicines at a time. Or

maybe the owner might get a discount for bulk purchase. This way Eskayef creates and

interest in pharmacists mind to buy & sell Eskayefs product more than other

pharmaceutical companies.

16.2.3.3 DONATION:

Donations are another important promotional strategy of Eskayef. Even though it is very

much prominent in pharmaceutical companies, Eskayef does a limited amount of

donation. But still Donation accounts for significant part of promotional expense.

Donations are made in a form of charity to different funds, donating in different medical

college & programs of medical college, donations to doctors for their office, furniture &

office equipments. Eskayef also make donates to doctors for their trips & tours for

international conference, meeting & training.

16.2.3.4 SPONSORSHIP:

Sponsoring at different national & international events is another form of promotion for

Eskayef. Eskayef also sponsors doctors in different international trainings &

conferences.
 16.2.4 HRM

HRM department of Eskayef is quite small but very much efficient. HR department

consists of only four officers and one manager. At present Eskayef have more than 2,600

employees. With this total of five employees, Eskayef is efficiently managing the human

resources.

HR department basically does five types of works which are

recruiting
Employee promotion & appraisal,
Salary & bonus,
Employee facilities
Closure

16.2.4.1 ORGANOGRAM
 16.2.4.2 EMPLOYEE BENEFITS

Different types of cash and non-cash employee benefits are available for the employees.

Among the non-cash benefits there are transport facilities, personal cars for mangers,

motor bike for sells force, mobile phone for all employees etc. Cash benefits include

Bonus, Increment, Gratuity, Provident fund and profit participation fund. Cash benefits

are described below:

Bonus

Bonus is given to all employees twice during the two Eid. Also performance bonus is

given to employees once in a year. Apart from that, manager level employees receives

special bonus each months. Bonus can be certain percentage of the basic or it can be

variable amount.

Gratuity
 The gratuity scheme has been introduced for non-management staff since 1992.

Under this scheme, non-management employees are entitled to receive gratuity as

follows.

Basic salary of half month in each completed year of service for those who have

been in service for five to eight years. Those who have been in service for more

than eight years will receive basic salary of one month for each completed year.

(Eskayef Bangladesh Limited Annual report, 2009)

The gratuity scheme has been introduced for management staff since 2005. Under

this scheme, management employees are entitled to receive the gratuity as follows:

All permanent employees after five years continuous service will get one

month basic salary for each completed year. (Eskayef Bangladesh Limited

Annual report, 2009)

Provident Fund

Provident fund scheme also exists where employees contribute @ 10% of their basic

salary which is matched by an equal contribution by the company. The respective

accumulated provident fund balances including interest thereon are paid to the

employees at the end of their services according to the provident fund rules. (Eskayef

Bangladesh Limited Annual report, 2009)

Employees Profit Participation Fund (WPPF)

Eskayef has introduced Workers Profit Participation Fund Scheme since 1997, as per

provision of the Companies Profits (Workers Participation Act 1968 and as amended

by the companys profit (Workers participation) (amendment) act of 1996. The

 amount is determined as per provision of the act i.e. @ 5% on the net profit before

tax. (Eskayef Bangladesh Limited Annual report, 2009)

17. Inventory Management System

Inventory is an essential in a manufacturing company. Manufacturing companies

usually have three basic types of inventory: raw material, work in process and finished

goods. A companys profitability and liquidity depend to a great extend on inventory.

Controlling inventory is an important part of working capital management. Inventory

control depends on different variable, such as future demand of a product, supply of raw

materials, production schedules etc. A company usually hold inventory for three

purposes:

1) To operate day to day production.

2) To meet the unexpected future demand and

3) To meet the forecasted demand

To control inventory a company should have a proper plan and constant monitoring of

inventory movement. Inventory control relates with working capital management. If a

company hold excess inventory, it would have more holding cost which would increase

the day to day operational cost. On the other hand if a company hold too little inventory

it would run out of raw material in production or it may not have enough stock of

finished goods to meet the demand of customers. Therefore making a proper inventory

holding and controlling plan refers to a good working capital management.

In case of Eskayef Bangladesh Limited (SK+F), the inventories are carried at the lower

of cost and net realizable value. Cost is determined on weighted average cost basis. The

cost of inventories comprises of expenditure incurred in the normal course of business

in bringing the inventories to their present location and condition. Net realizable value

is based on estimated selling price less any further costs expected to the incurred to

make the sale. Thus, the importance of inventory management and control varies from

industry to industry also.

17.1 Purposes and types of inventory

The purpose of carrying inventories is to separate the operations of the firm-that is, to

make each function of the business independent of each other function-so that delay or

shutdowns in one area do not affect the production and sale of the final product. For

example, in the auto industry, a strike or shutdown in a parts plant may shutdown

several assembly plants. Because production shutdowns results in increased costs, and

because delays in delivery can lose customers, the management and control of inventory

are important duties of the financial manager.

Eskayef Bangladesh Limited manages and controls several types of inventories, such as:

TABLE INVENTORY MANAGEMENT SYSTEM.8 Different types of Inventory of Eskayef

1. Finished Goods 2. Promotion Materials

3. Work in Process 4. Physician Samples
5. Raw Materials 6. Raw and Packing Materials in
Transit
7. Packing Materials 8. Stock of Stationary
9. Reagent 10. Spare and Accessories

1. Finished Goods Inventory:

The finished-goods inventory consists of goods on which the production has been

completed but that are not yet sold. The purpose is to divide the production and

sales functions so that is not necessary to produce the goods before a sale can

occur- sale can made out of inventory.

2. Work in Process Inventory:

 Work-in-Process consists of partially finished goods requiring additional work

become they become finished goods. The purpose of work-in-process inventory is

to uncouple the various operations in the production process so that machine

failures and work stoppages in one operation will not affect the other operations.

3. Raw Materials Inventory:

Raw materials inventory consists of basic raw material purchased from other firms

to be used in the firms operations. Its purpose is to uncouple the production from

the purchasing function-that is, to make these two functions independent of each

other, so that delays in shipment of raw materials does not cause production

delays.

4. Packing Materials Inventory:

Packing materials inventory consists of basic packing material purchased from

other firms to be used in the other firms operations. Its purpose is to detach the

production function from the purchasing function-that is, to make these two

functions independent of each other, so that delays in shipment of packing

materials do not cause production delays.

5. Reagent:

Reagent is any substance which is used in or produced reaction involving changes

to atoms or molecules. This chemical purchased from other firms to be used in the

firms operations. Its purpose is to uncouple the production function from the

purchasing function-that is, to make these two functions independent of each

other.

6. Promotional Material:
 Promotional materials are connected with promotional activities. These activities

are done in order to increase the sales of a product or service. All the promotional

materials come with a main product brand (i.e. any medicine name like Oradin) &

those have different codes which represent brand name & type of gift item.

7. Physician samples:

Physician sample is also connected with promotional activities. Those activities are

to promote the product distribution and increase the sales of product or service.

8. Raw and Packing Material in Transit:

These types of inventories are raw and packing materials between various stages

of production or stage-permits efficient production scheduling and utilizing of

resources. Without this type of materials, each stage of production would have to

wait for the preceding stage to complete a unit. The possibility of resultant delays

and idle time gives the firm an incentive to maintain in-transit inventory.

9. Stock of stationery:

Stock of stationery is the inventory which is not for increasing the value of assets,

but for running the business on a day-to-day basis. The purpose of stock of

stationery is to uncouple the daily operations and productions function so that is

not necessary to continue one operation will not affect the other operations.

10.Spare and accessories:

Spares and accessories of the factory are extra things that are useful and reduce

the downtime of the factory.

17.2 The reasons for maintaining Inventory

Eskayef Pharmaceuticals Limited keeps inventories for several reasons. These reasons

consider the following factors:

Time factor:

The time delays present in the supply chain, from supplier to user at every stage,

require that SK+F maintain certain amount of inventory to use in this Lead Time.

Uncertainty factor:

Inventories are maintained as buffers to meet uncertainties in demand, supply and

movement of goods.

Economics of Scale factor:

Ideal condition of one unit at a time at a place where SK+F needs it, when SK+F

needs it principle tends to incur lots of costs in terms of logistics. So Bulk buying,

movement and strong brings in economics of scale, thus inventory.

SK+F used all these factors for applying to any product stage. Buffer stock is held in

individual workstations against the possibility that the upstream may be a little delayed

in long setup or change-over time. This inventory is then used while that change-over is

happening. These classifications apply along the whole supply chain not just within a

facility or plant. Where these inventories contain the same or similar items it is often the

work practice to hold all these inventories mixed together before or after the sub-

process to which they relate. This reduces costs. As they are mixed-up together there

is no visual reminder to operators of the adjacent sub-processes or line management of

the inventory which is due to a particular cause and should be a particular individuals

responsibility with inevitable consequences. Some plants have centralized stocks

holding across sub-process which makes the situation even more acute.

17.3 Inventory Management Techniques

The importance of effective inventory management is directly related to the size of the

investment in inventory, because effective management of these assets is essential to the

goal of shareholder wealth maximization. To control the investment in inventory,

management must solve two problems: the order quantity problem & order point

problem.

Order Quantity Problem:

The order quantity problem involves determining the optimal order size for an

inventory item given its expected usage, carrying costs and ordering costs. Total

inventory costs equal to total carrying costs plus total ordering costs.

Order Point Problem:

The decision on how much safety stock to hold is generally referred to as the order

point problem that is how low inventory should be depleted before it is reordered.

Two factors go into the determination of the appropriate order point: (1) the

procurement or delivery time stock and (2) the safety stock desired.

Numerous techniques are available for effectively managing the firms inventory. Here

point out four commonly used techniques.

17.3.1 The ABC System

A firm can use the ABC inventory system divides its inventory into groups: A, B, and C. A

group includes those items with the largest dollar investment. Typically, this group

consists of 20 percent of the firms inventory items but 80 percent of its investment in

inventory. The B group consists of items that account for the next largest investment in

inventory. The C group consists of a large number of items that require a relatively small

investment. The inventory group of each item determines the items level of monitoring.
 17.3.2 The economic Order Quantity Model

The Economic Order Quantity (EOQ) model is an important concept in the purchase of

raw material and in the storage of finished goods and in transit inventories. EOQ

determines the optimal order quantity for a particular item of inventory, given its

forecast usage, ordering cost and carrying cost. It is assumed in Eskayef that ordering

costs per order are constant regardless of the size of the order.

In the purchase of raw materials or other items, these costs represent the clerical costs

involved in placing an order as well as certain costs of inventory storage, handling and

insurance, together with the required return on the investment in inventory over the

period. These costs are assumed to be constant per unit of inventory and per period of

time.

17.3.3 Just-in-Time System

The just in time system is used to maximize the inventory investment. The basic

objective of JIT is to produce or receive a required item at the exact time needed. Ideally,

the firm would have only work in process inventory. JIT system uses no safety stock. JIT

breaks with the conventional wisdom of maintaining large inventory stocks as buffers

against uncertainties. Reduction in inventory carrying costs is one of the more obvious

results of the JIT system. However, additional hoped for results include improvements in

productivity, product quality and flexibility.

17.3.4 Materials Requirement Planning System

Many companies use materials requirement planning (MRP) system to determine what

materials to order and when to order them. MRP applies EOQ concept to determine how

much to order. It simulates each products bill of materials, inventory status, and
manufacturing process. The bill of material is simply a list of all parts and materials that

go into making the finished products. On the basis of the time it takes for a product that

is an process to move through the various production stages and the lead time required

to get materials, the MRP system determine when order should be placed for the various

items on the bill of materials. The advantages of the MRP system is that it forces the firm

to consider its inventory needs more carefully.

17.3.5 Inventory Techniques Followed by Eskayef

Within the four techniques, Eskayef considers EOQ model for determining the optimal

size inventory items. The companys goal for inventory is to turn it over as quickly as

possible without stock outs. Eskayef follow this technique because EOQ model considers

the various cost of inventory and then determines what order size maximizes total

inventory cost. The relevant cost of inventory can be divided into order cost and

carrying cost. According to Eskayef, Order costs include the fixed clerical cost of placing

and receiving the order: the cost of writing a purchase order, of processing the resulting

the paper work, and of receiving an order and checking it against the invoice. On the

other hand, carrying cost is the variable cost per unit of holding an item of inventory for

specific period of time.

Carrying costs include storage cost, insurance cost, the cost of deterioration and

obsolescence, and the opportunity or financial cost of having funds invested in

inventory. Eskayef dont follow the JIT because they purchase 80% raw materials and

15% packing materials from foreign countries and rest of the materials purchase from

local markets. So, failures of materials to arrive on time results in shutdown of the

production line until the material arrive. Otherwise, JIT system requires high quality
parts from suppliers. When quality problem arises, production must be stopped until

the problems are solved.

17.3.6 Problem reflected on material purchasing

Marketing department of Eskayef forecast about the future demand for their product in

the market. After that they inform to the planning department for collecting these types

of inventories base on market demand. Planning department investigates the inventory

how much are remained in their warehouse and how much they have to buy. At that

time planning department considered several issues that reflect on purchasing material

because they import 80% raw materials and 15% packing materials outside the country

and rest of the materials purchase from local market. Depends on order quantity and

order point problem many factors influence on purchasing materials. Those factors are

given below:

Economic or financial condition of the company when they will purchase the

material.

Political condition of both countries (home and host country)

Rule and regulation follow by the government for importing materials.

Delivery-time stock that is, the inventory needed between the order date and the

receipt of the inventory ordered.

Importance of these materials.

Find out the cost and rate for purchasing these materials.

Measures the quantities which have to purchase these types of materials for

fulfilling their requirement.

Identify the space which is available in their warehouse for carrying these

materials.
 Be aware about the cost that need for carrying these materials.

Identify about the nature of these materials that is perishable, liquid or solid.

Find out the arrangement about the material that these materials are available in

the market or not.

Expected fluctuation of the price of these materials in the future.

17.3.7 TQM in Eskayefs Inventory management

Total quality management (TQM), which is a companywide system approach to quality,

has come a new philosophy in inventory management. Under this approach, the

traditional hostile relationship between suppliers and customers, where suppliers are

coldly dropped when a cheaper source can be found, is being replaced by a new order in

customer-supplier relationship.

In effect, what began as an effort to increase quality through closer supplier relations

has turned out to have unexpected benefits. Close customer relations have helped trim

costs, in part, by allowing for the production of higher quality products. This close

customer-supplier relations has allowed the TQM philosophy to be passed across

company boundaries to the supplier, enabling the firm to tap the suppliers expertise in

designing higher quality products.

In addition, the interdependence between the supplier and customer has allowed for the

development and introduction of new products at a pace much faster than previously

possible. The traditional purchasing philosophy is to purchase a part or material from a

variety of different suppliers, with the suppliers contracting out to go a number of

different firms.

Quality is the utmost concern of Eskayef. To maintain the quality of the products Eskayef

has a world class QC lab. The Quality Control Department has the responsibility and
authority to sample, test and accept or reject all materials, such as active substances,

primary and secondary packing materials. The Quality Assurance Department has

responsibility and authority to sample intermediates and finished goods. The Quality

Control Laboratory facilities are designed equipped and maintained for efficient testing

of raw materials, packing materials, intermediates and finished products. Staffs in the

laboratory are qualified, trained and certified to analyze and document the results for

raw materials, packing materials, intermediates and finished products. The lab is

facilitated with the entire up to date machineries necessary for maintaining quality such

as atomic absorption, FTIR, HPLC and NMR. The documentation procedure of Quality

Assurance Department is also up to the highest level.

Quality is the measure of excellence in the field of infusion therapy. The Infusion Unit of

Eskayef, the superior name of quality in Bangladesh Infusions markets, built its

confidence and reliability image through consistent quality management. Consequently,

the Infusion Unit of Eskayef was the first and only intravenous fluid manufacturing

facility in Bangladesh to be awarded with an ISO 9001 certificate in 1996. The technical

audit was done by TUV-CERT, a highly renowned German company having the

reputation of providing ISO 9001 certification to some of the worlds most eminent

enterprises both in Europe and USA.

Eskayef uses very few suppliers as a source for a particular part or material. In this way,

BVPL has more direct influence and control over the quality performance of a supplier

because Eskayef accounts for a larger proportion of the suppliers volume. The supplier

agrees to meet the quality standards of the company in terms of parts, material, service,

and delivery. In this way, the supplier can be brought into the TQM program of the

customer. In return, Eskayef enter into the long term purchasing agreement with the

supplier that includes a stable order and delivery schedule.

Eskayef believe that single sourcing creates an environment of cooperation between

customer and supplier where both share the common goal of quality. Also, the supplier

may be given the responsibility of designing a new part or component to meet the

quality standards and features outlined by the company. SK+F and supplier can then

enter into a partnership, as partnering. The concept of partnering has radically changed

the way inventory is purchased.

Moreover, it has turned the customer-supplier relationship from a formerly adversarial

one into a cooperative one. The benefits in term of purchased quality of parts, materials,

and design are so dramatic that partnering is not likely fade away, but rather continue to

evolve and take on even more importance in the future.

18. Health, Safety & Environment Policy

Health Safety Environment is a new dimension in corporate arena. It does not deal only

with health, but also other aspects of health and safety related issues. It indicates that

health should not be achieved as a single perspective rather it should be considered as a

total combination with proper safety and better environment. So, to keep an employee

healthy Eskayef tries to ensure a sound physical and mental health as well as a safe &

healthy corporate environment.

As Eskayef is always very much concerned about its employees, so to provide them a

healthy working environment, HSE department has established with the following

concept.

To make Eskayef a safe, healthy and attractive place to work.

To prevent and minimize injury, discomfort and work related stress.

 To maintain a well motivated employee and well-educated workforce from

HSE point of view.

To have a good and safe working environment that will enable the employees

to give their service with high productivity and efficiency.

To increase human capital by contributing and maintaining simple, aligned

and efficient working environment.

To manage critical care /incident.

To ensure work-life balance.

The main principle of HSE policy is to prevent most of the job and work related injury

and diseases. This can be achieved through systematic work, awareness of dangers and

common sense.

Good health, safety and environmental performance are strongly linked to personal

ownership of the day to day challenges and the ultimate productivity of the employee in

a pharmaceutical company like Eskayef Bangladesh Ltd. The Health, Safety and

Environment (HSE) Department of Eskayef relates with major emphasis to its

Manufacturing Plant, specifically to the commitment to health, safety and wellbeing of

all the employees and also its environmental performance.

To protect and maintain employees occupational health, as part of a commitment to

employees physical, mental and social well being, Eskayef HSEs task tries to ensure

that, work does not have an adverse impact on employees health, and that general

health is maintained. By taking a proactive stance, HSE department of Eskayef

Bangladesh Ltd. intends to be among the leaders in the pharmaceutical field ensuring

occupational health improvement.

Eskayef HSE seeks to proactively prevent work related illness by recognizing hazards;

assessing the risks and applying appropriate controls. Its occupational illness

monitoring aims to reduce health problems through corrective actions based on root

cause analysis. HSE Manager, primarily located in Eskayef Factory, supervises overall

activities of Eskayef HSE.

19. Corporate Social Responsibility

Corporate social responsibility is not that much common in the pharmaceutical

companies. However, Eskayef Bangladesh Limited doses some CSR in limited form.

Eskayef donates medicine to rural government hospitals and sells medicines at a very

low price to the government hospitals.

Continuing medical education (CME) consists of educational activities which serve to

maintain, develop, or increase the knowledge, skills, and professional performance and

relationships that a physician uses to provide services for the patients, the public, or the

profession. Eskayef Bangladesh Limited has been providing the following CME related

services to the medical community over the past 13 years, which are as follows:

Arranging the large scale national & international scientific seminars &

symposium on the burning health issues.

Arranging the clinical workshop and meetings at Medical Colleges and other

major academic institutions at Dhaka and outside Dhaka with appropriate

scientific information and logistic support.

 Providing the customized information on latest clinical and pharmaceutical

development through journals, leaflets and journal reprints to the medical

community as per the requirement.

Providing the best available IT support (especially Audio and Visual) for

augmenting the medical education of the country.

(Continuous Medical Education, 2008)

20. SWOT Analysis

SWOT analysis is a strategic planning method used to evaluate the Strengths,

Weaknesses/Limitations, Opportunities, and Threats involved in a project or in a

business venture (SWOT Analysis). It involves specifying the objective of the business

venture or project and identifying the internal and external factors that are favourable

and unfavourable to achieve that objective. SWOT Analysis of Eskayef is given below:

20.1 Strengths
Strengths of Eskayef are

Goodwill:

With Its high quality drugs, Eskayef has now established itself as one of the

leading and strongest of all the pharmaceutical companies.

Strong Board of Directors:

The sponsors of Eskayef are reputed personalities in the field of trade and

commerce.

Skilled Employee
 Eskayef Bangladesh Limited follows a strict screening system during appointing

their employees followed by a very rigid training period. Each and every

employee of Eskayef Bangladesh Limited has to go through on the job training for

time to time basis.

Less Employee Turnover

Eskayef firmly believes that consistently strong performance of the company is

the result of the team of committed knowledgeable team of employees thus

human resource most valuable asset of the company. Eskayef provide the

employees right amount of motivation which helps it to achieve less employee

turnover.

High Quality

The most important strength of Eskayef Bangladesh Limited is its continuous

drive towards quality.

Huge geographic coverage

Currently Eskayef has coverage of around 16 regions all over Bangladesh. The

coverage is still increasing.

