CITATION: Ondore, J. O andOdoyo, C. O (2012): Effect ofDifferent Strategies on ProcurementEfficiency in Public Secondary Schools: ASurvey of Public Secondary Schools inNdhiwa District, Kenya

ABSTRACT

Public procurement system inKenya has undergonesignificant developments. Thepurpose of this study was todetermine the impact ofdifferent strategies adoptedby public schools on theirprocurement processes. Theresearch objectives were to:Establish the status ofdifferent procurementstrategies used in publicsecondary schools, identifyfactors that influence prices,settlement time and customersatisfaction in publicprocurement in public schoolsand Determine the impact ofprocurement strategies onprices, settlement time andcustomer satisfaction. Thestudy examined procurementstrategies in local publicsecondary schools that coveredsampled schools in Ndhiwadistrict. The study employed

survey design in which theexisting procurementstrategies were considered. Asample was selected from theentire population usingstratified random samplingtechnique in order to classifythe entire population of 51school administration officersand 340 staff member. Datawas collected using structuredand unstructuredquestionnaire. The collecteddata was analyzed usingdescriptive statistics. Itwas then classified andpresented by frequencydistribution tables, chartsand graphs. Likert scaleanalysis was used to weigh therespondents’ perception. Thestudy revealed that usingstrategies in the procurementimproves efficiency andminimizes the costs ofpurchases. The study alsorevealed that many challengesface the stakeholders whenapplying the framework ofprocurement practice in thepublic secondary schools andthat there is need to identifythe underlying challenges withan aim of reviewing the

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procurement procedures,training all persons involvedin procurement; have freeaccess to procurementinformation by procurementpractitioners in publicinstitutions to enableprosecution of those who floutthe laid down procurementrules. On recommendation, theresearcher observed the needto adopt procurementstrategies, identify theunderlying challenges toimplementation of theprocurement regulations tofoster accountability andtransparency in the publicinstitutions.

Key words: Procurement Strategies,Procurement Efficiency, Accountability,Procurement Processes.

1.0 INTRODUCTION

Public procurement system inKenya has undergonesignificant developments, frombeing a system with noregulations in the 1960s, anda system regulated by TreasuryCirculars between 1970 and2000, to a system withregulations in the late 2000s

(through introduction of thePublic Procurement andDisposal Act (PPDA) of 2005and the Public Procurement andDisposal Regulations (PPDR) of2006) (Public ProcurementOversight Authority, October2007). The aim of this was foraccountability andtransparency in the publicsector to reduce abuse ofpublic funds – obtained fromthe tax-payer.This law led to the creationof the Public ProcurementRegulations (PPR) and thePublic Procurement Directorate(PPD) in 2001. Between 2001and 2004, the PublicProcurement and Disposal Billwere drafted and after severalmodifications, were assentedto by the President to becomethe Public Procurement andDisposal Regulations act in2006. This act containsregulations to effectivelyensure that procurementprocesses are fair and just.

The act was fully operationalfrom 1st January 2007, a yearbefore the introduction offree secondary education. Withfree secondary education,there has been more focus onthe public secondary schools’expenditure as they are directbeneficiaries of the publicfunds.

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Public procurement has beenadopted by governments inorder to increase efficiency,transparency and foraccountability in purchasinggoods, services or works inthe public sector using publicfunds. Public procurement isaimed at reducing, if noteliminating, fraud, wastageand corruption in the publicsector. It is believed thatthrough public procurement,governments provide qualityservices, goods or works toits citizens and hence,increasing value for money.

Public procurement is aimed atpromoting fair competitionamong supplies which iseffective in bridging the gapbetween suppliers - bothestablishing and established.This is because of thepresumed equity and opennessin awarding the tenders forsupplies ofgoods/services/works tovarious governmentdepartments.

While public procurement hasseen improved efficiency andaccountability in mostgovernment departments, littleif no research has beenfocused on procurementstrategies in public

institutions (secondaryschools) of which, almost allare direct beneficiaries ofthe exchequer.Studies have revealed thatwith introduction of thepublic procurement andregulations, publicinstitutions have come up withdifferent strategies with theaim of reducing expenditure.

The purpose of this studytherefore tries to determinethe impact of differentstrategies adopted by publicsecondary schools on theirprocurement processes.

1.4 OBJECTIVE OF STUDY1.4.1 General objectiveThe broad objective of thisresearch was to determine theeffect of different strategieson procurement efficiency inpublic secondary schools.

1.4.2 Specific Objectives

The specific objectives wereto:-

i. Establish the status ofdifferent procurementstrategies used in publicsecondary schools

ii. Identify factors thatinfluence prices,settlement time and

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customer satisfaction inpublic procurement inpublic schools.

iii. Establish whether publicsecondary schools haverules/regulations inplace that govern theirprocurement processes.

