EFFECTS OF PROCUREMENT ON THE PERFOMANCE OF PUBLIC HOSPITALS IN KENYA.

A CASE
STUDY OF NGONG’ SUB-COUNTY HOSPITAL.

DIANA NELIMA JUMA

BPSMC01/2383/2022
 CHAPTER ONE
INTRODUCTION

Introduction

This chapter, provides an overview of the research topic, highlighting the background, problem
statement, objectives, research questions, significance of the study, scope, limitations, and key
definitions.

1.1 Background of the Study

1.1.1 Global Perspective

Public hospitals worldwide face unique challenges in ensuring efficient and effective
procurement processes to meet the diverse and complex healthcare needs of their populations.
The procurement process in public hospitals is a critical determinant in ensuring the efficient
provision of healthcare services, with significant effects on the quality of care (Smith, 2018).
Choice of suitable procurement methods plays a key role in ensuring that organization goals are
met.

As the global healthcare sector undergoes major changes driven by factors such as rapid
population growth, shifting demographics characterized by an increasingly aging population, and
heightened healthcare awareness (World Health Organization [WHO], 2020), healthcare
institutions are under mounting pressure to meticulously assess and enhance their procurement
methods.

To meet the escalating demand for healthcare services, public hospitals in developed countries
such as USA, China and Japan find it important that health care facilities efficiently acquire a
broad spectrum of medical supplies, equipment, and pharmaceuticals while simultaneously
upholding the standards of cost-effectiveness and quality (Jones et al., 2019). These countries use
various methods of sourcing that are technologically improved with a focus improving patient
care and reducing costs.

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 1.1.2 Regional Perspective

The East African healthcare sector, presents a unique and dynamic context with distinct
challenges and opportunities (Mukiri & Omondi, 2017). Public hospitals in this region, such as
Ngong Sub- County Hospital, operate within an environment characterized by several key
factors, including budget constraints, evolving healthcare needs, and a strong emphasis on
transparent and accountable procurement practices.

The budget constraints in East African healthcare institutions necessitate the adoption of strategic
procurement approaches to maximize the efficient allocation and utilization of limited resources
(Kiplagat et al., 2020). With limited financial resources, healthcare facilities must carefully
consider their procurement strategies to ensure cost-effectiveness and optimal resource
utilization. Furthermore, the healthcare landscape in East Africa is constantly evolving to meet
changing patient demands. This necessitates the adoption of adaptable procurement methods to
ensure that healthcare institutions can efficiently respond to the ever-shifting healthcare needs of
the population (Ongaro et al., 2019).

Transparency and accountability in procurement are of paramount importance in this regional

context. They are vital for not only efficient resource allocation but also for combating
corruption, thus aligning with ethical and legal standards (Kariuki, 2018). Maintaining
transparency and accountability in procurement practices is crucial for ensuring that resources are
allocated fairly and that healthcare services are delivered with integrity.

1.1.3 Local Perspective

At the local level, Ngong Sub-County Hospital, situated in the Ngong region of Kenya, is subject
to specific dynamics and influences that significantly impact its procurement practices (Njoroge
& Mwangi, 2016). These local factors include disease prevalence, demographics, and economic
conditions, which shape the hospital's unique procurement requirements. For example, a higher
prevalence of certain diseases in the Ngong region may necessitate specific medical supplies and
pharmaceuticals, reflecting the local health profile (Kibet et al., 2018). Additionally, the
demographics of the area, such as age distribution and population size, influence the types of
healthcare services and equipment needed by the hospital to cater to the community's specific
healthcare needs (Wambua et al., 2020).

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Government regulations and policies play a crucial role in guiding procurement practices at
Ngong Sub-County Hospital. These regulations are designed to ensure fairness, transparency, and
accountability in the procurement process (Government of Kenya, 2019). Compliance with these
regulatory frameworks is vital for the hospital to uphold its ethical and legal responsibilities
while serving the local community.