Strong Promotional activity

Eskayef Bangladesh always tries to promote their products through, Direct Sales

to institutions as well as retailers. Huge promotional activities are done by the

Sales Department.

20.2 Weaknesses
Eskayef has few weakness of its own. These weaknesses are:
 Manual Work

Most of works in the marketing and sales department is done manually .Like

incentive calculation or any other instrument which is time consuming and has

high chances of mistakes.

Lack of HR department

Now a day no company can survive without a strong Human Resource base. To

maintain a strong Human Resource base, a HR department is a must.

Lack of Adequate research and development facilities

Though it is a growing company, it lacks adequate research and development

facilities. But it is working for it.

20.3 Opportunities

There are few opportunities for Eskayef which are

Good chance of expanding geographically within Bangladesh.

Although Eskayef covers all over Bangladesh but it still has scope of increasing its

business by extending more into Bangladesh as the total medicine market are not

covered by pharmaceutical induatry. Kobirazi medicines are yet to be

overthrown.

Opportunity to take over market share from rivals

Eskayef can introduce new drugs which their competitors have not yet started

producing or they can think in the cost strategy.

 20.4 Threats
Finally there are few threats exist for Eskayef which are:

Entry of local pharmaceutical companies

New and developed pharmaceutical companies could become a threat in the way

of Eskayefs growth.

Competitors are offerings

Large competitor like Square Pharma has more regional coverage and more

drugs. It also exports to the major countries all over the world.

Bargaining power of customer is increasing.

Numbers of local pharmaceutical companies are increasing day by day thus the

choices of customers are increasing day by day.

21. Industry Analysis

There are several sectors on which Bangladesh can be proud of and undoubtedly the

pharmaceutical sector is one of these sectors. Pharmaceutical Industry is the second-

largest contributor to the government revenue. There are about 231 companies in this

sector and the approximate total market size is about Taka 76,500 million per year of

which about 97% of the total requirement of medicines is created by the local

companies and the rest 3% is imported (Eskayef Bangladesh Limited, 2011). The

imported drugs mainly comprise of the cancer drugs, vaccines for viral diseases,

hormones etc.
In Bangladesh the pharmaceutical sector is one of the most developed hi-tech sectors

within the country's economy. After the promulgation of Drug Control Ordinance - 1982,

the development of this sector was accelerated. The professional knowledge, thoughts

and innovative ideas of the pharmaceutical professionals working in this sector are the

key factors for these developments.

Due to recent development of this sector it is exporting medicines to global market

including European market. Leading pharmaceutical companies are expanding their

business with the aim to expand export market. Recently few new industries have been

established with high tech equipments and professionals which will enhance the

strength of this sector (Pharmaceutical industry in Bangladesh, 2011).

21.1 Industry Background

Background of pharmaceutical industry goes long ago. Unani, ayurvedic, homeopathic

and biochemical medicines existed from the long past. During the Pakistan Period

legislation was formed for pharmaceutical industry on the basis of The Drug Act of 1940

and its rules. Unani, ayurvedic, homeopathic and biochemical medicines were exempted

from control under the legislation.

The pharmaceutical industry, however, like all other sectors in Bangladesh, was much

neglected during Pakistan regime. Most multinational companies had their production

facilities in West Pakistan. With the emergence of Bangladesh in 1971, the country
inherited a poor base of pharmaceutical industry. For several years after liberation, the

government could not increase budgetary allocations for the health sector.

With the promulgation of the Drug (Control) Ordinance of 1982 many medicinal

products considered harmful, useless or unnecessary got removed from the market

allowing availability of essential drugs to increase at all levels of the healthcare system

(Investment Analysis: Pharmaceutical Industry in Bangladesh (Part 2), 2008) . Increased

competition helped maintain prices of selected essential drugs at the minimum and

affordable level.

In 1981, there were 166 licensed pharmaceutical manufacturers in the country, but local

production was dominated by eight multinational companies (MNCs) which

manufactured about 75% of the products. There were 25 medium sized local companies

which manufactured 15% of the products and the remaining 10% were produced by

other 133 small local companies.

All these companies were mainly engaged in formulation out of imported raw materials

involving an expenditure of Tk 600 million in foreign exchange. In spite of having 166

local pharmaceutical production units, the country had to spend nearly Tk 300 million

on importing finished medicinal products. (Investment Analysis: Pharmaceutical Industry

in Bangladesh (Part 2), 2008)

In 2000, there were 210 licensed allopathic drug-manufacturing units in the country,

out of which only 173 were on active production; others were either closed down on

their own or suspended by the licensing authority for drugs due to non compliance to

GMP or drug laws. They manufactured about 5,600 brands of medicines in different

dosage forms.
There were, however, 1,495 wholesale drug license holders and about 37,700 retail drug

license holders in Bangladesh. Anti-infective is the largest therapeutic class of locally

produced medicinal products, distantly followed by antacids and anti-ulcerants.

(Investment Analysis: Pharmaceutical Industry in Bangladesh (Part 2), 2008)

21.2 Major Players of the industry

As mentioned in earlier section, there are about 231 companies in pharmaceutical

industry. However, most of them are small companies and have less than 1% market

shares. Those companies are basically market followers. On the other hand there are

some big companies which, on total have 85% market shares, control the industry.

Market Competition is basically among them. A list of those major players of the

industry is given below

TABLE INDUSTRY ANALYSIS.9 Major players of the Pharmaceutical industry of Bangladesh in

2010

Rank SALE Share (%) Growth (%)

(Tk Cr.)

Total Market 6,457.22 24.58

1 SQUARE 1,238.65 19.18 21.28

2 INCEPTA 573.63 8.88 37.79
3 BEXIMCO 528.65 8.19 34.50
4 OPSONIN 316.62 4.90 31.17
5 ESKAYEF 316.49 4.90 29.81
6 RENATA 306.23 4.74 36.98
7 ACME 293.93 4.55 13.64
8 A.C.I 277.16 4.29 21.16
9 ARISTO 260.77 4.04 24.06
10 Drug Int 249.85 3.87 24.48
11 AVENTIS 179.36 2.78 11.58
12 GLAXO 131.61 2.04 7.96
13 ORION LAB. 124.76 1.93 38.69
14 NOVO 116.69 1.81 56.39
NORDISK
15 HEALTHCARE 108.30 1.68 30.74
 16 GENERAL 105.47 1.63 12.68
17 SANDOZ 90.59 1.40 -3.78
18 IBN SINA 89.60 1.39 30.80
19 POPULAR 72.77 1.13 47.52
20 NOVARTIS 72.60 1.12 22.96

Data Source: (Bangladesh Pharmaceutical Index, 2010)

The list above shows that Square Pharmaceutical Limited is the market leader of the

industry with almost 20% market share. Square Pharmaceutical Limited is in safe

position because the market challenger Incepta (2nd) & Beximco (3rd) both have 8%

market share which is less than half of Squares market share. Beximco is competing

closely with Incepta for the 2nd position. Few years earlier Incepta was out of the top 5.

However it was able to beat all competition and grab the 2 nd position. Opsonin, Eskayef

& Reneta are close competitors each have almost 5% of the market share. These 3

companies are holding 4th, 5th and 6th position respectively.

FIGURE INDUSTRY ANALYSIS.19 MARKET SHARE OF TOP 6 PHARMACEUTICAL COMPANIES

Square, Incepta, Beximco, Opsonin, Eskayef and Reneta these 6 companies together own

the 50% market share are basically the major players of the pharmaceutical industry.

Rest top 16 companies owns together owns 35% market share. And remaining 211

small companies holds the 15% share of the pharmaceutical market. Because strong
competition exists in the industry, all companies are trying to increase its market share

by expanding the market. They are even trying to capture the international market.

21.3 Success of the industry

The great success of the pharmaceutical industry is turning into Drug exporting country

from drug importing country. After the liberation in 1971, the pharmaceutical industry

was dominated by the foreign companies. Those companies used to import

pharmaceutical raw materials and finished drugs, which are not produced in the

country. Thus lots of foreign currency was spent on drug import. After the Drug

(Control) Ordinance of 1982, import of drug decreased gradually and the value of locally

produced medicines rose from Tk 1.1 billion in 1981 to Tk 16.9 billion in 1999. And

now, besides meeting the 97% need of local demand Bangladesh is exporting the

medicines into 72 countries. (Eskayef Bangladesh Limited, 2011)

Bangladesh Pharmaceutical Industry is now heading towards self-sufficiency in meeting

the local demand. There are about 450 generics registered in Bangladesh. Out of these

450 generics, 117 are in the controlled category i.e. in the essential drug list. The

remaining 333 generics are in the decontrolled category, the total number of brands

/items that are registered in Bangladesh is currently estimated to be 5,300, while the

total number of dosage forms and strengths are 8,300.

During the last two decades the pharmaceutical industry of Bangladesh has been taken

a newer height. This sector now contributes a lot into the national economy by

exporting raw materials and finished goods instead of spending valuable foreign

currencies. Bangladesh is ready to enter the Highly Regulated Market. For this reason

different pharmaceutical companies are investing to build high tech pharmaceutical

industries. Some renowned companies have already entered the Highly Regulated

Market and got the UK MHRA, EU, TGA Australia and GCC approval and some are in the

process to get the USFDA & UK MHRA approval. Through this accreditation these

companies will be able to export medicine and through contract manufacturing

agreement. (Eskayef Bangladesh Limited, 2011)

Pharmaceutical Industry of Bangladesh has gain reputation in international market.

Many Bangladeshi pharmaceutical companies are receiving awards and certificates all

over the world. People of this industry believe that in next 10 years pharmaceutical

industry will surpass RMG industry (Pharma industry to surpass RMG sector in 10 years,

2011). In order to boost the performance of pharmaceutical industry, An Active

Pharmaceutical Ingredients (API) Park has been set up at Gajaria upazila of Munshiganj

district (Industrial park for pharmaceutical, 2010). According to the survey conducted by

Business Monitor International (BMI), Pharmaceutical Industry of Bangladesh has

moved up a step to occupy the 14th position of the 17 regional markets for the Asia

region (Bangladesh moves to rank 14th, 2010).

21.4 Regulation and Restriction faced by the industry

Two organizations, one government (Directorate of Drug Administration) and one semi-

government (Pharmacy Council of Bangladesh), control pharmacy practice in

Bangladesh. The Bangladesh Pharmaceutical Society is affiliated with international

organizations International Pharmaceutical Federation and Commonwealth

Pharmaceutical Association (Pharmaceutical industry in Bangladesh, 2011). Apart from

these organizations, there is The Drug Policy of 2005 to provide guideline to the

pharmaceutical industry.
These organizations and policy puts different restrictions on the pharmaceutical

companies. One of the restrictions is prohibiting medicine advertisement on media. In

India, government has allowed their pharmaceutical companies to advertise for the

generic medicines like headache, fever, acidity and many others. Lots of brand has been

created and advertised in TV and News papers. Some of those branded medicines like

Eno and Move are made available in Bangladesh. And by watching Indian TV channels,

Bangladeshi people have learned about those brands and started consuming them. This

is how some of Indian pharmaceutical companies have entered in Bangladeshi market. If

advertisement were allowed in Bangladesh, Indian products wouldnt get the

opportunity to enter in Bangladesh market.

22. Competitive Analysis

Competitive analysis is done among the Square pharma, Beximco Pharma, Eskayef &

Reneta. Competetive analysis is divided in two sections. In the first section, sales

performance and sales growth is compared. Financial performance is compared in the

2nd section. From this competitive analysis, a clear idea will be found about Eskayfs

competitive position with other top 3 pharmaceutical companies.

22.1 Sales Performance

Square pharmaceutical company is the leader of the industry with approximate 19%

market share. The closest competitor BEXIMCO has only about 8% market share where

Eskayef and Reneta both has 5% market share. Therefore it is logical that Square will

have the highest sales volume and BEXIMCO will have the second highest sales volume.

Eskayef and Reneta will compete closely as they both have 5% market share. During

2010, Square Pharmaceutical Company had total sales of over BDT 1200 million.
BEXIMCO had about 628 million and Reneta pushed its sales volume to about 306

million. On the other hand Eskayef had sales volume of BDT 316 million.

FIGURE COMPETITIVE ANALYSIS.20 SALES PERFORMANCE OF DIFFERENT COMPANIES

The graph above illustrates that square has the highest amount of sales, Beximco has the

second highest. Eskayef and Reneta has almost same amount of sales. This is logical

because both companies has almost equal market share.

Although Sales volume shows that Square and Beximco are in the best position, sales

growth rate tells something else. Square has the lowest sales growth rate of approx. 20%

where Reneta, who has the lowest sales volume, has the highest sales growth rate of

more than 35%. Meanwhile Eskayef has 30% growth and Beximco has approximately

35%. This shows that Reneta and Beximco are actually performing better than others.
 FIGURE COMPETITIVE ANALYSIS.21COMPARATIVE GROWTH RATE

22.2 Financial Performance

One way of comparing financial performance of different companies is to compare their

ratio. In the following section, comparative ratio analysis of Beximco Pharma, Square

Pharma, Eskayef and Reneta has been illustrated. A competitive summary of different

types of ratio is given below:

TABLE COMPETITIVE ANALYSIS.10 Camparative Ratio table

Comparative Ratio Analysis

As at December 31, 2010

A. Liquidity Ratio Square Beximco Eskayef Reneta

1 Current Ratio 2.15 2.46 1.10 1.11
2 Quick Ratio 1.16 1.67 0.66 0.41

B. Profitability Ratio Square Beximco Eskayef Reneta

3 Gross Profit Margin 42.76% 48.89% 43.54% 52.75%
4 Net Profit Margin 18.21% 16.20% 6.61% 16.73%
5 Return On Equity (ROE) 18.07% 6.58% 6.86% 28.65%
6 Return On Capital Employed 16.30% 5.58% 5.88% 26.10%
7 Return On Assets (ROA) 13.89% 4.92% 4.07% 16.65%

C. Solvency Ratio Square Beximco Eskayef Reneta

8 Solvency Ratio 4.32 3.96 2.46 2.39
9 Gearing/ Debt to equity Ratio 0.30 0.34 0.69 0.72
10 Equity Multiplier 1.30 1.34 1.69 1.72
 11 TIE Ratio 8.71 2.47 4.11 11.17

D. Activity Ratio Square Beximco Eskayef Reneta

12 Net Asset Turnover 0.76 0.30 0.62 1.00
13 Inventory Turnover 2.97 1.67 2.55 1.86
14 Receivable Turnover 22.55 7.90 4.47 10.64
15 Average Collection Period 16.18 46.19 81.61 34.30

Data source: (Annual Reports of Square, Beximco, Eskayf & Reneta, 2010)

22.2.1 Liquidity Ratios

Current Ratio

Liquidity ratio shows a firms ability to meet its short term obligation with its short

term assets. The following figure shows that Beximco has the highest current ratio of

approx. 2.5 and Square has over 2. On the other hand Eskayef and Reneta have

current ratio of almost 1.

FIGURE COMPETITIVE ANALYSIS.22 COPETETIVE CURRENT RATIO

Thus Beximco & Square has almost double current assets to meet its short term

obligation where Eskayef and Renta have almost equal current assets. Using the Net

Working capital theory it can be concluded that Eskayef and Reneta are very much

efficient in managing its working capital.

Quick Ratio
 Quick ratio measures firms ability to pay its short term obligation using its most

liquid portion of current assets. Generally inventory is the least liquid form of asset.

Therefore while calculating the ratio, inventory is subtracted from current assets.

The figure of current ratio in next page shows that Beximco has the highest amount

of quick ratio. Quick ratio of Beximco is higher than 1.5, 1 for Square, 0.5 for Eskayef

and Reneta has less than 0.5.

FIGURE COMPETITIVE ANALYSIS.23 GRHAPHICAL REPRESENTATION OF COPETETIVE QUICK RATIO

This indicates that Reneta has least portion of liquid current asset to pay off its short

term obligations where Bximco has the highest.On the other hand Eskayef will be

able to pay off 50% of its short term obligation with its current assets keeping

inventory unchanged.

22.2.2 Profitability Ratios

Gross Profit Margin

Gross profit ratio measures profit percentage on gross basis on sales amount.

Although higher gross profit doesnt ensure higher net profit but it contributes to net

profit.
 FIGURE COMPETITIVE ANALYSIS.24 GRHAPHICAL REPRESENTATION OF COPETETIVE GROSS PROFIT
MARGIN

Gross profit margin for is the highest for Reneta which is over 50%. Beximco has the

gross profit margin of 48% where Eskayef and Square has over 40%. This indicates

that Reneta is earning highest gross profit margin and Square is earning the least.

Net Profit Margin

Net profit margin indicates the percentage of profit made from the sales. Net profit is

found after subtracting all operating and administrative expenses from gross profit.

Therefore the net profit margin also measures firms ability to generate profit sales

after covering all sorts of expenses.

FIGURE COMPETITIVE ANALYSIS.25 GRHAPHICAL REPRESENTATION OF COPETETIVE NET PROFIT

MARGIN

The figure above shows that Beximco & Reneta have almost same net profit marging.

Square has the highest where Eskayef has the lowest. Although Square made the
 lowest gross profit margin, it is earning highest net profit margin. This indicates that

square is very much efficient in minimizing its operational and administrative

expenses. On the other hand operating and administrative expense is high for other

firms especially for Eskayef. Eskayef has 43% gross profit marging but it has only 6%

net profit margin. It is because that Eskayef has huge interest to pay. In 2010 Eskayef

paid almost half of its gross profit as interest. Beximco and Reneta has the same

problem but in minimum level. Mainly their operational and administrative expenses

are high.

Return on Equity

FIGURE COMPETITIVE ANALYSIS.26 GRHAPHICAL REPRESENTATION OF COPETETIVE RETURN ON

EQUITY

Return on equity indicates how much a firm generated profit using its equity. The

graph below shows that Reneta has highest ROE which is equal to 25% where

Beximco has the lowest. Meanwhile Square return 18% on equity and Eskayef return

about 6%. The graph indicates that Reneta is performing very well as it returns almost

25% of its equity as net profit.

Return on Assets
 Return on Assets or ROA measures Companys ability to generate net profit using its

assets. The following graph shows that Reneta has higherst ROA wher Eskayef has

the lowest. Similar to Eskayef, Beximco too has less than 5% ROA.

FIGURE COMPETITIVE ANALYSIS.27 GRHAPHICAL REPRESENTATION OF COPETETIVE RETURN ON

ASSETS

So it can be concluded that reneta is performing well because it is giving the highest

return On the other hand Eskayef is not performing very well as it return less than

bank rate.

Return on Capital Employed

ROCE measures how much return made on the capital that has been employees. The

graph next page shows that reneta has 25% which is the highest return on employed

capital. Square too has a fair return of 15%on employed capital.

FIGURE COMPETITIVE ANALYSIS.28 GRHAPHICAL REPRESENTATION OF COPETETIVE ROCE

 22.2.3 Solvency Ratios

Solvency Ratio

Solvency ratio indicates that how much asset is available to back the liabilities. The

graph below shows that Eskayef and Reneta have the lowest solvency ratio where

Square has the highest.

FIGURE COMPETITIVE ANALYSIS.29 GRHAPHICAL REPRESENTATION OF COPETETIVE SOLVENCY RATIO

This means that Most of the assets of Eskayef and Reneta are financed by debt and

because of that their solvency ratio is low. On the other hand square has almost 4

times asset than its liabilities.

Debt to Equity Ratio

Debt to equity ratio measure how much debt a firm has compared to its equity. The

debt to equity ratio or the gearing ratio is highest for Reneta with 0.70.. Eskayef too

has over gearing ratio of 0.60. On the other hand Square and beximco has gearing

ratio of 0.25 and .30 respectively.

 FIGURE COMPETITIVE ANALYSIS.30 GRHAPHICAL REPRESENTATION OF COPETETIVE GEARING RATIO

This indicates that Eskayef and Reneta both has very high debt portion in its equity

structure.

Equity Multiplier

Equity multiplier is higher for Eskayef and Reneta. Both firms have equity multiplier

of approx. 1.5. Square and Beximco has multiplier ratio of 1.2. That means that

Eskayef & Reneta both has total assets which are 1.5 times of their equity.

Figure Competitive Analysis.31 Graphical representation of Competitive equity multiplier

ratio

TIE Ratio

TIE ratio measures how many times a firm is able to cover its interest expense with

profit before interest and expense. The figure below shows that Reneta has the

highest TIE ratio of 10. That means Reneta generates profit 10 times of its interest
 expenses where eskayef generates only 3 times. Beximco has the lowest TIE ratio as

it generates profit only 2 times of its interest expenses.

Figure Competitive Analysis.32 Graphical representation of Competitive TIE ratio

22.2.4 Activity Based Ratios

Asset Utilization Ratio

Asset utilization ratio measures firms ability to generate sales using its assets. The

following figure shows that reneta has the highest and Beximco has the lowest asset

turnover ratio. Reneta generates almost 90% and Eskayef generates sales of more

Figure Competitive Analysis.33 Graphical representation of Competitive asset turnover

ratio

than 50% of their total assets. On the other hand square generates sales which are

approximately 70% of its total assets and Beximco generates 25% of its assets. This
 means that Reneta is most efficient to generate sales using its assets where Beximco

is the least efficient.

Inventory Turnover

Inventory turnover indicates how many times a firm is to sell its inventories in a

particular period. Higher inventory turnover indicates higher sales efficiency. The

inventory turnover graph below shows that Square has the highest inventory

turnover and Eskayef has the second highest.

