TOPIC: ERP System leads to Excellent Procurement Performance In

Borjan Private Limited

Capstone Research Project-1

Submitted

By

Students Name

NAUMAN RAFIQUE SAHITO 2025158

KHIZR QURESHI 2035181

ABDUL MOIZ TARIQ 2035181

SAMEER ASIF 2035323

TAHAMIR UZAIR 2035246

To Faculty of Business Administration

In partial fulfilment of the requirement for the Degree of

MASTER OF BUSINESS ADMINISTRATION

In

SUPPLY CHAIN MANAGEMENT

Advisor

Ms/Mr
Ferhan Syed

Dated: 14-01-2022

Shaheed Zulfiqar Ali Bhutto Institute of Science & Technology (SZABIST)

i
 Appendix A1 – ORIGINAL LITERACY WORK DECLARATION FORM

SZABIST, ORIGINAL LITERACY WORK DECLARATION

STUDENT NAME & REGISTRATION:

NAUMAN RAFIQUE SAHITO 2025158

KHIZR QURESHI 2035181

ABDUL MOIZ TARIQ 2035181

SAMEER ASIF 2035323

TAHAMIR UZAIR 2035246

NAME OF DEGREE: MBA

TITLE OF PROJECT REPORT/THESIS: ERP System leads to Excellent Procurement

Performance In Borjan Private Limited

I do solemnly and sincerely declare that

1. I am/We are the author/s of this work;

2. This work is original

ii
 3. Any use of any work in which copyright exists was done by way of fair dealing and
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of any copyright work has been disclosed expressly and sufficiently and the title of the
Work and its authorship have been acknowledged in this Work; I do not have any
actual knowledge nor do I ought reasonably to know that the making of this work
constitutes an infringement of any copyright work;
4. I hereby assign all and every rights in the copyright to this Work to the Shaheed
Zulfikar Ali Bhutto Institute of Science and Technology (SZABIST) of who
henceforth shall be owner of the copyright in this Work and that any reproduction or
use in any form or by any means whatsoever is prohibited without the written consent
of (SZABIST) having been first had and obtained;
5. I am fully aware that if in the course of making this Work I have infringed any
copyright whether intentionally or otherwise, I may be subject to legal action or any
other action as may be determined by SZABIST.

----------------- --------------- Candidate Signature

Date

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Appendix A2 – CHECKLIST FOR FORMAT OF THESIS

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8.Turnitin
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Appendix A3 – SUPERVISOR-STUDENT MEETING RECORD FORM

Supervisor-Student Meeting Record Form

Semester: 2th Program: M B A

Student Names: Student ID’s

NAUMAN RAFIQUE SAHITO 2025158

KHIZR QURESHI 2035181

v
 ABDUL MOIZ TARIQ 2035181

SAMEER ASIF 2035323

TAHAMIR UZAIR 2035246

Thesis Title: ERP System leads to Excellent Procurement Performance In Borjan Private
Limited

SupervisorName: Ferhan Syed

Meeting 1
23-10-2021 Face to Face

The first meeting is all about the introduction session, Supervisor discussed about project in detail, he
inform and guide regarding selection of research topic.

Student Signature Supervisor Signature

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 Meeting 2
28-10-2021 Face to Face
Date and time * Medium of Communication

In second meeting we discuss about companies and select the one company on which we will do project.
We discuss about company, why we are doing research on this company, what problems company is
facing in their supply chain, how this research will help them, how research will be beneficial for
company, how this research will contribute in our learning.

Student Signature Supervisor Signature

Meeting 3
13-11-2021 Face to Face
Date and time * Medium of Communication

In third meeting we share information and ideas we received from focal person of company with
Supervisor, Focal person of company said that they need ERP system which will improve their
procurement performance, and then we start working on chapter 01.

Student Signature Supervisor Signature

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 Meeting 04

01-12-2021 Face to Face

Date and time * Medium of Communication

In fourth meeting, we discuss problems and difficulties we face in writing chapter 01 then Supervisor
guide us regarding chapter 01 and help us in how to write research objectives and goals, research
problem, and scope of research .Supervisor discuss about the importance of literature review in our
project and he guides us how to write it.

Student Signature Supervisor Signature

Meeting 5
11-12-2021 Face to Face
Date and time * Medium of Communication

In fifth meeting regarding chapter 01 and 02, we discuss about mid progress review of research project.

Student Signature Supervisor Signature

viii
 Meeting 6
17-12-2021 Face to Face
Date and time * Medium of Communication

Summary of Discussion

In 6th meeting we discussed and shared mid review progress performance with our supervisors, and shared
with supervisor guided us regarding points we have to improve and change.

