EFFECT OF CONTRACT MANAGEMENT ON PROCUREMENT PERFORMANCE IN NGOS IN NAIROBI COUNTY

Judy Mawia Itumo

Jomo Kenyatta University of Agriculture and Technology, Kenya

Dr. Karanja Ngugi

Kenyatta University, Kenya

CITATION: Mawia, I., J. & Ngugi, J., K. (2018). Effect of Contract Management on Procurement Performance among NGOs in Nairobi County, Kenya. International Journal of Human Resources and Procurement. Vol. 7 (3) pp 102 – 126.

ABSTRACT

The financial year 2015/2016 disclosed that procurements amounting to Billions of monies were misappropriated which in turn hindered from achieving value for money in most institutions, NGOs included which led to poor procurement performance in terms of decreased efficiency, low flexibility, long procurement cycle times, increased supplier defect rate and decreased customer satisfaction. Contract management is a subject in the developed world that has been found to be a cure to procurement scandals. The general objective of the study was to establish the effect of contract management on procurement performance in NGO, s in Nairobi County. Specifically the study aimed to determine the effect of relationship management, contract administration, post contract appraisal and contract closure on procurement performance in NGO’S in Nairobi County. A descriptive survey approach was adopted to justify the relationship between the independent and dependent variables. The target population was procurement officers who are employed to work within the 288 NGOs situated in Nairobi County. The study sampled 167 procurement officers who were selected using simple random sampling. The study relied on primary data which was collected using a questionnaire. Data was analyzed qualitatively and quantitatively. Qualitative data was analyzed using content analysis whereas quantitative data was analysed using Descriptive statistics analysis which was done by measuring central tendencies which include frequencies, means, standard deviations and regression. Descriptive statistics was done using the Statistical Package for Social Sciences (SPSS). Inferential statistics which included correlation (r) and regression (R²) through the use of Multiple Linear Regression model was employed to establish the significance of the independent variables on the dependent variable. The findings revealed that contract management was a key aspect in performance of procurement among the NGOs in Nairobi County. Through management of relationship, proper contract administration, post contract appraisal and contract closure, procurement process became successful and this enhanced the firm performance. The regression analysis revealed that relationship management, contract administration, post contract appraisal and contract closure were significantly and positively related to the procurement performance of the NGOs in Nairobi County where their P-values were observed to be less than the standard P-value of 0.05. The study concluded that as much as the contract management aspect such as contract administration, relationship management, post contract appraisal as well as contract closure were recognized as key aspect in contract and procurement processes among the NGOs, many of them did not effectively use the aspects which lead to continued underperformance of their procurement processes. The study recommends that NGOs and other organizations especially in the public sector should take heed of relationship management, contract administration, post contract appraisal and contract closure in their procurement processes as they are the key players as much as procurement performance is concerned.

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