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UNIVERSITI TUN HUSSEIN ONN MALAYSIA

STATUS CONFIRMATION FOR DOCTORAL THESIS

DEVELOPMENT OF AN INTEGRATED MODEL FOR ADOPTION OF

MANAGEMENT INFORMATION SYSTEMS IN YEMENI

TELECOMMUNICATION ORGANIZATIONS

ACADEMIC SESSION : 2015/2016

I, YASER HASAN SALEM ALWAN, agree to allow this Doctoral Thesis to be kept at the Library under the following terms:

1. This Doctoral Thesis is the property of the Universiti Tun Hussein Onn Malaysia. 2. The library has the right to make copies for educational purposes only. 3. The library is allowed to make copies of this report for educational exchange between

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7 July 2015 This thesis has been examined on date ………………..…………………………..

and is sufficient in fulfilling the scope and quality for the purpose of awarding the

Degree of Doctor of Philosophy.

Chairperson:

PROF. DR. AHMAD SHAKRI BIN MAT SEMAN

Faculty of Technology Management and Business

Tun Hussein Onn University of Malaysia

Examiners:

PROF. T. RAMAYAH

School of Management

University of Science, Malaysia

DR MD FAUZI BIN AHMAD MOHAMAD


Tun Hussein Onn University of Malaysia

DEVELOPMENT OF AN INTEGRATED MODEL FOR ADOPTION OF

MANAGEMENT INFORMATION SYSTEMS

IN YEMENI TELECOMMUNICATION ORGANIZATIONS

YASER HASAN SALEM ALWAN

A thesis submitted in

fulfillment of the requirement for the award of the

Doctor of Philosophy in Technology Management


Universiti Tun Hussein Onn Malaysia

July 2016

ii

I hereby declare that this thesis entitled “Development of An Integrated Model for

Adoption of Management Information Systems in Yemeni Telecommunication

Organizations” is the result of my own research except as cited in the references. This

thesis has not been accepted for any degree and is not concurrently submitted in

candidature of any other degree.

Student : . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .YASER HASAN SALEM ALWAN

Date : . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Supervisor : . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .ASSOCIATE PROFESSOR DR. ALINA

BINTI SHAMSUDDIN

Co-Supervisor : . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .DR. NOR AZIATI BT

ABDUL HAMID

iii

This thesis is dedicated to the most special people in my life; my parents, Shukria and

Hasan; my wife, Reema; our son, Raiyan; our daughter, Raseel; my brothers, Fahd,

Khaled, Mohammed and Abdul-Jabbar; and my sisters, Amera and Abeer.

iv

ACKNOWLEDGEMENT

In all stages of doing this thesis, I dreamt of reaching the moment of writing the

acknowledgments, which is in my case, the final part. All the people who have done

a PhD before know what this moment means. The completion of this thesis would

not have become a reality without the invaluable support, sacrifice, encouragement,

and inspiration of several individuals and organizations. Hence, I wish to express my

appreciation to all those who extended their support in many different ways.

I would like to thank my dignified, beloved supervisor Associate Prof. Dr Alina

Binti Shamsuddin for all the support and help during this research. Besides, I learnt

from her not only how to do this research but many other things. I was very fortunate to

be under her supervision, as she embraced every responsibility of a principal supervisor

to guide my research. I also acknowledge with gratitude the intellectual support of

my co-supervisor Dr. Nor Aziati Bt Abdul Hamid, who provided me with invaluable

assistance, especially in structural equation modeling (SEM). She showed a great deal

of interest in reading, discussing and giving feedback on all aspects of my thesis. To

both of my supervisors, a hearty thank you. I also acknowledge with gratitude my

internal examiner Dr. Fauzi Bin Ahmad Mohamad, and external examiner, Professor

T. Ramayah, their valuable comments paved the way for shaping and revising the study.

My thanks go also to all lecturers and professors of UTHM who contributed immensely

towards boosting my wealth of knowledge.

I am also grateful to the Republic of Yemen for its full financial support during

my bachelor, master, and doctoral studies in.

Last but certainly not least, I would like to thank my wife, my son, and my

daughter (Reema Ahmed Abdo Al-Mamary, Raiyan, and Rassel) for their constant

v

support, endless encouragement and for standing beside me during the doctoral jour-

ney. In addition I would like to express a sense of gratitude to my beloved parents

(Hasan Salem Alwan Al-mamary and Shukria Abdullah Qasim AlFaqih) who I love

so much. I also would like to thank my brothers, sisters, sister in law, Ghuzlan, and

friends for their help. I am deeply indebted to them for being constantly supportive

throughout the duration of my studies.

vi

ABSTRACT

The Telecommunication sector is a significant contributor towards countries’ economic

activities. Recently, the developing nations have witnessed significant transformations

in this sector due to its impact on their economies. In the context of Yemen, telecom-

municationis an interesting sector due to its high growth rate over the past few decades

compared to other sectors. The sector’s revenue alone has accounted for 13 % of

Yemeni GDP. Consequently, Telecommunication is important in the Yemeni economy.

There are various issues faced by this sector, especially in the Yemeni context such as

inadequate training provided to end users, insufficient support provided by top man-

agement, insufficient quality of information and data, and low level of employee’s

satisfaction. Apart from that, the previous issues have caused low level of individual

performance. Hence, this study focused on the previous factors as well as other fac-

tors which are rarely mentioned in previous studies in Yemeni context. Management

information systems is one of the most important solutions in telecommunication orga-

nizations, which is used to solve the previous issues in Yemen. Moreover, the adoption

of management information systems in Yemeni Telecommunication companies plays

an imperative role to develop and further improve individual performance by resolving

the stated issues. Hence, the objective of this study was to develop an integrated model

for the adoption of management information systems in Telecommunication organiza-

tions. In addition, this study determined the impact of technological, organizational,

and people factors on perceived usefulness and user satisfaction towards enhancing

individual performance. Questionnaire was used to collect primary data and the col-

lected data were analyzed by using AMOS version 21 and SPSS version 22. The

response rate in this study was 60.57%. 382 effective cases were analyzed with the

SEM technique to validate the proposed model where data were obtained from four

telecommunication companies. CFA and hypothesized model were tested with SEM

vii

technique in this study. The findings showed that technological factors (system quality,

and information quality) and people factors (computer self-efficacy, and computer ex-

perience) impacted on perceived usefulness. In addition, technological factors (system

quality, and information quality), organizational factor (user training), people factor

(computer experience) and perceived usefulness impacted on user satisfaction while

perceived usefulness impacted on individual performance. The findings of this study

would be useful for managers, especially in the Telecommunications sector to under-

stand the impact in the adoption of management information systems. The success of

the adoption affects individual performance, thus the revenue of these companies will

increase and have a positive role in improving the country’s economy.

viii

ABSTRAK

Sektor Telekomunikasi merupakan penyumbang utama ke arah aktiviti-aktiviti ekonomi

negara. Baru-baru ini, negara-negara membangun telah menyaksikan perubahan yang

ketara dalam sektor ini disebabkan oleh kesan ke atas ekonomi mereka. Dalam kon-

teks Yaman, sektor Telekomunikasi merupakan sektor menarik kerana kadar pertum-

buhan yang tinggi sejak beberapa dekad yang lalu berbanding sektor-sektor yang lain.