Student Signature Supervisor Signature

Meeting 7
06-01-2022 Face to Face
Date and time * Medium of Communication

Summary of Discussion

In 7th meeting supervisor guide us regarding third chapter and tell us how to write third methodology
chapter.

Student Signature Supervisor Signature

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 Meeting 8
11-01-2022 Face to Face
Date and time * Medium of Communication
Summary of Discussion

In 8th meeting we went to supervisor office and discussed some problems and issues we faced while writing
third chapter, then supervisor guided us and we completed third chapter.

Student Signature Supervisor Signature

Note: Please add extra sheet for more than 5 meetings.

Minimum 8 meeting are compulsory for each student.

*Medium of Communication 1. Face to face 2. Telephone 3.E-mail 4.Facebook 5.WhatsApp 6.

Video conferencing 7.Voice Chat 8. Other

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 Appendix A4 – PLAGIARISM VERIFICATION

Plagiarism Verification
(Note: This form is filled when student submits)

Title: ERP System leads to Excellent Procurement Performance In Borjan Private

Limited

Total Page: 25

Student Names: Registration ID’s

NAUMAN RAFIQUE SAHITO 2025158

KHIZR QURESHI 2035181

ABDUL MOIZ TARIQ 2035181

SAMEER ASIF 2035323

TAHAMIR UZAIR 2035246

Supervisor: Ferhan Syed Program: MBA

Faculty of Management Sciences

This is to report that the above thesis was scanned for similarity detection. Process and outcome are
given below. (Plagiarism maximum percentage allowed is 19% and no more than 5% from a single
source):

Software used: Turnitin Date: 16-01-2022

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Similarity Index: 8% Total word count: 7075

File Name:RP_Plagiarism_Check.docxDigital Receipt No: 1742388460

--------------------------- -----------

Checked only by PSO/MBA Coordinator (Name & Signature) (Signature /& Stamp)

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Contents
ABSTRACT....................................................................................................................................15
ACKNOWLEGMENT......................................................................................................................16
Chapter: 1 Introduction........................................................................................................................17
1.1 Background of the Company:..............................................................................................17
1.2 Background of the study:...........................................................................................................17
1.3 Problem Statement:...................................................................................................................18
1.4 Research Questions:..................................................................................................................19
1.5 Research Objectives:..................................................................................................................19
1.6 The Significant of study:.............................................................................................................19
1.7 Scope of the study& Justification:..............................................................................................20
1.8 Limitations:................................................................................................................................20
1.9 Organization of the research:....................................................................................................21
1.11 Key Definition:.........................................................................................................................21
Chapter 2: Literature Review...............................................................................................................23
2.1 Procurement Management Performance..................................................................................23
2.2 Implementation of ERP in Organizations...................................................................................23
2.3 Improved Supply Chain Network and procurement management:...........................................24
2.4: Enhanced collaboration and procurement management.........................................................25
2.5: Reduced costs and procurement management........................................................................26
2.6 Demand Planning.......................................................................................................................27
2.7 Research Framework.................................................................................................................27
2.8 Hypotheses:...............................................................................................................................29
Chapter Three: Research Methodology..............................................................................................30
Research Methodology:...................................................................................................................30
3.1 Research Design:........................................................................................................................30
3.2 Sampling Design:.......................................................................................................................30
3.2.1 Target Population:..................................................................................................................31
3.2.2 Sample Size:............................................................................................................................31
3.2.3 Sampling Technique................................................................................................................31
3.3 Instrument of Data Collection....................................................................................................31
3.3.1 Reliability & Validity:...............................................................................................................32
3.4 Procedure of Data Collection.....................................................................................................32

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3.5 Data Analysis Technique............................................................................................................32
References.......................................................................................................................................34

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ABSTRACT
The aim of the study is to study the procurement performance in Borjan Private Limited. The
significant of this study is to understand how ERP systems should be implementing in the company so
it may help and improve procurement practices. As Borjan is leading the footwear and accessories
industry of the Pakistan, Borjan has distinguish itself from competitors by providing private label,
imported items and branded product at reasonable price to targeted market, despite being famous in
the market company is facing problem on their supply chain procurement department. The major
problems they are facing in procurement department is transportation cost, freight cost, carrying cost,
inventory excess, accurate information and real time information, demand planning and material
requirement planning. Company has no centralized system which integrates all the departments of the
company, procurement unable to communicate with others department such as marketing, finance and
HR. After studying and meeting with focal person of company we came to known that procurement
department is facing problem because of not having centralized ERP system. Thorough our study we
will try to find major issues company is facing in supply chain and how ERP System will help
procurement department to cope up this issue. We will also find out problems and difficulties
company will face in implementing ERP System, in a nut shell we will do research that how ERP Will
improve procurement practices in the Borjan company and increase productivity and profitability of
company as a whole. The project is to elaborate how ERP system will reduce freight cost, holding
cost and transportation cost, how ERP system will improve communication of procurement
department with other departments of the company. This project is about how procurement
department in Borjan will get real time data and visibility about warehouse storage, inventory
requirement, material requirement planning, and demand planning by implementing effective ERP
system in the company. How ERP system especially helps and improve procurement practices in
retail business especially footwear and accessories. Therefore, the rational for this study is to
investigate and address the problems occurs in the procurement department because of not having
ERP system so it could be solved and make the supply chain performance more efficient. Lastly, the
qualitative approach will be adopted to conduct the interview analysis from the managers working in
the company.

