The impact of supply chain management practices on performance: the case of Safaricom Limited

Abstract

The purpose of the study was to find the impact of Safaricoms supply chain management practices on the company’s performance in the Kenya telecommunication industry. The research design used was a case study and the research method was mainly content analysis. The research interviewed supply chain partners that form part of Safaricoms supply chain. A total of 74 questionnaires were distributed of which sixty responses were completed and returned giving a response rate of 81.1%. The literature reviewed the links between supply chain management and operational performance in the wireless telecommunication industry. Supply chain management needs to address information management, trade offs, cash flows, inventory, distribution network configuration and distribution strategies to be able to establish a link with operational performance. Critical activities in a supply chain management function and objectives of a supply chain function have been highlighted to guide the researcher to look for these activities while gathering information for the study. The literature also reviewed the issue of how to measure the performance of a supply chain management function. Emerging practices in supply chain management in selected countries is presented. The findings of the study were that it was observed that there exists very strong supply chain management practices in Safaricom and there was evidence of superior operational performance within the supply chain. The performance dimension of flexibility, service, cost, quality as well as innovation are well represented in the supply chain. The performance dimensions contribute immensely towards a good supply chain management practice in the wireless telecommunication industry and specifically within Safaricom Limited and its partners. While the findings give the company a good standing in terms of superior operational performance, it should be noted that many supply chain partners suggested that more needs to be done to performance manage the chain for sustainable operational performance. It was also observed that while there is seamless organization early in the supply chain i.e. between Equipment suppliers, DHL and Safaricom, there is relatively lesser, although still impressive, seamless organization down the supply chain and especially between managing the large number of Safaricom authorized dealers and Safaricom limited.