Implementation of e-procurement practices among private hospitals in Nairobi, Kenya

Abstract

The role of purchasing in corporate success has changed considerably due to the advances in information technologies and information systems. E-procurement has thus gained strategic visibility in its role in enhancing inter-functional and inter-organizational relationships and has emerged as the driving force behind several supply chain practices. This study sought to examine factors influencing e-procurement implementation among private hospitals in Kenya. It was guided by three specific objectives: to examine the extent of e-procurement implementation, establish the factors influencing implementation of e-procurement and to find out the relationship between the identified factors and e-procurement implementation among private healthcare service providers in Nairobi, Kenya. The study employed a descriptive research design. The population consisted of all the 58 private health care service providers accredited by the National Hospital Insurance Fund. Since the population was relatively small, a census was done. Primary data was collected from procurement/finance personnel using a semi-structured questionnaire. Data analysis was done using SPSS with the main analysis tools being frequencies, mean and standard deviation, factor analysis and multivariate linear regression. The study found that e-procurement had been implemented to a moderate extent by the NHIF accredited hospitals. Seven factors that influence e-procurement implementation were identified through factor analysis. These include: risk perception, end user training, existing technology, top management support, supplier systems integration, implementation strategy and vendor support. Four out of the seven variables were found to have statistically significant relationships with e-procurement implementation. These include: Risk perception which had a negative relationship with e-procurement implementation, Existing Technology, Top management support and implementation strategy all of which had positive relationships. An examination of the joint relationship confirmed these findings and established that the seven variables jointly account for 66.3% of the variability in e-procurement implementation. It was recommended that private hospitals should seek ways to enhance greater collaboration within the industry and with suppliers so as to hasten the pace of implementation of e-procurement. Further, since risk perception is a key driver, hospital associations, the private sector, the government and other stakeholder should facilitate empirical studies to be conducted to dispel any myths and to help private hospitals better understand the genuine risks as well as the cost benefit tradeoffs involved in adoption and implementation of e-procurement. It was suggested that since the present study focused only on private hospitals accredited by NHIF, future studies should consider expanding the scope by including public hospitals. Future studies should also consider expanding the topic to include moderating variables like firm size and firm age.