Factors Affecting Strategic Procurement

Gastor Josephat Orio, International Journal of Research in Management, Economics and Commerce,
ISSN 2250-057X, Impact Factor: 6.384, Volume 09 Issue 3, March 2019, Page 1-9
Factors Affecting Strategic Procurement

Practices in Public Procuring Entities in
Moshi- Tanzania
Gastor Josephat Orio
(Member of Procurement and Supplies Professionals and Technicians Board; Procurement and Supplies
Professionals and Technicians Board (PSPTB); P.O. Box 5993, Dar es Salam)
Abstract: Recently procurement has been moving from traditional way of practices to strategic procurement
practices, in order to facilitate the achievement of long term objectives of the organization. As this being the
case, this study explored “Factors affecting strategic procurement practices in public procuring entities”, a
case of selected PE’s in Moshi. Theory Z of Supplier Relationship Management was used to explain the
relationship with the study conducted. The study was specifically aimed to find out to what extent procurement
portfolio models are used by procurement practitioners in public procuring entities; Also to identify at what
extent procurement innovation strategy is practiced in public procurement entities; and Lastly, To determine
whether public procuring entities implement strategic supplier relationship management and lastly was to
determine to what extent procurement practitioners influence green procurement in public procuring entities.
The study used a descriptive research method of collecting information by administering a questionnaire to a
sample of individuals. The researcher used the purposive sampling technique to obtain the reasonable
information. Researcher used a total sample of 60 respondents. The study involved the use of questionnaire and
documentary review as the techniques for data collection. The researcher used SPSS to process and analyzes
the collected data to obtain a research result, where findings were presented using tables. The major findings of
the study showed that there is a lot factors both practically and theoretically which affect strategic procurement
practices in most of public sectors in Tanzania, which were; Also it founded that, there is no training on
strategic issues to procurement staff; Never the less, there is no strategic practice of developing suppliers; Also,
Most of staff lack skills in managing supplier relationship; Most of those public organizations does not make
promptly and timely payment to their suppliers; Most of staff lack enough knowledge about the concept of green
procurement. The study concluded that, it was seen public organizations have not focused on practicing
strategic procurement as it was seen there are many factors which hinder the implementation of strategic
procurement practices. Thus it was recommended that, the explored factors which affect such implementation
should been taken into account by all public PE’s in Tanzania.
Keywords: Strategic Procurement Practices, Strategic Supplier Relationship Management, Procurement
Portfolio Models, Green Procurement.
I. INTRODUCTION
The public sector needs to ensure effective, sustainable and strategic management of the procurement
function. This is vital for economic development and effective service delivery in African countries
(Muchaonyerwa, 2014).
Strategic procurement is essential for competitiveness of procurement function in any organization
(Klasa et al 2018). Research on the topic of procurement strategies has become increasingly prevalent as the
function shifted away from a primarily clerical role to a more strategic one. A study by Muiga and Kwasira
(2016), have been taken to investigate the role of strategic procurement practice in realization of corporate goals
in public sector as well as the relationship between strategic procurement practices and procurement
performance in private sector.
Statement of the Problem
Therefore, basing on the coverage of above studies, there is a need to explore the knowledge upon
different factors which affect the overall practices of strategic procurement in public sector. Strategic
procurement practices such as supplier relationship management, procurement innovation, and green
procurement are some of them which are not implemented accordingly in most of public procuring entities in
Tanzania and therefore they lead most procurement function in many public sectors to still practice operational
procurement without considering procurement strategic issues (Muchaonyerwa, 2014).
Therefore, the situation states above prompted a researcher to make a research on factors affecting
strategic procurement practices in public sector and provide appropriate, supported and justified practical
solutions and recommendations to the listed public procuring entities which are Moshi Municipal Council,
Moshi District, Tanzania Coffee Board (TCB), Moshi Urban Water Supply and Sewerage Authority (MUWSA)
http://indusedu.org Page 1
This work is licensed under a Creative Commons Attribution 4.0 International License
and Government Procurement Services Agency(GPSA) which was chosen to represent public procuring entities
in Tanzania.
Justification of the Study
It is the conviction of the researcher that the findings of this study have contributed enormously to the
body of knowledge respect to the existing area of the subject. The study prevailed that new skills and knowledge
on formulating and implementing supplier relationship strategies is very vital for long-term success of the public
organization, in steady of relaying only in ensuring time delivery and quality of supplies. To that extent, it is
important for public procurement practitioners to be given practical training and seminars focusing on strategic
supplier relationship management.
Never the less, in order for green procurement to be well practiced in public sectors, the study added
that, public organizations have to set a clear budget for facilitating the implementation of it. As it was portrayed
by the study finance and awareness of green procurement has been in low level in public procurement. The
study might therefore contribute to theory and hypothesis formulation.
However, Chief accounting officers are direct involved in procurement and by the public procurement
laws and regulations are the ones required to provide all approvals of any procurement done within public
procuring entity. They are part of the management and are involved in any strategic decision making for the
long term success of the organization. Then the recommendations from the study provided strategic advice as to
how chief accounting officers may make their organizations successful in future and avoid any unnecessary
risks and cost as far as procurement is concerned.
Moreover, the study equipped procurement staff with new knowledge and skills and the importance to
apply and implement strategic procurement practices within their procuring entities. Through that, they were
able to implement smoothly Value for Money Procurement (VFMP). Through skills from the study they were
able to advice top management and apply different strategic procurement models in buying supplies, conducting
strategic negotiation with suppliers, applying effective green procurement, development of potential suppliers
for ensuring time supply of goods and services within organization. Not only but also, procurement staff
acquired new skills of doing things in their daily procurement activities as far as procurement innovation is
concerned.
Objectives of the Study
The general objective of the study was to explore the factors affecting strategic procurement practices
in public procuring entities.
The study aimed specifically to:
1. To find out to what extent procurement portfolio models are used by procurement practitioners in
public procuring entities.
2. To identify at what extent procurement innovation strategy is practiced in public procurement entities.
3. To determine whether public procuring entities implement strategic supplier relationship management.
4. To determine to what extent procurement practitioners influence green procurement in public procuring
entities.
II. LITERATURE REVIEW