Hasil sektor Telekomunikasi sahaja menyumbang 13% kepada KDNK Yaman. Oleh

hal yang demikian, sektor Telekomunikasi merupakan satu sektor penting yang mem-

berikan kesan kepada ekonomi Yaman. Terdapat pelbagai isu yang dihadapi oleh sek-

tor ini terutamanya dalam konteks Yaman seperti latihan yang tidak mencukupi yang

diberikan kepada pengguna akhir, sokongan yang tidak mencukupi yang disediakan

oleh pengurusan atasan, kualiti yang tidak mencukupi maklumat dan data, dan tahap

rendah kepuasan pekerja, isu-isu sebelum ini menyebabkan rendahnya tahap prestasi

individu. Kajian ini memberikan tumpuan kepada faktor-faktor sebelumnya dan faktor-

faktor lain yang jarang disebut dalam kajian-kajian sebelum ini dalam konteks Ya-

man. Sistem maklumat pengurusan merupakan salah satu penyelesaian yang paling

penting dalam organisasi Telekomunikasi yang digunakan untuk menyelesaikan isu-

isu sebelumnya di Yaman. Penggunaan sistem maklumat pengurusan dalam syarikat-

syarikat Telekomunikasi Yaman memainkan peranan yang penting untuk dimajukan

lagi bagi meningkatkan prestasi individu dengan menyelesaikan isu-isu yang diny-

atakan. Oleh itu, objektif kajian ini untuk membangunkan model bersepadu bagi

penggunaan sistem maklumat pengurusan dalam organisasi Telekomunikasi. Di samp-

ing itu, menentukan kesan teknologi, organisasi, dan orang-orang pada faktor dilihat

kegunaan dan kepuasan pengguna ke arah meningkatkan prestasi individu. Soal selidik

ix

telah digunakan untuk mengumpulkan data primer dan data yang dikumpulkan dianal-

isis dengan menggunakan AMOS versi 21 dan SPSS versi 22. Kadar tindak balas

dalam kajian ini ialah 60.57%. 382 kes berkesan dianalisis dengan teknik SEM untuk

mengesahkan model yang dicadangkan. Kajian ini melibatkan empat syarikat Teleko-

munikasi. CFA dan model hipotesis telah diuji dengan teknik SEM dalam kajian ini.

Dapatan kajian menunjukkan bahawa faktor-faktor teknologi (sistem kualiti dan kualiti

maklumat), faktor-faktor orang (komputer efikasi-kendiri dan pengalaman komputer)

kesan kepada kegunaan dilihat. Di samping itu, faktor-faktor teknologi (sistem kualiti

dan kualiti maklumat), faktor-faktor organisasi (latihan pengguna), faktor-faktor orang

(pengalaman komputer) dan kegunaan dilihat kesan kepada kepuasan pengguna. Se-

lain itu, kegunaan dilihat memberikan kesan kepada prestasi individu. Hasil kajian ini

akan menjadi berguna untuk para pengurus, terutamanya dalam sektor Telekomunikasi

dalam memahami kesan penggunaan sistem maklumat pengurusan. Penggunaan ke-

jayaan sistem maklumat pengurusan memberikan kesan kepada prestasi individu, oleh

itu hasil daripada syarikat-syarikat ini akan meningkat dan akan memainkan peranan

yang positif dalam meningkatkan ekonomi negara.

