INFLUENCE OF PROCUREMENT KEY PERFORMANCE INDICATORS ON THE PERFORMANCE OF STATE AGENCIES IN KENYA

Abstract

Public procurement is the largest single buyer in any given country and sellers within a country seek to have the state as their major buyer thus creating immense competition. The purpose of the study is to examine influence of procurement key performance indicators on the performance of state agencies in Kenya. Specifically, the study sought to assess the influence of cost management on performance of state agencies in Kenya and to establish the influence of quality index management on performance of state agencies in Kenya. To achieve this, the researcher reviewed both theoretical and empirical literature and proposed the research methodology that addressed the gaps identified in literature as well as answer the stipulated research questions. The study employed a descriptive research design, targeting the 127 heads of procurement in state agencies in Kenya, who were selected using simple random sampling, from the four strata. The researcher prefers this method because it allows an in-depth study of the subject. Data was collected using self-administered questionnaires. Structured questionnaire was used to collect data. Data was analyzed using descriptive and inferential statistics. Quantitative data was analyzed using multiple regression analysis. The qualitative data generated was analyzed by use of Statistical Package of Social Sciences (SPSS) version 22. The study concludes that cost management has a significant effect on performance of state agencies in Kenya. In addition, the study concludes that quality index management has a significant effect on performance of state agencies in Kenya. Based on the findings, this study recommends that the management of state agencies in Kenya should formulate and implement effective strategies for ensuring cost reduction and put into consideration procurement ROI, cost Avoidance and cost reduction.