Theoretical Literature
Theory Z of Supplier Relationship Management
Raheja, (2007) proposed that the contract between the buyer and seller should be nothing but a step
along the way to establishing mutual value creating relationships where both parties are focused on generating a
significant amount of value for each other. Some of the best value-creating activities for an organization are
capable of being accomplished after the contract is signed by starting with a focus on a “Mutuality of Interest”.
Both sides, the supplier and buyer organizations, need to be cognizant of this “Mutuality of Interest” so that the
benefits are realized from the beginning and throughout the relationship.
Theory Z of supplier relationship management is relevant to this study as it is related to the importance
of setting supplier relationship strategies for the realization of organizational objectives/strategies which may be
short term objectives/strategies or long term objectives/strategies. This theory gives a clear insight of the
importance of the public procurement practitioners to set supplier relationship strategies which they can act on,
in order to improve the overall organization performance which can then be measured within a given period of
time.
According to Camilla (2013), Strategic Supplier Relationship Management (SSRM) entails broadening
your view of key suppliers so that you see them as not simply vendors that you buy things from, but as actual or
potential partners who can help you drive competitive advantage. This in turn means expanding the scope of
interaction with them beyond purchasing and fulfillment transactions tapping into their expertise and capabilities
to drive innovation enter new markets, improve quality, exchange insights about marketplace trends, and more.
It also means beginning to view relationships with suppliers as assets and to manage them accordingly
Cox et al, (2005), link this power model to the relationship portfolio framework shown in Figure below suggests
that buyers and suppliers can potentially form one of six main types of relationship, and that power is a key
influence on which is possible. They illustrate their argument with a series of short case studies involving both
public and private sector organization
Figure: A portfolio of buyer–supplier relationships
Source: Cox et al, 2005