Keywords: ERP, Procurement performance, Improved Supply Chain, Demand planning, reduced cost.

Acknowledgment:
We are grateful to our supervisor and course mentor, Sir Ferhan Syed, for providing us with
the information and skills we needed to continue our research project. His unwavering
15
support and encouragement, as well as his time and energy, have all contributed greatly to the
project's successful completion. Furthermore, he pushed us to think outside the box and
challenged us to look beyond what is right in front of us.

We are also thankful to the focal person of Bojan private Limited Sir, Mansoor working in
procurement department at Karachi for support and consideration.

Chapter: 1 Introduction

1.1 Background of the Company:

The Borjan Private Limited is a retailer of shoes in the Pakistan; it is one of the leading footwear
companies in the Pakistan. It started operation in 1986 as a named as Prestige company, it launched its

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outlets in the main cities of the Pakistan, later it changed its name to Borjan company. The company
has distinguished itself from competitors and now become Pakistan's leading fashion footwear chain
with many outlets in the major cities of the Pakistan. It has more than one thousand employees, more
than 120 outlets around 70 major cities of the country. The company has many private label and
branded footwear such as Gig, Skywalk, Matilla, GB, Digger and SP. The Company also imported
products from other companies such as Brazil, China and Thailand; they have contact with local
manufacturer and suppliers there. Borjan targets the men, women and children with vast varieties of
different footwear and accessories. The positioning line of Borjan is "Fashion Forward” which they
are providing latest in fashion trends and designs to enhance customer shopping experience. Borjan
opened first outlet in Middle East in 2014 and seeking for new opportunities to expand its business
operation internationally.

1.2 Background of the study:

Due to change in market conditions, globalization, diffusion of technology and competitive

environment survival of companies is very critical in the market. The businesses need to use advance
technology, novel methods, new ways to reduce operation cost, reduced overall cost, increase lead
time, increase overall customer satisfaction, product quality and company profit. Country like
Pakistan is the fastest growing market in the arena of footwear and accessories, greater access of
technology and change in lifestyle and trends increase the demand of footwear industry (Shahram
Haq, 2021). The footwear segment and industry are expected to reach US$391m in 2022, the annual
revenue growth will be 6.67 percent by 2025 (Statista, 2021).

The key issue is in procurement department; as procurement department received order requirement
information from merchandising team, then procurement department do contact with vendors
( suppliers) then procurement department delivered products to the warehouse of Lahore by third
logistic company, when procurement team delivered products to the Lahore warehouse mostly no any
empty space is available at Lahore centralized warehouse so Trucks and other transportation stay
outside for one or two days which increase company freight cost and carrying cost. In addition to that
procurement department don’t know how much stock is remaining in the warehouse? How much
products are remaining in the particular city outlet? Which is the most selling product? Company has
no any ERP system which connects procurement departments with other department such as
marketing, finance, Human resource and operation. All the communication is done through manually,
on phone or via e mail. These all issue can be solved by implementing effective ERP system in the
company.

ERP is a software which is used by companies to integrated all the functions or departments of the
organization, it is used to make the communication between the function smooth and fast.

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Borjan must implement ERP system which will connects and integrate all different aspects, functions
of your business and help you streamline your business process, and share accurate, authentic
information in company, in a nutshell it will integrate all the different departments of the company
and make the flow of information easy and centralized (Anne Mulvenna, 2020). ERP system will
lower the cost, increase efficiency, increase productivity, decrease carrying and freight cost, provide
real time information and visibility increase communication, make demand planning and material
planning more effective and make decision fast and accurate and improve overall operations of
company. Implementation of ERP system will improve the procurement department practices in the
Borjan and make the decision and activities of the Procurement department effective and smooth.

ERP system benefits are that procurement department get real time data and visibility of stock, they
can be able to know how much space is available in warehouse, which product's sell and demand is
high, which outlet performance is good, they can communicate with merchandising team, sales team
and HRM team as well. Procurement department will be able to make demand planning as per each
product and make their communication effective with suppliers too.