x

CONTENTS

TITLE i

DECLARATION ii

DEDICATION iii

ACKNOWLEDGEMENT iv

ABSTRACT vi

ABSTRAK viii

CONTENTS x

LIST OF TABLES xix

LIST OF FIGURES xxii

LIST OF SYMBOLS AND ABBREVIATIONS xxiv

LIST OF APPENDICES xxvii

CHAPTER 1 INTRODUCTION 1

1.1 Introduction 1

1.2 Background of the Study 1

1.2.1 Telecommunication Industry: A Perspective 1

1.2.2 Telecommunication Industry: Issues and Chal-lenges 5

xi

1.2.3 Importance of Management Information Systemsin Organizations 6

1.3 Problem Statement 8

1.4 Research Questions 11

1.5 Research Objectives 11

1.6 Significance of The Study 12

1.7 Research Scope 14

1.8 Definition of Variables 14

1.8.1 System Quality 14

1.8.2 Information Quality 14

1.8.3 Service Quality 15

1.8.4 Top Management Support 15

1.8.5 User Training 15

1.8.6 Computer Self-Efficacy 16

1.8.7 Computer Experience 16

1.8.8 Perceived Usefulness 16

1.8.9 User Satisfaction 16

1.8.10 Individual Performance Impact 17

1.9 Organization of Thesis 17

CHAPTER 2 LITERATURE REVIEW 19

2.1 Introduction 19

2.2 Information Systems 19

2.2.1 Overview of Information Systems 19

2.2.2 Types of Information Systems 21

2.3 Management Information Systems (MIS) 23

xii

2.3.1 The Concept of MIS 23

2.3.2 Definition of MIS 25

2.3.3 Benefits of MIS 26

2.3.4 The Role of MIS in Organizations 27

2.3.5 Types of MIS in Yemeni Telecommunication Or-ganizations 29

2.3.5.1 Human Resource Information Systems 30

2.3.5.2 Accounting Information Systems 31

2.3.5.3 Financial Information Systems 32

2.3.5.4 Customer Relationship Management Sys-tem 33

2.3.5.5 Billing System 35

2.3.6 Summary 38

2.4 Theories in Field of Successful Adoption of InformationSystems 38

2.4.1 Theory of Reasoned Action (1980) 40

2.4.2 Social Cognitive Theory (1986) 41

2.4.3 Technology Acceptance Models 44

2.4.4 Technology, Organization, and Environment Frame-work (1990) 49

2.4.5 End-User Computing Effectiveness Model (1990) 51

2.4.6 Theory of Planned Behavior (1991) 53

2.4.7 Model of PC Utilization (1991) 57

2.4.8 Delone & Mclean’s Models 59

2.4.9 Motivational Model (MM) (1992) 63

2.4.10 Diffusion of Innovation (DOI) Theory (1995) 65

2.4.11 Summary 68

xiii

2.5 Summary of The Chapter 78

CHAPTER 3 CONCEPTUAL MODEL AND HYPOTHESES DEVEL-OPMENT 80

3.1 Introduction 80

3.2 Research Variables and Measurements 80











3.2.11 Summary 92

3.3 The Conceptual Model 95

3.4 Hypotheses Development 96

3.4.1 Effect of System Quality on Perceived Useful-ness, and User Satisfaction 96

3.4.2 Effect of Information Quality on Perceived Use-fulness, and User Satisfaction 98

3.4.3 Effect of Service Quality on Perceived Useful-ness, and User Satisfaction 99

3.4.4 Effect of Top Management Support on PerceivedUsefulness, and User Satisfaction 100

xiv

3.4.5 Effect of User Training on Perceived Usefulness,and User Satisfaction 101

3.4.6 Effect of Computer Self-Efficacy on PerceivedUsefulness, and User Satisfaction 101

3.4.7 Effect of Computer Experience on Perceived use-fulness, and User Satisfaction 102

3.4.8 Effect of Perceived Usefulness on User Satisfac-tion, and Individual Performance Impact 103

3.4.9 Effect of User Satisfaction on Individual Perfor-mance Impact 103


CHAPTER 4 METHODOLOGY 108

4.1 Introduction 108

4.2 Research Design 108

4.3 Research Population / Sample 111

4.3.1 Introduction 111

4.3.2 Sampling Method 111

4.3.3 Sample Size 112

4.3.4 Sampling Procedure 113

4.4 Data Collection Method: Survey 114

4.5 Instrument Design 115


4.5.2 Pretest 116

4.5.3 Pilot Study 123

4.6 Data Analysis Method (Quantitative Method) 125

4.6.1 Descriptive Analysis 126

4.6.2 Assumption of Multivariate Analysis 126

xv

4.6.3 Confirmatory Factor Analysis 126

4.6.4 Analysis for Structural Model 127

4.7 Reliability 128

4.8 Validity 129

4.8.1 Content Validity 130

4.8.2 Construct Validity 131

4.8.2.1 Convergent Validity 131

4.8.2.2 Discriminant Validity 131

4.9 Ethical Considerations 132


CHAPTER 5 DATA ANALYSIS AND RESULTS 134


5.2 Data Editing and Coding 135

5.3 Response Rate and Non-Response Bias 135

5.3.1 Response Rate 135

5.3.2 Non Response Bias 136

5.4 Data Screening 138

5.4.1 Missing Data 138

5.4.2 Outliers Examination 141

5.5 Multivariate Analysis 142

5.5.1 Normality Test 142

5.5.2 Homoscedasiticity 144

5.5.3 Multicollinearity 145

5.6 Demographic Profiles 146

5.7 Descriptive Analyses 148

xvi











5.8 Structural Equation Modeling 160

5.9 Measurement model 161

5.10 Measures of Goodness-of-Fit 162

5.11 Confirmatory Factor Analysis 163


5.11.2 Confirmatory Factor Analysis Results 164

5.12 Reliability and Validity of a Measurement Model 168

5.13 Structural Model 172

5.13.1 Initially Proposed Structural Model 172

5.13.2 Revised Structural Model 176


CHAPTER 6 DISCUSSION , IMPLICATIONS, AND CONCLUSIONS 182


6.2 Discussion 183

xvii

6.2.1 The Impact of System Quality on Perceived Use-fulness 183

6.2.2 The Impact of System Quality on User Satisfaction 184

6.2.3 The Impact of Information Quality on PerceivedUsefulness 185

6.2.4 The Impact of Information Quality on User Sat-isfaction 187

6.2.5 The Impact of Service Quality on Perceived Use-fulness 188

6.2.6 The Impact of Service Quality on User Satisfaction188

6.2.7 The Impact of Top Management Support on Per-ceived Usefulness 189

6.2.8 The Impact of Top Management Support on UserSatisfaction 190

6.2.9 The Impact of User Training on Perceived Use-fulness 191

6.2.10 The Impact of User Training on User Satisfaction 192

6.2.11 The Impact of Computer Self-Efficacy on Per-ceived Usefulness 193

6.2.12 The Impact of Computer Self-Efficacy on UserSatisfaction 194

6.2.13 The Impact of Computer Experience on PerceivedUsefulness 194

6.2.14 The Impact of Computer Experience on User Sat-isfaction 195

6.2.15 The Impact of Perceived Usefulness on User Sat-isfaction 196

6.2.16 The Impact of Perceived Usefulness on Individ-ual Performance 197

xviii

6.2.17 The Impact of User Satisfaction on Individual Per-formance 198

6.3 Implications 199

6.3.1 Theoretical Implications 199

6.3.2 Practical Implications 202

6.4 Limitations of the Study 204

6.5 Directions for Future Research 206

6.6 Conclusion 207

REFERENCES 209

APPENDICES 238

VITA 263

xix

LIST OF TABLES

1.1 Number of Subscribers in the Different Means of

Telecommunications

2

1.2 The Number of Subscribers in the Cellular Network

between 2005- 2013

3

1.3 The Cellular Network Operating Lines by Companies:2011

- 2013

4

2.1 Types of MIS in Yemeni Telecommunication Companies 37

2.2 Summary of The Strengths and Weakness of The Theories 69

2.3 Factors that Used in this Study 77

3.1 Summary of the Variables 93

3.2 Summary of Hypotheses 105

4.1 Population and Sample Size 114

4.2 Deleted Items 117

4.3 Items that Used to Measure Latent Variables 118

4.4 Pilot Testing Reliability Result 124

4.5 Testing Reliability Result 129

4.6 Summary of the Methodology 133

5.1 Response Rate for The Four Companies 136

5.2 Non-Response Bias Results 137

5.3 Missing Data Statistics 139

5.4 Test of Univariate Normality 143

5.5 Test of Homogeneity of Variances 145

xx

5.6 Multicollinearity Test 146

5.7 Demographic Profiles 147

5.8 Descriptive Statistics of Measured Items of System Quality

Construct

149

5.9 Descriptive Statistics of Measured Items of Information

Quality Construct

150

5.10 Descriptive Statistics of Measured Items of Service Quality

Construct

151

5.11 Descriptive Statistics of Measured Items of Top

Management Support Construct

152

5.12 Descriptive Statistics of Measured Items of User Training

Construct

154

5.13 Descriptive Statistics of Measured Items of Computer

Self-Efficacy Construct

155

5.14 Descriptive Statistics of Measured Items of Computer

Experience Construct

156

5.15 Descriptive Statistics of Measured Items of Perceived

Usefulness Construct

158

5.16 Descriptive Statistics of Measured Items of User

Satisfaction Construct

159

5.17 Descriptive Statistics of Measured Items of Individual

Performance Impact Construct

160

5.18 Goodness-of-Fit Indexes 162

5.19 The Improved Fitness Indexes for All Constructs

Simultaneously (Initial CFA model)

164

5.20 The Improved Fitness Indexes for All Constructs

Simultaneously (Final CFA model)