Figure Competitive Analysis.34 Graphical representation of Competitive inventory

turnover ratio

In 2010 Beximco sold its inventory approximately 3 times where eskayef sold 2.5

times. Reneta achieved a inventory turnover of 1.75 times and Beximco had 1.5

times. This situation shows that Square and Eskayef was efficient in selling their

inventory compare to other two big companies.

Receivable Turnover

Receivable turnover indicates a firms ability to create receivables in a particular

period. Higher receivable turnover means higher efficiency in collecting receivables.

 Figure Competitive Analysis.35 Graphical representation of Competitive receivable

turnover ratio

The figure above shows that Square has the highest receivable turnover which is

approximately 22 times. Reneta has receivable turnover of approx. 10 times where

Beximco has 6 times. On the hand Eskayef has the lowest receivable turnover which

is accounts to be 3 times. This indicates that Eskayef is the least efficient in

regenerating receivables in 2010.

Average Collection Period

Average collection period is a measurement of firms efficiency in receivable

collection. Ager collection period tells that how many days firm takes on average to

collect its receivables. The graph shows that Eskayef is the least and Square is the

most efficient in collection compared to other firms.

Figure Competitive Analysis.36 Graphical representation of Competitive average collection

period

PART III
Research Part

[Research on ACCPAC ERP]

 23. Research Introduction
Eskayef Bangladesh Limited, a prominent pharmaceutical company in Bangladesh,

uses ACCPAC ERP in order to instigate the production units, marketing department and

Accounts department. The implementation of ACCPAC in Eskayef Bangladesh Limited

has been completed in August 31, 2004. ACCPAC team directly guided and trained the

employees of Eskayef Bangladesh Limited. Through ACCPAC, financial reports can be

generated successfully which coincided with manual reports. Therefore it is possible to

replace the manual accounting system with the ACCPAC ERP software.

In 2004 Eskayef reengineered the business process by implementing Accounts module

of ACCPAC ERP. Business Process Reengineering (BPR) is an approach for redesigning

the way of working for better support to the organization's mission and aiming for

achieving dramatic improvements in critical performance measures, such as cost,

quality, service, and speed. By implementing ACCPAC ERP, Eskayef was able to eliminate
the manual accounting procurers. Thus it was able to speed up the accounting process

and increase the reliability of financial statements.

However, ACCPAC ERP was mainly implemented for the accounting purpose and helped

in inventory control. Thus it is mostly limited to Finance & Accounts department, Plants

and Storages. Marketing department can check inventory balance and enter information

of received purchase orders. The ERP system has its own limitation too. ACCPAC in

Transcom has a limitation of active users of 20. That means not more than 20 users can

work at a time in ACCPAC. This often causes disturbance. Also technical problem occurs

often while working in ACCPAC.

To eliminate the limitations of the existing ERP, at present Eskayef is planning to extend

its current ERP coverage and thinking of adopting SAP which will cover Control,

Production decision, sales & distribution and other management planning. This change

will cause a change in the existing the business process. In my research, I tried to

measure the effect of BPR through ERP on employee performance.

24. Research Background

Knowing the background information about ACCPAC and ACCPAC in Transcom will be

helpful in understanding the outcome of study. In this section ACCPAC in Transcom,

modules used and problem with existing ERP is described in details.

24.1 Introduction to Sage ACCPAC ERP

ACCPAC is the common name for the Sage ACCPAC ERP, line of accounting application,

which serves primarily the small and medium sized business. Sage ACCPAC ERP is

produced by the Sage Group PLC, a UK based Software Company, commonly known as
Sage. Sage is the third largest producer (just behind Oracle & SAP) of Enterprise

Resource Planning (ERP) software (The Sage Group).

ACCPAC is a Windows based ERP software allows multi-users at a time and accepts

monetary value in multi-currency. ACCPAC is also available in different languages.

Originally ACCPAC was developed for the CPM operation system in the late seventies.

However, this was ported to MS-DOS and IBM-PC in the early eighties. Later windows

version was developed in 1990 and released in 1994 (ACCPAC).

24.2 TRANSCOM ACCPAC ERP

Transcom Group has purchased the license of Sage ACCPAC in order to establish ERP

system in its different companies. Because of obtaining the license, Transcom group was

eligible to change the name to Transcom ACCPAC ERP. As a concern of Transcom group,

Transcom ACCPAC ERP was established in Eskayef Bangladesh Limited.

24.3 Modules of ACCPAC used in Eskayef

Eskayef basically uses the accounting solution part of the ACCPAC ERP which includes 6

modules of ACCPAC. Modules used in Eskayef are

Accounts Receivables Module (AR)

A/R module is used for managing Accounts receivable. Through this module it is

possible to record sales transactions, view reports of sales transaction, create

invoice, enter new customer, make groups of customers and set up accounts for

customers. Apart from this different A/R related adjustments are made through

this module.
Accounts Payable Module (AP)
Accounts Payable of Eskayef is managed through the AP module of ACCPAC. This

module is responsible for recording A/P transaction, showing reports of A/P

transactions, setting up new vendor account, managing vendors account. AP

modules records and provides all accounting information about accounts

payables.

General Ledger module (GL)

Apart from inventory, accounts receivables and payables, all kinds of transaction

are managed through General Ledger or GL module of ACCPAC. GL records all

kinds of expenses, incomes. This module is used to prepare trial balance, make

adjustments and prepare adjusted trial balance.

Inventory Control Module (IC)

IC or Inventory Control Module is dedicated to manage inventory accounts. This

module provides information about product price, sales quantity, inventory

balance, inventory received, inventory transferred and pending shipments. This

module also used for making adjustments to inventory amount, inventory price

and inventory location. All products have a unique accounts code and IC module

is used to set the accounts code of all products.

Purchase Order Module (PO)

Purchase Order module is used for managing all sorts of purchase related

information. This module is used for raising requisitions, recoding placed

 purchase orders, recording received material after placing orders. This module

also provides purchase reports.

Order Entry Module (OE)

OE module is for managing sales. This module records the received orders, sales

amount of inventory, current status of received orders and the customer

information. Also this module provides information of daily stock position,

prepaid VAT, product-wise sales, sales statements. Delivery Note is also created

through this module.

24.4 Problems faced in TRANCOM ACCPAC ERP

Users of ACCPAC reported that the system is user friendly. However they also notified

some problem about ACCPAC ERP. While working as intern, I personally found some

problem. All these problems are mentioned below:

ACCPAC ERP at Eskayef doesnt serve the main purpose of an ERP which is to

integrate all departments. In Eskayef, ACCPAC is limited mostly to Accounts

department and warehouses.

Eskayef uses only 6 modules of ACCPAC which only provides accounting solution.

It is not possible to integrate all departments with these modules.

ACCPAC is installed in a server and its user access and work in ACCPAC from their

workstations. If the server crashes or in case of server failure, whole system will

collapse and the work process will be impacted.

ACCPAC ERP of Eskayef doesnt cover production units. Therefore the quantity of

raw materials and packing materials used is recorded manually and later entered

in ACCPAC as consumption quantity. This process is time-consuming and doesnt

add value to the process. Moreover entering error causes problem during the
 reconciliation between material consumption statements of accounts

department and Production plants.

Data entered in ACCPAC are restricted from editing or modification. In some

cases. For example, if any mistake is made while preparing a invoice, that invoice

have to be rejected any new invoice have to be made. That causes waste of time

and human resource.

Whole system is connected by LAN. Users are not able to access ACCPAC.

ACCPAC doesnt have auto-save option. All entered data gets lost If LAN gets

disconnected and users forgets to save manually while entering larger amount of

data.

ACCPAC in Eskayef doesnt support auto-entry of data. Therefore, lots of paper

works are needed in data preparation and data entry.

These are the problem of ACCPAC ERP which is used in Eskayef. The main reason of

upgrading the ERP is to overcome these problems and make the process easier.

25. Objective of the study

The objective of this report was to measure the effect of Business Process Reengineering

through ERP on employee performance and productivity. The study focused on two

broad issues. One was process reengineering which I narrowed down to developing ERP

infrastructure. The main purpose of implementing ERP was to eliminate unproductive

activities and focus more on providing consistent & quick support to the organizations

value adding activity. Therefore, it was reasonable to expect process reengineering

through ERP projects to have a significant and measurable effect on the performance of

Finance & Accounts department as well as the entire organization. The other issue was
to measure the necessity of bringing changes in current ERP and doing more

reengineering of the business operations.

Eskayef Bangladesh Limited had already done process reengineering by implementing

ACCPAC in 2004. Right now it is planning to upgrade its current ERP and bring more

departments under the ERP. This study has assisted me to understand the effect of

process reengineering by implementing ERP on employee and overall organization.

26. Significance of Study

This study is significant for the management of Eskayef Bangladesh Limited and its all

employees as they can take my findings into account while upgrading the current ERP

infrastructure and understand the effects of process reengineering on organization &

employee performance. Also, management will understand whether training and

education is necessary and what sort training should be provided. This study is

significant to me as it helped me to understand the Enterprise Resource Planning

system and its effect on employee performance. There is also a scope for further studies

into this topic for ERP module selection.

27. Hypothesis
I expected process reengineering through ERP will increase the employee performance.

In my research I tried to find if there is any necessity for upgrading the current ERP

infrastructure. On the basis of these, I constructed two hypothesizes which are given

below:

Hypothesis 1:

H0: Performance of the employees improves after process reengineering through ERP.
H1: Performance of the employees improves after process reengineering through ERP.

Hypothesis 2:

H0: Upgrading the current ERP is necessary.

H1: Upgrading the current ERP is not necessary.

28. Research Methodology

In order to conduct my research, I developed a survey questionnaire to collect my

primary data. I used close ended questions in the questionnaire. The questionnaire was

developed by me and I received approval both from my supervisor and the organization.

I used two sources in my research and the sources were:

Primary Source: To make a beginning for my research, I took the employees of Eskayef

as my representative sample. I took their idea, opinion and view about my topic through

questionnaire survey. In my research I focused on the users of ACCPAC which is the

current ERP of Eskayef. This helped me to get my required primary data.

Secondary Source: I used internet and search websites, links, e-newspapers, e-

magazines, e-books etc. to get better information on the topic. I also checked for some

references like journals, newspaper articles, and publications of Eskayef etc. for

necessary data.
 TABLE RESEARCH METHODOLOGY.11 VARIABLE table

INDEPENDENT VARIABLES DEPENDENT VARIABLES

Existing ERP System.

Performance of the employees.
Necessary IT Skill.
Necessity of upgrading the ERP.
Training & Education for new ERP.

Process Reengineering through ERP.

29. Description of the variables

As mentioned earlier, I had considered 6 variables for my research among which 4 are

independent variables and rest 2 are dependent variables. Brief description of all these

variables is given below:

Existing ERP System.

Existing ERP is an independent variable for the research. This variable was

selected to get a clear picture about the current system. It is possible to understand

the user satisfaction of the system and their perception about ACCPAC from this

variable. The variable evaluates the existing system and provides information

about any problem with existing ERP system. The variable is considered as

independent because the ERP system affects the employee performance.

Necessary IT Skill.
This independent variable measures the IT skills and expertise of the system users.

From this variable, I will be able to understand whether system users have

necessary IT skills and expertise of an ERP system. Also the variable will provide

information about employee perception about developing new IT skills and

expertise which will be helpful to their job. IT skill is considered as independent as

the performance of an employee depends on the IT and ERP skills he/she has

which is necessary for his/her job.

Training & Education for new ERP.

Training and Education is an independent variable which is selected to measure

the necessity of providing training to the employees after implementing new ERP

system and process reengineering. This variable will also show the perception of

employees toward training and education. This is an independent variable because

training and education can affect employee performance.

Process Reengineering through ERP.

Process reengineering means changing or modifying the current system. Process

reengineering can be done by adding or eliminating work stages and simplifying

and changing the way of doing a job. It is considered as an independent variable for

this study because process reengineering can impact job performance by

modifying the work system. Through this variable I will be able to know whether it

is possible to reengineer the current process and increase efficiency.

Necessity of upgrading the ERP.

Eskayef is thinking of upgrading the current ERP system. In my research I wanted

to check whether it is necessary to upgrade the current system. To serve this

 purpose I have selected this variable. It is considered as a dependent variable

because the necessity of upgrading depends on the flaws of current system, it skills

of the users and the opportunity of process reengineering. Necessity of upgrading

the current system can be determined after considering all these factors.

Performance of the employees.

The main objective of this study is to measure the impact of process reengineering

on employee performance. Therefore I have considered performance as a

variable for the study. However the variable is considered as a dependent variable.

It is because performance is dependent on many factors like environment, work

pressure, types of work, work system, motivation and others. For the study, I have

considered performance as a combination of current system, employee skills,

received training and education and the result of process reengineering. In Eskayef,

performance is considered as a combination of knowledge, quantity and quality of

works, leadership, resourcefulness, attendance and attitude. Performance of the

employees will increase in any of these factor improves.

30. Sample Design

Since the research was done to figure out the employee performance of Eskayef

Bangladesh Limited, therefore, I selected the employees and manager of the company

who uses or have access to the ERP as my sample. The sample size of this study was 120.

The survey questionnaire was sent via email to the employees including the senior

managers. Face to face personal interviews was conducted with the supervisors and the

employees to get more information.

31. Data Collection Method

Data has been collected from the users of the current ERP in order to get more relevant

result. Data has been collected through both email and manual survey. At first, the

questionnaire was sent to all ACCPAC users via email. But as most of the users didnt

reply the email I conducted a manual survey on them.

32. Data Analysis Method

I used the SPSS software & MS Excel to analyze my survey data. In my research, I used

descriptive analysis like graphical presentations, frequency analysis, normality test and

causal methods like cross-tabs & Chi-Square analysis, T-tests, ANOVA, correlation

analysis, regression analysis and other analysis.

33. Limitation of the research

The biggest limitation of this study was time. To conduct research on this topic within

three month was not enough. Another limitation is that the respondent of the sample

was limited and employees were reluctant to fill up the questionnaire. Questionnaire

was sent to all ACCPAC users via email. However most of didnt participated. Therefore

data collection became problematic as the ERP users of different department are

scattered in different parts of the city.

PART IV
Data Analysis

34. FREQUENCY DISTRIBUTION

Age Range

Table FREQUENCY DISTRIBUTION.12 Age range of the ERP system users

Age
 Frequency Percent Valid Percent Cumulative
Percent

21-25 17 14.2 14.2 14.2

26-30 43 35.8 35.8 50.0

31-35 34 28.3 28.3 78.3

Valid
36-40 15 12.5 12.5 90.8

Above 40 11 9.2 9.2 100.0

Total 120 100.0 100.0

FREQUENCY DISTRIBUTION.37 Histogram showing the frequency distribution of employees age range

DATA ANALYSIS

Out of 120 ACCPAC users, 14.2% of the employees belong to 21 - 25 age range, 35.8% of

the employees are in the age group of 26-30, 28.3% of the employees are in the age

group of 31-35, 12.5% of the employees are in the age group of 36-40 and the rest 9.2%

of the employees age are above 40.

INTERPRETATION
The numbers of employees working with ERP System are mostly young and mid thirties.

However, there are also some employees who are at their forties. This shows that

ACCPAC users of ACCPAC are mostly at their young age.

Gender

Table FREQUENCY DISTRIBUTION.13 Gender of the ERP system users

Gender

Frequency Percent Valid Percent Cumulative

Percent

Male 88 73.3 73.3 73.3

Valid Female 32 26.7 26.7 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.38 Histogram showing the frequency

distribution of employees gender

DATA ANALYSIS

Out of 120 ACCPAC users, 73.3% of the employees are male and rest 26.7% of the

employees are female.

INTERPRETATION

The figure above shows that most of the ACCPAC uses are male.

Job Level

Table FREQUENCY DISTRIBUTION.14 Job Level of the ERP system users

Job Level

Frequency Percent Valid Percent Cumulative Percent

Managerial Level 26 21.7 21.7 21.7

Valid Officer Level 94 78.3 78.3 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.39 Histogram showing the frequency

distribution of employees job level

DATA ANALYSIS

Out of 120 ACCPAC users, 21.7% belongs to manager level and rest 78.3% users belong

in officer level.
INTERPRETATION

The figure above shows that most of the ACCPAC uses are belong to officer level. That

means officer level users are actual users of the ERP system.

Making Work easier

Table FREQUENCY DISTRIBUTION.15 Making work easier to the ERP system users

ACCPAC ERP has made my works easier.

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 23 19.2 19.2 19.2

Agree 68 56.7 56.7 75.8

Neutral 22 18.3 18.3 94.2

Valid
Disagree 5 4.2 4.2 98.3

Strongly Disagree 2 1.7 1.7 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.40 Histogram showing the frequency

distribution of making works easier to the number of employee

DATA ANALYSIS

Out of 120 ACCPAC users, 19.2% strongly agrees, 56.7% agrees that current ERP system

made their work easier. 18.3% are neutral about the issue where rest 5.9% disagrees

that current ERP system made their work easier.

INTERPRETATION

The figure above shows that most of the ACCPAC uses are reported that their work has

become easy because of the ERP system.

Problem faced in current ERP

Table FREQUENCY DISTRIBUTION.16 frequency distribution of the number of users

faced problem in ERP.

I do not face problem while working on ACCPAC.

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 4 3.3 3.3 3.3

Agree 35 29.2 29.2 32.5

Neutral 26 21.7 21.7 54.2

Valid
Disagree 48 40.0 40.0 94.2

Strongly Disagree 7 5.8 5.8 100.0

Total 120 100.0 100.0

 Figure FREQUENCY DISTRIBUTION.41 Histogram showing the frequency

distribution of the number of users faced problem in ERP

DATA ANALYSIS

Out of 120 ACCPAC users, 32.5% agrees that they dont face problem while working on

current ERP. On the other hand 45.8% disagrees with the statement where another

21.7% remained neutral.

INTERPRETATION

The figures above show that most of the ACCPAC uses faces problem while working on

the ERP system.

Manual works before working in ERP System

Table FREQUENCY DISTRIBUTION.17 frequency distribution of the number of users

does manual works before working in ERP system

I have to do supporting Manual works before working in ACCPAC

Frequency Percent Valid Percent Cumulative Percent

Valid Strongly Agree 34 28.3 28.3 28.3

 Agree 44 36.7 36.7 65.0

Neutral 20 16.7 16.7 81.7

Disagree 19 15.8 15.8 97.5

Strongly Disagree 3 2.5 2.5 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.42 Histogram showing the frequency

distribution of the number of user does manual works before working in ERP system

DATA ANALYSIS

Out of 120 ACCPAC users, 65% agrees that they dont do supporting manual works

before working in ERP. On the other hand 18.3% disagrees with the statement where

another 16.7% remained neutral.

INTERPRETATION

The figures above show that most of the ACCPAC uses have to do supporting manual

works before working in ACCPAC.

Sufficient IT skills and expertise to use ERP

Table FREQUENCY DISTRIBUTION.18 frequency distribution of the number of users
have sufficient IT skills and expertise to use ERP

I have sufficient IT skills and expertise to use ERP (ACCPAC or SAP).

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 19 15.8 15.8 15.8

Agree 54 45.0 45.0 60.8

Valid Neutral 31 25.8 25.8 86.7

Disagree 16 13.3 13.3 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.43 Histogram showing the frequency

distribution of the number of users have sufficient IT skills and expertise to use ERP

DATA ANALYSIS

Out of 120 ACCPAC users, 60.8% agrees that they have sufficient skills and expertise to

work on ERP. On the other hand 13.3% disagrees with the statement where another

31% remained neutral.

INTERPRETATION
The figures above show that most of the ACCPAC uses believe that they have sufficient IT

skill and expertise to work on ERP system.

Ability to adapt with new ERP system

Table FREQUENCY DISTRIBUTION.19 Frequency distribution of the number of users able to adapt
with new ERP system.
My IT skills and expertise are capable to adapt with a new system.

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 23 19.2 19.2 19.2

Agree 57 47.5 47.5 66.7

Valid Neutral 37 30.8 30.8 97.5

Disagree 3 2.5 2.5 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.44 Histogram showing the frequency

distribution of the number of users able to adapt with a new ERP.

DATA ANALYSIS
Out of 120 ACCPAC users, 66.7% agrees that they have the ability to adapt with a new

ERP system. On the other hand only 2.5% disagrees with the statement where another

30.8% remained neutral.

INTERPRETATION

The figures above show that most of the ACCPAC uses are capable to adapt with new

ERP system. That means if new ERP system is implemented, it wont be necessary to

hire new employees.

IT skills necessary to maximize the use of ERP

Table FREQUENCY DISTRIBUTION.20 Frequency distribution of the number of

users believes that IT skills are necessary to maximize the use of ERP
Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 47 39.2 39.2 39.2

Agree 48 40.0 40.0 79.2

Neutral 20 16.7 16.7 95.8

Valid
Disagree 4 3.3 3.3 99.2

Strongly Disagree 1 .8 .8 100.0

Total 120 100.0 100.0

 Figure FREQUENCY DISTRIBUTION.45 Histogram showing the Frequency

distribution of the number of users believes that IT skills are necessary to maximize the

use of ERP

DATA ANALYSIS

Out of 120 ACCPAC users, 79.2% agrees that IT skill and expertise are necessary to

maximize the use of ERP. On the other hand only 4.1% disagrees with the statement

where another 16.7% remained neutral.

INTERPRETATION

The figures above show that most of the ACCPAC uses agree that in order to maximize

the use and benefit of ERP, IT skills and expertise is necessary.