Procurement Department Process:

Step: 01 Procurement Department received each article (Product) requirements and demand from
merchandising team

Step: 02 Procurement team do contact with vendors or suppliers

Step: 03 Procurement departments delivered final products to the Lahore centralized warehouse by
third party logistic.

Step: 04 Distribute products to different outlets.

1.3 Problem Statement:

As Borjan is leading the footwear and accessories industry of the Pakistan, Borjan has distinguish
itself from competitors by providing private label, imported items and branded product at reasonable
price to targeted market, despite being famous in the market company is facing problem on their
supply chain procurement department. The major problems they are facing in procurement
department is transportation cost, freight cost, carrying cost, inventory excess, accurate information
and real time information, demand planning and material requirement planning. Company has no
centralized system which integrates all the departments of the company, procurement unable to
communicate with others department such as marketing, finance and HR. After studying and meeting
with focal person of company we came to known that procurement department is facing problem
because of not having centralized ERP system. Thorough our study we will try to find major issues

18
company is facing in supply chain and how ERP System will help procurement department to cope up
this issue. We will also find out problems and difficulties company will face in implementing ERP
System, in a nut shell we will do research that how ERP Will improve procurement practices in the
Borjan company and increase productivity and profitability of company as a whole.

1.4 Research Questions:

 Does ERP have significant effect on the procurement performance?

 Does effective ERP System help procurement department in reduced costs?
 How ERP help procurement department in demand planning?
 How ERP enhanced collaboration within the team and improve communication of other
departments with procurement department?
 How ERP System improved Supply Chain Network in procurement Management?

1.5 Research Objectives:

Macro Objectives:

 The main objective of this is to determine how ERP system helps and contributes in better
procurement Performance in Borjan Private Limited.

Micro Objectives:

 To study and examine how ERP System helps in reduced costs.

 To study how ERP system helps procurement department in demand planning.
 To investigate how ERP system enhanced collaboration within the team and interconnect
procurement department with other departments and make communication smooth and fast.
 To improve our knowledge about effectiveness of ERP tool in the field of supply chain.
 To study the relationship of ERP with procurement management & Performance.

1.6 The Significant of study:

The significant of this study is to understand how ERP systems should be implementing in the
company so it will help and improve procurement practices. The project is to elaborate how ERP
system will reduce freight cost, holding cost and transportation cost, how ERP system will improve
communication of procurement department with other departments of the company. This project is
about how procurement department in Borjan will get real time data and visibility about warehouse
storage, inventory requirement, material requirement planning, and demand planning by

19
implementing effective ERP system in the company. How ERP system especially helps and improve
procurement practices in retail business especially footwear and accessories.

In footwear retailers in Pakistan only few companies have adapted ERP system, mostly people are
using different software for each department no any centralized system is used by footwearretailers,
and in addition to that only few studies have been done on this topic especially in footwear retailers’
segment. This study will elaborate how procurement practices can be improved in supply chain via
using effective ERP system. This study will help footwear retailers that how ERP system can improve
procurement practices.

1.7 Scope of the study& Justification:

The rational for this study is to investigate and address the problems occurs in the procurement
department because of not having ERP system so it could be solved and make the supply chain
performance more efficient. Previous studies are depicting that ERP system plays vital role in the
success of company in this competitive environment.

The research will help many stakeholders such as:

 Firms will get the information about ERP system and receive new idea and awareness about
ERP system and will be able to know how ERP will solve issue related to procurement
practices.
 All the stakeholders of company such as suppliers, employees, retailers will get the real time
data and visibility in a glance.
 Borjan Company will get benefit from this research and could be used in future for
implementing ERP system.
 This study will help and support other retailer companies too especially footwear and
accessories that how ERP system improve their procurement practices and Supply chain
process as a whole.

1.8 Limitations:

There are some limitations while doing this research is given below:

1. Mostly companies do not share and disclose all the information with outsiders we will try to
get all the information which will help us in this research.
2. As this is a university project, we have time constraint we have to do this research in deadline.
3. As there is less research has been done on this topic before in the Pakistan so base paper was
not accessible.
4. Time constraint will restrict us to conduct survey or interview of only small sample size.

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 We will add more limitation if needed as we will go through the process of research

1.9 Organization of the research:

3. Research 5. Conclusion
1. 2. Literature 4. Results & &
Introducation Methodlogy
Review Findings Recommodatio
ns
1.10 Assumptions:

1. The respondent of our research will give accurate answers without personal biasness, they
will response honestly; without any pressure, doubt and ambiguity.
2. We are assumed that company will provide us information which will help us in conducting
effective research.
3. Personal judgment, intuition and self-interest will not affect research process and outcomes.