168

xxi

5.21 The Confirmatory Factor Analysis ( CFA ) Report

Summary for All Constructs

169

5.22 Discriminant Validity Index Summary 172

5.23 Goodness of Fit indexes for the Proposed Structural Model 173

5.24 Estimates for the Initial Structural Model 174

5.25 Goodness of Fit Indices for the Revised Structural Model 176

5.26 Estimates for the Revised Structural Model 177

5.27 Summary of Hypotheses Testing 179

xxii

LIST OF FIGURES

2.1 The Role of Management Information Systems in Business 28

2.2 The Different Types of MIS in Yemeni Telecommunication Com-

panies 30

2.3 Theory of Reasoned Action (TRA) (Ajzen & Fishbein, 1980) 40

2.4 Social Cognitive Theory (Bandura, 1986) 42

2.5 Technology Acceptance Model (Davis et al., 1989) 44

2.6 Technology Acceptance Model 2 (TAM 2) (Venkatesh & Davis,

2000) 46

2.7 Unified Theory of Acceptance and Use of Technology (UTAUT)

(Venkatesh et al., 2003) 47

2.8 Technology Acceptance Model 3 (TAM3) (Venkatesh & Bala, 2008) 48

2.9 Technology, Organization, and Environment Framework (Tornatzky

& Fleischer, 1990) 50

2.10 End-User Computing Effectiveness Model (Igbaria, 1990) 52

2.11 Theory of Planned Behavior (Ajzen, 1991) 55

2.12 Combined TAM-TPB (Taylor & Todd, 1995) 56

2.13 Model of PC Utilization(Thompson et al., 1991) 58

2.14 Delon and Mclean IS Success Model (DeLone & McLean, 1992) 60

2.15 Updated Delone & Mclean IS Success Model (Delone & McLean,

2003) 62

2.16 Motivational Model (Davis et al., 1992) 64

2.17 Variables Determining the Rate of Adoption Innovations (Rogers,

1995) 67

xxiii

3.1 Conceptual Framework 96

4.1 Research Design 110

5.1 Initial CFA model 165

5.2 Re-Specify CFA Model 167

5.3 Initial Proposed Structural Model 175

5.4 Revised Structural Model 178

LIST OF SYMBOLS AND ABBREVIATIONS

AIS - Accounting Information Systems

AMOS - Analysis of Moment Structures

AVE - Average Variance Extracted

CE - Computer Experience

CFA - Confirmatory Factor Analysis

CFI - Comparative Fit Index

Chisq/df - Chi Square / Degrees of Freedom

CRM - Customer Relationship Management

CSCW - Computer Supported Collaborative Work

CSE - Computer Self-Efficacy

DOI - Diffusion of Innovation

DSS - Decision Support Systems

DVs - Dependent Variables

EDP - Electronic Data Processing

EIS - Executive Information Systems

EM - Expectation Maximization

ES - Expert System

ESS - Executive Support System

EUCE - End-User Computing Effectiveness

GDSS - Group Decision Support Systems

xxv

GFI - Goodness of Fit Index

GOF - Goodness of Fit

HRIS - Human Resources Information Systems

ICS - Inventory Control System

IP - Individual Performance

IPC - Information Processing Cycle

IQ - Information Quality

IS - Information Systems

IT - Information Technology

IVs - Independent Variables

KI - Kurtosis Index

KWS - Knowledge Work Systems

MI - Modification Indices

MIS - Management Information Systems

MM - Motivational Model

MPCU - Model of PC Utilization

NFI - Normed Fit Index

OAS - Office Automation Systems

OQ - Output Quality

OS - Organization Support

PEOU - Perceived Ease of Use

PU - Perceived Usefulness

RMSEA - Root Mean Square Error of Approximation

SCT - Social Cognitive Theory

SEM - Structural Equation Modeling

SerQ - Service Quality

SI - Skew Index

xxvi

SPSS - Statistical Package for the Social Sciences

SysQ - System Quality

TAM - Technology Acceptance Model

TAM2 - Technology Acceptance Model 2

TAM3 - Technology Acceptance Model 3

TLI - Tucker-Lewis Index

TMS - Top Management Support

TOE - Technology, Organization, and Environment

TPB - Theory of Planned Behavior

TPS - Transaction Processing System

TRA - Theory of Reasoned Action

US - User Satisfaction

UT - User Training

UTAUT - Unified Theory of Acceptance and Use of Technology

VIF - Variance Inflation Factors

xxvii

LIST OF APPENDICES

APPENDIX TITLE PAGE

A Application to Request Company’s Information 239

B Survey Instrument 244

C Certificate of Proofreading 251

D Assessment of Multivariate Outliers 252

E Multivariate Normality 257

F Publications Associated With The Thesis 260

CHAPTER 1

INTRODUCTION

1.1 Introduction

This chapter provides an introduction to this research. It is divided into nine sections.

Following this section, section 1.2 presents the issues related to the research back-

ground. Section 1.3 specifies the research problem. Section 1.4 identifies the research

objectives and section 1.5 determines the research questions. Section 1.6 describes

the significance of the study and section 1.7 identifies the research scope. Section 1.8

presents the definitions of the terms that are commonly used throughout this thesis.

Finally, the overall structure of thesis content is outlined in section 1.9.

1.2 Background of the Study

1.2.1 Telecommunication Industry: A Perspective

The telecommunications industry is the key enabler of productivity across economies

and societies. The telecommunications sector is not only a significant contributor to-

wards the economic activities of countries, but also towards the growth of other indus-

tries. In recent times, developing nations have witnessed significant transformations in

2

this sector due to the impact it has had on their economies. The telecommunications

sector is an interesting sector to study, not only due to its volatile nature in terms of

technological breakthrough and its policies, but also due to the high growth rate over

the past few decades and the significant contribution to the economies of these nations

(Venkatram & Zhu, 2012).

Hence, the telecommunications sector is a strategic and vital link for the citi-

zen and the public and private institutions alike. This sector has witnessed substantial

change and development during the last ten years. Its infrastructure has progressed

in recent years (AL-Subari, 2010). According to the Embassy of the Republic of

Yemen in Washington (2008) telecommunications sector was one of the most promis-

ing sectors available in Yemen for trade and investment.

The telecommunications industry in Yemen consisted of fixed-line, mobile

communications and the internet. In addition, the number of subscribers is increas-

ing at a rapid pace, which adds to the growth and importance of the industry. Table 1.1

shows the number of subscribers in the different telecommunications sectors in Yemen.

Table 1.1: Number of Subscribers in the Different Means of Telecommunications

Year

Item

2011 2012 2013

Local telephone 1,075,312 1,103,807 1,093,305

International telephone 111,085 115,240 156,294

Cellular Phone 12,349,860 13,893,265 17,423,000

Internet 810,750 857,970 1,093,492

Source: Annual Statistical Bulletin of Public Corporation for Wired, and

Wireless Telecommunications (2012)

According to Annual Statistical Bulletin of the Public Corporation for Wired,

and Wireless Telecommunications (2012), mobile communications were the most pop-

ular in Yemen. From 2005-2013, Yemen improved its mobile services as the number

3

of mobile subscribers jumped from 2,277,553 million in 2005 to 17,423,000 million in

2013. Table 1.2 shows the number of mobile subscribers from 2005-2013.

Table 1.2: The Number of Subscribers in the Cellular Network between 2005-2013

Year Subscribers

2005 2,277,553

2006 2,977,781

2007 4,348,264

2008 6,445,033

2009 8,312,773

2010 11,085,344

2011 12,349,860

2012 13,893,265

2013 17,423,000



Yemen’s mobile market has four operators: Sabafon, MTN Yemen, Y and

Yemen Mobile. Yemen Mobile provides mobile services through a CDMA network,

while the other operators use GSM technologies. Sabafon and MTN launched mobile

services in early 2001 after winning a 15 year license at a cost of USD 10 million

in mid-2000. The expansion of their network which currently covers about 60% of

the population, by a French firm, Alcatel, is continuing. In May 2004, the Ministry

of Telecommunications announced operations for a third mobile telecommunications

provider, Yemen Mobile, which was owned exclusively by the Ministry until 55% of

the company’s shares were put up for sale in mid 2006. Yemen Mobile started opera-

tions on the CDMA (code division multiple access) protocol (Embassy of the Republic

of Yemen in Washington, 2008).

4

The competition between the companies led to the expansion of mobile service

coverage to include all governorates and the diversifying of services. Competition

in service pricing increased public demand for mobile services. Table 1.3 shows the

Cellular Network Operating lines by companies: 2011 - 2013.

