Influence of Supplier Evaluation Criteria on the Performance of State Corporations in Kenya

Abstract

In Kenya state corporations have become a strong entity and very useful engines to promote development. State corporations play vital roles in an economy of a country as it even creates employment opportunities. The performance of State Corporations (SCs) however, has been a matter of on-going concern in an environment of resource scarcity and mounting needs. Therefore, the purpose of this study was to investigate the influence of supplier evaluation criteria on the performance of state corporations in Kenya. The study was guided by the following specific objectives: to establish the influence of supplier quality commitment on the performance of state corporations in Kenya, to determine the influence of supplier competence on the performance of state corporations in Kenya, to establish the influence of supplier financial viability on the performance of state corporations in Kenya and to establish the influence of supplier capacity on the performance of state corporations in Kenya. The study was anchored on the following theories, grey system theory, multiple attribute utility theory, the lean supplier competence model and rough set theory. The study adopted cross-sectional survey design using both quantitative and qualitative approaches. The target population was all the 187 state corporations in Kenya. The study employed a census approach. Primary data was collected using questionnaires. A pilot study was conducted to measure the research instruments reliability and validity. Descriptive statistics were used aided by Statistical Packages for Social Sciences version 24 to compute percentages of respondents’ answers. Inferential statistics using linear regression and correlation analysis were applied to assist examining relationship between the research variables. The results were presented using tables and graphs. The study findings indicated that supplier quality commitment, supplier competence, supplier financial viability and supplier capacity have a positive and significant association with performance of state corporations. This implied that supplier evaluation and performance of state corporations change in the same direction. Further, the study found out that supplier quality commitment and performance of state corporations are positively and significantly related, supplier competence and performance of state corporations are positively and significantly related Further, it was established that supplier financial viability and performance of state corporations are positively and significantly related, also supplier capacity and performance of state corporations were found to be positively and significantly related. This implied that supplier evaluation has a positive and significant influence on performance of state corporations. The study recommended that the need for suppliers to improve on the quality of their services; develop competent technical abilities so as to provide high quality products or services; formulate an effective financial plan, which will ensure that their financial viability is sustainable; and enhance their capacity so as to meet the expectations of their customers. The implication of the study is that supplier evaluation play a significant role in the performance of state corporations in Kenya. Therefore, there is need for state corporations to regularly assess the quality, competence, financial viability and capacity of all their suppliers.