1.11 Key Definition:

1. Supply chain Management: According to Professor Douglas M Lambert, SCM is

basically an integration of firm process from the end user through original supplier who
provides products, information, and service that add value for the customers.

2. Procurement Management: It is a process which is necessary for an organization in

which it purchase, or acquire products, services from third party or outsource outside to
fulfill their business operation activities need.

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3. ERP:ERP is a software which is used by companies to integrated all the functions or
departments of the organization, it is used to make the communication between the
function smooth and fast.

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Chapter 2: Literature Review
2.1 Procurement Management Performance

The word procurement is associated with the word purchase and is a crucial part of the supply chain
management process. It is essential for procurement managers to come up with such strategies that
can enable them to focus on priorities and for the proper allocation of resources (Ertem,
Buyurgan&Rossetti, 2010). In order to achieve a good procurement performance it is important to
identify and analyse the products of the suppliers so that costs can be reduced and likewise quality is
not compromised. As per the study conducted by Gorla, Somers, & Wong (2010) procurement
managers have to ensure that if the cost of a supplier’s products is reduced thus the quality should not
be hindered since suppliers tend to reduce quality in order to save additional costs.

The procurement department is considered to work on the essence of three factors which is the right
time, quality and price (Chin, Tat& Sulaiman, 2015). These factors help an organisation to gain a
competitive advantage and improve the procurement management performance hence also leading to
the minimisation of cost. Moreover the procurement management performance is also associated with
the increase in optimisation of the supply chain process where it is necessary to identify opportunities
and avoid any kind of risks (Lamba & Singh, 2017). This would certainly lead to a creation of system
that would have lower flaws and would create better relations with suppliers hence leading to better
products.

Collaboration and communication is yet another important aspect of procurement management. As

per the study that has been conducted by Van der Laan et al (2016) understanding the demands of the
internal stakeholders and forecasting accordingly can improve the management of procurement which
can enable to allocate resources and have a clear vision. Moreover selection of credible suppliers is a
crucial task for the procurement management performance since suppliers are often evaluated on their
ability to provide goods and services on time with the right price and quality (Carvalho, Azevedo &
Cruz-Machado, 2012). It is also essential to keep suppliers in check since there could be a chance of
receiving defective items and to lower the number of suppliers which can increase the chances of any
administration costs.

2.2 Implementation of ERP in Organizations

ERP is such a function that can add immense value to an organization in order to create a quality
planning and execution of tasks provided by the operations. It further enables the chanced for an
organisation to reach towards a high level of optimization and a competitive advantage (Tarigan,
Siagian & Jie, 2020). With the help of ERP companies are able to achieve great visibility in their
operations especially in their supply chain and procurement management. The ERP is considered to

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be a critical and advanced tool that can provide automation and strengthen business processes
(Karlsson & Flink, 2014). When an ERP is implemented in an organisation it causes changes in the
culture and the strong support from the upper management is required for its implementation.

There are certain criteria which require the implementation of ERP in an organisation such as the
selection of the employees having the right technical skills to operate the software. If there is a lack of
technical skills then there is a chance that the ERP system might fail and costs the organisation
(Kumar & Thapliyal, 2010). The implementation of ERP requires time and resources which can result
in increasing the efficiency of the organisation and cost saving. ERP in supply chain management can
enable organisations to reduce their wastage of products and the availability of the stock (Green et al.,
2012). It can further aid in the decrease of lead time in order to make an efficient system within the
organisation and bring about continuous improvements.

The implementation in the procurement department can lead to a better coordination with the
suppliers since it can lead to have to a better control over them. It can allow an easy flow of
information and develop a strong connection between the supply chain partners (Shatat & Udin,
2012). An ERP system in an organisation can enable managers to easily develop budgeting and
forecasting report as per the requirement of the operations in order to keep a balanced inventory. It
can prevent organisations from going through any financial breakdowns and avoids production
challenges (Matano, Musau & Nyaboga, 2020). ERP can moreover develop a transparent system
within an organisation and create a lean system of procurement which can help in reducing costs since
less number of employees may be required in the process.

2.3 Improved Supply Chain Network and procurement management:

Risk factors (e.g., pollution, global warming, and increasing amount of greenhouse gases) can lead to
the extinction of the human race therefore it is needed to take such steps by which we can protect the
environment and can minimize the pollution (Cai et al., 2009). Organizations aim to increase the
profitability and competitive advantage on one side and eliminating or minimizing the losses (energy,
greenhouse, chemical/hazardous gases and solid waste) on the other hand. Customers also demands
the best products which are cheap and are readily available, which means that the overall supply chain
processes must be efficient and should be low cost, minimizing the overall costs of each and every
process.

