INFLUENCE OF E-PROCUREMENT ON PERFORMANCE OF COMMERCIAL STATE CORPORATIONS IN KENYA

Abstract

The study was guided by the following specific objectives; the influence of buyer/supplier collaboration on performance of commercial state Corporations in Kenya, the influence of optimization of inventory level on performance of commercial State Corporations in Kenya and the influence of procurement cost reduction on performance of commercial State Corporations in Kenya and the influence of customer service level on performance of commercial State Corporations in Kenya. A comprehensive literature review was carried out in Chapter two outlining previous research on same area of study.  Based on comprehensive literature review a suitable conceptual framework which dramatically depicts the key areas of study was developed. This conceptual framework outlines the independent variables (customer service level, buyer/supplier collaboration, inventory level optimization and procurement cost reduction) and dependent variables (performance of commercial State Corporation). The study adopted a descriptive survey design. The total population is 119 state corporation, but the study targeted population included all 110 commercial state cooperation in Kenya, the sample size was 100% of the target population which included 110; one respondent per commercial State Corporation. The study relied on primary data collected through administering a structured questionnaire comprising closed and open-ended questions. The data was analyzed using descriptive analysis such as descriptive statistics, mean scores and standard deviations, frequencies distributions and percentages. The results was presented in form of table, pie charts, graphs and figures. The response rate was 100 respondents which gave 90.1% of the sample size. The inferential test indicates that that Procurement cost reduction influences the Performance of Commercial State Corporation most followed by Buyer/supplier collaboration, Customer service level and finally Procurement cost reduction. From the findings the study concludes that procurement cost reduction strategy has a direct relationship with e-procurement and finally improving the procurement performance of state corporations in Kenya. Supplier management, pooling of purchase requisitions and procurement-oriented product development are tasks that are typically assigned to strategic procurement. The findings in addition revealed that inventory level optimization. Buyer/supplier collaboration strategy has positive relationship with procurement performance in State Corporation. In line with this state corporation must view the embracement of e-procurement as a tool that will support procurement cost and processes as it generally contributes partner relationships, information sharing, and supply chain integrations as e-procurement contributes to supply chain performance. The study also recommends that management must be commitment to implement the E-procurement system and encourage staff to accept the new system.