DETERMINANTS OF PERFORMANCE OF THE PROCUREMENT FUNCTION IN PARASTATALS IN KENYA: A CASE STUDY OF EAST AFRICAN PORTLAND CEMENT PLC
Abstract
Purpose of the study: The aim of the study was to establish the determinants of performance of the procurement function in parastatals in Kenya with a case study of East African Portland Cement Plc. The specific objectives were; to establish whether employee training is a determinant of performance of procurement function in parastatals in Kenya, to establish whether communication determines the performance of procurement function in parastatals in Kenya, to establish the influence of finance mobilization on performance of procurement function in parastatals in Kenya and lastly to establish the influence of supplier-buyer relationship on performance of procurement function in parastatals in Kenya.
Short Introduction of Problem Statement: Procurement is at the center of performance in every organization or institution, be it public or private institution and therefore it is required that a proper functional procurement system be followed and adopted. Many procurement activities in Kenya still suffer from neglect, lack of proper direction, poor co-ordination, slow with a lot of bureaucracy, lack of open competition and transparency, differing levels of corruption and not having a cadre of trained and qualified procurement specialists who are competent to conduct and manage the procurement process in a professional, timely and cost effective manner.
Method/methodology: The study adopted descriptive research design. The study population target was 96 employees of East Africa Portland Cement Plc drawn from various departments involved in the procurement processes. These departments are; Finance Department, Human Resource Department and Supply Chain department. The study adopted a questionnaire as the data collection instrument. The specific descriptive statistics included percentages and frequencies while the inferential statistics included a multiple linear regression models..
Results of the study: Regression results showed that employee training and procurement performance are positively and significantly related (β=0.156, p=0.001). Communication and procurement performance were positively and significantly related (β =0.095, p=0.029). Finance mobilization and procurement performance were positively and significantly related (β=0.089, p=0.024). Supplier-buyer relationship and procurement performance were positively and significantly related (β =0.149, p=0.000).
Conclusion and policy recommendation: Based on the findings, the study concluded that employee training, communication; finance mobilization and supplier-buyer relationship, are all positive and significant determinants of the performance of procurement function in parastatals in Kenya. The study recommends that the organization should implement training programs for its procurement officers in order to enhance their performance in procurement activities. The organization should consider the implementation of on-job training programs to equip its procurement officers with basic skills, knowledge and competence on how best to conduct the procurement functions within the organization.
Key words: Procurement, Parastatals, Performance, East African Portland Cement Plc & Kenya.
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