The use of ERP Systems helps to minimize operational costs and provides real time data processing,
below mentioned are some of the steps that will help to increase business profits while reducing costs
and wastages and can make processes smoother. With the newer ERP systems, the system monitors
the inventory by itself and orders the stock whenever the inventory is low (Kanda & Deshmukh,
2006). Standardization helps to increase the efficiency while saving money and time, with the

24
advanced ERP systems the employees will share standardized system tools which increase the
accuracy and reduces miscommunications amongst employees.

The biggest problem in supply chain is to reconciling the system with physical inventory, by
increasing internal supply chain transparency with ERP it will help to track real time stock inventory
which is present in the warehouse (Presutti Jr, 2003). The supply chain network depends upon
outstanding vendor performance, therefore, vendor performance needs to be monitored and rated each
time through robust metrics available through ERP systems (Chang, Tsai & Hsu, 2013). With this
performance management the concerned person can review vendor cycle times and error rates which
will help in the evaluation of vendors.

The most important factor in supply chain is to minimize delays in the customer’s order fulfillment,
delays do a lot of damage to the reputation of the company so in order to maximize the profit and to
efficiently utilize the resource’s the company must utilize its resources effectively and efficiently
(Yılmaz & Pardalos, 2017). The lead time can be minimized by following these strategies; domestic
supplier, increase order frequency, installation of ERP systems and communication. Domestic
suppliers help to decrease the lead time which means if the supplier is in the same state as where the
manufacturing is being carried out the total time of manufacturing will be much lesser.

Providing the supplier with key performance indicators will help to motivate the supplier to achieve
levels of service which the manufacturer expects. As Some manufacturers accept the long and delayed
lead times as a normal part of business and that there isn’t much, they want to do about that. Using the
above tips can help reduce the risk of production schedule interruptions and the resulting lost revenue
(Bhattacharjee & Ramesh, 2000). Building a strong partnership with reputable suppliers that are
committed to the success of organization is as much important as the supplier’s own business;
however there may be the greatest factor in reducing lead times.

2.4: Enhanced collaboration and procurement management

Lent, (2013) address procurement management as a process through which a more advantageous and
a careful supplier is selected. The whole process is carried out through a lengthy yet trained tendering
procedure. After the supplier is selected, the contract that is been drawn is carefully administered
during the management of the projectManagement school of Michigan university, (2021) while
supporting the definition of lent, address that through PM all the products and services that are
required for an efficient business operation are procured after the contract has been drawn out.

When the contract is been drawn the independent suppliers collaborate with the PMT (procurement
management team). This collaboration is the requirement of independent organizations to achieve the
desired share objectives (Boyce et al., 2016). This collaboration benefits both the parties, but its better

25
if the supplier work with its current client rather then a new one. This retention of supplier’s customer
relation brings innovations to the firms and helps them in staying ahead and competitive in the
corporate world. Erikson, (2017) address enhanced collaboration as a procurement strategy that
exploit opportunities while nourishing the firm productivity. Furthermore, this collaboration enhanced
the supply chain activity.

Despite the reported benefits of collaboration Boyce et al, (2016) analyzed that this enhanced
collaboration between the suppliers and the purchasing firm does not turns out to be productive ad
forecasted and this procedure is not widespread as well. While surveying the professionals of
procurement management for their research Boyce et al, (2016) added that 86% of their research
survey response clearly address that the purchasing firms are not utilizing this collaborative strategy
of procurement management.

Enhanced collaboration is an important strategy of procurement management, yet the desired results
are reported not to be productive. The goal of this literature review was given investigatory yet
analyzed remarks on the enhanced collaboration in supply chain and management. Collaboration is
sometimes exploitive as well if the firm somehow manages to procure the efficient team of suppliers.
This not only leads to their relationship retention but bring productivity to the organization.
Furthermore, help organization in achieving its objectives. However, this literature does not support
the use of collaboration in procurement management.

2.5: Reduced costs and procurement management

The post-covid world is getting complex and the organizations are trying to build an initiative of
procuring cost reduction initiatives. Though the procurement management is finding it hard in
reducing the costs. As the world after crisis is still finding it hard to retain their product image and the
monetary problems are still upfront. Firms are required to dive into certain cost reduction strategies.

Reduced cost is a centralized strategy of procurement management. It not only helps in luring new
investors but help in suppliers and firm relationship. (Anderson et al., 2007). If the concerned parties
review the contracts that have been signed or implemented three or four years ago can exploit the
reduction opportunity and can achieve their goal of cost reduction if they review the previous signed
contracts (Renner, 2016).

