Supplier development and operational performance of manufacturing firms in Nairobi city county

Abstract

This study was carried out to establish the effect of supplier development on operational performance among large manufacturing firms in Kenya. The study had three objectives, to determine the extent to which large manufacturing firms in Kenya have adopted the concept of supplier development, the effect of supplier development on operational performance and to determine the challenges facing supplier development implementation in the large manufacturing firms in Nairobi. The research design involved a cross sectional survey of 56 large manufacturing companies in Nairobi, Kenya. Data was collected using a questionnaire that was administered through “drop and pick” method. Mean and standard deviation were used to analyse the extent of concept implementation whereas regression analysis was used to analyse the relationship between supplier development and operational performance among large manufacturing firms in Kenya. The findings are presented in tables. The research found it evident that there is a significant relationship between supplier development and operational performance represented by R2 value of 0.894 which translates to 89.4% variance explained by the seven independent variables of supplier training, standardization, financial support, communication, certification, recognition and auditing. The study only focused on the large manufacturing companies in Nairobi. Therefore, the researcher recommends further research on other manufacturing firms not located in Nairobi and others not in the manufacturing industry. The researcher has also recommended that all manufacturing companies and other organizations embrace supplier development so that they can acquire competitive advantage associated with the concept application.