Hello. My name is Michael. I can help you with your question.
A factory reset would be your best option - once you reset and enter your account information, it will synchronize almost everything you had on the device. There is very little that you will lose.
The error you are getting is one of the main system processes, which is why I suggest the reset - you may have difficulty even working on the device if you keep getting system errors.
It is possible that a failed update caused this, but it could also be from a corrupt system file, or an app that affected system files. If you do the reset, I would do the sync with online items, but if you have backups (like titanium backup), be careful about restoring backup data as it could reintroduce the problem.