Elram, (1991) address cost reducing as a strategy through which the overall cost of the supplies and
goods has been reduced. And those assets are utilized which are authentic, in-quality, effective and
particularly inventory. Chopra and Sodhi, (2014) analyzed that reducing costs not only act as a luring
factor but also help in the reducing disruptions in supply chain and management. Apuser, (2017)
added that reducing costs of the supply and chain bring profits to the firm while increasing its overall

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productivity. Baird (2011) address that this can be done by centralizing the profit of the purchasing
firm as well as of the suppliers while encompassing innovation in their procurement strategies.

The manufacturer should order more frequently rather than to order in bulk quantity which will also
increase the lead time and more labor and resources will be required for inventory management. The
manufacturer should order in small quantities and in should order more frequently. The ERP systems
helps the company to forecast demand based upon its previous orders, through this technology the
lead time can be reduced (De Treville, Shapiro & Hameri, 2004). Keeping in touch with your supplier
throughout the production process helps ensure that expectations are being met and that any issues
along the way can be addressed.

Reducing cost in procurement management is an effective strategy that helps in the budget of
business, mainly in the purchasing departments. The goal of this strategy is to reduce the cost that is
attached with the purchasing of supplies, while improve the management of the supply and chain. The
aim of this literature was to build an argument regarding the reduction strategy of the procurement
management.

2.6 Demand Planning

The objective of procurement activities is to forecasting the needs, sourcing the supplier, getting the
supplies, get them to the organization and to record and monitor them as current assets (D Bower,
2003). Organizations used procurement planning to plan the activities related to the procurement for
specific time period during budgeting process. The main focus of this planning is to be efficient and
save the cost which results in profitability of the organization. The main motive of the whole process
is to make efficient decision that impact on future related operation (CJ Onyango, 2012). Knowing
about the demand of the product and manage it according is known as demand management (C Kilger
& M Wagner, 2008). Demand management make the organizational supply chain management
efficient and effective, the main focus of the demand management is make build revenue greater,
making the operations efficient by streamline them and to reduce the cost (H Min & WBV Yu, 2008).
A perfect demand management do rely on the accurate data which help the organization in improving
the supply chain operations, generating the revenues through anticipating market through and it also
provide competitive advantage (A Gupta & CD Maranas, 2003).

2.7 Research Framework

The variables in research framework help in understanding the relationship and effect of independent
variable on dependent variable. Research framework of this research is elaborate below:

Independent Variables: Independent variables are used in this research such as demand planning,
reduced costs, enhanced collaboration and improve supply chain network.

27
Dependent Variable: Procurement Performance.

Mediating Variable: It defines the process through which two variables are related, in our research
ERP System is a mediating variable which shows the relationship of independent variable (Costs,
Demand Planning, Enhanced Collaboration and Improved Supply Chain Network) and Dependent
Variable (Procurement Performance).

ERP system play vital role in enhanced collaboration within team and communication of business, it
integrate all the departments of the business, it make the flow of information smooth, and fast.
Procurement performance will improve when they easy communicate with all the concern
departments and this is only possible through effective ERP System.

ERP System will help procurement department in demand planning, with the implementation of ERP
System procurement department will get real time data and visibility of warehouse and each outlet so
they can do demand planning in advance and reduce the lead time and improve overall efficiency of
procurement operations and activities. The ERP System helps company in reducing costs, in our study
with the implementation of effective ERP System Company will get real time data and visibility and it
will reduce logistic cost, freight cost, transportation costs, inventory management cost. ERP system
increase collaboration and communication with vendors which will help company in reduce inventory
cost.

This framework and the factors have been adopted from the study that has been conducted by Nemati
and Mangaladurai 2013 respectively.

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 Research Model

Improved
Supply
Chain

Reduced Costs
ERP System Procurement
Performance

Demand
Planning

Enhanced
Collaboration

Source: Nematiand Mangaladurai, 2013).

2.8 Hypotheses:

Hypotheses:

H1: Improved supply chain network has a significant impact on procurement performance.

H2: Reduce cost has a significant impact on procurement performance.

H3: Enhanced Collaboration hasa significant impact on procurement performance.

H4: Demand planning has a significant impact on procurement performance.

H5: ERP System mediates the relationship between improved supply chain network and procurement
performance.

H6: ERP System mediates the relationship between enhanced collaboration and procurement
performance.

H7: ERP System mediates the relationship between demand planning and procurement Performance.

H8: ERP System mediates the relationship between reduced cost and procurement performance.

29
Chapter Three: Research Methodology
Research Methodology:

Basically a research methodology is the process or the roadmap to conduct research where first
categories research as quantitative or qualitative based on the research need and philosophy. After this
we decide how data will he collected either we used primary data or secondary data which method
will be used such as interview, survey, or observation. Third it includes a critical assessment of total
population from which we will drive out sample then we will use sampling technique for selection of
sample, then finally we will analyse the data we collected and reached at a final conclusion by
explaining relationship between dependent and independent variables.