IT skills help to perform effectively

Table FREQUENCY DISTRIBUTION.21 Frequency distribution of the number of

users believes that IT helps to perform effectively.

IT skills can help me to perform effectively by saving time.

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 49 40.8 40.8 40.8

Agree 50 41.7 41.7 82.5

Valid Neutral 14 11.7 11.7 94.2

Disagree 7 5.8 5.8 100.0

Total 120 100.0 100.0

 Figure FREQUENCY DISTRIBUTION.46 Histogram showing the Frequency

distribution of the number of users believes that IT helps to perform effectively.

DATA ANALYSIS

Out of 120 ACCPAC users, 82.5% agrees that IT skill and expertise helps them to perform

their works effectively. On the other hand only 5.8% disagrees with the statement where

another 11.7% remained neutral.

INTERPRETATION

The figures above show that most of the ACCPAC uses agree that IT skill and expertise is

necessary to perform their works effectively.

Wants to develop new IT skills

Table FREQUENCY DISTRIBUTION.22 Frequency distribution of the number of users wants to

develop new IT skill

I would like to develop new IT skills & expertise required for SAP.

Frequency Percent Valid Percent Cumulative

Percent
 Strongly Agree 53 44.2 44.2 44.2

Agree 47 39.2 39.2 83.3

Valid Neutral 12 10.0 10.0 93.3

Disagree 8 6.7 6.7 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.47 Histogram showing the Frequency

distribution of the number of users wants to develop new IT skill

DATA ANALYSIS

Out of 120 ACCPAC users, 83.4% agrees that they want to develop new IT skills and

expertise. On the other hand only 6.7% disagrees with the statement where another

10% remained neutral.

INTERPRETATION

The figures above show that most of the ACCPAC users want to develop new IT skills and

expertise.
Necessity of Training & Education

Table FREQUENCY DISTRIBUTION.23 Frequency distribution of the number of user need training
& education for new ERP.

Training & Education are necessary for me after SAP implementation.

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 58 48.3 48.3 48.3

Agree 56 46.7 46.7 95.0

Valid Neutral 5 4.2 4.2 99.2

Disagree 1 .8 .8 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.48 Histogram showing the Frequency

distribution of the number of users needs training & education for new ERP.

DATA ANALYSIS

Out of 120 ACCPAC users, 95% reported that they need training and education if a new

ERP system is implemented. On the other hand only 0.8% disagrees with the statement

where another 4.2% remained neutral.

INTERPRETATION

The figures above show that most of the ACCPAC users will need training and education

if a new ERP system is implemented.

Training increases flexibility & Adaptability

Table FREQUENCY DISTRIBUTION.24 Frequency distribution of the number of users believes

training increases flexibility and adaptability

Training & Education will increase flexibility and adaptability to change.

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 57 47.5 47.5 47.5

Agree 53 44.2 44.2 91.7

Valid Neutral 8 6.7 6.7 98.3

Disagree 2 1.7 1.7 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.49 Histogram showing the Frequency

distribution of the number of users believes training increases flexibility and

adaptability
DATA ANALYSIS

Out of 120 ACCPAC users, 91.7% agrees that training and education increases flexibility

to work and adaptability to new system. On the other hand only 1.7% disagrees with the

statement where another 6.7% remained neutral.

INTERPRETATION

The figures above show that most of the ACCPAC users agree that training and education

increases flexibility to work and adaptability to new system.

Training helps to develop new skill

Table FREQUENCY DISTRIBUTION.25 Frequency distribution of the number of users believes

training helps to develop new skill.

Training & Education will assist me to develop new skills.

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 59 49.2 49.2 49.2

Agree 44 36.7 36.7 85.8

Valid Neutral 14 11.7 11.7 97.5

Disagree 3 2.5 2.5 100.0

Total 120 100.0 100.0

 Figure FREQUENCY DISTRIBUTION.50 Histogram showing the Frequency
distribution of the number of users believes training helps to develop new skill.

DATA ANALYSIS

Out of 120 ACCPAC users, 85.9% agrees that training and education helps to assist them

develop new skill. On the other hand only 2.5% disagrees with the statement where

another 11.7% remained neutral.

INTERPRETATION

The figures above show that most of the ACCPAC users agree that training and education

helps to assist them develop new skill.

Training helps to perform effectively

Table FREQUENCY DISTRIBUTION.26 Frequency distribution of the number of users believes

training helps to perform effectively.

Training & Education will help me to perform effectively by saving time.

Frequency Percent Valid Percent Cumulative Percent

Valid Strongly Agree 61 50.8 50.8 50.8

 Agree 49 40.8 40.8 91.7

Neutral 8 6.7 6.7 98.3

Disagree 2 1.7 1.7 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.51 Histogram showing the Frequency

distribution of the number of users believes training helps to perform effectively.

DATA ANALYSIS

Out of 120 ACCPAC users, 91.6% agrees that training and education helps to perform

effectively by saving time. On the other hand only 1.7% disagrees with the statement

where another 6.7% remained neutral.

INTERPRETATION

The figures above show that most of the ACCPAC uses agree that training and education

helps to perform effectively by saving time.

Training helps to minimize error

 Table FREQUENCY DISTRIBUTION.27 Frequency distribution of the number of users believes
training helps to minimize errors.

Training & education will help me to minimize errors & to be productive.

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 59 49.2 49.2 49.2

Agree 52 43.3 43.3 92.5

Valid Neutral 6 5.0 5.0 97.5

Disagree 3 2.5 2.5 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.52 Histogram showing the Frequency

distribution of the number of users believes training helps to minimize errors.

DATA ANALYSIS

Out of 120 ACCPAC users, 92.5% agrees that training and education helps to perform

effectively by minimizing errors. On the other hand only 2.5% disagrees with the

statement where another 5% remained neutral.

INTERPRETATION
The figures above show that most of the ACCPAC uses agree that training and education

helps to perform effectively by minimizing errors.

Possibility to bring change

Table FREQUENCY DISTRIBUTION.28 Frequency distribution of the number of users believes that it
is possible to bring change in current work process

It is possible to bring changes or modify the current process of my works.

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 34 28.3 28.3 28.3

Agree 57 47.5 47.5 75.8

Valid Neutral 28 23.3 23.3 99.2

Disagree 1 .8 .8 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.53 Histogram showing the Frequency

distribution of the number of users believes that it is possible to bring change in current
work process.

DATA ANALYSIS
Out of 120 ACCPAC users, 75.8% agrees that it is possible to bring change in current

work process. On the other hand only 0.8% disagrees with the statement where another

23.4% remained neutral.

INTERPRETATION

The figures above show that most of the ACCPAC users agree that it is possible to bring

change in current work process.

Modifying current process will make work easy

Table FREQUENCY DISTRIBUTION.29 Frequency distribution of the number of

users believes that Modifying current process will make work easy
My works will become easier if the work process is modified or changed.

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 31 25.8 25.8 25.8

Agree 52 43.3 43.3 69.2

Valid Neutral 33 27.5 27.5 96.7

Disagree 4 3.3 3.3 100.0

Total 120 100.0 100.0

 Figure FREQUENCY DISTRIBUTION.54 Histogram showing the Frequency
distribution of the number of users believes that Modifying current process will make
work easy

DATA ANALYSIS

Out of 120 ACCPAC users, 69.1% agrees that a change in current process will make their

work easy. On the other hand only 3.3% disagrees with the statement where rest 27.3%

remained neutral.

INTERPRETATION

The figures above show that most of the ACCPAC users agree that a change in current

process will make their work easy.

Change in current process will save time

Table FREQUENCY DISTRIBUTION.30 Frequency distribution of the number of

users believes that change in current process will save time
Changing the current process I could save time.

Frequency Percent Valid Percent Cumulative Percent

Valid Strongly Agree 26 21.7 21.7 21.7

 Agree 58 48.3 48.3 70.0

Neutral 30 25.0 25.0 95.0

Disagree 3 2.5 2.5 97.5

Strongly Disagree 3 2.5 2.5 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.55 Histogram showing the Frequency

distribution of the number of users believes that change in current process will save
time.

DATA ANALYSIS

Out of 120 ACCPAC users, 70% agrees that a change in current process will save work

time. On the other hand only 5% disagrees with the statement where rest 25%

remained neutral.

INTERPRETATION

The figures above show that most of the ACCPAC users agree that a change in current

process will save working time.

Eliminating manual works will increase productivity

 Table FREQUENCY DISTRIBUTION.31 Frequency distribution of the number of
users believes that eliminating manual works will increase productivity

I could focus more on productive works if manual works are eliminated.

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 42 35.0 35.0 35.0

Agree 56 46.7 46.7 81.7

Neutral 18 15.0 15.0 96.7

Valid
Disagree 3 2.5 2.5 99.2

Strongly Disagree 1 .8 .8 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.56 Histogram showing the Frequency

distribution of the number of users believes that eliminating manual works will increase
productivity.

DATA ANALYSIS

Out of 120 ACCPAC users, 81.7% agrees that eliminating manual works will increase

productivity. On the other hand only 3.3% disagrees with the statement where rest 15%

remained neutral.

INTERPRETATION
The figures above show that most of the ACCPAC users agree that eliminating manual

works will increase productivity.

Current ERP system should be upgraded

Table FREQUENCY DISTRIBUTION.32 Frequency distribution of the number of

users believes that current ERP system should be upgraded

Current ERP system ACCPAC should be upgraded.

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 47 39.2 39.2 39.2

Agree 50 41.7 41.7 80.8

Valid Neutral 22 18.3 18.3 99.2

Strongly Disagree 1 .8 .8 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.57 Histogram showing the Frequency

distribution of the number of users believes that current ERP system should be
upgraded.

DATA ANALYSIS
Out of 120 ACCPAC users, 80.9% agrees that current ERP system should be upgraded.

On the other hand only 0.8% disagrees with the statement where rest 18.3% remained

neutral.

INTERPRETATION

The figures above show that most of the ACCPAC users agree that current ERP system

should be upgraded.

SAP should be implemented if it helps to perform more efficiently

Table FREQUENCY DISTRIBUTION.33 Frequency distribution of the number of

users believes that SAP should be implemented if it helps to perform more efficiently

SAP should be implemented if it helps to perform more efficiently.

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 50 41.7 41.7 41.7

Agree 54 45.0 45.0 86.7

Valid Neutral 15 12.5 12.5 99.2

Strongly Disagree 1 .8 .8 100.0

Total 120 100.0 100.0

 Figure FREQUENCY DISTRIBUTION.58 Histogram showing the Frequency
distribution of the number of users believes that SAP should be implemented if it helps
to perform more efficiently.

DATA ANALYSIS

Out of 120 ACCPAC users, 86.7% agrees that SAP should be implemented if it helps to

perform more efficiently. On the other hand only 0.8% disagrees with the statement

where rest 12.5% remained neutral.

INTERPRETATION

The figures above show that most of the ACCPAC users agree that SAP should be

implemented if it helps to perform more efficiently.

SAP should be implemented if it saves time and minimize work load

Table FREQUENCY DISTRIBUTION.34 Frequency distribution of the number of

users believes that SAP should be implemented if it saves time and minimize work load.
Frequency Percent Valid Percent Cumulative Percent

Valid Strongly Agree 51 42.5 42.5 42.5

Agree 55 45.8 45.8 88.3

 Neutral 12 10.0 10.0 98.3

Disagree 1 .8 .8 99.2

Strongly Disagree 1 .8 .8 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.59 Histogram showing the Frequency

distribution of the number of users believes that SAP should be implemented if it saves
time and minimize work load.

DATA ANALYSIS

Out of 120 ACCPAC users, 88.3% agrees that SAP should be implemented if it saves time

and minimize work load. On the other hand only 1.6% disagrees with the statement

where rest 10% remained neutral.

INTERPRETATION

The figures above show that most of the ACCPAC users agree that SAP should be

implemented if it saves time and minimize work load.

SAP should be implemented if it eliminates the problems exist in ACCPAC

 Table FREQUENCY DISTRIBUTION.35 Frequency distribution of the number of
users believes that SAP should be implemented if it eliminates the problems exists in
ACCPAC.

SAP should be implemented if it eliminates the problems exist in ACCPAC.

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 42 35.0 35.0 35.0

Agree 65 54.2 54.2 89.2

Valid Neutral 12 10.0 10.0 99.2

Strongly Disagree 1 .8 .8 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.60 Histogram showing the distribution of the

number of users believes that SAP should be implemented if it eliminates the problems
exist in ACCPAC.

DATA ANALYSIS

Out of 120 ACCPAC users, 89.2% agrees that SAP should be implemented if it eliminates

the problems exist in ACCPAC. On the other hand only 0.1% disagrees with the

statement where rest 10% remained neutral.

INTERPRETATION

The figures above show that most of the ACCPAC users agree that SAP should be

implemented if it eliminates the problems exist in ACCPAC.

Performance is depended on the ERP System

Table FREQUENCY DISTRIBUTION.36 Frequency distribution of the number of

users agrees that performance is depended on the ERP System

My works performance is depended on the ERP System.

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 17 14.2 14.2 14.2

Agree 53 44.2 44.2 58.3

Valid Neutral 34 28.3 28.3 86.7

Disagree 16 13.3 13.3 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.61 Histogram showing the distribution of the

number of users agrees that performance is depended on the ERP System.
DATA ANALYSIS

Out of 120 ACCPAC users, 58.4% agrees that their performance is depended on the ERP

System. On the other hand 13.3% disagrees with the statement where rest 28.3%

remained neutral.

INTERPRETATION

The figures above show that performance of the most ACCPAC users depends on the ERP

system.

Performance can be increased by process reengineering

Table FREQUENCY DISTRIBUTION.37 Frequency distribution of the number of

users agrees that performance can be improved by process reengineering
Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 29 24.2 24.2 24.2

Agree 61 50.8 50.8 75.0

Valid Neutral 25 20.8 20.8 95.8

Disagree 5 4.2 4.2 100.0

Total 120 100.0 100.0

 Figure FREQUENCY DISTRIBUTION.62 Histogram showing the distribution of the
number of users agrees that performance can be improved by process reengineering.

DATA ANALYSIS

Out of 120 ACCPAC users, 75% agrees that their performance can be improved by

process reengineering. On the other hand 4.2% disagrees with the statement where rest

20.8% remained neutral.

INTERPRETATION

The figures above show that performance of the most ACCPAC users can be improved by

process reengineering.

Productive works will increase performance

Table FREQUENCY DISTRIBUTION.38 Frequency distribution of the number of

users agrees that productive works will increase performance.
Frequency Percent Valid Percent Cumulative Percent

Valid Strongly Agree 43 35.8 35.8 35.8

Agree 64 53.3 53.3 89.2

 Neutral 12 10.0 10.0 99.2

Disagree 1 .8 .8 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.63 Histogram showing the distribution of the

number of users agrees that productive works will increase performance.

DATA ANALYSIS

Out of 120 ACCPAC users, 89.1% agrees that productive works will increase their

performance. On the other hand 0.8% disagrees with the statement where rest 10%

remained neutral.

INTERPRETATION

The figures above show that productive works will increase performance of the most

ACCPAC users.

Training & Education will increase performance

Table FREQUENCY DISTRIBUTION.39 Frequency distribution of the number of

users agrees that training and education will increase performance.
IT Education and ERP Training will improve my performance.
 Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 43 35.8 35.8 35.8

Agree 60 50.0 50.0 85.8

Valid Neutral 14 11.7 11.7 97.5

Disagree 3 2.5 2.5 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.64 Histogram showing the distribution of the

number of users agrees that training and education will increase performance.

DATA ANALYSIS

Out of 120 ACCPAC users, 85.8% agrees that training and education will increase their

performance. On the other hand 2.5% disagrees with the statement where rest 11.7%

remained neutral.

INTERPRETATION

The figures above show that training and education will increase performance of the

most ACCPAC users.

A change in current process will increase performance

Table FREQUENCY DISTRIBUTION.40 Frequency distribution of the number of

users agrees that a change in my current work process will enhance my performance.
Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 32 26.7 26.7 26.7

Agree 47 39.2 39.2 65.8

Neutral 35 29.2 29.2 95.0

Valid
Disagree 5 4.2 4.2 99.2

Strongly Disagree 1 .8 .8 100.0

Total 120 100.0 100.0

Figure FREQUENCY DISTRIBUTION.65 Histogram showing the Frequency

distribution of the number of users agrees that a change in my current work process
will enhance my performance.

DATA ANALYSIS

Out of 120 ACCPAC users, 65.9% agrees that a change in current process will increase

their performance. On the other hand 5% disagrees with the statement where rest

29.1% remained neutral.

INTERPRETATION

The figures above show that a change in current process will increase the performance

of the most ACCPAC users.

35. Correlation analysis

Correlation analysis measures the relationship between two continuous numeric

variables that indicates both the direction and degree to which they co-vary with one

another from case to case, without implying that one is causing the other. The

significance of each correlation coefficient is displayed in the correlation Table 1. The

significance level (or p-value) is the probability of obtaining results as extreme as the

one observed. If the significance level is very small (less than 0.05) then the correlation

is significant and the two variables are linearly related. If the significance level is

relatively large (for example, 0.50) then the correlation is not significant, hence the two

variables are not linearly related.

 Table Correlation analysis.41 correlation matrix

Correlations

Current.System IT.Skill Training.Education Process.Reengineering Upgrade.ERP.System Perfor

t. System Pearson 1 .171 .001 .285** .010

Correlation

Sig. (2- .062 .991 .002 .914

tailed)

N 120 120 120 120 120

Pearson .171 1 .479** .441** .571**

Correlation

Sig. (2- .062 .000 .000 .000

tailed)

N 120 120 120 120 120

g. Education Pearson .001 .479** 1 .516** .630**

Correlation

Sig. (2- .991 .000 .000 .000

tailed)

N 120 120 120 120 120

s.Reengineerin Pearson .285** .441** .516** 1 .588**

Correlation

Sig. (2- .002 .000 .000 .000

tailed)

N 120 120 120 120 120

de.ERP.System Pearson .010 .571** .630** .588** 1

Correlation

Sig. (2- .914 .000 .000 .000

tailed)

N 120 120 120 120 120

mance Pearson .166 .426** .512** .434** .571**

Correlation
 Sig. (2- .070 .000 .000 .000 .000
tailed)

N 120 120 120 120 120

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

The cross table matrix above shows the total correlation between Current system, IT

skill, Training education, process reengineering and upgrade ERP system. The inter

correlation between all of this items shows that how strongly they are related to each

other.

H0: Current system and the performance of the employees are not correlated.

H1: Current system and the performance of the employees are correlated.

Table Correlation analysis.42 correlation between current system and the performance
Correlations

Current. System Performance

Pearson Correlation 1 .166

Current. System Sig. (2-tailed) .070

N 120 120

Pearson Correlation .166 1

Performance Sig. (2-tailed) .070

N 120 120

Decision: The table above shows that the correlation of two variables, Current ERP

System and Performance of the employees, is 0.166. That means two variables have

almost no relation. Also the significance level is .07 which is higher than 0.05. That

means we cannot reject null hypothesis and at 95% confidence interval we can state

that current system and the performance of the employees are not correlated.

H0: IT skill and the performance of the employees are not correlated.
H1: IT skill and the performance of the employees are correlated.

Table Correlation analysis.43 Correlation between IT skill and performances of the employees
Correlations

Performance IT. Skill

Pearson Correlation 1 .426**

Performance Sig. (2-tailed) .000

N 120 120

Pearson Correlation .426** 1

IT. Skill Sig. (2-tailed) .000

N 120 120

Decision: The table above shows that the correlation of two variables, IT Skill and

Performance of the employees, is 0.426. That means two variables have positive

relation. Also the significance level is .000 which is less than 0.05. That means we can

reject null hypothesis and at 95% confidence interval we can state that IT skill and the

performance of the employees are correlated.

H0: IT skill and necessity of upgrading the ERP System are not correlated.

H1: IT skill and necessity of upgrading the ERP System are correlated.

Table Correlation analysis.44 Correlation between IT skill and Upgrading the ERP System of
Eskayef

Correlations

Upgrade.ERP.System IT.Skill

Pearson Correlation 1 .571**

UpgradeERP.System Sig. (2-tailed) .000

N 120 120

IT.Skill Pearson Correlation .571** 1

 Sig. (2-tailed) .000

N 120 120

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

Decision: The table above shows that the correlation of two variables, IT Skill and

Performance of the employees, is 0.571. That means two variables have strong positive

relation. Also the significance level is .000 which is less than 0.05. That means we can

reject null hypothesis and at 95% confidence interval we can state that IT skill and

necessity of upgrading the ERP System are correlated.

H0: Performance and Process reengineering are not correlated.

H1: Performance and Process reengineering are correlated.

Table Correlation analysis.45 Correlation between Performance and Process reengineering

Correlations

Performance Process. Reengineering

Pearson Correlation 1 .434**

Performance Sig. (2-tailed) .000

N 120 120

Pearson Correlation .434** 1

Process.Reengineering Sig. (2-tailed) .000

N 120 120

Decision: The table above shows that the correlation of two variables, IT Skill and

Performance of the employees, is 0.434. That means two variables have positive

relation. Also the significance level is .000 which is less than 0.05. That means we can

reject null hypothesis and at 95% confidence interval we can state that Performance

and Process reengineering are correlated.

H0: Upgrading ERP system and Process reengineering are not correlated.

H1: Upgrading ERP system and Process reengineering are correlated.

