IMPLICATIONS OF INFORMATION TECHNOLOGY ON

PERFORMANCE OF LOGISTICS FIRMS IN KHOMAS REGION

BY

BEAULAH TUSHUWANE KALALUKA

STUDENT NUMBER: 216032326

A MINI THESIS RESEARCH PROPOSAL SUBMITTED IN PARTIAL

FULFILMENT OF THE REQUIREMENTS FOR THE DEGREE OF BACHELOR OF
LOGISTICS AND SUPPLY CHAIN MANAGEMENT HONOURS IN THE
FACULTY OF MANAGEMENT SCIENCES

NAMIBIA UNIVERSITY OF SCIENCE AND TECHNOLOGY

SUPERVISOR: MS ESTHER JESAYA

1st June 2022

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 CHAPTER 1

INRODUCTION AND BACKGROUND 0F THE STUDY

1.1 Introduction
If deployed effectively, new supply chain technology can assist increase supply chain agility,
power up operations, cut cycle time, achieve improved efficiency, and deliver items to
customers on time. It's also critical to ensure that new solutions work with existing
technologies and procedures. Integrating new technology into current processes can
significantly improve customer service, lower costs, and streamline supply chains. The new
technology must integrate with existing policies, processes, and people in order to fully
utilise its potential. The issue of "Information Technology's Contribution to Firm Success"
has been the subject of research for more than three decades, and a slew of studies will be
undertaken to better understand and analyze the relationship between IT investment and
organizational performance.

1.2 Background of the study

A recent illustration of the dynamics of technical change and economic development is the
continual proliferation of new Information Communication Technology (ICT) and e-business
technologies among businesses (Koellinger, 2006). IT has the potential to have a substantial
impact on people and commodities mobility; it is a potential enabler of change in social and
organisational behaviours, altering demand for transportation in both spatial and temporal
terms. Technological advancements in the field of telemetrics will match the requirement for
comfort, safety, and speed (Capgemini, 2008). This includes traffic and transportation
management systems, travel information and reservations, vehicle guidance, and mobility
cards, among other things. Firms in the transportation and logistics sector have made
tremendous success in adopting new technologies in recent years, notably those related to the
internet and e-business (Koellinger, 2006).

In recent years, the spread of IT has had a considerable impact on the competitive landscape
of the third party logistics (3PL) industry, resulting in a significant shift in the position of
Third Party Logistics (3PLs) in the supply chain. Insofar as they are entrusted with the
responsibility of integrating and accelerating physical and information flows at many levels

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of the supply chain, logistics service businesses play a more vital role than in the past
(Kenneth & Laudon, 2007). The importance of measuring 3PLs' performance has been
highlighted as a result of their new supply chain role. There has been minimal empirical study
on 3PL performance measurement, particularly in terms of structuring 3PIs for value added
service evaluation. Furthermore, the impact of IT on logistics service organisations has
exacerbated the challenges of assessing performance, as it is especially difficult to pinpoint
the role of IT in delivering improved corporate performance (Kenneth & Laudon, 2007).
Many businesses have embraced information technology into their business processes to
improve operational excellence as a result of its rapid expansion. Logistics companies, in
particular, have not been left behind when it comes to incorporating technology into their
business processes (Akkermans, Bogerd, and Vos, 2009).

Kenneth & Laudon (2007), has defined information technology and/or management of any
computer-based information systems as the study, design, development, and implementation
support. This is especially true when it comes to software programmes and computer
hardware. Information technology is concerned with the use of electronic devices, computers,
and software to convert, store, protect, process, retrieve, and transfer data in a secure manner
(Kenneth & Laudon, 2007).

Information technology according to Hansen (2015), is concerned with the design,

development, and use of technologically based systems and processes that improve the
efficiency and effectiveness of information in a variety of strategic, tactical, and operational
situations to improve a variety of human and organisational problem-solving endeavours.
This is best accomplished by paying close attention to people' information demands in
problem-solving tasks and providing technical aids, such as electronic communication and
computer-based systems comprising hardware, software, and associated procedures. By
emphasising the information base for engineering, information technology complements and
strengthens traditional engineering (Capgemini, 2008).