The hospital's capacity to meet the healthcare needs of its community is intricately tied to its
procurement priorities. Therefore, an agile approach is necessary to remain responsive to
evolving healthcare demands (Nyambura & Ochieng, 2021). The hospital must adapt its
procurement strategies to address the changing needs of the local population, thus maintaining
the delivery of high-quality healthcare services.

By studying Ngong Sub-County Hospital, this research provides valuable insights into the
determinants of procurement practices, which have implications not only for this specific
institution but also for similar healthcare facilities across Kenya. Understanding local dynamics,
regulatory frameworks, and healthcare demands is fundamental for ensuring the provision of
quality healthcare services at the community level (Kagure et al., 2017).

1.1.4 EFFECT OF PROCUREMENT

In examining the effect of procurement on the performance of public hospitals in Kenya, one key independent
variable is the quality of procurement management. Research by Mokaya et al. (2017) underscores the
significance of effective procurement management in influencing hospital performance. The study suggests that
well-managed procurement processes contribute to the timely acquisition of medical supplies and equipment,
ultimately enhancing the overall efficiency and effectiveness of healthcare services in public hospitals.

Transparency in the procurement process significantly impacts the performance of public hospitals in Kenya. A
study by Omollo et al. (2017) emphasizes the importance of transparent procurement practices in building trust
and accountability. When procurement processes are transparent, it not only reduces the likelihood of
corruption but also ensures fair competition among suppliers, leading to better value for money. This
transparency in procurement positively correlates with improved hospital performance as it fosters a conducive
environment for ethical and accountable resource allocation.

Financial resources allocated to procurement crucially affects the performance of public hospitals. According to

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Oronje et al. (2017), inadequate funding can lead to delays in procurement processes, hindering the timely
availability of essential medical supplies. Insufficient financial resources may compromise the quality and
quantity of healthcare services, directly influencing the overall performance of public hospitals. Therefore,
understanding and addressing the financial aspects of procurement are essential for ensuring optimal hospital
performance in the Kenyan context (Mokaya et al., 2017; Omollo et al., 2017; Oronje et al., 2017)

1.1.5 Performance of Public Hospitals

Despite the crucial role that procurement plays in the performance of public hospitals in Kenya, limited recent
research has specifically delved into this relationship since 2017. However, a study by Kibet et al. (2019) sheds
light on the broader healthcare context in Kenya, emphasizing the intricate link between efficient procurement
and overall hospital performance. The findings highlight that optimized procurement processes positively
correlate with improved service delivery, patient satisfaction, and resource utilization, underscoring the
enduring relevance of effective procurement strategies in enhancing the performance of public hospitals.

While specific studies on procurement's direct impact on hospital performance in Kenya post-2017 are
somewhat scarce, broader research in healthcare management offers insights. According to Nyikuri et al.
(2015), systemic challenges, including those related to procurement, contribute to disparities in healthcare
performance across Kenyan counties. The study emphasizes the need for targeted interventions in procurement
practices to address these challenges and improve overall healthcare outcomes. This perspective underscores
the ongoing importance of understanding and refining procurement strategies to positively influence the
performance of public hospitals in Kenya.

Furthermore, discussions on the performance of public hospitals in Kenya should consider the broader
healthcare reforms and policies implemented since 2017. Notably, Kenya's Health Sector Services Fund
(HSSF) has been a pivotal initiative aimed at enhancing healthcare service delivery. While not exclusively
focused on procurement, the success of such initiatives is inherently tied to efficient procurement practices,
emphasizing the continued relevance of studying the effects of procurement on the performance of public
hospitals in the evolving healthcare landscape of Kenya (Ministry of Health, Kenya, 2017). Future research
should delve deeper into recent developments, policies, and specific procurement strategies to provide a more
nuanced understanding of the current dynamics influencing public hospital performance in Kenya

