ASSESSMENT OF PARTNERSHIP SOURCING ON PERFORMANCE OF THE PROCUREMENT FUNCTION IN SELECTED UNIVERSITIES IN NAKURU COUNTY, KENYA

Abstract

Sourcing in procurement has evolved from a traditional purchasing approach which was mainly opportunistic and transactional based where organizations used to purchase in response to immediate needs, choosing freely from among all the suppliers that can supposedly meet those needs to one that is futuristic and uses plans and strategies. However, in modern era there is growing interest in creating a partnership sourcing that is focused on future stability. The purpose of this study was to assess the effect of partnership sourcing on performance of the procurement in selected university campuses in Nakuru County. The target population of the study comprised of 400 employees and sample size comprised of 80 employees. These employees were drawn from departments related to procurement functions.Data was analyzed using descriptive statistics such as frequency, percentages and inferential statistics; Pearson Chi-square test. The results shows shared goals leads to improved flexibility (40%) and improvement of cash flow (48%) within the procurement functions in the campuses surveyed. Moreover, contractual agreement was evident in almost all campuses surveyed (96%) but a significant section of the respondents could not tell exactly the kind of procurement contractual relationships (38%). There were positive correlation between shared goals and performance of procurement function though not significant (p=0.121). Contractual agreement contributes to supplier loyalty and commitment. The null hypothesis was rejected and concluded that contractual agreement contribute positively towards supplier loyalty and commitment (P=0.001). These contractual agreements however dot not always comes with affirmative benefits but sometimes with shortcomings such as the amount of time and effort involved in building this trust. It also results in that higher switching costs if problems were to arise with the supplier and there is a sharing of proprietary information, strategy, planning, and goals. Finally, it was concluded that effective communication had a positive correlation to procurement (P-value=0.012). The study recommends that policy and practice for procurement should be carefully evaluated and the results of that evaluation fed back into improved approaches in the relevant sectors of the procurement to embrace shared goals, contractual agreements and communication strategy. Contractual relationships between the university and source partners must be supported from the entire organization. More importantly, for a procurement organization to operate both efficiently and effectively in such a complex environment communication strategy need to be created and suitable instruments put in use.