From the figure above, Cox et al. argue that buyer–supplier relationships differ along two dimensions. A
collaborative relationship is closer on all of these dimensions than an arm’s length one. The ‘share of surplus
value’ dimension relates to the commercial balance of a relationship in terms of who bears the costs and who
receives the benefits. In a buyer-skewed relationship, for example, the supplier bears the bulk of the costs and
the buyer receives most of the benefits. This framework has two key implications. First, collaboration is possible
only where either one party dominates the other or where both parties are highly dependent on one another.
Dependency is deemed to create such an investment incentive whereas independence does not. Second, the
framework suggests that collaboration is not necessarily about an equal sharing of costs and benefits.
Collaboration can be successfully undertaken even where one party is dominant and therefore receives a greater
share of the relationship benefits and bears a smaller share of the costs. This is what Cox et al. call adversarial
collaboration (Cox et al, 2005).
Conceptual Framework
The study was guided by the following conceptual framework;
Source: Researcher Model, 2018

From the conceptual framework above, strategic procurement practice is explained by four independent
variables, namely: procurement portfolio models; procurement innovation; strategic supplier relationship and
green procurement practices. By the means of arrows, these elements of strategic procurement practices are
capable of influencing organizational performance through indicators such as realization of the importance on
the use of strategic procurement and supply chain models or approaches, the time and cost saving through
creativity in performing procurement activities, establishing short and long term relationship with potential
suppliers/contractors/service providers and lastly, ensuring that goods and equipments procured are
environmental friendly . In addition, the framework includes policies and other internal organizational factors as
the intervening variables which may affect strategic procurement practices in the organization. Most
government and organization policies provide a set of guiding principles to help decision making. Most of
government policies have a direct impact in the organization’s performance.
Empirical Review
Strategic Supplier Relationship Management
Mashiku and Kimbu (2011), on their research report namely, Assessment of Strategic Procurement
Practices and Principles on Organizational Performance in Tanzania; A Case of Tanzania National Roads
Agency. Specifically the study intended to look on the four strategic procurement independent variables which
influence organizational performance which are; cost management; information technology; supplier
relationship and records management. A descriptive research design was used in this study. The researcher
collected both primary and secondary data during the researcher. Primary data was collected using a
questionnaire. The questionnaire contained both structured and unstructured questions. Quantitative data was
analyzed by employing descriptive statistics and inferential analysis using statistical package for social science
(SPSS). In addition, the researcher conducted a linear multiple regression analysis so as to test the relationship
among variables (independent) on the organizational performance.
The studies found out that majority of the employees were not well trained on Records management,
that they had other working knowledge of other than procurement. The study also found out that the
organization had a Cost management development programme in place; that costs are involved in organizational
performance at the initial stage to a moderate extent; that costs affects organizational performance and costs
affects procurement performance to a great extent. The study found out that Management is committed to
supplier relationship that is, management encourage collaborative relationships with supplier for innovative
procurement.
The study found out that Information Technology affects procurement performance to a very great
extent that is, that new technologies are promising to save costs, to improve customer and supplier relationships,
business processes and performance, and to open new business opportunities. The researchers recommend that,
policy and practice for procurement should be carefully evaluated and the results of that evaluation fed back into
improved approaches. Also the organization should have sufficient special techno-economic knowledge and
openness to new, effective methods when assessing tenders for organizational performance. Employees should
be equipped with the specific skills and competencies needed to design and manage contracts.
According to Muiga and Kwasira (2016), A research paper on, Role of strategic procurement practice
in realization of corporate goals in public secondary schools, In Molo Sub-county, Nakuru, Kenya ; The study
sought to examine the influence of negotiation strategy on realization of corporate goals in public secondary
schools in Molo sub-country. The study employed a mixed research design population of sixty five respondents
which included school Principals, Bursars and Pre-qualified suppliers in Molo sub-county, Kenya. Data was
collected using self-administered questionnaires constructed on a Likert scale. The collected data was analyzed
with the aid of SPSS 21 using descriptive statistics and inferential statistics. Results were presented in form of
tables. Correlation analysis indicated very weak negative insignificant relationship between negotiation
strategies and the realization of corporate goals.
The researcher recommended that the school management should not focus on negotiation as a
strategic procurement tool since it does not enhance the realization of corporate goals, instead they should focus
their attention on other strategies that would lead to realization of goals and objectives of the school.
Knowledge Gap
Compared to other previous studies in literature review, this study has identified the lack of knowledge
concerned the use of different strategic procurement models by public procurement practitioners by positioning
in matrix their organizational supplies and managing supplier relationships for short and long term decision
making. This knowledge has been well covered in this study and provides clearly simple models which can be
used to make decisions for purchased supplies as well as for managing supplier’s relationship strategically. The
study also has provided clear recommendations on important procurement areas where public procurement
practitioners can realize the benefits of innovative procurement in long term success of the organization.
III. RESEARCH METHODOLOGY