Table 1.3: The Cellular Network Operating Lines by companies: 2011 - 2013

Company Operating Lines Year

Yemen mobile

4,267,965 2011

4,099,352 2012

4,529,000 2013

Sabafon

3,093,502 2011

4,000,000 2012

5,421,000 2013

MTN

4,562,019 2011

4,974,903 2012

5,777,000 2013

Y

426,374 2011

819,010 2012

1,696,000 2013

Total

12,349,860 2011

13,893,265 2012

17,423,000 2013



According to Table 1.3 there is intense competition among mobile companies

in Yemen. In addition, the table indicates that the number of subscribers of mobile

companies was increasing at a rapid pace.

5

According to GSMA-Intelligence (2014) there is a recent explosion in the num-

ber of mobile subscribers in the Arab states. Unique subscriber penetration rates are

now above the global average and the region is also seeing increasing adoption of con-

nected devices. Bringing communication services to previously unconnected popula-

tions has changed the way people lived and had a key role in the social and economic

development across the region. The mobile industry already makes a significant con-

tribution to the social and economic development of the Arab states where significant

proportion of the wages, taxes or profits paid out by the industry are subsequently spent

across other sectors of the economy. This results in other economic sectors also bene-

fiting from the value generated by the mobile ecosystem. Mobile technology facilitates

productivity improvements for many workers and businesses.

According to Belhaj (2012), the telecommunications sector contributes signif-

icantly to the Yemeni economy by providing more opportunities for economic devel-

opment and plays an important role in the rapidly changing environment. In addition,

the telecommunications sector is an interesting sector in Yemen due to the high growth

rate over the past few decades. Telecommunications sector revenues alone accounted

for 13 % of Yemeni GDP.

1.2.2 Telecommunication Industry: Issues and Challenges

Organizations in the global marketplace face stiff competition to survive and sustain

their competitive advantage. In order to accomplish this, organizations must provide

a high level of quality performance to its customers. In reaction to high levels of in-

creased competition, many businesses are forced to restructure their labor-management

practices and motivate their employees to improve performance (Belhaj, 2012). Ac-

cording to Sultana et al. (2012), training is the main issue affecting employee perfor-

mance in the telecommunications sector. If organizations invest in the right type of

training, it can enhance employee performance, competency and skill. In addition,

training is a useful means of coping with new changes in technology, competition,

6

organizational structuring and most importantly it enhances employee performance.

Al-Qurashi (2010) mentioned that in the Yemeni telecommunications industry, top

management support and training are the key factors that affect employee performance.

Al Haderi (2014b) mentioned that in the context of Yemen, information quality

affects the adoption of the technology when it is useful, easy to use and when it helps

them achieve organization goals.

In addition, Odembo (2013) mentioned that employee’s satisfaction is becom-

ing more challenging for companies including those in the telecommunications sectors.

Saeed et al. (2014) indicates that the main issue in telecommunication companies is the

level of satisfaction of the employees. An organization with good management would

consider its employees its assets and the primary source of productivity and financial

gain.

In addition, Hashed et al. (2012) mentioned perceived quality, perceived value

and corporate image as important factors affecting customer satisfaction. Moreover,

Belhaj (2012) mentioned that the absenteeism of employees are one of the issues in

the telecommunications sector in Yemen where it reduces effective service capacity,

increases waiting time, waste a lot of financial resources, disturbs management and

colleagues at work and disturbs the work schedule which ultimately affects the pro-

ductivity and performance of employees in the sector.

In a nutshell, there are various issues faced by the industry especially in the

Arab countries. The following section discusses the importance of adopting manage-

ment information systems as the solution.

1.2.3 Importance of Management Information Systems in Organizations

According to Hashim et al. (2012) the management information system plays an im-

portant role as it is the life blood of an organization. According to Dinesh & Ragel

(2015) organizations are developing their own management information system for

more efficient management. Understanding the impact of management information

7

system on the performance of users is very crucial for all organizations because it can

improve organizational or individual performance.

According to Nath & Badgujar (2013) a great number of organizations could

not operate properly and successfully without the implementation of management in-

formation system. Management information systems make it possible for organiza-

tions to get the right information to the right people at the right time in the right form

by enhancing the interaction between the people’s organization. In addition manage-

ment information system allows information to move between departments instantly,

reducing the need for face-to-face communications among employees, thus increasing

the responsiveness of the organization. The role of management information system in

companies is to manage the data; organizing and retrieving of the information which

helps the organization to provide services faster; and market accurately and easily (AL-

Gharaibeh & Malkawi, 2013).

Another primary purpose of management information systems was to help an

organization achieve its goals by providing managers with insight into the regular op-

erations of the organization so that they can control, organize and plan more effectively

(Sekhar & Babu, 2012).

In the past, organizations employed the manual system for collecting, process-

ing and storing the information. However, for the last few years the organizations are

storing huge amounts of information and the structure of today’s organization manage-

ment systems are more complex. Some organizations store information of more than

one million customers, as in the case of telecommunication companies. Hence tradi-

tional methods such as the use of paper work and files to store the data are no longer

relevant. It is necessary to adopt management information systems to enable these or-

ganizations to control this huge amount of information and provide it to all managerial

levels in a timely manner as needed (Al-Hameedi et al., 2009).

8

1.3 Problem Statement

The Telecommunication sector is a significant contributor towards the economic activ-

ities of countries. In the context of Yemen, Telecommunication sector revenue alone

accounted for 13 % of Yemeni GDP. Consequently, the Telecommunication sector is

an important sector that affects the economy of Yemen (Belhaj, 2012). The main issue

faced by this sector is low level of individual performance. Consequently, the Telecom-

munication sector strongly recommended to adopts management information systems

in order to solve this issue. Management information systems is one of the most impor-

tant tools in Telecommunication organizations that used to solve this issue. Adoption

of management information systems in Yemeni Telecommunication companies plays

an imperative role for development, and when it is used to improve employee’s perfor-

mance.

Today more companies are moving from the manual systems to computerized

information systems (Rani & Singhal, 2014). According to Al-Hameedi et al. (2009)

adoption of management information systems in telecommunication companies is nec-

essary to enable these companies to control the huge amounts of information. Manage-

ment information systems enable storage and processing of all business transactions

with the overall purpose to make that information available on demand in the required

format.

There are a lot of issues that hinder the successful adoption of management

information systems and technologies in organizations. Most of the literature focused

on issues such as training, top management support, information quality, employee’s

satisfaction, customer satisfaction and absenteeism of employees (Sultana et al., 2012;

Al-Qurashi, 2010; Al-Omari, 2009; Al Haderi, 2014b; Odembo, 2013; Saeed et al.,

2014; Hashed et al., 2012; Belhaj, 2012). However, limited studies especially in the

context of Arab countries, had investigated computer self-efficacy, computer experi-

ence, system quality and service quality issues. Hence, this research focuses on tech-

nological, organizational and people factors, which is rarely mentioned in the previous

9

studies in the Arab context.

Based on discussions with some of the employees of telecommunication com-

panies in Yemen, the main problems that hinder the successful adoption of manage-

ment information systems are:

(1) The employees don’t have adequate skills and knowledge in using the sys-

tem. Lai (2009) claimed that computer self-efficacy affected successful adoption. In

addition, Al-Haderi (2013) supported that in the case of Yemen, where it was revealed

that computer self-efficacy is an important determinant to influencing the adoption of

technologies.

