ELECTRONIC PROCUREMENT AND SUPPLY CHAIN PERFORMANCE IN COUNTY GOVERNMENTS IN WESTERN REGION, KENYA

Abstract

Electronic procurement is one the critical functions used by county governments in their procurement departments to shorten lead time, increase transparency and increase levels efficiency alongside supply chain performance. Despite these, reports indicate that counties in western region Kenya are still grappling with challenges of longer lead times, poor supply performance and inadequate efficiency in procurement processes, and this and this affects their supply chain performance. The main objective of this study was to evaluate the electronic procurement and supply chain performance in county governments in western region, Kenya. The specific objectives were; to establish how electronic tendering impacts on supply chain performance, to evaluate ways in which electronic sourcing affects supply chain performance, to determine the concern of electronic ordering on supply chain performance and to assess how electronic payment affects supply chain performance in county governments of Western region, Kenya. The study was guided by technology acceptance theory, electronic market theory and dynamic capability theory. The target population of the study was 216 respondents and stratified random sampling was used to select 140 respondents from the county government employees. Primary data was collected. A pilot study was done in Kisumu County. Cronbach’s Alpha was used to test reliability. Validity was tested by experts and factor analysis. Data was analyzed using SPSS version 27. Both descriptive and inferential statistics were obtained. Descriptive statistics comprised of variance, standard deviation and mean. Inferential statistics comprised of multiple regression analysis. Diagnostic tests like normality, Heteroscedasticity, multicollinearity and autocorrelation test were conducted. Data was presented using tables, charts and graphs. Multiple regression analysis indicated that electronic tendering, electronic sourcing, electronic ordering and electronic payment had a significant effect on supply chain performance by reducing the inventory cost with a coefficient of -0.771, 0.169, -0.495, -578 respectively. The study depicted that 76.3% variation in supply chain performance is caused by electronic procurement. The study may help policymakers to create e-procurement regulations and the information from the study findings may also be used by investors to help in deciding how much money they should spend on electronic purchases in order to cut costs and increase profits. The study concluded that electronic tendering, electronic ordering and electronic payment affected supply chain performance negatively and significantly through reduction of inventory cost while electronic sourcing had insignificant effect on supply chain performance. The study therefore recommended that county government should effectively enhance to electronic ordering and train its employees on how to use electronic ordering efficiently to minimize use of paperwork in the organization and the transaction in the county government should be automated such that electronic payment modes such as e wallet should be used.