Information technology encompasses everything from data management to networking,

computer hardware engineering, software design, database design, and system management
and administration. When discussing the various components of IT, the utilisation of
computers and information are frequently mentioned. IT has a long and illustrious history.
Computers, servers, database management systems, and cryptography will be used to fulfil
the functions related with the field of technology in the modern day (Kenneth &Laudon,

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2007). Because of the nature of logistics organisations, globalisation, and technological
advancements, they have been forced to incorporate IT in their operations. IT has been linked
to benefits such as increased efficiency and effectiveness in business processes, the ability to
share information quickly and efficiently by removing linguistic and geographic barriers, the
ability to communicate more cheaply, quickly, and efficiently, and the ability to reduce costs,
resulting in increased productivity, increased working hours, and the ability to bridge cultural
divides (Capgemini, 2008). In general, businesses that have adopted IT have improved their
performance by acquiring a competitive advantage, increasing profitability, and increasing
market share over their competitors (Capgemini, 2008).

1.3 Statement of the Problem

Despite the widespread deployment of information technology in the logistics sector today,
observation has revealed that not all of the objectives have been accomplished and felt by
users. It's distressing to see that some of the many projects being undertaken aren't up to par,
inflicting more harm than good to shareholders, potential investors, and other users and
traders (Christopher, 2005). Today's logistic corporations appear to be primarily concerned
with moving and procuring goods from one location to another while increasing profit,
oblivious to the vital and more important areas such as ensuring that transaction equipment
functions well and providing protection to commodities in transit (Hansen, 2015). With
today's information technology, logistic companies are unable to properly adhere to their
mission statement/corporate mission. Many logistics managers do not have plans in place to
ensure the quality of service and the security of commodities.

Furthermore, since the volume of transactions grows every day, logistic enterprises have
found it difficult to grow and meet their commitments. Despite the fact that logistic
companies make a lot of money, they nevertheless have inefficiencies and insecurity. When
assessing the introduction of information technology in light of its goals, the focus is on how
well it serves potential users, not on how much technology is offered. As a result, the purpose
of this study was to investigate the implications of information technology on the
performance of logistic firms in Khomas Namibia in order to recognize its major impact on
their operations and ensure their profitability and expansion.

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1.4 Purpose of the Study
The study will focus on the impact of information technology on logistics enterprises in the
Khomas region. As a result, the scope chosen was logistics enterprises in Namibia's Khomas
Region. The study will concentrate on small and medium-sized third-party logistics
companies in the county that provide cargo tracking, fleet management, forwarding and
clearing services, as well as transportation and parcel delivery. The selected firms' top and
middle management will be interviewed for the study.

1.5 Research Objectives

1.5.1 General Objective of the Study

The general objective of this study is to establish the effects of Information Technology on
the performance of logistics firms in Khomas Region, Namibia.

1.5.2 Specific Objectives

The study is guided by the following specific objectives

I. To determine how levels of IT usage affect performance of logistic firms in

Khomas Region.
II. To establish the influence of cargo tracking and security system on the
performance of logistic firms in Khomas Region.
III. To establish how use of IT on customer service delivery system affect
performance of logistic firms in Khomas Region.
IV. To determine how information integration influence the performance of logistics
firms in Khomas Region.

1.6 Research Questions

In order to achieve its objectives, the researcher will use the following research questions in
line with the research objectives. These include the following;

I. How does the level of IT usage affect performance of logistic firms in Khomas
Region?
II. How does cargo tracking and security system on the performance of logistic firms
in Khomas Region?

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 III. How does IT usage on customer service delivery influence performance of logistic
firms in Khomas Region?
IV. How information integration with influences the performance of logistics firms in
Khomas Region?

1.7 Significance of the Study

The following are some of the reasons why this study is important: firms and managers will
have a better grasp of how technology influences their business, which will drive them to
pursue better technology equipment.

1.8 Limitations of the Study

The limitations of this research may include financial constraints and inadequate time in
which to do the research and restricted interaction due to the on going coronavirus situation
in Namibia.

1.9 Delimitations of the Study

This study will be held in Khomas Region and the population of this study will involve 10
logistics firms in Khomas.

1.10 Conclusion
If deployed effectively, new supply chain technology can assist increase supply chain agility,
power up operations, cut cycle time, achieve improved efficiency, and deliver items to
customers on time. It's also critical to ensure that new solutions work with existing
technologies and procedures. Integrating new technology into current processes can
significantly improve customer service, lower costs, and streamline supply chains.