(2) The difficulty of learning and using the system. According to Al-Omari

(2009) ease of use and ease of learning the system leads to the acceptance of the sys-

tem.

(3) The difficulty to retrieve the information. Lee & Kozar (2006) supported the

idea that the quality of the information the system produces and delivers is considered

to be a key factor affecting management information system success.

(4) Most of the employees don’t have prior experience with using the system.

According to Sabherwal et al. (2006) computer experience enhances the system use

and affects the information systems success.

(5) The companies should provide training to their staff to improve their skill

and knowledge. Similarity Ajami & Mohammadi-Bertiani (2012) claimed that a num-

ber of information systems failed because the end-users were inadequately trained. Al-

Omari (2009) supported that in the context of telecommunication companies in Gaza,

training is one of the important factors that increase user awareness of the capabilities

of a system.

(6) Top management should provide the necessary material needed for training

and encourage and support the employees to use management information systems.

The top management should provide the required budget for continued skill training

programs. According to Chen & Hsiao (2012); Ragu-Nathan et al. (2004) top manage-

ment support gives significant impact on the adoption of technologies in organizations.

10

(7) There is a problem with the technical team which supports the department.

Most of the technical support staff doesn’t have the skills to solve complex problems.

The technical support team also needs to be trained to develop their skills and knowl-

edge. According to Gorla et al. (2010) service quality has a significant positive influ-

ence on organizational impact either directly or indirectly. Especially in the context of

mobile telecommunications, the continuance of trust using the same product range is

much dependent on customer service and values provided by the service provider.

(8) The employees sense that the system is not beneficial and are not willing to

use it. These will indeed affect the performance of the employees. Park et al. (2011)

supported that user satisfaction and perceived usefulness have a positive influence on

organizations. In addition, Choi et al. (2013); Shih (2004) supported that there is a

positive relationship between perceived usefulness and individual performance impact.

In addition, Sharabati et al. (2015); Iivari (2005); Hou (2012) supported that there is

a positive relationship between user satisfaction and individual performance impact.

Moreover Seddon & Kiew (1996) supported usefulness as an IS success measure. On

other hand, Petter et al. (2008) supported the user satisfaction as an IS success measure.

According to Moller & Chaudhry (2012) during the introduction stage of man-

agement information systems the employees still can’t experience the benefits of man-

agement information systems. This is due to apprehension. Moreover, the functions of

management information systems are not clearly understood.

Based on previous discussions, the researcher concludes that the main issues

related to management information systems adoption in Yemeni telecommunication

companies are technological issues (system quality, information quality, and service

quality), organizational issues (top management support and user training) and people

issues (computer self-efficacy and computer experience). In addition, perceived use-

fulness and user satisfaction are the important factors which affect the acceptance and

successful adoption of technology in organizations. Consequently these issues have

influence on the individual performance. The following section elaborates further on

the research questions.

11

1.4 Research Questions

Based on previous discussion, the following questions are going to be addressed by the

research:

i. What is the impact of technological factors (system quality, information qual-

ity, and service quality), organizational factors (top management support, and training),

and people factors (computer self-efficacy, and computer experience) on perceived use-

fulness?

ii. What is the impact of technological factors (system quality, information

quality, and service quality), organizational factors (top management support, and

training), and people factors (computer self-efficacy, and computer experience) and

perceived usefulness on user satisfaction?

iii. What is the impact of perceived usefulness and user satisfaction on individ-

ual performance?

1.5 Research Objectives

The objectives of this study are to develop integrated model for successful adoption of

management information systems that link three factors (technological, organizational

and people) and determine the impact of these factors on perceived usefulness and user

satisfaction. These factors subsequently impact the individual performance.

i. To determine the impact of technological factors (system quality, informa-

tion quality, and service quality), organizational factors (top management support, and

training), and people factors (computer self-efficacy, and computer experience) on per-

ceived usefulness.

ii. To determine the impact of technological factors (system quality, informa-

tion quality, and service quality), organizational factors (top management support, and

training), and people factors (computer self-efficacy, and computer experience) and

perceived usefulness on user satisfaction.

12

iii. To determine the impact of perceived usefulness and user satisfaction on

individual performance.

1.6 Significance of The Study

This study expects to contribute significant theoretical and practical contributions in the

domain of management information systems adoption in Yemen. There is a lack of re-

search in terms of the relationship between management information systems adoption

and individual performance. Based on the database of the National Information Center

in the Republic of Yemen, few studies attempt to focus on main factors that affect the

success of management information systems adoption and individual performance. In

addition, most studies that investigated the impact of management information systems

adoption in individual performance are western focused. In recognition of the need to

bridge this gap in literature, this study contributes to the existing body of knowledge

by investigating the impact of management information systems adoption and perfor-

mance among employees in the Yemeni telecommunications sector. In addition, this

study provides insight on the impact of technological, organizational and people factors

on perceived usefulness and user satisfaction among employees in Yemeni telecommu-

nication companies. On the other hand the study findings serve as lessons to be shared

by other developing countries especially among the Arabic countries.

The main theoretical contribution in this study is the adding of four constructs

(top management support, user training, computer self-efficacy and computer experi-

ence) that are rarely mentioned as independent variables in previous studies especially

in the field of information system success in the Arabian context. Another theoreti-

cal contribution of this study is the development of an integrated model that integrates

the elements of technological factors, organizational factors, and people factors affect-

ing Yemen. Investigate the impact of those factors in perceived usefulness and user

satisfaction towards enhancing the individual performance.

13

In addition, assessing the success of information systems has been identified as

one of the most critical issues in the information systems field. Several conceptual and

empirical studies have been conducted to explore this confusing yet important issue.

A huge debate continues concerning the appropriate set of variables that can be used

to determine the users’ perception of IS success. However, studies relating to this

issue within the context of Arab countries are few and lack the ability to propose an

appropriate evaluation criterion for Arab organizations (Al-Adaileh, 2009). This study

attempts to focus deeply on the factors that lead to successful adoption of management

information systems (MIS) in Yemeni telecommunication companies.

In terms of the practical significant of the study, the findings would be useful

for managers and practitioners, especially in the telecommunications sector in under-

standing the impact of management information systems adoption in individual per-

formance. Telecommunication companies in Yemen are still dealing with issues in

adopting success factors. Terms that identify the factors accurately, will have posi-

tive role on successful adoption of technology in Yemeni organizations in general. The

successful adoption of management information systems affect individual performance

(improved productivity, improved effectiveness and improved performance), thus the

revenues of these companies will increase and will have a positive role in improving

the country’s economy.

In addition, this study will also provide the management with knowledge about

the role of technological, organizational and people factors among employees. It pro-

vides the management clear reasons to pay more attention to factors which affect suc-

cessful adoption of management information systems.

Finally, the current study was conducted in one of the important sectors sup-

porting the Yemeni national economy i.e. estimated to be 13% of the Yemeni GDP

(Belhaj, 2012). Hence this research will go a long way in improving the Yemeni GDP

by focusing on effective adoption policy to overcome the problem that might affect

productivity and performance of employees in the telecommunications sector.

