Challenges of e-procurement implementation among multinational tea companies in Kericho county, Kenya

Abstract

Electronic Procurement is the use of electronic computer systems to manage the entire procurement process Francois (2012). While this system can deliver significant cost savings to business, a number of innovative companies and marketplaces are now looking at other appropriate areas of their business to drive forward their business performance throughout the value chain - both supply and demand. The objective of the study was to assess the challenges facing implementation of e-procurement by multinational tea companies in Kericho County. The target population was the heads of procurement departments and two employees drawn from each of the three companies. Questionnaires and interview guide was used as the instrument for collecting data since both primary and secondary data was collected. Data was analyzed using qualitative and quantitative techniques. Qualitative data was analyzed using content analysis. Linear regression model was used. According to data findings; all the four independent variable ; cost, legal, security and supplier enablement were found to have correlation coefficients of 0.49, 0.575, 0.506 and 0.552 respectively with the implementation of e-procurement among the multinational tea companies involved in the study. Conclusions are that the entire four variables that were identified for analysis namely; cost, legal infrastructure, security and supplier enablement were found to be key impediments to the implementation of eprocurement. Recommendations are; As much as resources are always limiting, multinational tea companies should look at e-procurement as a critical investment and set aside adequate financial resources in their budgeting process. Furthermore only the initial investment in procurement of the necessary hardware, software and training of require personnel is resource intensive while the subsequent maintenance and operation cost are substantially low in comparison to the streams of benefits that will accrue from such investments