3.1 Research Design:

The purpose of this study is to implement the ERP process in Borjan shoes; since it is a qualitative
research study it conducts intensive research from the employees within the organization. We have
selected Borjan shoes for this research as they did not had any proper ERP structure followed by their
organization for the management of goods, and the further processes which were performed in the
company. We will be collecting the data internally from the employees in order to provide a solution
towards their problem. This qualitative research will help us to provide a clear view of what the
employees need from the management in order to increase the productivity and what kind of issues
they are currently facing because of lack of availability of proper ERP system. The collected data will
be tested through thematic analysis in order to find the difference of level of productivity through the
implementation of ERP system.
3.2 Sampling Design:

The sampling design basically is a framework or a roadmap or a plan for obtaining a simple form a
given population. It basically refers to the technique, method or procedure would adopt in selecting
items for the sample. There are many sampling design but researcher must choose that samples which
are reliable and appropriate for his research study (combes, 2020).

The research is qualitative in nature and it is exploratory research used in this context to understand
and elaborate ERP system and its effect on the performance on procurement department of Borjan
private limited. For this research we will use primary data which will be gathered by interviews,
although primary data is time consuming and requires more efforts but it is a very authentic than
secondary data in some cases. As we are doing research on Borjan so primary data will give us
authentic and accurate data and insights. Employees of Borjan Company will give interview and their
answers and feedback will be analyzed by using thematic analysis.

30
3.2.1 Target Population:

As study is a type of business research study, the target populations to collect the data in that case are
employees of Borjan private limited.

Our research is based on a company therefore; our target audience is in that case is restricted within
the employees of Borjan which is around 1000.

3.2.2 Sample Size:

Sample size refers to the number of participants or observations included in a study (john,
2019). The sample size in this case is 15-20 which are working in the procurement
department of the company; this sample size is driven out from a total population of one
thousand.

3.2.3 Sampling Technique

In research term sample means a group of people, objects, or items that are selecting from large
population for measurement (Thomas.2020). There are two type of sampling which is used for driven
out sample from large population, one is probability sampling and second is non-probability sampling
technique. Probability sampling further divided into four categories simple random sampling,
stratified sampling, cluster sampling and systematic sampling.

In this research we will use simple random sampling because we are aware about the population of the
company, simple random sampling will be best type of sampling technique because all the elements
are given equal chance to select from bigger population.

3.3 Instrument of Data Collection

The questionnaire for collecting primary data is known as the research instrument. It helps in
gathering the first hand information specifically for the purpose of current or new study which has not
been investigated before (Golafshani, 2003). The primary data of this study is based on qualitative
technique because the interview will be conducted from relevant respondents of the decided
population. The questions will be open-ended so that the participants can share their views and
opinions on the relevant issue or the questions asked to them. The demographical questions will be
asked to attain information about the age, gender and monthly income of the respondents whereas the
descriptive questions are formulated to attain information about the views and opinions of respondent
son the subject of an issue.

31
3.3.1 Reliability & Validity:

The reliability test plays an important role in checking the consistency and stability level of the
gathered primary data (Morse, Barrett, Mayan, Olson & Spiers, 2002). The inter-rated reliability
method or pilot tasting technique can be used for checking validity and reliability of research. Has
been utilized for checking the consistency level of the unstructured questionnaire for the purpose of
interview sessions.

For validity we can ask to the experts of the domain such as teachers of supply chain management in
our university, our Supervisor, even we can get help from the focal person of the company; we can
share interview questions with them which will help us in precede this research further.

3.4 Procedure of Data Collection

The purpose of data collection is to acquire enough data to identify the problem of the research and to
present a relevant outcome. There two types of data collection methods which are primary and
secondary data collection method (Choy, 2014). In order to gain an answer to established hypothesis
of the research, primary data collection method is used in this research. The reason for using primary
data collection method is to gain information directly rather than secondary sources and to establish
an in depth analysis of the problems raises. Moreover to further support the usage of primary data
collection, interviews have been conducted in order to gain insight of the implementation of ERP in
the organization and its advantages.

3.5 Data Analysis Technique

Data that is collected is carefully analysed in order to interpret the results for the problem statement.
The advantage of a relevant data analysis technique is to gain answers to the research questions
(Neuendorf, 2018). This research has made use of the thematic analysis technique since it follows a
qualitative research approach and interviews have been conducted for data collection. The thematic
analysis technique allowed presenting the collected responses in to themes to get a better
understanding of the problem state and the advantage the implementation of ERP in the organization.

32
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Plagiarism Report:

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