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The typical situation in Ukrainian enterprises

Category: Information Systems

When selecting and analysing candidate companies for project assistance and working with the selected companies, a number of striking similarities were observed. These similarities led to the idea to formulate a generic methodology for MIS implementation.

Systems in place

In every short listed company considered for assistance, we found some level of integration of the information system in place. This is not surprising considering the size and complexity of the enterprises involved. In fact, they were the more successful and large enterprises: three of them belong to the top 100 Ukrainian companies and all of them are sufficiently profitable to consider implementation of a fully integrated MIS system.

All the client companies had some sort of MIS at the start of the Project.

Operational level system based on the needs of financial accounting

The typical system we found in place at a large Ukrainian company usually processed information at the operational level and was based on the financial accounting system. The fact that financial accounting is usually the first area to be computerised is explained by the need to produce reports for the tax authority. This creates a demand for integrated software packages for financial accounting purposes. We found that «1C» Accounting, a Russian-made software product for financial accounting, which was initially developed for small and medium-size companies, was widely accepted and used by companies employing several thousand people. The core functionality of 1C is the computerisation of financial accounting functions.

However, this core functionality explains why the collected information is inappropriate for the purposes of management accounting and for the practical tools of management information.

Computerisation in a Ukrainian company starts with financial accounting to report to the tax authority.

No tools for top management

Some companies had more sophisticated systems that typically supported control at the operational level in the functions of production, logistics, payroll etc. However, Even when data was processed and aggregated, this information was rarely used for the purposes of day-to-day management of the company by senior management. The information provided for management was often incomplete, late and too detailed.

Even more specifically, we found that lack of tools for senior management was the most typical problem of Ukrainian companies in the area of management information.

The typical problem of management information in Ukraine is lack of tools at the executive level.

Platform: no modern tools, hardware OK

Most Ukrainian companies tend to invest in hardware- underestimating the importance of modernising software tools. In most of our client companies we found good hardware platforms with Pentium computers installed in several departments and networks of sufficient bandwidth to connect them. However, typically, the software running on these platforms was outmoded.

The weak point of the MIS platform is software.

Lack of integration and lack of general IT strategy

Lack of integration is typical of the companies visited. This results in a number of independent and semi-independent information systems functioning simultaneously. The programmes are often written in different programming languages, function with various database management systems under different operational systems and on different platforms. This leads to cases when data is manually fed into the system twice or when the data from one database is not usable in another one.

Several systems automated a number of operations at a company but did not function within an integrated IT strategy. Indeed, often there was no IT strategy integrated into an overall corporate strategy.

Variety and lack of integration of operational systems cause problems for users. Some users still work in character mode whilst others use more modern graphic interfaces. Many users have to work in several systems at the same time. This hampers work and makes training more difficult.

Lack of system integration and of a general IT strategy is common.

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