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 1.2 Problem Statement

Efficient and effective procurement processes in public hospitals are foundational for delivering
high-quality healthcare services to the community (AfDB, 2019). However, a significant gap
exists in comprehensive research on the determinants influencing the selection of procurement
methods employed by public hospitals in Kenya. This knowledge gap is not merely an academic
concern; it has real-world implications, hampering the ability of public hospitals to optimize their
procurement processes, allocate resources judiciously, and ultimately enhance the overall quality
of healthcare services provided to patients

The existing research on procurement methods in public hospitals often lacks a truly global
perspective, with many studies focusing on specific regions or individual countries. This
geographical bias in the literature creates a methodological gap, as it hinders the development of
a comprehensive understanding of the determinants influencing procurement decisions in public
hospitals across diverse cultural, economic, and regulatory contexts (Van,2006).

Despite the paramount importance of procurement in the healthcare sector, there exists a
considerable knowledge gap in understanding the factors that influence the selection of
procurement methods in public hospitals across Kenya. The dearth of comprehensive research
hinders healthcare institutions from adopting evidence-based procurement practices (Grieco,
2015). It also limits their ability to adapt to the changing healthcare landscape, including shifts in
disease prevalence, advancements in medical technology, and the expectations of patients and
their families (Mossialos et al., 2017).

Consequently, the lack of empirical insights into procurement determinants affects the ability of
public hospitals to meet the diverse and dynamic healthcare needs of their communities. These
needs include catering to a growing and aging population, responding to public health
emergencies, and achieving efficient healthcare resource allocation (Nash, 2017; WHO, 2020).

This research seeks to address this problem by investigating the determinants of procurement
methods used by Ngong Sub-County Hospital, serving as a representative case study for other
public hospitals in Kenya. By identifying these determinants and understanding how they
influence procurement methods, this study aims to contribute to the development of evidence-

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based procurement practices that can enhance the efficiency and quality of healthcare services in
Kenya's public hospitals (Chuma et al., 2009).

1.3 Objectives

1.3.1 General Objectives

The general objective of this research is to identify and analyze the determinants of procurement
methods used by public hospitals in Kenya, with a specific focus on Ngong Sub-County Hospital.

1.3.2 Specific Objectives

i. To investigate how selection procurement affect performance of Ngong sub county hospital
ii. To examine how efficiency and effectiveness of resource allocation affect performance of Ngong Sub
county hospital
iii. To understand the relationship between government regulations, policies with the performance of Ngong
sub county hospital.

1.4 Research Questions

i. How does selection procurement affect performance of Ngong sub county hospital?
ii. What extent does efficiency and effectiveness of resource allocation affect performance of Ngong Sub
county hospital?
iii. What is the relationship between government regulations, policies with the performance of Ngong sub
county hospital?

1.5 Significance of the Study

It will provide valuable insights into the determinants of procurement methods used by public
hospitals in Kenya, potentially improving the efficiency and quality of healthcare services (Nash,
2017). The findings will be useful for policymakers, hospital administrators, and procurement
officers in making informed decisions to enhance procurement processes (Grieco, 2015). The
research will contribute to the existing body of knowledge in healthcare procurement and serve
as a foundation for future studies in the field (AfDB, 2019).

1.6 Scope of the Study

This study focuses on the determinants of procurement methods employed by public hospitals,
with a specific case study of Ngong Sub-County Hospital in Kenya. The research will seek to

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explain different variables such as economic, technological and social cultural norms and their
contribution to procurement methods. The research encompasses factors influencing procurement
choices, resource allocation efficiency, and the impact of government regulations on procurement
practices. The research study timeframe will be 3 months.

1.7 Limitations of the Study

Access to Real-Time Data: The study's effectiveness may be constrained by the availability of real-time data,
especially if the proposed research involves an empirical investigation. Access to current and relevant data on
procurement processes and hospital performance is essential for accurate analysis. The study's findings may be
influenced by the accessibility and timeliness of such data, and any delays or limitations in data collection
could impact the study's comprehensiveness.
External Factors and Unforeseen Events:External factors and unforeseen events beyond the researcher's control
may affect the study's implementation. Economic, political, or health-related crises could impact procurement
practices and hospital performance