The Effect of Enterprise Resource Planning Implementation on Human Resource Management Effectiveness; The Case of Commercial Bank of Ethiopia

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The objective of this study is to examine Human resource management effectiveness in context of ERP in Commercial Bank of Ethiopia. Quantitative research approach is used in the study. Explanatory and correlational research design is used to examine ERP implementation factors and their relationship with HRM effectiveness and organizational productivity of the bank. The study adopted simple random sampling technique to select 224 respondents from the total 509 target population of human resource department in head office of Commercial bank of Ethiopia. Furthermore, the finding of this study indicates that four of the ERP implementation factors; top management support, effective communication, vendor support and user acceptance shows positive and significant result when directly related with organizational productivity. User training and change management are not statically significant predictors of organizational productivity. The findings also indicate that all the six ERP implementation factors have positive relationship with HRM functions except, effective communication and change management which are not statically significant predictor of training development, which indicates that effective communication and change management are inversely related with training and development. User training is not also a statically significant predictor of compensation and benefits, which indicates that user training is inversely related with compensation and benefits. The findings of the indirect relationship of ERP implementation factors with organizational productivity through the mediation of HRM effectiveness indicated that three of the independent variables (Effective communication, vendor support and user acceptance) are statically significant predictor of organizational productivity. On the other hand (Top management support, user training and change management) are not statically significant predictor of organizational productivity. Hence, HRM effectiveness have mediating role for half of the independent variables, and it doesn’t have any mediating role for the remaining half independent variables. Based on the findings and conclusions Commercial Bank of Ethiopia should focus on giving sophisticated and continuous update and training for the staffs in order to use ERP on HRM effectively. Key Words: Enterprise resource planning, Human resource management, Organizational Productivity and Commercial Bank of Ethiopia.



Enterprise Resource Planning, Human Resource