The type of the study was a descriptive research. According to Kombo and Tromp (2006), define that;
Descriptive research is the method of collecting information by administering a questionnaire to a sample of
individuals. Under this study the researcher prepared or formulated some of the questions related to the topic of
the study and submits them to the targeted respondents. This helped the researcher to obtain the first hand data
from the respondents, which is more accurate to the study that is undertaken.
This study used a positivistic paradigm which typically assumes a quantitative methodology.
Positivism may be seen as an approach to social research that seeks to apply the natural science model of
research as the point of departure for investigations of social phenomena and explanations of the social world
(Chilisa and Kawulich, 2015). The positivist researcher prefers working with an observable social reality; and
such research would produce generalizations similar to those produced by the natural scientists.
This study used two methods to collect data that includes; questionnaire and documentary analysis. The
questionnaire which was used on this study was in a form of a likert scale questionnaires. This was so in order to
make sure that respondents were not limited in giving their views. Questionnaire is suitable for saving time as
compared to other data collecting instruments. Under this study the researcher reviewed documentary sources in
order to obtain information and other required data from selected PE’s. Data also were collected from various
documents including Tanzania procurement journals published by PPRA. The information obtained was used to
cross checked against the answers of respondents form questionnaire.
According to Mugenda and Mugenda (2003), the population refers to an entire group of individual’s
events or objectives having common observable characteristics. The study was conducted at Moshi Municipal
Council, Moshi Rural District, Tanzania Coffee Board (TCB), Moshi Urban Water Supply and Sewerage
Authority (MUWSA) and Government Procurement Services Agency (GPSA). This study targeted a sample
size of 60 respondents(staff) from procurement management unit or procurement department and others from
user departments as calculated below:
According to Charan and Biswas (2013), In a Quantitative research study the following formula for
computing sample size was used;
Sample size = Z1α/22 ×(Sd)2
d2
Z1α/2 = Standard normal variate(at 5% type 1 error (P˂0.05) it is 1.96 and at 1% type 2 error (P˂0.01) it is 2.58)
d = Absolute error/margin error in precision. This was decided by the researcher
Sd = Standard deviation of variable based on previous studies or pilot study
According to Charan and Biswas (2013), in majority of the studies P values are considered significant
below 0.05 or 5% hence 1.96 was used as the value of Z1α/2 in the formula and hence d= 5%.
Therefore, Using formula above; Sample Size = 1.962 × (19.7)2 = 60 sample size
52
The researcher selected 3 respondents from each procuring entity a total of 15 staff from PMU; 5
respondents in each PE a total of 25 staff from administrative; 2 respondents in each PE a total of 10 staff from
account and finance; 4 respondents of marketing department from TCB and 2 respondents from 3 selected PE’s
(i.e MMC, MRD and MUWSA) a total of 6 staff from engineering.
The researcher used the purposive sampling technique/method to obtain the reasonable information
whereby employed with the major objectives ensuring that the head of the departments and other staff members
are involved in the whole issue so as to enable the researcher to obtain the accurate and reasonable information
according to (Wiersma and Jurs, 2009), in purposive sampling, the researcher purposely selects individuals who
can provide data that are relevant to the research problem.
Data analysis methods employed involved quantitative procedures. Under the study the researcher used
SPSS to process and analyzes the collected data to obtain a research result. The data collected were organized
into manageable units, that the researcher used descriptive analysis. The study adopted a descriptive analysis by
use of questionnaires which were analyzed using tables.
IV. FACT FINDINGS, ANALYSIS AND DISCUSSIONS