Table Correlation analysis.46 Correlation between Upgrading ERP system and Process
reengineering

Correlations

Upgrade.ERP.System Process. Reengineering

Upgrade.ERP.System Pearson Correlation 1 .588**

 Sig. (2-tailed) .000

N 120 120

Pearson Correlation .588** 1

Process. Reengineering Sig. (2-tailed) .000

N 120 120

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

Decision: The table above shows that the correlation of two variables, IT Skill and

Performance of the employees, is 0.588. That means two variables have strong positive

relation. Also the significance level is .000 which is less than 0.05. That means we can

reject null hypothesis and at 95% confidence interval we can state that upgrading ERP

system and Process reengineering are correlated.

H0: Necessity of upgrading ERP system and employees training are not correlated

H1: Necessity of upgrading ERP system and employees training are correlated.

Table Correlation analysis.47 Correlation between Upgrading ERP system and Training
Education

Correlations

Upgrade.ERP.System Training.Education

Pearson Correlation 1 .630**

Upgrade.ERP.System Sig. (2-tailed) .000

N 120 120

Pearson Correlation .630** 1

Training.Education Sig. (2-tailed) .000

N 120 120
 **. Correlation is significant at the 0.01 level (2-tailed).

Decision: The table above shows that the correlation of two variables, IT Skill and

Performance of the employees, is 0.630. That means two variables have strong positive

relation. Also the significance level is .000 which is less than 0.05. That means we can

reject null hypothesis and at 95% confidence interval we can state that necessity of

upgrading ERP system and employees training are correlated.

H0: Performance and Training & Education of employees are not correlated.

H1: Performance and Training & Education of employees are correlated.

Table Correlation analysis.48 Correlation between Performance and Training Education

Correlations

Performance Training. Education

Pearson Correlation 1 .512**

Performance Sig. (2-tailed) .000

N 120 120

Pearson Correlation .512** 1

Training. Education Sig. (2-tailed) .000

N 120 120

Decision: The table above shows that the correlation of two variables, IT Skill and

Performance of the employees, is 0.512. That means two variables have strong positive

relation. Also the significance level is .000 which is less than 0.05. That means we can
reject null hypothesis and at 95% confidence interval we can state that performance

and Training & Education of employees are correlated.

H0: Performance and necessity of upgrading ERP system are not correlated.

H1: Performance and necessity of upgrading ERP system are correlated.

Table Correlation analysis.49 Correlation between Performance and necessity of upgrading ERP
system
Correlations

Performance Upgrade.ERP.System

Pearson Correlation 1 .571**

Performance Sig. (2-tailed) .000

N 120 120

Pearson Correlation .571** 1

Upgrade.ERP.System Sig. (2-tailed) .000

N 120 120

Decision: The table above shows that the correlation of two variables, IT Skill and

Performance of the employees, is 0.571. That means two variables have strong positive

relation. Also the significance level is .000 which is less than 0.05. That means we can

reject null hypothesis and at 95% confidence interval we can state that Performance

and necessity of upgrading ERP system are correlated.

36. RELIABILITY TEST

In statistics, reliability is the consistency of a set of measurements or of a measuring

instrument, often used to describe a test. In the survey of this report, a set of 5 questions

was asked to measure each variable. Here, reliability test is performed in order to check

the consistency in the each set of questions. In SPSS, reliability is measured through

Cronbachs alpha. Cronbach's (alpha) is a coefficient of reliability. It is commonly used

as a measure of the internal consistency or reliability of a psychometric test score for a

sample of examinees.

Alpha varies from zero to 1 and it can take any value less than or equal to 1, including

negative values, although only positive values make sense. Higher values of alpha are

more desirable as it represents higher reliability. In most cases, alpha value is needed to

be higher than 0.7 to be considered as reliable.

RELIABILITY TEST ON CURRENT ERP SYSTEM

A set of five questions was asked to measure the effectiveness of Current ERP System.

After performing reliability test on these 5 questions, following SPSS output was

generated.

RELIABILITY TEST.50 Histogram showing the frequency distribution of employees age range
Reliability Statistics

Cronbach's Alpha N of Items

.584 5

The table above shows that Cronbachs alpha is positive but lower than 0.7. Therefore

the questionnaire set measuring the effectiveness of Current ERP System is internally

consistent. This also means factor analysis is needed to on the variable current ERP

system to increase reliability. Factor Analysis is done in next section.

RELIABILITY TEST ON IT Skill

A set of five questions was asked to measure the effectiveness of IT Skill. After

performing reliability test on these 5 questions, following SPSS output was generated.
 RELIABILITY TEST.51 Result of reliability test on IT Skill
Reliability Statistics

Cronbach's Alpha N of Items

.789 5

The table above shows that Cronbachs alpha is positive and higher than 0.7. Therefore

the questionnaire set measuring the effectiveness of IT Skill is acceptable and internally

consistent. This also means that the questions for this variable were objective, accurate

and positive.

RELIABILITY TEST ON TRAINING & EDUCATION

A set of five questions was asked to measure the effect of training & education. After

performing reliability test on these 5 questions, following SPSS output was generated.

RELIABILITY TEST.52 Result of reliability test on Training and Education

Reliability Statistics

Cronbach's Alpha N of Items

.847 5

The table above shows that Cronbachs alpha is positive and higher than .7. Therefore

the questionnaire set measuring the effectiveness of training & education is acceptable

and internally consistent. This also means that the questions for this variable were

objective, accurate and positive.

RELIABILITY TEST ON PROCESS REENGINEERING

A set of five questions was asked to measure the effect of process reengineering. After

performing reliability test on these 5 questions, following SPSS output was generated.

RELIABILITY TEST.53 Result of reliability test on Training and Education

Reliability Statistics

Cronbach's Alpha N of Items

.828 5

The table above shows that Cronbachs alpha is positive and higher than 0.7. Therefore

the questionnaire set measuring the effectiveness of process reengineering is acceptable

and internally consistent. This also means that the questions for this variable were

objective, accurate and positive.

RELIABILITY TEST ON NECESSITY OF SYSTEM UPGRADE

A set of five questions was asked to measure the necessity of ERP system upgrade. After

performing reliability test on these 5 questions, following SPSS output was generated.

RELIABILITY TEST.54 Result of reliability test on Training and Education

Reliability Statistics

Cronbach's Alpha N of Items

.825 5

The table above shows that Cronbachs alpha is positive and higher than 0.7. Therefore

the questionnaire set measuring the necessity of system upgrade is acceptable and

internally consistent. This also means that the questions for this variable were objective,

accurate and positive.

RELIABILITY TEST ON PERFORMANCE

A set of five questions was asked to measure the performance. After performing

reliability test on these 5 questions, following SPSS output was generated.

RELIABILITY TEST.55 Result of reliability test on Training and Education

Reliability Statistics

Cronbach's Alpha N of Items

.825 5

The table above shows that Cronbachs alpha is positive and higher than 0.7. Therefore

the questionnaire set measuring the performance is acceptable and internally

consistent. This also means that the questions for this variable were objective, accurate

and positive.
 37. FACTOR ANALYSIS
Factor analysis is a statistical method used to describe variability among observed

variables in terms of a potentially lower number of unobserved variables called factors.

The observed variables are modelled as linear combinations of the potential factors,

plus error terms. The information gained about the interdependencies between

observed variables can be used later to reduce the set of variables in a dataset (Factor

analysis, 2011).

Figure FACTOR ANALYSIS.66: Comparison of Cronbach's alpha

Through the reliability test it was found that the alpha value of all variables were

positive and higher than 0.7 except for current ERP System. Following table shows the

alpha range for each variable.

TABLE FACTOR ANALYSIS.56: Range of Cronbach's Alpha

0.00 - 0.69 0.70 - 0.89 0.90 - 1.00

Independent Variable

Current ERP System 0.584

IT Skill 0.789

Training & Education 0.847

Process Reengineering 0.828

Dependent Variable

Performance 0.825

Necessity of upgrading ERP System 0.766

The table shows that Cronbachs alpha for current ERP system is lower than 0.7 which

means the questions asked to measure the variable does not have internal consistency.

Hence factor analysis is important in order to deduct the question which is causing

higher variation or inconsistency in the question set. If the questions or factors with

high variation are deducted, question set will become more consistent and therefore will

be more reliable. After conducting factor analysis on Current ERP System, following

SPSS output was generated.

TABLE FACTOR ANALYSIS.57: Variance in Current ERP System

Total Variance Explained

Component Initial Eigenvalues Extraction Sums of Squared Loadings

Total % of Variance Cumulative % Total % of Variance Cumulative %

1 2.154 43.073 43.073 2.154 43.073 43.073

2 .974 19.482 62.554

3 .947 18.935 81.489

4 .523 10.469 91.958

5 .402 8.042 100.000

Extraction Method: Principal Component Analysis.

Data with high variance creates discrepancy. Therefore only the factors that have

eigenvalue below 1 should be considered for analysis. Scree plot shows value that

should be extracted. The table above shows that first component or the answers of first

questions have highest percentage of variance. That means answers of first question are

causing inconsistency in the question set. It is possible to get rid of 43% variance if the

first question is deducted.

 37.1 SCREE PLOT

Figure FACTOR ANALYSIS.67 Scree Plot

From the scree plot we can see that first factors have eigenvalue over 1. Therefore, the

first factor should be excluded from analysis and all remaining factors should be

considered for analysis.

After deducting the first question, reliability test on the current ERP System generates

following SPSS output.

TABLE FACTOR ANALYSIS.58: Reliability test on current ERP System after factor
analysis

Reliability Statistics
 Cronbach's Alpha N of Items

.767 3

The reliability statistics table shows that after deducting the factor with highest

variance Cronbachs alpha have increased to 0.767 from 0.584. As the Cronbachs alpha

is now higher that 0.7, the questionnaire set is internally consistent and reliable.

38. CROSSTABS & CHI-SQUARE TEST

Crosstab, or Cross Tabulation, is a process or function that combines and/or

summarizes data from one or more sources into a concise format for analysis or

reporting. Crosstabs display the joint distribution of two or more variables and they are

usually represented in the form of a contingency table in a matrix. Chi-square test is

possible from the crosstabs after finding the expected value for each cell.

CROSSTAB BETWEEN AGE AND USER FRIENDLINESS

The cross tabulation between two variables, age and user friendliness is given below

TABLE CROSSTABS & CHI-SQUARE TEST.59: Crosstab between age and user friendliness

Cross tabulation of Age & Current ERP (ACCPAC) is user-friendly.

Current ERP (ACCPAC) is user-friendly. Total

Strongly Agree Agree Neutral Disagree

Age 21-25 7 4 3 3 17
 26-30 7 12 12 12 43

31-35 5 16 13 0 34

36-40 2 8 3 2 15

Above 40 3 6 2 0 11

Total 24 46 33 17 120

From the cross tabulation and the bar chart, it appears that people from all age agreed

that their performance have improved after process reengineering.

CHI-SQUARE TEST OF AGE AND USER FRIENDLINESS

H0: User friendliness is not same due to age difference.

H1: User friendliness is same even there is age difference.

TABLE CROSSTABS & CHI-SQUARE TEST.60: Chi-Square output for user

friendliness

Chi-Square Tests

Value df Asymp. Sig. (2-sided)

Pearson Chi-Square 24.651a 12 .017

Likelihood Ratio 28.989 12 .004

Linear-by-Linear Association 1.701 1 .192

N of Valid Cases 120

a. 11 cells (55.0%) have expected count less than 5. The minimum expected count is 1.56.

Decision: the significance level is .017 which is lower than 0.05. Therefore null

hypothesis should be rejected. So it can be stated that user friendliness is same even

there is age difference.

CROSSTAB BETWEEN AGE AND CAPABILITY TO ADAPT WITH A NEW SYSTEM

The cross tabulation between two variables, age and capability to adapt with a new

system is given below

TABLE CROSSTABS & CHI-SQUARE TEST.61: Crosstab between age and user friendliness

Cross tabulation between Age & capability to adapt with a new system.

My IT skills and expertise are capable to adapt with a new system. Total

Strongly Agree Agree Nutral Disagree

21-25 4 9 3 1 17

26-30 7 17 19 0 43

Age 31-35 7 16 11 0 34

36-40 1 10 2 2 15

Above 40 4 5 2 0 11

Total 23 57 37 3 120

From the cross tabulation and the bar chart, it appears that people from all age agreed

that they are capable to adapt with a new ERP System.

CHI-SQUARE TEST OF AGE AND CAPABILITY TO ADAPT WITH A NEW SYSTEM

H0: Capability to adapt with a new system is not same due to age difference.

H1: Capability to adapt with a new system is same even there is age difference.

TABLE CROSSTABS & CHI-SQUARE TEST.62: Chi-Square output for Capability to

adapt with a new system

Chi-Square Tests

Value df Asymp. Sig. (2-sided)

 Pearson Chi-Square 20.714a 12 .055

Likelihood Ratio 19.444 12 .078

Linear-by-Linear Association .444 1 .505

N of Valid Cases 120

a. 10 cells (50.0%) have expected count less than 5. The minimum expected count is .28.

Decision: the significance level is .055 which is higher than 0.05. Therefore null

hypothesis cannot be rejected. So it can be stated that Capability to adapt with a new

system is not same due to age difference.

CROSSTAB BETWEEN GENDER AND SATISFACTION WITH CURRENT ERP

The cross tabulation between two variables, gender and satisfaction with current ERP

system is given below

TABLE CROSSTABS & CHI-SQUARE TEST.63: Crosstab between gender and user friendliness

Cross tabulation between Gender and Satisfaction with Current ERP

I am satisfied with ACCPAC (current ERP). Total

Strongly Agree Agree Neutral Disagree Strongly Disagree

Male 13 26 24 10 15 88
Gender
Female 5 19 7 0 1 32

Total 18 33 31 10 16 120

From the cross tabulation and the bar chart, it appears that people confused about the

satisfaction level with ACCPAC. 1/4th of the sample are showing neutral response.

CHI-SQUARE TEST OF GENDER AND SATISFACTION WITH CURRENT ERP

H0: Satisfaction level is not same between genders.

H1: Satisfaction level is same between genders.

TABLE CROSSTABS & CHI-SQUARE TEST.64: Chi-Square output for Gender and
Satisfaction with Current ERP

Chi-Square Tests

Value df Asymp. Sig. (2-sided)

Pearson Chi-Square 7.429a 4 .115

Likelihood Ratio 9.872 4 .043

Linear-by-Linear Association 1.231 1 .267

N of Valid Cases 120

a. 4 cells (40.0%) have expected count less than 5. The minimum expected
count is .27.

Decision: The Chi-square vale is 7.429 and the significance level is .115 which is higher

than 0.05. Therefore null hypothesis cannot be rejected. So it can be stated that

Satisfaction level is not same between genders.

CROSSTAB BETWEEN GENDER AND IT SKILL TO USE ERP

The cross tabulation between two variables, gender and sufficient IT skill to use current

ERP system is given below

TABLE CROSSTABS & CHI-SQUARE TEST.65: Crosstab between gender and sufficient IT skills and
expertise to use ERP

Cross tabulation between Gender and sufficient IT skills and expertise to use ERP

Sufficient IT skills and expertise to use ERP. Total

Strongly Agree Agree Neutral Disagree

Male 11 40 26 11 88
Gender
Female 8 14 5 5 32
 Total 19 54 31 16 120

From the cross tabulation and the bar chart, it appears that people agrees that they have

sufficient IT Skill and expertise to use ERP.

CHI-SQUARE TEST OF GENDER AND GENDER AND IT SKILL TO USE ERP

H0: IT Skill and expertise is not same between genders.

H1: IT Skill and expertise is same between genders.

TABLE CROSSTABS & CHI-SQUARE TEST.66: Chi-Square output for gender and
sufficient IT skills to use ERP

Chi-Square Tests

Value df Asymp. Sig. (2-sided)

Pearson Chi-Square 4.263a 3 .234

Likelihood Ratio 4.243 3 .236

Linear-by-Linear Association 1.161 1 .281

N of Valid Cases 120

a. 1 cells (12.5%) have expected count less than 5. The minimum expected count is 4.27.

Decision: The Chi-square vale is 4.263 and the significance level is .234 which is higher

than 0.05. Therefore null hypothesis cannot be rejected. So it can be stated that IT Skill

and expertise is not same between genders.

CROSSTAB BETWEEN GENDER AND IT SKILL TO ADAPT NEW SYSTEM

The cross tabulation between two variables, gender and IT Skill to adapt with a new

system is given below

TABLE CROSSTABS & CHI-SQUARE TEST.67: Crosstab between gender and sufficient IT skills and
expertise to use ERP

Cross tabulation between Gender and capability of IT skills to adapt with a new system.

My IT skills and expertise are capable to adapt with a new system. Total

Strongly Agree Agree Nutral Disagree

Male 17 40 29 2 88
Gender
Female 6 17 8 1 32

Total 23 57 37 3 120

From the cross tabulation and the bar chart, it appears that people agrees that they have

sufficient IT Skill and expertise to adapt with new ERP.

CHI-SQUARE TEST OF GENDER AND GENDER AND IT SKILL TO ADAPT NEW SYSTEM

H0: Adaptability is not same between genders.

H1: Adaptability is same between genders.

TABLE CROSSTABS & CHI-SQUARE TEST.68: Chi-Square output for Gender and
IT Skill to adapt new system

Chi-Square Tests

Value df Asymp. Sig. (2-sided)

Pearson Chi-Square .844a 3 .839

Likelihood Ratio .856 3 .836

Linear-by-Linear Association .131 1 .717

N of Valid Cases 120

a. 2 cells (25.0%) have expected count less than 5. The minimum expected count is .80.
Decision: The Chi-square vale is 0.844 and the significance level is .839 which is higher

than 0.05. Therefore null hypothesis cannot be rejected. So it can be stated that

Adaptability is same between genders.

CROSSTAB BETWEEN GENDER AND INTEREST TO DEVELOP NEW SKILL

The cross tabulation between two variables, gender and interest to develop new Skill is

given below

TABLE CROSSTABS & CHI-SQUARE TEST.69: Crosstab between Gender and Interest to develop
new Skill

Cross tabulation between Gender and Interest to develop new Skill

I would like to develop new IT skills & expertise required for SAP. Total

Strongly Agree Agree Nutral Disagree

Male 41 34 8 5 88
Gender
Female 12 13 4 3 32

Total 53 47 12 8 120

From the cross tabulation and the bar chart, it appears that people agrees that most of

the employees are interested to develop new IT Skill.

CHI-SQUARE TEST OF GENDER AND INTEREST TO DEVELOP NEW SKILL

H0: Interest to develop new IT skill is not same between genders.

H1: Interest to develop new IT skill is same between genders.

TABLE CROSSTABS & CHI-SQUARE TEST.70: Chi-Square output for Gender and
Interest to develop new Skill

Chi-Square Tests
 Value df Asymp. Sig. (2-sided)

Pearson Chi-Square 1.216a 3 .749

Likelihood Ratio 1.185 3 .757

Linear-by-Linear Association 1.203 1 .273

N of Valid Cases 120

a. 2 cells (25.0%) have expected count less than 5. The minimum expected count is 2.13.

Decision: The Chi-square vale is 1.216 and the significance level is .749 which is higher

than 0.05. Therefore null hypothesis cannot be rejected. So it can be stated that Interest

to develop new IT skill is same between genders.

CROSSTAB BETWEEN GENDER AND THOUGHT ABOUT SYSTEM UPGRADE

The cross tabulation between two variables, gender and IT Skill to adapt with a new

system is given below

TABLE CROSSTABS & CHI-SQUARE TEST.71: Crosstab between Gender and thought about System
upgrade

Cross tab between Gender and thought about System upgrade

Current ERP system ACCPAC should be upgraded. Total

Strongly Agree Agree Nutral Strongly

Disagree

Male 31 41 16 0 88
Gender
Female 16 9 6 1 32

Total 47 50 22 1 120

From the cross tabulation and the bar chart, it appears that people agrees that most of

the employees believes that ACCPAC should be upgraded.

CHI-SQUARE TEST OF GENDER AND THOUGHT ABOUT SYSTEM UPGRADE

 H0: Thought of upgrading ACCPAC is not same between genders.

H1: Thought of upgrading ACCPAC is same between genders.

TABLE CROSSTABS & CHI-SQUARE TEST.72: Chi-Square output for Gender and
thought about System upgrade

Chi-Square Tests

Value df Asymp. Sig. (2-sided)

Pearson Chi-Square 5.982a 3 .112

Likelihood Ratio 5.975 3 .113

Linear-by-Linear Association .088 1 .767

N of Valid Cases 120

a. 2 cells (25.0%) have expected count less than 5. The minimum expected count is .27.

Decision: The Chi-square vale is 5.982 and the significance level is .112 which is higher

than 0.05. Therefore null hypothesis cannot be rejected. So it can be stated that thought

of upgrading ACCPAC is same between genders.

CROSSTAB BETWEEN JOB LEVEL AND PROBLEM WITH ACCPAC

The cross tabulation between two variables, Job level and problem with ACCPAC is given

below

TABLE CROSSTABS & CHI-SQUARE TEST.73: Crosstab between job level and problem with
ACCPAC

Cross tabulation between job level and problem with ACCPAC

I do not face problem while working on ACCPAC. Total

Strongly Agree Agree Neutral Disagree Strongly

Disagree

Job Level Managerial Level 2 9 2 11 2 26

 Officer Level 2 26 24 37 5 94

Total 4 35 26 48 7 120

From the cross tabulation and the bar chart, it appears that people from all job level

faces problem while working on ACCPAC.