14

1.7 Research Scope

The study focuses on the telecommunication companies in Yemen. This study involved

all the mobile companies in Yemen namely Sabafon, Y, Spacetel Yemen (MTN) and

Yemen Mobile. This study focuses on the following departments: customer service,

information systems, accounting, finance, human resource and sales. The instrument

for collecting the data is the questionnaire. The questionnaire was distributed to end-

users (employees who use the system) of management information systems in these

companies. This study focuses on the factors that affect successful adoption of the

management information systems.

1.8 Definition of Variables

1.8.1 System Quality

System quality is the desirable characteristics of an information system, for example:

ease of use, system flexibility, system reliability and ease of learning as well as system

features of intuitiveness, sophistication, flexibility and response times (Petter et al.,

2008). This study defines system quality as "the desirable characteristics of manage-

ment information systems that measures the quality of the system performance".

1.8.2 Information Quality

Information quality is the desirable characteristics of the system outputs, for example:

relevance, understandability, accuracy, conciseness, completeness, currency, timeli-

ness, and usability (Petter et al., 2008). This study defines information quality as "the

desirable characteristics that measures the output of management information system".

15

1.8.3 Service Quality

Service quality is the quality of the support system users receive from the IS depart-

ment and IT support personnel, for example: responsiveness, accuracy, reliability,

technical competence and empathy of the personnel staff (Petter et al., 2008). Ac-

cording to Delone & McLean (2003) service quality is the overall support delivered

by the service provider. This study defines service quality as "the quality of the sup-

port that the users receive from the management information systems department and

technical support team".

1.8.4 Top Management Support

Management support is able to ensure sufficient allocation of resources and act as a

change agent to create a more conducive environment for IS success and a lack of it

is considered a critical barrier to the effective utilization of information technology

(Igbaria et al., 1997). This study defines top management support as "the extent of

top management that understands the importance of the system and is able to ensure

sufficient allocation of resources to support and encourage the end-users to use man-

agement information systems".

1.8.5 User Training

User training refers to the amount of training provided by other computer users or

computer specialists in the company, friends, consultants or educational institutions

external to the company (Igbaria et al., 1997). This study defines user training as "the

amount of internal and external training that is provided to end-users to use manage-

ment information systems".

16

1.8.6 Computer Self-Efficacy

Self-efficacy is the belief that one has the ability to perform a particular action (Igbaria

& Iivari, 1995). According to Brown (2002) self-efficacy is a measure of user’s con-

fidence in their ability to use a technology. In this study, computer self-efficacy refers

to an individual’s belief that he or she has the skills and abilities to use management

information systems to perform specific tasks.

1.8.7 Computer Experience

Computer experience is the extent of the experience in using application systems, dif-

ferent types of computer software packages, financial modeling, languages, and par-

ticipation in non-technical analysis and technical design of computerized information

systems (Igbaria & Iivari, 1995). This study defines computer experience as "the extent

of the experience in using management information systems".

1.8.8 Perceived Usefulness

Perceived usefulness is the degree to which a person believes that using a particular

system would enhance his or her job performance (Davis, 1989). This study defines

perceived usefulness as "the degree to which end-user believes that using management

information systems enables them to accomplish tasks more quickly, and makes the

job easier to do".

1.8.9 User Satisfaction

User satisfaction is the net feeling of pleasure or displeasure that results from aggregat-

ing all the benefits that a person hopes to receive from interaction with the information

system (Seddon & Kiew, 1996). This study defines user satisfaction as "individual’s

17

belief that management information systems met the needs and expectations".

1.8.10 Individual Performance Impact

Individual Performance impact relates to the accomplishment of a portfolio of tasks

by the individual. Higher performance implies some mix of improved efficiency, im-

proved effectiveness, and/or higher quality (Goodhue & Thompson, 1995). This study

defines Individual Performance impact as "the degree to which end-user believes that

using management information systems has influenced effectiveness, productivity, and

the performance to perform the work by the individual".

1.9 Organization of Thesis

This study consists of six different chapters; Chapter 1 consists of introduction, back-

ground of the study, problem statement, research questions, research objectives, sig-

nificance of the study, and definition of variables. Chapter 2 present overview of in-

formation systems, and management information systems. Moreover, discusses the

different types of management information systems that are used in the telecommu-

nication companies in Yemen. In addition, presents a review of the existing litera-

ture related to this study, as well as underlying theories related to the research topic.

Chapter 3 explains the measurements and variables that are considered in this study in-

cluding system quality, information quality, service quality, top management support,

user training, computer self-efficacy, computer experience, perceived usefulness, user

satisfaction and individual performance. It also shows the conceptual framework and

hypotheses of this study. In general, the study hypothesizes that: (1) system quality is

significantly related to perceived usefulness, (2) system quality is significantly related

to user satisfaction, (3) information quality is significantly related to perceived use-

fulness, (4) information quality is significantly related to user satisfaction, (5) service

quality is significantly related to perceived usefulness, (6) service quality is signifi-

18

cantly related to user satisfaction, (7) top management support is significantly related

to perceived usefulness, (8) top management support is significantly related to user

satisfaction, (9) user training is significantly related to perceived usefulness, (10) user

training is significantly related to user satisfaction, (11) computer self-efficacy is sig-

nificantly related to perceived usefulness, (12) computer self-efficacy is significantly

related to user satisfaction, (13) computer experience is significantly related to per-

ceived usefulness, (14) computer experience is significantly related to user satisfaction,

(15) perceived usefulness is significantly related to user satisfaction, (16) perceived

usefulness is significantly related to individual performance, (17) user satisfaction is

significantly related to individual performance. Chapter 4 explains the methodology

used to achieve the research objectives. In addition, this chapter highlighted detailed

explanations on research methods which consists of introduction, research purpose,

research design, research population/sample, data collection method, survey, instru-

ment design, data analysis method (Quantitative Method), reliability, validity, ethical

considerations and summary of the chapter. Chapter 5 reports the data analysis and re-

sults of the study. Finally, Chapter 6 presents the discussion, theoretical and practical

implications, limitations of the study, directions for future research and conclusion.

CHAPTER 2

LITERATURE REVIEW

2.1 Introduction

This chapter is organized into five sections. Following this section, section 2.2 de-

scribes the information systems. Section 2.3 describes the management of information

systems and the types of management information systems in Yemeni telecommunica-

tion companies. Section 2.4 clarifies the theories in the field of successful adoption of

information systems. Finally the chapter is summarized in section 2.5.

2.2 Information Systems

2.2.1 Overview of Information Systems

Information systems (IS) have been incorporated in companies since the appearance

of the first computer as an important and powerful tool to optimize and improve man-

agement activities. They have progressively advanced due to systems evolution and

advances in technology. The first application of information systems in companies

was made in the 1960’s in the accountant management area. As soon as accounting

software appeared, there was the necessity to manage the administration area using

20

information systems too. So several information systems were developed to manage

invoices, to pay bills, to collect revenue and others. After that, the development of soft-

ware for companies concentrated efforts toward the research and development of stock

management systems such as the ICS (Inventory Control System). Once again, the in-

tegration of these systems with the information application in the company (accounting

and administration systems) was revealed as a very important factor in process opti-

mization (Gil Gómez et al., 2010).