In order to identify factors affecting strategic procurement practices in public sector, a number of
questions were drawn from the variable, strategic supplier relationship management. The results are as presented
in table below; (where SD=Strong Disagree, D=Disagree, N= Neither Agree nor Disagree, A=Agree and
SA=Strong Agree)
Table 1: Effect of Strategic Supplier Relationship Management on Strategic procurement practices
Likert Statements SD% D% N% A% SA Likert Standard
% Mean Deviation
Potential suppliers developed financially 6.7 43.3 28.3 21.7 0 2.65 0.899
or technically to meet user requirements
Supply risk are evaluated on how to deal 1.7 31.7 11.7 46.7 8.3 3.28 1.059
with different suppliers in terms of
capacity, experience, financial stability
etc.
Higher level of customer service and cost 8.3 11.7 30.0 41.7 8.3 3.30 1.062
reduction is one of the results of strategic
supplier relationship management
There is lack of skills in managing 10.0 26.7 11.7 41.7 10.0 3.15 1.219
supplier relationship
There is lack of supplier’s track record on 11.7 31.7 21.7 30.0 5.0 2.85 1.132
his/her past and current projects
Suppliers are regularly informed on 11.7 30.0 30.0 20.0 8.3 2.83 1.137
organization strategic goals and plans
Public procurement act limit cooperation 11.7 26.7 30.0 21.7 10.0 2.92 1.169
between buyer and supplier
There lack of understanding culture of 5.0 18.3 25.0 41.7 10.0 3.33 1.052
buyer and supplier
There is lack of timely payment to 6.7 6.7 18.3 46.7 21.7 3.70 1.094
suppliers
Source: Field data, 2018
As presented in the table above, 43% of the respondents disagree with the statement that potential
suppliers are not developed financially or technically by the organization to meet user requirements, 28% of the
respondent they had no opinion, 22% agree, 7% strong disagree while 0% of the respondents strong agree with
the statement. The findings above revealed that, one of the strategic practices which is supplier development is
not done in most of public procuring entities in Tanzania. This situation creates non-transparency and limit
cooperation between buying organization and supplier. Public procuring entities are services oriented
organization as a result there will not be customer satisfaction. Lack of supplier development in most of public
projects will lead to low quality, non improved manufacturability, and non-reliability for new designs by the
suppliers.
These findings agreed with Tiura (2006), that public procurement has been slow to develop, primarily
due to public procurement accountability, deficient commercial incentives and a lack of skills Second, public
buyers are less focused on relationship building and more on how to obtain the lowest price possible. Third,
Public buyers are generally risk averse.
In relation to whether strategic supplier relationship is practiced in public sector, 47% of the
respondents agreed that there is evaluation of supply risks of procured items and services within the
organization on how to deal with different suppliers in terms of capacity, experience, financial stability and etc,
but 32% of the respondents disagree with the statement, 12% neither agree nor disagree, 8% of the respondents
strong agree while only 2% of the respondents strong disagree. Some of the public organizations they did not
evaluate their suppliers in different areas such as suppliers capacity, experience, financial stability of suppliers
so as they can meet users requirements in terms of cost, quality and time delivery. Therefore in order to ensure
all are met assessment of supply risks before awarding contract to successful bidders is very important.
According to the findings revealed by the table above it shows hat, 42% of the respondents agreed that
high level of customer services and cost reduction is one of the results of strategic supplier relationship
management, 30% of the respondents had no opinion, 12% disagreed with the statement, 8% strong agree and
again 8% strong disagree with the statement.
The study also found that, 42% of the respondents agreed that in most of public procuring entities their
staff lack skills in managing supplier relationship, 27% disagreed, 12% neither agreed nor disagreed with the
statement, 10% strong agreed and 10% strong disagreed with the statement. Findings reveal that, there is lack of
specific competencies and skills is among the key challenges faced when implementing supplier relationship
management. Therefore, there is an indication for a call to action to implement SRM training and development
programs. Furthermore, the research highlights the key value drivers for supplier relationship management:
innovation, sustainability and resilience. It is important that both partners develop and deploy these capabilities.
Factors like trust, open communication, empathy and a win-win orientation are fundamental in order to benefit
from these capabilities and eventually function properly.
Hence, training and development programs represent a good means to encourage these qualities. The
training courses should cover topics such as the process to run SRM, supplier identification, supplier
segmentation, relationship analysis, relationship management etc. All these lead to in-depth insights about
supplier relationship management which consequently result into more profitability and positive outcomes for
the organization.
The analysis of the findings of the table above shows that 32% of the respondents disagreed with the
