SUPPLY CHAIN OPTIMIZATION AND PERFORMANCE OF LARGE MANUFACTURING FIRMS IN NAIROBI CITY COUNTY, KENYA

Angeline Wanjiku Mwangi, Dr. Ismael Shale Noor

Abstract


The research study aimed to explore the influence of information integration cost reduction on the performance of large manufacturing firms in Nairobi City County. A descriptive survey research design was employed, drawing on relevant theories such as Transaction Cost Theory, and Institutional Theory to guide the investigation. The conceptual framework, review of empirical studies, and identification of research gaps were comprehensively addressed. Data was collected over the period of 2023 using both primary and secondary sources. The study utilized stratified random sampling, targeting 420 large manufacturing firms, with a sample size of 210 respondents, representing 210 large-scale manufacturing firms. The respondents were heads of Procurement and Logistics departments, and questionnaires were administered to them. A pilot test was conducted to assess the reliability of the research instrument, using Cronbach’s alpha (α) as a measure. Data analysis was carried out using SPSS Version 29 and Microsoft Excel 2019, with findings presented through tables, pie charts, graphs, and histograms. Both descriptive and inferential analyses were employed, including regression analysis to estimate regression coefficients and determine prediction levels. Data collected through surveys was obtained from 156 Heads of Procurement and Logistics. The measurement scales used in the study demonstrated satisfactory reliability and validity, providing confidence in the accuracy and consistency of the measurements. The findings highlight the interconnectedness and strong positive relationships between information integration, and cost reduction, and the performance of large manufacturing firms. Improvements in any one of these dimensions are likely to be associated with improvements in the others. Information integration emerged as a critical factor, exhibiting the strongest positive association with firm performance among the predictor variables. With regard to information integration, it is recommended that firms invest in robust and integrated information systems that enable seamless data sharing and communication across different supply chain functions and processes. In terms of cost reduction, conducting comprehensive cost analysis across the supply chain is recommended to identify potential areas for cost savings. Exploring opportunities for process automation, inventory optimization, and resource optimization can contribute to reducing operational costs

Key Words: Supply Chain Optimization, Information Integration, Cost Reduction And Performance Of Large Manufacturing Firms


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