According to O’Brien & Marakas (2007) the business applications of infor-

mation systems have expanded significantly over the years. Until the 1960s, the role

of most information systems was simple: transaction processing, record keeping, ac-

counting, and other electronic data processing (EDP) applications. Then another role

was added, namely the processing of all these data into useful, informative reports.

Thus, the concept of management information systems (MIS) was born. This new role

focused on developing business applications that provided managerial end users with

predefined management reports that would give managers the information they needed

for decision-making purposes. By the 1970s, it was evident that the pre-specified in-

formation products produced by such management information systems were not ade-

quately meeting the decision making needs of management, so the concept of decision

support systems (DSS) was born. After that, most top corporate executives did not

directly use either the reports of management information systems or the analytical

modeling capabilities of decision support systems, so the concept of executive infor-

mation systems (EIS) developed. Then, other types of information systems were de-

veloped such as expert systems, strategic information systems and enterprise resource

planning.

Every business organization in this era needs an information system (IS) to

keep track of all business activities, from business planning until product delivery via

manufacturing and quality cycles (Nowduri & Al-Dossary, 2012).

According to O’Brien & Marakas (2007) information system (IS) can be any

organized combination of people, hardware, software, communications networks, data

21

resources, policies and procedures that stores, retrieves, transforms and disseminates

information in an organization. People rely on modern information systems to com-

municate with one another using a variety of physical devices (hardware), informa-

tion processing instructions and procedures (software), communications channels (net-

works) and stored data (data resources). According to Patterson (2005) an information

system was a group of interrelated components that worked to carry out input, process-

ing, storage, output and control actions in order to convert data into information that

can be used to support forecasting, planning, control, coordination, decision making

and operational activities in an organization. According to Shim (2000) an information

system was a computerized system that processed data (facts) and produced informa-

tion. This process is defined as an information processing cycle (IPC). The information

processing cycle consists of four operations. They are input, process, output and stor-

age.

According to Laudon & Laudon (2006) information system can be defined

technically as a set of interrelated components that collect (or retrieve), process, store,

and distribute information to support decision making, coordination and control in an

organization. In addition to supporting decision making, coordination and control; in-

formation systems may also help managers and workers analyze problems, visualize

complex subjects and create new products.

In summary, the applications of information systems in business have expanded

significantly over the years. Every business today needs information systems to keep

track of its business activities. Information systems can be defined as a set of inter-

related components that collect, process, store and distribute the information in the

organization to support all the business activities.

2.2.2 Types of Information Systems

According to Nath & Badgujar (2013) for the last twenty years, different kinds of in-

formation systems were developed for different purposes depending on the need of

22

the business. Transaction Processing systems (TPS) functions at the operational level

to process large amounts of data for routine business transactions. Office automation

systems (OAS) support data workers and knowledge work systems (KWS) support

professional workers. Higher-level systems include management information systems

(MIS) and decision support systems (DSS). Expert system (ES) applies the expertise

of decision makers to solve specific, unstructured problems. At the strategic level

of management, there is executive support system (ESS). Group decision support sys-

tems (GDSS) and the more generally described computer supported collaborative work

(CSCW) systems aid group level decision making of a semi structured or unstructured

decision.

According to Patterson (2005) there were several categories of information sys-

tem such as data processing systems, management information systems, decision sup-

port systems and executive information system.

According to O’Brien & Marakas (2007) the applications of information sys-

tems that are implemented in today’s business world can be classified in several differ-

ent ways. For example, several types of information systems can be classified as either

operations (support of business operation) or management information systems (sup-

port of managerial decision making); support of business operation such as transaction

processing systems, process control systems and enterprise collaboration systems (of-

fice automation system); support of managerial decision making such as management

information system, decision support system and executive information systems.

This study attempts to focus on the system that is responsible for collecting

the data, processing, storing the information and dissemination the information in a

useful form (as reports) to support the management activities. So this study chooses

the management information systems. Management information systems (MIS) use

the data collected by the TPS to provide supervisors with the necessary control reports

(Belle et al., 2001). Moreover, management information systems are responsible for

the collection, processing, storage, and dissemination of information in the organiza-

tion for the purpose of supporting the management operations and improve individual

23

performance. In addition management information systems are a popular system used

in Yemeni organizations to support all the management activities.

2.3 Management Information Systems (MIS)

2.3.1 The Concept of MIS

The term management information systems consist of three parts. To understand the

meaning of this term we must understand what’s the meaning of management, infor-

mation and systems. It is better to understand each part of the term.

Management is comprised of the processes or activities that describe what man-

agers do in the operation of their organization: plan, organize, coordinate and control

operations (Shim, 2000). Al-Najjar (2010) defines management as achieving organiza-

tional goals efficiently and effectively through planning, organizing, directing and con-

trolling organizational resources. It is the ability to achieve the goals through others.

Weihrich (2000) defines management as the process of designing and maintaining an

environment in which individuals, working together in groups, accomplish efficiently

selected aims.

The word data is the plural of datum, though data commonly represents both

singular and plural forms. Data are raw facts or observations, typically about phys-

ical phenomena or business transactions. Data is raw unprocessed facts and figures

that have no context or purposeful meaning and information is processed data that has

meaning and is presented in a context (Patterson, 2005). Data can take many forms,

including traditional alphanumeric data, composed of numbers and alphabetical and

other characters that describe business transactions and other events and entities. Text

data, consisting of sentences and paragraphs used in written communications; image

data, such as graphic shapes and figures; and audio data, the human voice and other

sounds, are also important forms of data. According to Shim (2000) data are usu-

ally the input of a management information system. After data are processed by the

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management information system, information will be generated. Users can then use

information for decision making. Data is normally organized into files, and files are

organized into databases. Users can retrieve data as the input of application software

and produce information as output. According to Hardcastle (2011) data is a raw fact

and can take the form of a number or statement such as a date or a measurement.

Information is generated through the transformation of data.

According to O’Brien & Marakas (2007) information is data that has been con-

verted into a meaningful and useful context for specific end users. According to Ra-

machandra & Srinivas (2012) information is the data that is processed in a form which

helps the management to make decisions i.e. it is the data that have been put into a

meaningful and useful context and communicated to a recipient who uses it to make

decisions. The relation of data to information is that of raw material to finished product.

The word information is a processed data, useful or relevant data, data with surprise

value, data which is useful in the decision making process. According to Shim (2000)

information is a collection of facts organized or processed in such a way that they have

additional value for further use. Information is valuable and useful because it can help

decision makers.

Moreover, the system can be defined as a set of elements joined together to

achieve common objectives i.e. group of elements organized with a purpose. The

systems often have multiple goals. The system utilizes computer hardware and soft-

ware, manual procedures, management and decision models and database. A system is

made up of sub-system, which may be composed of further sub-systems. Sub-systems

send and receive data from each other (Ramachandra & Srinivas, 2012). According

to O’Brien & Marakas (2007) a system is a set of interrelated components, with a

clearly defined boundary, working together to achieve a common set of objectives by

accepting inputs and producing outputs in an organized transformation process. Many

examples of systems can be found in the physical and biological sciences, in modern

technology and in human society. According to Belle et al. (2001) a system is an or-

ganized assembly of components with special relationships between the components.

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