CHI-SQUARE TEST OF JOB LEVEL AND PROBLEM WITH ACCPAC

H0: Problem faced while working on ACCPAC is not same between job levels.

H1: Problem faced while working on ACCPAC is same between job levels.

TABLE CROSSTABS & CHI-SQUARE TEST.74: Chi-Square output for Gender and
problem with ACCPAC

Chi-Square Tests

Value df Asymp. Sig. (2-sided)

Pearson Chi-Square 5.462a 4 .243

Likelihood Ratio 5.838 4 .212

Linear-by-Linear Association .211 1 .646

N of Valid Cases 120

a. 3 cells (30.0%) have expected count less than 5. The minimum expected count is .87.

Decision: The Chi-square vale is 5.462 and the significance level is .243 which is higher

than 0.05. Therefore null hypothesis cannot be rejected. So it can be stated that

Problem faced while working on ACCPAC is same between job levels.

CROSSTAB BETWEEN JOB LEVEL AND DEPENDENCY OF PERFORMANCE

ON ERP SYSTEM

The cross tabulation between two variables, Job level and dependency of performance

on the ERP System is given below

TABLE CROSSTABS & CHI-SQUARE TEST.75: Crosstab between job level and dependency of
performance on the ERP System

Cross tabulation between Job Level and dependency of performance on the ERP System.

My works performance is depended on the ERP System. Total

Strongly Agree Agree Nutral Disagree

Managerial Level 4 16 5 1 26
Job Level
Officer Level 13 37 29 15 94

Total 17 53 34 16 120

From the cross tabulation and the bar chart, it appears that people from all job level are

dependent on ERP System for their Performance.

CHI-SQUARE TEST OF JOB LEVEL AND DEPENDENCY OF PERFORMANCE

H0: Employee performance of different job level is not dependent on ERP system.

H1: Employee performance of different job level is dependent on ERP system.

TABLE CROSSTABS & CHI-SQUARE TEST.76: Chi-Square output for Gender and
dependency of performance

Chi-Square Tests

Value df Asymp. Sig. (2-sided)

Pearson Chi-Square 5.514a 3 .138

Likelihood Ratio 6.091 3 .107

Linear-by-Linear Association 3.568 1 .059

N of Valid Cases 120

a. 2 cells (25.0%) have expected count less than 5. The minimum expected count is 3.47.
Decision: The Chi-square vale is 5.514 and the significance level is .138 which is higher

than 0.05. Therefore null hypothesis cannot be rejected. So it can be stated that

employee performance of different job level is dependent on ERP system.

39. T - Tests
T-Test on Performance increase through process change

H0: A Change in the current process will not increase performance.

H1: A Change in the current process will increase performance.

Following SPSS output was generated after conducting One Sample T-test in SPSS.
 Table T - Tests.77 One sample T test on increasing performance through process change.

One-Sample Test

Test Value = 1

t df Sig. (2-tailed) Mean 95% Confidence Interval of the Difference

Difference
Lower Upper

A change in my current work

process will enhance my 13.979 119 .000 1.13333 .9728 1.2939
performance.

Test Statistic: The One Sample T-test table shows that the t value is 13.979 with degree

of freedom of 119. Also the level of significance is .000.

Decision: Here the significance level .000 is lower than statistical significance .05.

Therefore, we can reject the null hypothesis and it can be concluded that a change in

the current process will increase performance.

T-Test on making work easier through process change

H0: Works will not become easier if the work process is modified or changed.

H1: Works will become easier if the work process is modified or changed.

Table T - Tests.78 One sample T test on making work easier through process change

One-Sample Test

Test Value = 1

t df Sig. (2-tailed) 95% Confidence Interval of the Difference

 Mean Lower Upper
Difference

My works will become

easier if the work process 14.550 119 .000 1.08333 .9359 1.2308
is modified or changed.

Test Statistic: The One Sample T-test table shows that the t value is 14.55 with degree

of freedom of 119. Also the level of significance is .000.

Decision: Here the significance level .000 is lower than statistical significance .05.

Therefore, we can reject the null hypothesis and it can be concluded that works will

become easier if the work process is modified or changed.

T-Test on supporting work before working in ACCPAC

H0: Users do not need to do supporting manual works before working in ACCPAC.

H1: Users need to do supporting manual works before working in ACCPAC.

Table T - Tests.79 One sample T test on necessity to do supporting works before working in
ACCPAC

One-Sample Test

Test Value = 1

t df Sig. (2-tailed) Mean 95% Confidence Interval of the

Difference Difference

Lower Upper

I have to do supporting
Manual works before 12.527 119 .000 1.27500 1.0735 1.4765
working in ACCPAC

Test Statistic: The One Sample T-test table shows that the t value is 12.527 with degree

of freedom of 119. Also the level of significance is .000.

Decision: Here the significance level .000 is lower than statistical significance .05.

Therefore, we can reject the null hypothesis and it can be concluded that users need to

do supporting manual works before working in ACCPAC.

T-Test on possibility of bringing change in current work process

H0: It is not possible to bring change in the current work process.

H1: It is possible to bring change in the current work process.

Table T - Tests.80 One sample T test on possibility of bringing change in current work process

One-Sample Test

Test Value = 1

t df Sig. (2- Mean 95% Confidence Interval of the Difference

tailed) Difference
Lower Upper

It is possible to bring
changes or modify the
14.233 119 .000 .96667 .8322 1.1011
current process of my
works.

Test Statistic: The One Sample T-test table shows that the t value is 14.233 with degree

of freedom of 119. Also the level of significance is .000.

Decision: Here the significance level .000 is lower than statistical significance .05.

Therefore, we can reject the null hypothesis and it can be concluded that it is possible

to bring change in the current work process.

T-Test on Necessity of Training after SAP implementation

H0: Training & Education is not necessary after SAP implementation.

H1: Training & Education is necessary after SAP implementation.

Table T - Tests.81 One sample T test on possibility of bringing change in current work process

One-Sample Test

Test Value = 1

t df Sig. (2- Mean 95% Confidence Interval of the Difference

tailed) Difference
Lower Upper

Training & Education are

necessary for me after 10.206 119 .000 .57500 .4634 .6866
SAP implementation.

Test Statistic: The One Sample T-test table shows that the t value is 10.206 with degree

of freedom of 119. Also the level of significance is .000.

Decision: Here the significance level .000 is lower than statistical significance .05.

Therefore, we can reject the null hypothesis and it can be concluded that Training &

Education is necessary after SAP implementation.

T-Test on performance can be improved by process reengineering

H0: It is not possible to improve performance by process reengineering.

H1: It is possible to improve performance by process reengineering.

Table T - Tests.82 One sample T test on performance can be improved by process reengineering

One-Sample Test

Test Value = 1
 t df Sig. (2- Mean 95% Confidence Interval of the
tailed) Difference Difference

Lower Upper

My performance can be
improved by process 14.616 119 .000 1.05000 .9077 1.1923
reengineering through SAP.

Test Statistic: The One Sample T-test table shows that the t value is 14.616 with degree

of freedom of 119. Also the level of significance is .000.

Decision: Here the significance level .000 is lower than statistical significance .05.

Therefore, we can reject the null hypothesis and it can be concluded that it is possible

to improve performance by process reengineering.

T-Test on Execution of SAP if it eliminates the existing problems

H0: SAP should not be implemented even if it eliminates the existing problems.

H1: SAP should be implemented if it eliminates the existing problems.

Table T - Tests.83 One sample T test on Execution of SAP if it eliminates the existing
problems

One-Sample Test

Test Value = 1

t df Sig. (2- Mean 95% Confidence Interval of the Difference

tailed) Difference
Lower Upper

SAP should be implemented

if it eliminates the problems 12.275 119 .000 .77500 .6500 .9000
exist in Accpac.

Test Statistic: The One Sample T-test table shows that the t value is 12.275 with degree

of freedom of 119. Also the level of significance is .000.

 Decision: Here the significance level .000 is lower than statistical significance .05.

Therefore, we can reject the null hypothesis and it can be concluded that SAP should be

implemented if it eliminates the existing problems.

T-Test on implementation of SAP if it minimize work load

H0: SAP should not be implemented even if it saves time and minimize work load.

H1: SAP should be implemented if it saves time and minimize work load.

Table T - Tests.84 One sample T test on performance can be improved by process

reengineering

One-Sample Test

Test Value = 1

t df Sig. (2- Mean 95% Confidence Interval of the Difference

tailed) Difference
Lower Upper

SAP should be implemented

if it saves time and minimize 10.513 119 .000 .71667 .5817 .8517
work load.

Test Statistic: The One Sample T-test table shows that the t value is 10.513 with degree

of freedom of 119. Also the level of significance is .000.

Decision: Here the significance level .000 is lower than statistical significance .05.

Therefore, we can reject the null hypothesis and it can be concluded that SAP should be

implemented if it saves time and minimize work load.

T-Test on ERP System Upgrade

H0: Current ERP system ACCPAC should be not upgraded.

H1: Current ERP system ACCPAC should be upgraded.

Table T - Tests.85 One sample T test on performance can be improved by process
reengineering
One-Sample Test

Test Value = 1

t df Sig. (2-tailed) Mean 95% Confidence Interval of the Difference

Difference
Lower Upper

Current ERP system

ACCPAC should be 11.347 119 .000 .81667 .6742 .9592
upgraded.

Test Statistic: The One Sample T-test table shows that the t value is 11.347 with degree

of freedom of 119. Also the level of significance is .000.

Decision: Here the significance level .000 is lower than statistical significance .05.

Therefore, we can reject the null hypothesis and it can be concluded that Current ERP

system ACCPAC should be upgraded.

40. ANOVA
PERFORMANCE AND CURRENT ERP SYSTEM

The ANOVA test was conducted to measure the performance enhancement due to

adaptation of IT System.

H0: Current ERP system influences employee performance.

H1: Current ERP system doesnt influences employee performance.

Following output was generated after conducting ANOVA test at 95% confidence

interval in SPSS.

TABLE ANOVA.86: ANOVA Table measuring the influence of current ERP system on
performance

ANOVAa

Model Sum of Squares df Mean Square F Sig.

Regression 1.079 1 1.079 3.340 .070b

1 Residual 38.121 118 .323

Total 39.200 119

a. Dependent Variable: Performance

b. Predictors: (Constant), Current.System

DECISION: The SPSS output for ANOVA shows that F value is 3.340 and the level of

significance is .070. Because the significance level .070 is higher than acceptable level of

significance .05, we cannot reject the null hypothesis. Therefore, it can be stated that

Current ERP system influences employee performance.

PERFORMANCE AND IT Skill

The ANOVA test was conducted to measure the performance enhancement due to

adaptation of IT System.
H0: IT skill is not important for employee performance.

H1: IT skill is important for employee performance.

Following output was generated after conducting ANOVA test at 95% confidence

interval in SPSS.

TABLE ANOVA.87: ANOVA Table measuring the importance of IT Skill for performance

ANOVAa

Model Sum of Squares df Mean Square F Sig.

Regression 7.101 1 7.101 26.105 .000b

1 Residual 32.099 118 .272

Total 39.200 119

a. Dependent Variable: Performance

b. Predictors: (Constant), IT.Skill

DECISION: The SPSS output for ANOVA shows that F value is 26.105 and the level of

significance is .000. Because the significance level .000 is lower than acceptable level of

significance .05, we can reject the null hypothesis. Therefore it can be stated that IT skill

is important for employee performance.

PERFORMANCE AND PROCESS REENGINEERING

The ANOVA test was conducted to measure the performance enhancement due to

adaptation of IT System.

H0: Process reengineering cannot enhance employee performance.

H1: Process reengineering can influence employee performance.

Following output was generated after conducting ANOVA test at 95% confidence

interval in SPSS.

TABLE ANOVA.88: ANOVA Table measuring the increase of performance due to process
reengineering

ANOVAa

Model Sum of Squares df Mean Square F Sig.

Regression 7.372 1 7.372 27.330 .000b

1 Residual 31.828 118 .270

Total 39.200 119

a. Dependent Variable: Performance

b. Predictors: (Constant), Process. Reengineering

DECISION: The SPSS output for ANOVA shows that F value is 27.330 and the level of

significance is .000. Because the significance level .000 is lower than acceptable level of

significance .05, we can reject the null hypothesis. Therefore, it can be stated that

Process reengineering can enhance employee performance.

PERFORMANCE AND Training & Education

The ANOVA test was conducted to measure the performance enhancement due to

adaptation of IT System.

H0: Training & Education does not enhance employee performance.

H1: Training & Education does influence employee performance.

Following output was generated after conducting ANOVA test at 95% confidence

interval in SPSS.
TABLE ANOVA.89: ANOVA Table measuring the influence of Training on performance

ANOVAa

Model Sum of Squares df Mean Square F Sig.

Regression 10.284 1 10.284 41.966 .000b

1 Residual 28.916 118 .245

Total 39.200 119

a. Dependent Variable: Performance

b. Predictors: (Constant), Training.Education

DECISION: The SPSS output for ANOVA shows that F value is 41.966 and the level of

significance is .000. Because the significance level .000 is lower than acceptable level of

significance .05, we can reject the null hypothesis. Therefore, it can be stated that

Training & Education does influence employee performance.

NECESSITY OF SYSTEM UPGRADE AND PROCESS REENGINEERING

The ANOVA test was conducted to measure the performance enhancement due to

adaptation of IT System.

H0: ERP system upgrade is not necessary for process reengineering.

H1: ERP system upgrade is necessary for process reengineering.

Following output was generated after conducting ANOVA test at 95% confidence

interval in SPSS.
TABLE ANOVA.90: ANOVA Table measuring the necessity of upgrading ERP system
for process reengineering.

ANOVAa

Model Sum of Squares df Mean Square F Sig.

Regression 12.895 1 12.895 62.198 .000b

1 Residual 24.464 118 .207

Total 37.359 119

a. Dependent Variable: Upgrade.ERP.System

b. Predictors: (Constant), Process. Reengineering

DECISION: The SPSS output for ANOVA shows that F value is 62.198 and the level of

significance is .000. Because the significance level .000 is lower than acceptable level of

significance .05, we can reject the null hypothesis. Therefore, it can be stated that ERP

system upgrade is necessary for process reengineering.

41. Regression Analysis

PERFORMANCE AND CURRENT ERP SYSTEM
Purpose of this regression analysis was to find out whether Current ERP System can

enhance employee performance. Here performance is considered as dependent variable

and Current ERP System is considered as independent variable. Following Model

Summary and Coefficients table was generated after running the regression analysis is

SPSS.

TABLE Regression Analysis.91: Model summary of Current ERP System predicting

Performance

Model Summary

Model R R Square Adjusted R Square Std. Error of the Estimate

1 .166a .028 .019 .56838

a. Predictors: (Constant), Current.System

Model summary above shows that correlation, r = .166. That means two variables,

Performance & Current ERP System, have almost no correlation. Coefficient of

determination or the R-Square value is 0.028. That means only 2.8% changes in the

employee performance can be explained by the current ERP System. Value of adjusted R-

Square is 0.019 indicates 1.9% variation in performance can be measured by current

ERP System.

Regression was conducted at 95% confidence interval to test the effect of Current ERP

System on employee performance. And the coefficient table of the regression is shown

below

TABLE Regression Analysis.92: Coefficients table for Performance & Current ERP
System

Coefficientsa

Model Unstandardized Coefficients Standardized Coefficients t Sig.

B Std. Error Beta

(Constant) 1.637 .222 7.364 .000

1
Current.System .162 .088 .166 1.828 .070

a. Dependent Variable: Performance

H0: Current ERP System has no effect on employee performance.

 H1: Current ERP System has effect on employee performance.

Test Statistic: The value of the for Current ERP System is 0.166, value of t statistic is

7.364 and the significance level is .000

Decision: Here the significance level .000 is lower than statistical significance .05.

Therefore, we can reject the null hypothesis and it can be concluded that Current ERP

System has effect on employee performance

The regression model to predict employee performance through Current ERP System is:

Performance = + (Current ERP System)

The coefficient table shows that value of is 1.637 and value of is 0.162. Therefore the

model is

Performance = 1.637 + 0.162(Current ERP System)

Now, the model will show how much effect Current ERP system have on performance if

the value of IT system is inserted in the model. For each unit of investment in current

ERP system will increase 1.799 units in employee performance.

PERFORMANCE AND IT SKILL

Purpose of this regression analysis was to find out whether IT Skill can enhance

employee performance. Here performance is considered as dependent variable and IT

Skill is considered as independent variable. Following Model Summary and Coefficients

table was generated after running the regression analysis is SPSS.

TABLE Regression Analysis.93: Model summary of IT SKILL predicting Performance

Model Summary
 Model R R Square Adjusted R Square Std. Error of the Estimate

1 .426a .181 .174 .52156

a. Predictors: (Constant), IT.Skill

Model summary above shows that correlation, r = .426. That means two variables,

Performance & IT SKILL, have positive correlation. Coefficient of determination or the R-

Square value is 0.181. That means 18.1% changes in the employee performance can be

explained by employees IT SKILL. Value of adjusted R-Square is 0.174 indicates 17.4%

variation in performance can be measured by IT SKILL.

Regression was conducted at 95% confidence interval to test the effect of IT Skill on

employee performance. And the coefficient table of the regression is shown below

TABLE Regression Analysis.94: Coefficients table for Performance & IT SKILL

Coefficientsa

Model Unstandardized Coefficients Standardized Coefficients t Sig.

B Std. Error Beta

(Constant) 1.255 .159 7.873 .000

1
IT.Skill .388 .076 .426 5.109 .000

a. Dependent Variable: Performance

H0: IT SKILL has no effect on employee performance.

H1: IT SKILL has effect on employee performance.

Test Statistic: The value of the for IT Skill is .426, value of t statistic is 7.873 and the

significance level is .000

Decision: Here the significance level .000 is lower than statistical significance .05.

Therefore, we can reject the null hypothesis and it can be concluded that IT Skill has

effect on employee performance

The regression model to predict employee performance through IT Skill is:

Performance = + (IT Skill)

The coefficient table shows that value of is 1.255 and value of is 0.426. Therefore the

model is

Performance = 1.255 + 0.426 (IT Skill)

Now, the model will show how much effect IT skill have on performance if the value of

IT skill is inserted in the model. For each unit of positive change in IT Skill will increase

1.681 units in employee performance.

PERFORMANCE AND PROCESS REENGINEERING

Purpose of this regression analysis was to find out whether process reengineering can

enhance employee performance. Here performance is considered as dependent variable

and process reengineering is considered as independent variable. Following Model

Summary and Coefficients table was generated after running the regression analysis is

SPSS.

TABLE Regression Analysis.95: Model summary of process reengineering predicting

Performance

Model Summary

Model R R Square Adjusted R Square Std. Error of the Estimate

1 .434a .188 .181 .51935

 a. Predictors: (Constant), Process.Reengeeniring

Model summary above shows that correlation, r = .434. That means two variables,

Performance & process reengineering, have positive correlation. Coefficient of

determination or the R-Square value is 0.188. That means 18.8% changes in the

employee performance can be explained by process reengineering. Value of adjusted R-

Square is 0.181 indicates 18.1% variation in performance can be measured by process

reengineering.

Regression was conducted at 95% confidence interval to test the effect of Process

reengineering on employee performance. And the coefficient table of the regression is

shown below

TABLE Regression Analysis.96: Coefficients table for Performance & process

reengineering
Coefficientsa

Model Unstandardized Coefficients Standardized Coefficients t Sig.

B Std. Error Beta

(Constant) 1.239 .159 7.796 .000

1
Process.Reengeeniring .382 .073 .434 5.228 .000

a. Dependent Variable: Performance

H0: Process reengineering cannot increase employee performance.

H1: Process reengineering can increase employee performance.

Test Statistic: The value of the for process reengineering is .434, value of t statistic is

7.796 and the significance level is .000

Decision: Here the significance level .000 is lower than statistical significance .05.

Therefore, we can reject the null hypothesis and it can be concluded that Process

reengineering can increase employee performance.

The regression model to predict employee performance by process reengineering is:

Performance = + (process reengineering)

The coefficient table shows that value of is 1.239 and value of is 0.434. Therefore the

model is

Performance = 1.239 + 0.434 (process reengineering)

Now, the model will show how much effect process reengineering have on performance

if the value of process reengineering is inserted in the model. For each unit of positive

process reengineering will increase 1.673 units in employee performance.

PERFORMANCE AND TRAINING & EDUCATION

Purpose of this regression analysis was to find out whether training & education can

enhance employee performance. Here performance is considered as dependent variable

and training is considered as independent variable. Following Model Summary and

Coefficients table was generated after running the regression analysis is SPSS.
TABLE Regression Analysis.97: Model summary of training & education predicting
Performance

Model Summary

Model R R Square Adjusted R Square Std. Error of the Estimate

1 .512a .262 .256 .49503

a. Predictors: (Constant), Training.Education

Model summary above shows that correlation, r = .512. That means two variables,

Performance & IT Training, have positive correlation. Coefficient of determination or the

R-Square value is 0.262. That means 26.2% changes in the employee performance can

be explained by training & Education. Value of adjusted R-Square is 0.256 indicates

25.6% variation in performance can be caused by Training & Education.

Regression was conducted at 95% confidence interval to test the effect of Training &

Education on employee performance. And the coefficient table of the regression is

shown below

TABLE Regression Analysis.98: Coefficients table for Performance & Training

Coefficientsa

Model Unstandardized Coefficients Standardized t Sig.