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CHAPTER TWO

LITERATURE REVIEW

2.0 Introduction
This chapter examines what other academics have said about the impact of information
technology on logistics organizations and how it has changed their operations. It also
provides an empirical overview of previous studies conducted on a global, international, and
national scale. Before finishing with a summary of the literature evaluation and research
gaps, the chapter concentrates on conceptual framework.

2.1 USAGE OF IT IN LOGISTICS

Implementing new IT and making complementary investments can lead to innovations, and
innovations are linked to increased turnover. To put it another way, innovative businesses are
more likely to expand (Seddon, 2005). Several countries have experienced tremendous
economic growth as a result of IT. Prior research on IT and global economy growth shows
that the contribution of IT to output growth was quite significant for economies between 1990
and 1995 and 1996 to 2000 (Baradwaj, 2010). Countries with high levels of IT dissemination
often see the greatest economic gains from IT. The United States, Canada, New Zealand,
Australia, the Nordic countries, and the Netherlands have the highest rates of IT dispersion,
according to OECD data (Baradwaj, 2010).

Logistic companies may now track their cargo and fleet using technology. This has had a
long-term influence on the cargo and fleet's security. The mandate for all truckers in Namibia
to install the Electronic Cargo Tracking System (ECTS) was met with hostility at first.
Truckers, on the other hand, have gradually accepted the ECTS, which aims to replace the
security bond while monitoring cargo in transit and delivering real-time information on cargo
location, security, and condition (Meuter, 2010). O’Dell (2009) notes that customs authorities
in several regions of the world are presently implementing the ECTS to avoid a variety of
hazards, including considerable revenue loss, cargo theft, and enhancing regulatory
compliance. The utilization of current technologies such as bar codes and RFID allows for
more exact stock information to be accessed. The wireless non-contact use of radio-frequency

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electromagnetic fields to transport data for the purposes of automatically identifying and
tracking tags attached to objects is known as radio-frequency identification (RFID). One of
the most significant advantages of radio-frequency identification is that data interchange
between tags and readers is quick and automatic, requiring no direct contact or line of sight
(Meuter, 2010). This will allow for more exact inventory management data to be accessed.
The study intends to see if there is any link between this and the performance of logistics
companies.

The importance of supply chain partnerships in attaining the firm's objectives cannot be
overstated. Companies profit more from better coordination and integration of activities with
suppliers, as well as a better grasp of client needs. Supply chain management, according to
Closs & Kefeng (2007), is inextricably linked to relationship management, which involves
suppliers and customers. Strategic supplier partnerships and customer relationships are key
components of supply chain management techniques, which contribute to information
exchange, one of the five pillars of a strong supply chain relationship. In the model
interaction with suppliers and customers, there are two sub-factors to consider. Companies
have a proclivity to work with several suppliers in a variety of ways. It is critical that the
supplier connection meets the needs of the firm. According to Bowersox (2009), in
commodity products, it is usual to see an adversarial relationship between buyer and supplier
based mostly on price.

The complementarily view, which was absent from traditional technology diffusion literature,
indicates that gaining a deeper grasp of the complimentary elements that may help or hinder a
firm's IT adoption is a pressing concern for both managers and policymakers today (Croom,
2006). First, when a company's technical decisions are in line with its operational and
organisational preparation for new technologies, they are more likely to succeed. As a result,
managers must align their efforts to maximise the efficacy of IT adoption and usage with
their organisations' ability to adapt to new technology. Second, taking a complementary
approach can assist policymakers obtain new insights into how to build industrial policies
that encourage the use of new technology. For example, firms in different industries have
varied business conditions in terms of market competitiveness and unpredictability, therefore
the amount to which industrial strategy reflects and responds to the unique circumstances of
their particular industries may influence their incentive to use IT (Meuter, 2010).

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CHAPTER 3

RESEARCH METHODOLOY

3.0 Introduction
The research methodology employed in this study is discussed in this chapter, as well as a
basic framework for the investigation. The research design, target population, sample and
sampling procedures, description of research instruments, instrument validity and reliability,
data collection procedures, data analysis methodologies, and ethical considerations while
performing the study are all covered in this chapter.