statement that they always keep track record of supplier’s past and current projects performed, but 30% of the
respondents agreed that there is lack of supplier’s track record on his or her past and current projects, 22% had
no opinion, 12% of the respondents strong disagreed and only 5% strong agreed with the statement. Also the
study found that, suppliers are not regularly informed on organization strategic issues and plans since 30% of
the respondents disagreed with the statement, 30% again of the respondents neither agreed or disagreed with the
statement, 20% agreed, 12% strong disagreed and 8% strong agree with the statement.
If suppliers are not well informed on organization strategies and plans they will not be able to help the
buying organization to achieve its objectives, vision and mission. They will not be able to match their own
strategies plans with that of the buying organization, hence will result to interruptions and misunderstanding
between the buying organization and the suppliers. Skills in managing supplier relationship are of important as it
help easy to improve long term collaboration between buyer and supplier. Lack of timely payments to suppliers
in public procuring entities may be due to many factors; firstly, bureaucracy processes starting from processing
supplier’s invoice up to when the cheque is paid to suppliers; secondly, may be due to lack of enough funds
allocated to that activity; thirdly, the use of the funds allocated to other emergency activities; moreover late
payment to suppliers may be associated with some personal interest of the staff. If buyer and supplier belong to
different culture may give rise to different views and interpretations while having the same conversation.
The study findings relate to Camilla (2013), who argues SSRM entails broadening your view of key
suppliers so that you see them as not simply vendors that you buy things from, but as actual or potential partners
who can help you drive competitive advantage. This in turn means expanding the scope of interaction with them
beyond purchasing and fulfillment transactions tapping into their expertise and capabilities to drive innovation
enter new markets, improve quality, exchange insights about marketplace trends, and more. It also means
beginning to view relationships with suppliers as assets and to manage them accordingly.
Table above also indicates that, large percent of 27% of the respondents disagreed that PPA limit
cooperation between buyer and supplier, while also 22% of the respondents agreed that PPA limit cooperation,
30% of the respondents had no opinion, 12% strong disagreed and 10% of the respondents strong agreed with
the statement. Results above revels that, respondents of the public PE’s on the one hand stated that they would
like to cooperate with their suppliers, while at the same time they stated that they viewed public procurement
legislation as constraint for cooperation with suppliers. They noted that they had to strictly follow public
procurement legislation, which tells them to ensure fair competition among suppliers. Consequently, they
argued that they had difficulty in maintaining a long-term strategic relationship with their supplier. Thus, when
procurers of public organizations fail to find creative ways of applying public procurement legislation, they are
likely to experience difficulty in managing cooperative or strategic relationships with their suppliers.
It was finally found that, 42% of the respondents agreed that both buyers and suppliers they don’t
understand well the organizational culture of each other, 25% of the respondents neither agreed nor disagree
with the statement, 18% disagreed, 10% strong agreed and only 5% of the respondents strong disagreed with the
statement. Belonging to a different culture may give rise to different views and interpretations while having the
same conversation. Also, table 4.13 above also shows that, 47% of the respondents agreed that there is lack of
timely payment to suppliers supplied goods and services to public procuring entities, also 22% strong agreed
with the statement, 18% of the respondents had no opinion, while 7% of the respondents disagreed and other 7%
of the respondents strong disagreed with the statement.
This finding is in line with Mehran (2013) who asserted that there are various avenues available to
improve the payment problem in the industry and some of these options have been incorporated in the
construction contracts or statutes in the other developed countries such as payment of stipulated interests,
eradication of the ’pay when paid‘ clause, liens and payment bonds. Although adequate payment mechanisms
are provided in many standard forms of construction contracts for work done, a chronic problem of delayed
payment issues in the construction industry still remains.
Statistical Analysis for Multiple Regressions
The study conducted regression analysis to facilitate found the relationship between procurement
portfolio models, procurement innovation, strategic supplier relationship and green procurement as independent
variables and strategic procurement practices as dependent variable. The results are presented in the form of
model of summary, Analysis of Variance (ANOVA) and regression coefficients. The findings are as shown in
the subsequent sections.
Table 2: Model Summary
Std. Error of the
Model R R Square Adjusted R Square Estimate
1 .624a .590 .537 1.92832
Predictors: (Constant); procurement portfolio models, procurement innovation, strategic supplier

