Influence of E-Procurement on Supply Chain Performance of Safaricom Limited Company: Greater Western and Rift Region in Kenya

Abstract

The president of the Republic of Kenya launched E-procurement system on 13^th August 2014 in order to increase transparency, accountability and to enhance prudent use of public resources that results to quality services and value for money. Safaricom Limited Company has continued to face tough competition from its competitors as well as the need to digitalize its E-procurement systems to for quick decision making for competitive advantage. This is due to conflict of interest, poor record keeping, inadequate transparency and accountability, transaction inefficiencies, delays in deliveries and collusion with suppliers. The specific objective of the study was to establish the influence of e-procurement on supply chain performance of Safaricom Limited Company. The study considered e-tendering, e-sourcing, e-invoicing and e-ordering as the independent variable. The study adopted descriptive research design and case study strategy. The population targeted managerial and non-managerial (Customer Service Agents) staffs from supply chain department, finance departments and IT department of Safaricom Limited Company. The study however was limited to Safaricom Retail Shops in Greater Western and Rift Region. The target population was 150 workers. A sample size of 109 employees was used in the study. Stratified random sampling was used to determine the sample size. The study used questionnaire to collect primary data. Both descriptive and inferential statistics was used to analyze data and test hypothesis of the relationship. The data was then processed by the use of Statistical Package for Social Sciences (SPSS 25.0). Multiple regression analysis and correlation analysis was used to measure the relationship between independent and dependent variable. The study established that E-tendering processing practice enhances supply chain performance positively. It is recommended that management should ensure that all modules from purchasing Requisition, Quotation/tenders, request for proposals, purchasing order approvals and Transmission, contract monitoring, Goods receipt note. This will reduce tender processing time, eliminate postal, printing & storage costs, wide supplier base will be achieved and audit trails will be maintained thus reduction of corruption. The study concludes that e-sourcing had a significant effect on supply chain performance of Safaricom Limited Company. From the study established that E-sourcing practice enhanced supply chain performance by Stocks being managed by application of MRP, EOQ, stock aging, stock location, receiving, issuing stocks and stock reports electronically. It is recommended that application of Bar codes should be improved to improve receipts and issues of stocks. It is recommended that management should ensure working Websites, working internal and External mail to improve supplier and buyer's integration. To improve buyer/supplier relationship in time electronic payment to suppliers is necessary. The study concludes that e-invoicing has a significant impact on supply chain performance of Safaricom Limited Company. Though, both sender and receiver are free to choose their operators to exchange digital invoices since it's not a must for parties to choose same e-invoice operators for exchanging their digital invoices, the study notes that e-invoicing promotes security and improved relationship with supplier. This implies that an improvement in e-invoicing would lead to an improvement in supply chain performance. The study also found out that E-ordering processing practice enhances supply chain performance. It is recommended that in order to achieve maximum benefits of reduced order processing time, reduced costs, reduced human errors and improved delivery, management should enhance electronic system and insist on all orders being processed electronically.