3.1 Research Design

The descriptive survey method will be used in this investigation. A research design is a plan,
structure, and method for obtaining answers to research questions while also controlling
variance (Nachmias, 2006). According to Orodho (2004), research design encompasses all of
a researcher's techniques for investigating a certain set of questions or hypotheses. As a
result, this design was chosen for this study since it allowed the researcher to gather cross-
referencing data, independent validation of data, and a variety of possibilities.

3.2 Population
Ten logistics enterprises in Khomas Region will make up the study's population. A
population, according to Ogula (2005), is any group of institutions, people, or items that share
similar features. It is a group of people or elements who share at least one characteristic. The
study's main target audience will be the firm's management, as well as top procurement and
transportation managers.

3.3 Sample
The study will use of sample size of 10 logistics firm in Windhoek. A sample is a smaller
group or sub-group drawn from the population that is accessible (Mugenda & Mugenda,

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2009). This subset was chosen with care to be representative of the entire population in terms
of key features. Subject, respondent, or interviewees are terms used to describe each
individual or case in the sample. An approach, process, or technique for selecting a sub-group
from a population to participate in a study is known as sampling (Ogula, 2005).

3.4 Research Instruments

The firms that will be researched will be chosen using a basic random sample technique. To
make certain that the items chosen are representative of the population. Sampling is a method
or technique for selecting a specific number of participants from a particular population to
serve as a representative sample of that community. According to Nachmias (2006), random
sampling is a basic and straightforward to use strategy that makes the research process easier
and faster. The goal of sampling is to find a representative sample of people who can help the
researcher learn more about a population. As a result, the random sample technique will aid
in reaching the study's requisite representativeness.

3.4 Data Collection Procedure

Secondary and primary data will be used in the investigation. A research questionnaire will
be used to collect primary data. Questionnaires were used to collect data. A questionnaire,
according to Cooper and Schindler (2013), is a properly developed instrument for gathering
data in accordance with the research questions' specifications. Because of their adaptability
for this type of investigation, questionnaires are preferred. Questionnaires are often used to
acquire crucial information on the population, according to Mugenda & Mugenda (1999).
Each question in the questionnaire is designed to address a specific goal or research issue
related to the study's project.

3.5 Data Analysis

Quantitative data will be examined using statistical approaches and generated using the
statistical package for social sciences (SPSS), with the results presented in pie charts, tables,
and bar graphs. Descriptive statistics are used to analyse qualitative data. Data analysis,
according to Orodho (2004), is the act of carefully finding and organising interview
transcripts, field notes, data, and other field materials in order to improve your understanding
of them and show them to others.

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3.6 Validity
The research instruments used in this study were carefully designed to ensure their reliability
and validity in achieving the study's goals. Three people from two logistics companies will be
used. They were tested in order to guarantee that they met the research's goals. The piloting
process assisted in the modification and removal of any unclear items from the instrument.
The data acquired during the piloting was examined, and the results were used to modify the
equipment as needed. The major goal of pilot testing is to ensure that the instruments are
accurate and valid before they are utilised in the actual study (Mugenda and Mugenda, 1999).

3.7 Reliability and Validity

The degree to which a research instrument produces consistent outcomes or data following
repeated administration is known as reliability (Mugenda and Mugenda, 2003). The level of
internal consistency or stability of a measurement equipment over time, according to Borg
and Gall (1986). A measuring tool is only trustworthy if the results are consistent. The
dependability coefficient can be calculated in a research study to determine how dependable
data is.

3.8 Research Ethics

Ethics are extremely important in research; research ethics dictate that the sample group's
identity be protected and that their data be treated with confidentiality. With this in mind, the
researcher will specifically request that respondents to the questionnaires do not write their
names, the researcher is considering not recording the names of the respondents who will be
interviewed, and the researcher is generally opposed to the idea of the data collected being
handled by any third party.

3.9 Conclusion
This chapter discusses the research methods that will be employed in this study as well as
providing a broad foundation for it. The research design, target population, sample and
sampling procedures, description of research instruments, instrument validity and reliability,
data collection procedures, data analysis methodologies, and ethical considerations while
performing the study are all covered in this chapter.

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