relationship, green procurement
Table above shows that determination coefficient is 0.624 which meant that 62.4% of the variation in
strategic procurement practices is well described by independent variables which are procurement portfolio
models, procurement innovation, strategic supplier relationship, green procurement. This therefore, means that
there exists a positive relationship between the independent and dependent variables. The remaining 37.6% can
be explained by other variables which were not part of the current study. As shown in the model summary.
There was high R square and adjusted R which is an indication that there exist high variations that can be
explained by the model.
The coefficient results in table above shows that a unit increases in strategic supplier relationship
would lead to improvement in strategic procurement practices of the selected Procuring Entities (PE’s) by a
factor of 0.321 having a p-value of 0.032 which is less than the confidence level of 0.05 at 5% level of
significance and 95% level of confidence.
V. CONCLUSION
Based on the findings, majority of respondents responded that in most of the public procuring entities
potential suppliers are not developed financially or technically by the organization to meet user requirements. In
addition it was found that, nearly to half of the public procuring entities there is evaluation of supply risks of
procured items and services within the organization on how to deal with different suppliers in terms of capacity,
experience, financial stability and etc. While also there are some of the organizations where there is no
evaluation of supply risks before awarding contract to successful suppliers. It was also found that, suppliers are
not regularly informed on organization strategic issues and plans. Moreover, most of public procuring entities
their staff lack skills in managing supplier relationship.
Training and development programs can considerably improve the skills needed for the proper
functioning of supplier relationship management. This will ensure a lasting relationship with strategic suppliers,
resulting in a significant improvement of the bottom-line of your organization. Public organizations need to
work towards engaging key strategic suppliers to build a mutually beneficial relationship. This study on the one
hand showed that the organizations are not able to properly value and assess the potential value of the supplier.
Consequently, the buying organization is not able to translate the suppliers’ potential added value to the award
criteria in the tender procedure.
Recommendations
It was recommended from the study that, training and development programs on procurement
practitioners represent a good means to facilitate the implementation of strategic supplier relationship
management. The training courses should cover topics such as the process to run SRM, supplier identification,
supplier segmentation, relationship analysis, strategic relationship management etc. All these lead to in-depth
insights about supplier relationship management which consequently result into more profitability and positive
outcomes for the organization.
Never the less, it was recommended that, supplier development may be carried out through the
procurement department or through the quality department depending on organizational structure, but as long as
there’s a development program of some sort in place and buy-in from the appropriate team members and
managers, then your organization should be in a good position to succeed.
Communication is absolutely necessary for many aspects of the business. If a supplier doesn’t
understand the organization’s strategic goals and plans may not be able to fulfill the needs and requirements due
to poor results. Maintaining a good contact with the suppliers can benefit the organization in a big way.
Optional, not binding on the authors
1) Limitations of the study
There was lack of maximum cooperation from the staff during data collection phase of the study.
However the researcher managed to convince employees of the organizations and outsiders on the
importance of their contribution to the study and the researcher managed to obtain relevant information
that resulted to the attainment of the objectives of the study.
Never the less there was lack of vast of adequate and relevant data since most the employees feared to
provide confidential information. However by employed creativity that resulted into innovative
techniques when the researcher wrote cover letters to the management that explain the aim and
importance of the study. Hence, it helped the researcher to obtain relevant information despite the
difficulties.
2) Directions for future research
The study was limited to four key strategic issues of strategic procurement practices. There is a need
for future research to increase number of the findings and wider coverage of strategic procurement
practices. The study could be more valid if other future researcher(s) on the same study could increase
the number of sample size of the respondents.
3) Source of funding of the study
The whole study from proposal preparation up to the completion of the thesis was self-financed by the
author.
VI. REFERENCES
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Factors Affecting Strategic Procurement

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Factors Affecting Strategic Procurement

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Gastor Josephat Orio, International Journal of Research in Management, Economics and Commerce,

Factors Affecting Strategic Procurement

II. LITERATURE REVIEW

Source: Cox et al, 2005

Source: Researcher Model, 2018

III. RESEARCH METHODOLOGY

IV. FACT FINDINGS, ANALYSIS AND DISCUSSIONS

Predictors: (Constant); procurement portfolio models, procurement innovation, strategic supplier

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