Coefficients

B Std. Error Beta

(Constant) 1.168 .141 8.292 .000

1
Training.Education .535 .083 .512 6.478 .000

a. Dependent Variable: Performance

 H0: Training & Education cannot increase employee performance.

H1: Training & Education can increase employee performance.

Test Statistic: The value of the for process reengineering is .512, value of t statistic is

8.292 and the significance level is .000

Decision: Here the significance level .000 is lower than statistical significance .05.

Therefore, we can reject the null hypothesis and it can be concluded that Training &

Education can increase employee performance.

The regression model to predict employee performance by training & education is:

Performance = + (Training & Education)

The coefficient table shows that value of is 1.168 and value of is 0.512. Therefore the

model is

Performance = 1.168 + 0.512 (Training & Education)

Now, the model will show how much effect training and education have on performance

if the value of training and education is inserted in the model. For each unit of training

& Education will increase 1.68 units employee performance.

NECESSITY OF SYSTEM UPGRADE AND PROCESS REENGINEERING

Purpose of this regression analysis was to find out whether it is necessary to upgrade

ERP System for process reengineering. Here necessity of upgrade is considered as

dependent variable and process reengineering is considered as independent variable.

Following Model Summary and Coefficients table was generated after running the

regression analysis is SPSS.

TABLE Regression Analysis.99: Model summary of system upgrade for process

reengineering.

Model Summary

Model R R Square Adjusted R Square Std. Error of the Estimate

1 .588a .345 .340 .45532

a. Predictors: (Constant), Process. Reengineering

Model summary above shows that correlation, r = .588. That means two variables,

necessity of system upgrade and process reengineering, have strong positive

correlation. Coefficient of determination or the R-Square value is 0.345. That means

34.5% necessity of system upgrade can be explained by process reengineering. Value of

adjusted R-Square is 0.34 indicates 34% necessity of upgrade is for process

reengineering.

Regression was conducted at 95% confidence interval to test the effect of process

reengineering on necessity of system upgrade. And the coefficient table of the

regression is shown below

TABLE Regression Analysis.100: Coefficients table for process reengineering and

necessity of system upgrade
Coefficientsa

Model Unstandardized Coefficients Standardized Coefficients t Sig.

B Std. Error Beta

(Constant) .715 .139 5.131 .000

1
Process. Reengineering .505 .064 .588 7.887 .000

a. Dependent Variable: Upgrade.ERP.System

H0: System upgrade is not necessary for process reengineering.

H1: System upgrade is necessary for process reengineering.

Test Statistic: The value of the for process reengineering is .588, value of t statistic is

5.131 and the significance level is .000

Decision: Here the significance level .000 is lower than statistical significance .05.

Therefore, we can reject the null hypothesis and it can be concluded that System

upgrade is necessary for process reengineering.

The regression model to predict employee performance by training & education is:

Necessity of System upgrade = + (process reengineering)

The coefficient table shows that value of is .715 and value of is 0.588. Therefore the

model is

Necessity if System upgrade = .715 + .588 (Process Reengineering)

Now, the model will show how much effect process reengineering have on necessity of

system upgrade if the value of process reengineering is inserted in the model. For each

unit of process reengineering will cause 1.303 units necessity of ERP System Upgrade.
 42. MULTIPLE REGRESSION MODEL FOR
PERFORMANCE
Multiple regression model was used to formulate a model that explains how 4 independent

variables, Current ERP System, IT Skill, Training & Education and process reengineering can

affects the employee performance which is a dependent variable of this research. In other

words, the model was formulated to understand how employee performance is affected

because of all independent variable together. Following output was generated after

conducting multiple regressions in SPSS.

TABLE MULTIPLE REGRESSION MODEL FOR PERFORMANCE.101: Summary

of multiple regression models

Model Summary

Model R R Square Adjusted R Square Std. Error of the Estimate

 1 .578a .335 .311 .47624

a. Predictors: (Constant), Process. Reengineering, Current.System, IT.Skill, Training.Education

Model summary above shows that correlation, r = .578. That means employee performance is

strongly correlated with Current ERP System, IT Skill, Training & Education and process

reengineering. Coefficient of determination or the R-Square value is 0.335. That means

33.5% changes in the employee performance can be explained by this model. Value of

adjusted R-Square is 0.3318 indicates only 33.1% variation in performance can be measured

by this model after considering all related factors.

The regression model to predict employee performance is:

Performance = + 1 (Current ERP System) + 2 (IT Skill) + 3 (Training & Education)

+ 4 (Process reengineering)

Total change in employee performance can be found after inserting the value of constant, ,

all variables and their related beta ().

The coefficient table of the multiple regressions is shown below.

TABLE MULTIPLE REGRESSION MODEL FOR PERFORMANCE.102: Coefficients

table for multiple regression models

Coefficientsa

Model Unstandardized Coefficients Standardized Coefficients t Sig.

B Std. Error Beta

1 (Constant) .625 .233 2.682 .008

Current.System .091 .079 .093 1.147 .254

IT.Skill .160 .082 .176 1.949 .045

 Training.Education .367 .100 .351 3.661 .000

Process. Reengineering .130 .085 .148 1.538 .027

a. Dependent Variable: Performance

The coefficients table above shows that significance level for Current ERP System is .254

which is much higher than acceptable significance level of 0.05. Therefore it can be

concluded that current ERP system does no effect on the model.

After inserting the values of constant and related beta of all variables, the multiple

regressions model is

Performance = 0.625 + .091 (Current ERP System) + .160 (IT Skill) + 0.367

(Training & Education) + 0.130 (process reengineering).

PART V
 Findings & Recommendation

34. Key Findings

Key findings of the research on Impact of Business Process Re-engineering through

Implementing ERP and Productivity Measures is given below:

Officer level users are actual users of the ERP system.

Their work has become easy because of the ERP system.
Most of the ACCPAC uses faces problem while working on the ERP system.
Most of the ACCPAC uses have to do supporting manual works before working in

ACCPAC.
ACCPAC uses believe that they have sufficient IT skill and expertise to work on

ERP system.
If new ERP system is implemented, it wont be necessary to hire new employees.
In order to maximize the use and benefit of ERP, IT skills and expertise is

necessary.
Most of the ACCPAC uses agree that IT skill and expertise is necessary to perform

their works effectively.

ACCPAC users will need training and education if a new ERP system is

implemented.
Users agree that training and education increases flexibility to work and

adaptability to new system.

ACCPAC users agree that training and education helps to assist them develop new

skill.
Training and education helps to perform effectively.
Most of the ACCPAC users agree that it is possible to bring change in current

work process.
ACCPAC users agree that a change in current process will make their work easy.
ACCPAC users agree that a change in current process will save working time.
Users agree that eliminating manual works will increase productivity.
Most of the ACCPAC users agree that current ERP system should be upgraded.
ACCPAC users agree that SAP should be implemented if it helps to perform more

efficiently.
Users agreed that SAP should be implemented if it saves time and minimize work

load.
Most of the ACCPAC users agree that SAP should be implemented if it eliminates

the problems exist in ACCPAC.

Performance of the most ACCPAC users depends on the ERP system.
Performance of the most ACCPAC users can be improved by process

reengineering.
Productive works will increase performance of the most ACCPAC users.
Training and education will increase performance of the most ACCPAC users.
A change in current process will increase the performance of the most ACCPAC

users.
Current system and the performance of the employees are not correlated.
IT skill and the performance of the employees are positively correlated.
IT skill and necessity of upgrading the ERP System have strong positive

correlation.
Performance and Process reengineering are positively correlated.
 Upgrading ERP system and Process reengineering have strong positive

correlation.
Necessity of upgrading ERP system and employees training are positively

correlated.
Performance and Training & Education of employees are correlated.
User friendliness level is same even there is age difference.
Capability to adapt with a new system is not same due to age difference.
Satisfaction level with ERP is not same between genders.
IT Skill and expertise is not same between genders.
Adaptability is same between genders.
Interest to develop new IT skill is same between genders.
Thought of upgrading ACCPAC is same between genders.
Problem faced while working on ACCPAC is same between job levels.
Employee performance of different job level is dependent on ERP system.
A change in the current process will increase performance.
Works will become easier if the work process is modified or changed.
Users need to do supporting manual works before working in ACCPAC.
It is possible to bring change in the current work process.
It is possible to improve performance by process reengineering.
SAP should be implemented if it eliminates the existing problems.
SAP should be implemented if it saves time and minimize work load.
Current ERP system ACCPAC should be upgraded.
Current ERP system influences employee performance.
Training & Education does influence employee performance.
ERP system upgrade is necessary for process reengineering.
Process reengineering can increase employee performance.

35. Summary of the Findings

From the research it has been found that most of the users of the current ERP system

belong to officer level and at mid thirties. Research has shown that most of the users of

ACCPAC, which is the current ERP system, faces problem while working. Moreover they

have to do manual works and prepare data before working in ACCPAC. However, the

users have reported that ACCPAC, the current ERP system, is user friendly and has made

their work easier. Even after that, the users believe that an upgrade is necessary in the

ERP system.
This research tried to find that whether current ERP system has any effect on employee

performance. It was found in the research that current ERP doesnt have major impact in

employee performance. These researches have found that it is possible to increase

employee performance by process reengineering through implementing a new ERP

which will solve the problems exists in current ERP.

Most of the ACCPAC users have reported that process reengineering is possible in their

work. If the work process is modified or changed, they could save time by working

quickly. These users have agreed that these changes can be done by implementing new

ERP system. This research has found that process reengineering has strong positive

relation with performance. That means positive changes in work process will increase

employee performance.

It is found in the research that IT skills and expertise are necessary in order to maximize

the benefit from ERP system. Also IT skill can affect employee performance. Although

most of the ERP users claim that they have sufficient IT skill and expertise, IT skill level

is different among employees. If a new ERP system like SAP is implemented, IT skill

which is necessary for current ERP might not be useful any longer. In that case new IT

skills & expertise have to be created through IT training and education. This research

has found that most of the ERP users are interested to develop new IT skills and

expertise.

IT training and education will be necessary for all employees if new ERP system like SAP

is implemented. In this research it has been found that IT skills and expertise can be

created though training. Moreover, training will help employees to increase flexibility
and do their job in less time. And by providing training and education it is possible to

enhance employee performance.

As most of the users are young, they will be able to adapt with new ERP system and

hence Eskayef will not need to hire new employees. All Eskayef has to do is to train

employees to develop IT skills which will eventually increase employee performance.

36. How process reengineering will affect Employee

Performance
As mentioned in research background that Eskayef acknowledge performance as a

combination of several factors which are

1. Quantity of jobs 2. Quality of job

3. Job knowledge 4. Leadership
5. Sincerity to work 6. Leadership

From the research it has been found that by process reengineering, unproductive works

can be eliminated. Research has also found that employees will be able to work on more

productive work and they will be able to save time. Also if new ERP system is

implemented, employees expect that it will solve the problem in current ERP and

minimize the work load. As employees will be able to do work in less time, quantity of

their work will increase. Also eliminating unproductive work will increase the work

quality. When an employee will go for IT training, they will be able to learn more about

their work procedure which will eventually increase job knowledge.

So it is clear that process reengineering through implementing a new ERP will increase

employees quantity & quality of job as well as job knowledge. Thus it will increase

employee performance.
 37. Recommendation
Several recommendations can be made from the research. Very first one is to implement

a new ERP system in Eskayef. Although the current ERP helps employees in their work

but it has little contribution in their performance. Apart from that, employees faces

problem while working on ERP.

Lots of manual works has to be done in current ERP. This increases the quantity of

unproductive works. These unproductive works e.g. data entry of raw material

consumption can be eliminated if system was automated. It is recommended for Eskayef

to implement an ERP system that will collect these sorts of data from the plants.

Officer level employees are actual users of ERP system. Performances of these users are

mostly dependent on ERP system. Before making decision of implementing a new ERP

system, it is highly recommended to consult with officer level employees to understand

the actual needs and requirements expected from new ERP.

Training is recommended for all ERP users after implementing a new ERP. Training will

help employees to develop new skills. Also training will increase employees flexibility

and minimize work errors.

38. Conclusion
Business process reengineering or BPR through ERP has a positive effect on employee

performance. Although Eskayef have already did process reengineering through ERP

when it implemented the current ERP ACCPAC. However it is necessary to upgrade the

current system and implement a new ERP as there is a need for upgraded ERP. For that

reason Eskayef is planning to change its current ERP and implement a new ERP like SAP.
IT skill is a very important factor to get maximum outcome form ERP system. But if a

new ERP like SAP is implemented, new IT skills have to be developed. Also necessary

training should be provided to the employees.

Eskayef should adopt a new ERP system. A new ERP will help employees to increase the

quantity and quality of their work. Moreover work load and errors will be reduced.

Employees will be able to concentrate more on productive works which will eventually

decrease operational expenses. Thus employee performance will be enhanced. But

adopting a new ERP, it is necessary for Eskayef to understand employees needs and

requirements from ERP.

39. Bibliography

ACCPAC. (n.d.). Retrieved October 20, 2011, from Wikipedia:

http://en.wikipedia.com/wiki/ACCPAC

(2010). Annual Reports of Square, Beximco, Eskayf & Reneta. Dhaka.

Bangladesh moves to rank 14th. (2010, December 19). the independent .

Bangladesh Pharmaceutical Index. (2010). Top 20 Pharmaceutical Company of

Bangladesh : 2010.
Continuous Medical Education. (2008). Retrieved Nov 25, 2011, from skfbd.com:

http://www.skfbd.com/index.php?page=45&pid=21

(2009). Eskayef Bangladesh Limited Annual report. Dhaka.

Eskayef Bangladesh Limited. (2011). Pharmaceutical Industry. Retrieved November

25, 2011, from Skfbd.com: http://www.skfbd.com/index.php?page=25&pid=22

Industrial park for pharmaceutical industry by 2012. (2010, December 27). Daily Sun .

Investment Analysis: Pharmaceutical Industry in Bangladesh (Part 2). (2008, June 6).

Retrieved Nov 25, 20011, from Report, Assignment, Case Study and Term Paper:

http://www.reportbd.com/articles/103/1/Investment-Analysis-Pharmaceutical-Industry-

in-Bangladesh-Part-2/Page1.html

Pharma industry to surpass RMG sector in 10 years. (2011, February 26). Bangladesh

Shongbad Shongstha (BSS) .

Pharmaceutical industry in Bangladesh. (2011, September 2). Retrieved November 25,

2011, from Wikipedia.org:

http://en.wikipedia.org/wiki/Pharmaceutical_industry_in_Bangladesh

Reliability (statistics). (2011, June 24). Retrieved August 25, 2011, from Wikipedia, the

free encyclopedia: http://en.wikipedia.org/wiki/Reliability_%28statistics%29

Solvency Ratio. (n.d.). Retrieved December 2, 2011, from Investopedia.com:

http://www.investopedia.com/terms/s/solvencyratio.asp

SWOT Analysis. (n.d.). Retrieved December 8, 2011, from Wikipedia.com:

http://en.wikipedia.org/wiki/SWOT_analysis
The Sage Group. (n.d.). Retrieved October 20, 2011, from

http://en.wikipedia.org/wiki/The_Sage_Group
 APPENDIX

Appendix II
SPSS Outputs

Frequency Analysis

FREQUENCIES VARIABLES=Age
/HISTOGRAM
/ORDER=ANALYSIS.

Frequencies
 Statistics

Age

Valid 120
N
Missing 0

Age

Frequency Percent Valid Percent Cumulative

Percent

21-25 17 14.2 14.2 14.2

26-30 43 35.8 35.8 50.0

31-35 34 28.3 28.3 78.3

Valid
36-40 15 12.5 12.5 90.8

Above 40 11 9.2 9.2 100.0

Total 120 100.0 100.0

FREQUENCIES VARIABLES=Gender
/HISTOGRAM
/ORDER=ANALYSIS.

Frequencies

Statistics

Gender

Valid 120
N
Missing 0

Gender

Frequency Percent Valid Percent Cumulative

Percent

Male 88 73.3 73.3 73.3

Valid Female 32 26.7 26.7 100.0

Total 120 100.0 100.0

FREQUENCIES VARIABLES=Job.Level
/HISTOGRAM
/ORDER=ANALYSIS.

Frequencies
Statistics
 Job Level

Valid 120
N
Missing 0

Job Level

Frequency Percent Valid Percent Cumulative

Percent

Managerial Level 26 21.7 21.7 21.7

Valid Officer Level 94 78.3 78.3 100.0

Total 120 100.0 100.0

FREQUENCIES VARIABLES=Crnt.ERP.Sys3
/HISTOGRAM
/ORDER=ANALYSIS.

Frequencies

Statistics
ACCPAC ERP has made my works
easier.

Valid 120
N
Missing 0

ACCPAC ERP has made my works easier.

Frequency Percent Valid Percent Cumulative

Percent

Strongly Agree 23 19.2 19.2 19.2

Agree 68 56.7 56.7 75.8

Nutral 22 18.3 18.3 94.2

Valid
Disagree 5 4.2 4.2 98.3

Strongly Disagree 2 1.7 1.7 100.0

Total 120 100.0 100.0

FREQUENCIES VARIABLES=Crnt.ERP.Sys4
/HISTOGRAM
/ORDER=ANALYSIS.
Frequencies

Statistics
I do not face problem while working
on ACCPAC.

Valid 120
N
Missing 0

I do not face problem while working on ACCPAC.

Frequency Percent Valid Percent Cumulative

Percent

Strongly Agree 4 3.3 3.3 3.3

Agree 35 29.2 29.2 32.5

Nutral 26 21.7 21.7 54.2

Valid
Disagree 48 40.0 40.0 94.2

Strongly Disagree 7 5.8 5.8 100.0

Total 120 100.0 100.0

FREQUENCIES VARIABLES=Crnt.ERP.Sys5
/HISTOGRAM
/ORDER=ANALYSIS.

Frequencies

Statistics
I have to do supporting Manual
works before working in ACCPAC

Valid 120
N
Missing 0

I have to do supporting Manual works before working in ACCPAC

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 34 28.3 28.3 28.3

Agree 44 36.7 36.7 65.0

Nutral 20 16.7 16.7 81.7

Valid
Disagree 19 15.8 15.8 97.5

Strongly Disagree 3 2.5 2.5 100.0

Total 120 100.0 100.0

FREQUENCIES VARIABLES=IT.Skill1
/HISTOGRAM
/ORDER=ANALYSIS.
Frequencies
Statistics

I have sufficient IT skills and

expertise to use ERP (ACCPAC or
SAP).

Valid 120
N
Missing 0

I have sufficient IT skills and expertise to use ERP (ACCPAC or SAP).

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 19 15.8 15.8 15.8

Agree 54 45.0 45.0 60.8

Valid Nutral 31 25.8 25.8 86.7

Disagree 16 13.3 13.3 100.0

Total 120 100.0 100.0

FREQUENCIES VARIABLES=IT.Skill2
/HISTOGRAM
/ORDER=ANALYSIS.

Frequencies

Statistics
My IT skills and expertise are
capable to adapt with a new
system.

Valid 120
N
Missing 0

My IT skills and expertise are capable to adapt with a new system.

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 23 19.2 19.2 19.2

Agree 57 47.5 47.5 66.7

Valid Nutral 37 30.8 30.8 97.5

Disagree 3 2.5 2.5 100.0

Total 120 100.0 100.0

FREQUENCIES VARIABLES=IT.Skill3
/HISTOGRAM
/ORDER=ANALYSIS.
Frequencies
Statistics

IT skills are necessary to maximize

the use of ERP (ACCPAC or SAP).

Valid 120
N
Missing 0

IT skills are necessary to maximize the use of ERP (ACCPAC or SAP).

Frequency Percent Valid Percent Cumulative Percent

Strongly Agree 47 39.2 39.2 39.2

Agree 48 40.0 40.0 79.2

Nutral 20 16.7 16.7 95.8

Valid
Disagree 4 3.3 3.3 99.2

Strongly Disagree 1 .8 .8 100.0

Total 120 100.0 100.0

FREQUENCIES VARIABLES=IT.Trainging1
/HISTOGRAM
/ORDER=ANALYSIS.

Frequencies
Statistics

Training & Education are

necessary for me after SAP
implementation.

Valid 120
N
Missing 0

Training & Education are necessary for me after SAP implementation.

Frequency Percent Valid Percent Cumulative

Percent

Strongly Agree 58 48.3 48.3 48.3

Agree 56 46.7 46.7 95.0

Valid Nutral 5 4.2 4.2 99.2

Disagree 1 .8 .8 100.0

Total 120 100.0 100.0

FREQUENCIES VARIABLES=IT.Trainging4
/HISTOGRAM
/ORDER=ANALYSIS.
Frequencies
Statistics
Training & Education will help me
to perform effectively by saving
time.

Valid 120
N
Missing 0

Training & Education will help me to perform effectively by saving time.

Frequency Percent Valid Percent Cumulative

Percent

Strongly Agree 61 50.8 50.8 50.8

Agree 49 40.8 40.8 91.7

Valid Nutral 8 6.7 6.7 98.3

Disagree 2 1.7 1.7 100.0

Total 120 100.0 100.0

FREQUENCIES VARIABLES=Process.reeng1
/HISTOGRAM
/ORDER=ANALYSIS.

Frequencies
Statistics

It is possible to bring changes or

modify the current process of my
works.

Valid 120
N
Missing 0

It is possible to bring changes or modify the current process of my works.

