INFLUENCE OF INVENTORY MANAGEMENT ON PERFORMANCE OF PROCUREMENT SYSTEM IN PUBLIC HOSPITALS IN KENYA:

A CASE OF KENYATTA NATIONAL HOSPITAL

Abdallah Ali O. Ofula

Msc. Procurement and Logistics,

Jomo Kenyatta University of Agriculture &Technology

Dr. Patrick Karanja Ngugi

Jomo Kenyatta University of Agriculture and Technology

Dr. David Kiarie Mburu

Jomo Kenyatta University of Agriculture and Technology

CITATION: Ofula, A., A., O., Ngugi, P., K., Mburu, D., K. (2016). Influence of Inventory Management On Performance Of Procurement System In Public Hospitals In Kenya: A Case Of Kenyatta National Hospital. International Journal of Human Resources and Procurement. Vol. 5(10) pp 411-442.

ABSTRACT

The study intended to determine the influence of effective inventory management in the performance of procurement system in Public hospitals, a case of Kenyatta National Hospital. The study is vital at this point in time because inventory in the public procurement is a major cost driver that takes a significant portion of the budget and is critical to service delivery. The objectives of the study were: to determine how inventory management influence the performance of procurement at Kenyatta national hospital; to find out the relationship between inventory cost management and customer service level at Kenyatta national hospital; to explain measures put in place for effective management of inventory at Kenyatta national hospital and to find out the challenges to effective management of inventory to procurement performance at the national hospital. The research is an exploratory case study involving employees of the Kenyatta national hospital. All staff involved in the planning, implementation and storage of inventory was targeted. Data was collected by use of questionnaires which was administered to respondents face to face by research assistants. The collected data was analyzed using descriptive statistics including means and standard deviations. The study used correlation and regression models to analyze the factors, and with help of Statistical Package of Social Sciences Version 21 as the tool of analysis. The study expected to unveil the influence of inventory management on the performance of the procurement and make recommendations for improvements. The findings of the study indicate that all the variables had a positive and significant influence on service delivery. According to the results, inventory management costs had a significant influence on procurement performance as shown by the coefficient (B = 0.731, t = 1.001, p> 0.006). Inventory information system also showed a significant influence on procurement performance with the coefficients (B = 0.725, t = 2.255, p> 0.017) indicating a positive effect on procurement performance. Skills of employees as well showed a significant influence with a coefficient of (B = 0.715, t = 2.058, p> 0.021) showing a positive and significant relationship. Similarly, lean inventory system indicated a significant positive influence with coefficients (B= 0.769, t = 2.713, p> 0.000).

Key Terms: Management, Organization, Procurement, Procurement controlling, Procurement Coordination, Procurement planning, Public Procurement, Supply chain

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