Survey to Examine the Drivers of E-Procurement in Public Hospitals in Kisii County, Kenya

Abstract

Despite the many benefits of e-procurement including reduction in cost and procurement cycle time, more effective budget control, minimization on ordering and administrative errors, enabling originator to concentrate on strategic aspect of purchasing, decreasing the product price, enhanced information management, better payment process among others, it has been a bit difficult to identify them as either strategic, operational or tactical in nature. E procurement is a practice if adopted can lead to efficiency, transparency, reduction in costs among public organizations in Kenya. This underlined the need to carry out the study on the drivers of e-procurement I n Public Hospitals in Kenya. Like other public institutions, Public Hospitals have has not fully adopted e procurement and there for continue to miss the benefits. The purpose of the study was to examine the drivers of e-procurement in public hospitals in Kisii County. Specifically, to examine the operational benefits of e-procurement in public hospitals in Kisii county, to establish the tactical benefits of e-procurement in public hospitals and  to establish strategic benefits of e- procurement in public hospitals in Kisii County. A survey research design was adopted. The study found out that specific strategic, operational and tactical benefits were drivers of e-procurement in public hospitals though in varying degree and a significant relationship existed between strategic, operational and tactical benefits and e-procurement in public hospitals. This study identified efficient purchasing system, reduced costs, increased process efficiency and strategic supplier relationships as the strongest drivers of e-procurement and therefore confirmed the null hypothesis. This study concluded that reduced operational and inventory cost enhances decision making, tactical benefits including a desire to shorten the procurement cycle drives e-procurement and that strategic benefits of e procurement in Kenya’s public hospitals is highly dependent on the decreasing procurement cycle and the ability to enable greater flexibility for supplier selection The study recommended further studies in other variables that are not limited to tactical, operational and strategic benefit drivers. Future research need also to be carried in other public sector entities (corporations) in order to show if the link between e-procurement strategy and procurement performance can be generalized.

Keywords: e-procurement, public hospitals, procurement performance