Frequency Percent Valid Percent Cumulative

Percent

Strongly Agree 34 28.3 28.3 28.3

Agree 57 47.5 47.5 75.8

Valid Nutral 28 23.3 23.3 99.2

Disagree 1 .8 .8 100.0

Total 120 100.0 100.0

FREQUENCIES VARIABLES=Process.reeng4
/HISTOGRAM
/ORDER=ANALYSIS.

Frequencies
Statistics
I could focus more on productive
works if manual works are
eliminated.

Valid 120
N
Missing 0

I could focus more on productive works if manual works are eliminated.

Frequency Percent Valid Percent Cumulative

Percent

Strongly Agree 42 35.0 35.0 35.0

Agree 56 46.7 46.7 81.7

Nutral 18 15.0 15.0 96.7

Valid
Disagree 3 2.5 2.5 99.2

Strongly Disagree 1 .8 .8 100.0

Total 120 100.0 100.0

FREQUENCIES VARIABLES=upgrad.ERP.sys1
/HISTOGRAM
/ORDER=ANALYSIS.

Frequencies
Statistics

Current ERP system ACCPAC

should be upgraded.

Valid 120
N
Missing 0

Current ERP system ACCPAC should be upgraded.

Frequency Percent Valid Percent Cumulative

Percent

Strongly Agree 47 39.2 39.2 39.2

Agree 50 41.7 41.7 80.8

Valid Nutral 22 18.3 18.3 99.2

Strongly Disagree 1 .8 .8 100.0

Total 120 100.0 100.0

FREQUENCIES VARIABLES=Performance1
/HISTOGRAM
/ORDER=ANALYSIS.

Frequencies
Statistics

My works performance is
depended on the ERP System.
 Valid 120
N
Missing 0

My works performance is depended on the ERP System.

Frequency Percent Valid Percent Cumulative

Percent

Strongly Agree 17 14.2 14.2 14.2

Agree 53 44.2 44.2 58.3

Valid Nutral 34 28.3 28.3 86.7

Disagree 16 13.3 13.3 100.0

Total 120 100.0 100.0

Correlation

CORRELATIONS
/VARIABLES=Current.System IT.Skill Training.Education
Process.Reengeeniring Upgrade.ERP.System Performance
/PRINT=TWOTAIL NOSIG
/MISSING=PAIRWISE.

Correlation Matrix

Correlations
Current.Sy IT.Skill Training.Edu Process.Reen Upgrade.ERP.S Performance
stem cation gineering ystem
**
Pearson Correlation 1 .171 .001 .285 .010 .166

Current.System Sig. (2-tailed) .062 .991 .002 .914 .070

N 120 120 120 120 120 120

** ** **
Pearson Correlation .171 1 .479 .441 .571 .426**
IT.Skill Sig. (2-tailed) .062 .000 .000 .000 .000
N 120 120 120 120 120 120
** ** **
Pearson Correlation .001 .479 1 .516 .630 .512**
Training.Educatio
Sig. (2-tailed) .991 .000 .000 .000 .000
n
N 120 120 120 120 120 120
** ** ** **
Pearson Correlation .285 .441 .516 1 .588 .434**
Process.Reengee
Sig. (2-tailed) .002 .000 .000 .000 .000
niring
N 120 120 120 120 120 120
** ** **
Pearson Correlation .010 .571 .630 .588 1 .571**
Upgrade.ERP.Sys Sig. (2-tailed) .914 .000 .000 .000 .000
tem N 120 120 120 120 120 120
** ** ** **
Pearson Correlation .166 .426 .512 .434 .571 1

Performance Sig. (2-tailed) .070 .000 .000 .000 .000

N 120 120 120 120 120 120

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

CORRELATIONS
/VARIABLES=Performance IT.Skill
/PRINT=TWOTAIL NOSIG
/MISSING=PAIRWISE.
Correlations
Correlations

Performance IT.Skill

Pearson Correlation 1 .426**

Performance Sig. (2-tailed) .000

N 120 120
**
Pearson Correlation .426 1
IT.Skill
Sig. (2-tailed) .000

N 120 120

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

CORRELATIONS
/VARIABLES=Upgrade.ERP.System Training.Education
/PRINT=TWOTAIL NOSIG
/MISSING=PAIRWISE.
Correlations
Correlations

Upgrade.ERP.System Training.Education

Pearson Correlation 1 .630**

Upgrade.ERP.System Sig. (2-tailed) .000

N 120 120
Pearson Correlation .630** 1

Training.Education Sig. (2-tailed) .000

N 120 120

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

CORRELATIONS
/VARIABLES=Performance Upgrade.ERP.System
/PRINT=TWOTAIL NOSIG
/MISSING=PAIRWISE.
Correlations
 Correlations
Performance Upgrade.ERP.System
Pearson Correlation 1 .571**
Performance Sig. (2-tailed) .000
N 120 120
Pearson Correlation .571** 1
Upgrade.ERP.System Sig. (2-tailed) .000
N 120 120
**. Correlation is significant at the 0.01 level (2-tailed).

Crosstabs & Chi-square test

CROSSTABS
/TABLES=Gender BY Crnt.ERP.Sys1
/FORMAT=AVALUE TABLES
/STATISTICS=CHISQ
/CELLS=COUNT
/COUNT ROUND CELL.
Crosstabs
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
Gender * I am satisfied with
120 100.0% 0 0.0% 120 100.0%
ACCPAC (our current ERP).

CROSSTABS
/TABLES=Gender BY IT.Skill2
/FORMAT=AVALUE TABLES
/STATISTICS=CHISQ
/CELLS=COUNT
/COUNT ROUND CELL.

Crosstabs
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
Gender * My IT skills and
expertise are capable to adapt 120 100.0% 0 0.0% 120 100.0%
with a new system.

CROSSTABS
/TABLES=Gender BY upgrad.ERP.sys1
/FORMAT=AVALUE TABLES
/STATISTICS=CHISQ
/CELLS=COUNT
/COUNT ROUND CELL.
Crosstabs
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
Gender * Current ERP system
120 100.0% 0 0.0% 120 100.0%
ACCPAC should be upgraded.
CROSSTABS
/TABLES=Job.Level BY Crnt.ERP.Sys4
/FORMAT=AVALUE TABLES
/STATISTICS=CHISQ
/CELLS=COUNT
/COUNT ROUND CELL.

Crosstabs
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
Job Level * I do not face
problem while working on 120 100.0% 0 0.0% 120 100.0%
ACCPAC.

CROSSTABS
/TABLES=Job.Level BY Performance1
/FORMAT=AVALUE TABLES
/STATISTICS=CHISQ
/CELLS=COUNT
/COUNT ROUND CELL.

Crosstabs
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
Job Level * My works
performance is depended on 120 100.0% 0 0.0% 120 100.0%
the ERP System.

CROSSTABS
/TABLES=Gender BY IT.Skill1
/FORMAT=AVALUE TABLES
/STATISTICS=CHISQ
/CELLS=COUNT
/COUNT ROUND CELL.

Crosstabs
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
Gender * I have sufficient IT
skills and expertise to use ERP 120 100.0% 0 0.0% 120 100.0%
(ACCPAC or SAP).
 Reliability Test
RELIABILITY
/VARIABLES=Crnt.ERP.Sys1 Crnt.ERP.Sys2 Crnt.ERP.Sys3 Crnt.ERP.Sys4
Crnt.ERP.Sys5
/SCALE('ALL VARIABLES') ALL
/MODEL=ALPHA.

Reliability
Scale: ALL VARIABLES
Case Processing Summary
N %
Valid 120 100.0
Cases Excludeda 0 .0
Total 120 100.0
a. Listwise deletion based on all variables in the
procedure.
Reliability Statistics

Cronbach's Alpha N of Items

.584 5

RELIABILITY
/VARIABLES=IT.Skill1 IT.Skill2 IT.Skill3 IT.Skill4 IT.Skill5
/SCALE('ALL VARIABLES') ALL
/MODEL=ALPHA.

Reliability

Scale: ALL VARIABLES

Case Processing Summary

N %

Valid 120 100.0

a
Cases Excluded 0 .0

Total 120 100.0

a. Listwise deletion based on all variables in the

procedure.
Reliability Statistics

Cronbach's Alpha N of Items

.789 5

RELIABILITY
 /VARIABLES=Performance1 Performance2 Performance3 Performance4
Performance5
/SCALE('ALL VARIABLES') ALL
/MODEL=ALPHA.

Reliability

Scale: ALL VARIABLES

Case Processing Summary

N %

Valid 120 100.0

Cases Excludeda 0 .0

Total 120 100.0

a. Listwise deletion based on all variables in the procedure.

Reliability Statistics

Cronbach's Alpha N of Items

.766 5

RELIABILITY
/VARIABLES=Process.reeng1 Process.reeng2 Process.reeng3 Process.reeng4
Process.reeng5
/SCALE('ALL VARIABLES') ALL
/MODEL=ALPHA.

Reliability

Scale: ALL VARIABLES

Case Processing Summary

N %

Valid 120 100.0

Cases Excludeda 0 .0

Total 120 100.0

a. Listwise deletion based on all variables in the procedure.

Reliability Statistics

Cronbach's Alpha N of Items

.828 5

RELIABILITY
/VARIABLES=upgrad.ERP.sys1 upgrad.ERP.sys2 upgrad.ERP.sys3
upgrad.ERP.sys4 upgrad.ERP.sys5
/SCALE('ALL VARIABLES') ALL
 /MODEL=ALPHA.

Reliability

Scale: ALL VARIABLES

Case Processing Summary

N %

Valid 120 100.0

Cases Excludeda 0 .0

Total 120 100.0

a. Listwise deletion based on all variables in the procedure.

Reliability Statistics

Cronbach's Alpha N of Items

.825 5

RELIABILITY
/VARIABLES=IT.Trainging1 IT.Trainging2 IT.Trainging3 IT.Trainging4
IT.Trainging5
/SCALE('ALL VARIABLES') ALL
/MODEL=ALPHA.

Reliability

Scale: ALL VARIABLES

Case Processing Summary

N %

Valid 120 100.0

Cases Excludeda 0 .0

Total 120 100.0

a. Listwise deletion based on all variables in the procedure.

Reliability Statistics

Cronbach's Alpha N of Items

.847 5

Factor Analysis
FACTOR
/VARIABLES Crnt.ERP.Sys1 Crnt.ERP.Sys2 Crnt.ERP.Sys3 Crnt.ERP.Sys4
Crnt.ERP.Sys5
 /MISSING LISTWISE
/ANALYSIS Crnt.ERP.Sys1 Crnt.ERP.Sys2 Crnt.ERP.Sys3 Crnt.ERP.Sys4
Crnt.ERP.Sys5
/PRINT INITIAL EXTRACTION
/PLOT EIGEN
/CRITERIA MINEIGEN(1) ITERATE(25)
/EXTRACTION PC
/ROTATION NOROTATE
/METHOD=CORRELATION.
Factor Analysis
Communalities

Initial Extraction

I am satisfied with ACCPAC (our current ERP). 1.000 .709

Current ERP (ACCPAC) is user-friendly. 1.000 .629

ACCPAC ERP has made my works easier. 1.000 .636

I do not face problem while working on ACCPAC. 1.000 .055

I have to do supporting Manual works before working in ACCPAC 1.000 .124

Extraction Method: Principal Component Analysis.

Total Variance Explained

Component Initial Eigenvalues Extraction Sums of Squared Loadings

Total % of Variance Cumulative % Total % of Variance Cumulative %

1 2.154 43.073 43.073 2.154 43.073 43.073

2 .974 19.482 62.554
3 .947 18.935 81.489
4 .523 10.469 91.958
5 .402 8.042 100.000

Extraction Method: Principal Component Analysis.

Component Matrixa

Component

I am satisfied with ACCPAC (our current ERP). .842

Current ERP (ACCPAC) is user-friendly. .793

 ACCPAC ERP has made my works easier. .798
I do not face problem while working on ACCPAC. .235

I have to do supporting Manual works before working in ACCPAC .353

Extraction Method: Principal Component Analysis.

a. 1 components extracted.

RELIABILITY
/VARIABLES=Crnt.ERP.Sys2 Crnt.ERP.Sys3 Crnt.ERP.Sys1
/SCALE('ALL VARIABLES') ALL
/MODEL=ALPHA
/STATISTICS=TUKEY
/SUMMARY=TOTAL.

Reliability
Scale: ALL VARIABLES
Case Processing Summary

N %

Valid 120 100.0

Cases Excludeda 0 .0

Total 120 100.0

a. Listwise deletion based on all variables in the procedure.

Reliability Statistics

Cronbach's Alpha N of Items

.767 3

Factor Analysis
T-TEST
/TESTVAL=1
/MISSING=ANALYSIS
/VARIABLES=Performance5
/CRITERIA=CI(.95).
T-Test
One-Sample Statistics
 N Mean Std. Deviation Std. Error Mean

A change in my current work

process will enhance my 120 2.1333 .88814 .08108
performance.

T-TEST
/TESTVAL=1
/MISSING=ANALYSIS
/VARIABLES=Crnt.ERP.Sys5
/CRITERIA=CI(.95).

T-Test
One-Sample Statistics

N Mean Std. Deviation Std. Error Mean

I have to do supporting Manual

works before working in 120 2.2750 1.11493 .10178
ACCPAC

T-TEST
/TESTVAL=1
/MISSING=ANALYSIS
/VARIABLES=Process.reeng1
/CRITERIA=CI(.95).

T-Test

One-Sample Statistics

N Mean Std. Deviation Std. Error Mean

It is possible to bring changes

or modify the current process 120 1.9667 .74398 .06792
of my works.

T-TEST
/TESTVAL=1
/MISSING=ANALYSIS
/VARIABLES=IT.Trainging1
/CRITERIA=CI(.95).

T-Test
One-Sample Statistics

N Mean Std. Deviation Std. Error Mean

Training & Education are

necessary for me after SAP 120 1.5750 .61716 .05634
implementation.
T-TEST
/TESTVAL=1
/MISSING=ANALYSIS
/VARIABLES=Performance2
/CRITERIA=CI(.95).

T-Test
One-Sample Statistics

N Mean Std. Deviation Std. Error Mean

My performance can be
improved by process 120 2.0500 .78697 .07184
reengineering through SAP.

T-TEST
/TESTVAL=1
/MISSING=ANALYSIS
/VARIABLES=upgrad.ERP.sys5
/CRITERIA=CI(.95).

T-Test
One-Sample Statistics

N Mean Std. Deviation Std. Error Mean

SAP should be implemented if

it eliminates the problems exist 120 1.7750 .69164 .06314
in Accpac.

T-TEST
/TESTVAL=1
/MISSING=ANALYSIS
/VARIABLES=upgrad.ERP.sys4
/CRITERIA=CI(.95).

T-Test
One-Sample Statistics

N Mean Std. Deviation Std. Error Mean

SAP should be implemented if

it saves time and minimize 120 1.7167 .74680 .06817
work load.

T-TEST
/TESTVAL=1
/MISSING=ANALYSIS
 /VARIABLES=upgrad.ERP.sys1
/CRITERIA=CI(.95).

T-Test
One-Sample Statistics

N Mean Std. Deviation Std. Error Mean

Current ERP system ACCPAC

120 1.8167 .78840 .07197
should be upgraded.

T-TEST
/TESTVAL=1
/MISSING=ANALYSIS
/VARIABLES=Process.reeng2
/CRITERIA=CI(.95).
T-Test
One-Sample Statistics

N Mean Std. Deviation Std. Error Mean

My works will become easier if

the work process is modified or 120 2.0833 .81564 .07446
changed.

Regression Analysis

REGRESSION
/MISSING LISTWISE
/STATISTICS COEFF OUTS R ANOVA
/CRITERIA=PIN(.05) POUT(.10)
/NOORIGIN
/DEPENDENT Performance
/METHOD=ENTER Current.System.

Regression
Variables Entered/Removeda

Model Variables Entered Variables Removed Method

1 Current.Systemb . Enter

a. Dependent Variable: Performance

b. All requested variables entered.

REGRESSION
/MISSING LISTWISE
 /STATISTICS COEFF OUTS R ANOVA
/CRITERIA=PIN(.05) POUT(.10)
/NOORIGIN
/DEPENDENT Performance
/METHOD=ENTER IT.Skill.
Regression
Variables Entered/Removeda

Model Variables Entered Variables Removed Method

1 IT.Skillb . Enter

a. Dependent Variable: Performance

b. All requested variables entered.

REGRESSION
/MISSING LISTWISE
/STATISTICS COEFF OUTS R ANOVA
/CRITERIA=PIN(.05) POUT(.10)
/NOORIGIN
/DEPENDENT Performance
/METHOD=ENTER Process.Reengeeniring.
Regression
Variables Entered/Removeda

Model Variables Entered Variables Removed Method

1 Process.Reengeeniringb . Enter

a. Dependent Variable: Performance

b. All requested variables entered.
REGRESSION
/MISSING LISTWISE
/STATISTICS COEFF OUTS R ANOVA
/CRITERIA=PIN(.05) POUT(.10)
/NOORIGIN
/DEPENDENT Performance
/METHOD=ENTER Training.Education.

Regression
Variables Entered/Removeda

Model Variables Entered Variables Removed Method

1 Training.Educationb . Enter

a. Dependent Variable: Performance

b. All requested variables entered.

REGRESSION
/MISSING LISTWISE
/STATISTICS COEFF OUTS R ANOVA
/CRITERIA=PIN(.05) POUT(.10)
/NOORIGIN
/DEPENDENT Upgrade.ERP.System
/METHOD=ENTER Process.Reengeeniring.

Regression
Variables Entered/Removeda
 Model Variables Entered Variables Removed Method
b
1 Process.Reengeeniring . Enter

a. Dependent Variable: Upgrade.ERP.System

b. All requested variables entered.

REGRESSION
/MISSING LISTWISE
/STATISTICS COEFF OUTS R ANOVA
/CRITERIA=PIN(.05) POUT(.10)
/NOORIGIN
/DEPENDENT Performance
/METHOD=ENTER Current.System IT.Skill Training.Education
Process.Reengeeniring.
Regression
Variables Entered/Removeda

Model Variables Entered Variables Removed Method

Process.Reengeeniring,Current.System, IT.Skill,
1 . Enter
Training.Educationb

a. Dependent Variable: Performance

b. All requested variables entered.
I am a BBA student of North South University doing a survey for a research which is a partial
requirement of my Internship (BUS-498) course. The research topic is The effects of Business
Process Re-engineering through Implementing ERP on the performance of the employees.
Please note that, ACCPAC & SAP both are ERP Software. The survey will take only few
minutes of your time. Your response would be a great help in accomplishing the study. However,
this information is only for academic purpose and will not be disclosed elsewhere. To answer,
mark on your selected option. I heartily thank you for your cooperation.
------ Al Amin Redwanur Rahman
Intern, Eskayef Bangladesh Limited

Gender: Male Female

Age Range: 21 -25 26-30 31-35 35-40 40 and above

Job Level: Manager Level Officer Level

For the following questions, please mark your answer according to the degree of your agreement.
1 = Strongly Agree, 2 = Agree, 3 = Neutral, 4 = Disagree, 5 = Strongly Disagree

Current ERP system (Independent Variable) 1 2 3 4 5

1 I am satisfied with ACCPAC (our current ERP).
2 Current ERP (ACCPAC) is user-friendly.
3 ACCPAC ERP has made my works easier.
4 I do not face problem while working on ACCPAC.
5 I have to do supporting manual works before working in ACCPAC.

IT Skills & Expertise (Independent Variable) 1 2 3 4 5

1 I have sufficient IT skills and expertise to use ERP (ACCPAC or SAP).

2 My IT skills and expertise are capable to adapt with a new system.
3 IT skills are necessary to maximize the use of ERP (ACCPAC or SAP).
4 IT skills can help me to perform effectively by saving time.
5 I would like to develop new IT skills & expertise required for SAP.

1 = Strongly Agree, 2 = Agree, 3 = Neutral, 4 = Disagree, 5 = Strongly Disagree

IT Training & Education (Independent Variable) 1 2 3 4 5

1 Training & Education are necessary for me after SAP implementation.
2 Training & Education will increase flexibility and adaptability to change.
3 Training & Education will assist me to develop new skills.
4 Training & Education will help me to perform effectively by saving time.
5 Training & education will help me to minimize errors & to be productive.

Process Reengineering (Independent Variable) 1 2 3 4 5

1 It is possible to bring changes or modify the current process of my works.

2 My works will become easier if the work process is modified or changed.
3 Changing the current process I could save time.
4 I could focus more on productive works if manual works are eliminated.
5 Manual works that I do could be eliminated if SAP is implemented.

1 = Strongly Agree, 2 = Agree, 3 = Neutral, 4 = Disagree, 5 = Strongly Disagree

Necessity of upgrading ERP system (Dependent Variable) 1 2 3 4 5

1 Current ERP system ACCPAC should be upgraded.
2 SAP should be implemented if it helps to perform more efficiently.
3 To make the work process easier, an upgrade in ACCPAC is necessary
4 SAP should be implemented if it saves time and minimize work load.
5 SAP should be implemented if it eliminates the problems exist in Accpac.

Performance (Dependent Variable) 1 2 3 4 5

1 My works performance is depended on the ERP System.
2 My performance can be improved by process reengineering through SAP.
3 My performance will enhance if my works becomes more productive.
4 IT Education and ERP Training will improve my performance.
5 A change in my current work process will enhance my performance.

Thank you for your response!!!!