1.4.3 Research Questions

i. What is the status ofdifferent procurementstrategies used in publicsecondary schools?

ii. What factors influenceprices, settlement timeand customer satisfactionin public procurement inpublic schools?

iii. What is the effect ofprocurement strategies onprices, settlement timeand customersatisfaction?

1.7 CONCEPTUAL FRAMEWORKAnalytical framework forevaluationProcurement strategies areinfluenced by the efficacy ofprocurement rules andregulations which aredetermined principally by twosets of factors. These are theinstitutional factors of theprocuring entity and the

quality of procurementpersonnel (independentvariables) particularly thedegree of professionalism,knowledge of the generalprocurement processes andwhether there is enough staffto carry out the process. Theinstitutional factors includeits structure i.e. complexityin terms of departments, etc,the level of budget adequacyi.e. the allocated finances,especially with regard to theprocurement function, roleclarity of different organsregarding the procurementprocess and the type ofgoods, services or works(materials) to be procured.The above factors in turninfluence the implementationof a procurement strategy(intervening variables) to beused e.g. themethods/techniques to used andtheir efficiency. These willultimately determine thequality of the procurementoutcomes (dependent variables)e.g. reduced timing, costs anduser satisfaction.The model below gives asummary of the conceptualanalysis for the evaluation ofthe procurement process. Itbriefly describes the factorsthat influence procurementstrategies and outcome.

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Institutional Framework for Public Procurement

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Institutional factors(Independent Variables)-Structure of the institution-Budget allocation-Type of materials to be

Procurement outcomes (effectiveness)(Dependent Variables)-User satisfaction-Reduced timing of

Strategic plans(Intervening Variables)-Procurement techniques & methods employed (strategies)

Procurement personnel-Knowledge of general procurement process-Adequacy of procuring staff

Source: Adapted from “the 2008 paper presentation at the ORSEA conference in Nairobi” byAkampumuza, James et al.

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2.0 LITERATURE REVIEW

2.1 Empirical ReviewUntil the early 1970s, publicprocurement in the East Africawas largely undertaken byexternal entities. This wasprimarily because most of theneeds of the then colonialgovernment and the incomingnew governments could only bemet from external sources, aslocal supplies were still notadequate. With increasingprocurement needs, the EastAfrica governments found itnecessary to pass over theresponsibilities ofprocurement to ministries. InKenya, the Ministry of Financewas charged with theresponsibility of overseeingthe procurement process andpreparing guidelines forprocurement. By 1974, thethree countries had in placean elaborate procurementsystem with supplies officeswithin their ministries anddepartments. Supply officerswere appointed to take chargeof procurement (Odhiambo andKamau, 2003).

The supplies system for eachentity was independent andautonomous, though majorprocurements were done through

the Central Tender Boards. Inline with the ideals of thethen East African Community, aSupplies Manual was developedin the country. This manualdetailed procedures that thepublic sector followed inpurchasing goods and services.The use of the manual was,however, short-lived, as itceased to exist with thecollapse of the EAC in 1977(Odhiambo and Kamau, 2003).Thereafter, the threecountries reverted back toindividualised procurementsystems. Kenya prepared itssupplies guide in 1978, whichremained in force until 2001.

In Kenya, public procurementcontinued to be decentralisedwith supplies officersprocuring for their ownministries but reverting tothe Central Tender Boards forlarger value procurement. TheMinistry of Finance controlledministerial procurement byissuing numerous circulars andguidelines to procurementofficers in the ministries andlocal authorities. The mainproblem with the use of thesecirculars was that corruptcivil servants easilymanipulated the process. Thisorder gave procedures and

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regulations to be followedwhenever procurement was totake place in any publicinstitution. However, thisdocument did not spell out theprocedures to be followed inthe process of procurement. Itmerely gave briefs on theacquisition of goods,completely leaving out worksand consultants’ services.According to this order,procurement was done at theministerial level and therewas no mechanism to regulateand control activities ofdifferent procuremententities. Although the CentralTender Board existed, it wasjust a department in theMinistry of Finance (Odhiamboand Kamau, 2003).

2.1.1 Public ProcurementReforms in KenyaIn 1986, a study was conductedby SGS Consultants to evaluatepublic procurement systems inKenya. The major finding ofthe study was that publicprocurement was not operatingefficiently and that the statewas losing a lot of moneythrough shoddy deals. Thereport strongly indicated theneed for reforming the publicprocurement system in thecountry. The World Bank, theAfrican Development Bank (ADB)

and ITC, in conjunction withthe Government of Kenya,initiated the publicprocurement reform process inthe late 1990s. This reformprocess was meant to create asystem that allowed, amongother things, a properdelegation of authority,incentives, procurementthresholds, planning, and thedevelopment of suppliesmanuals (World Bank, 2000).

The reform process focused onaddressing the issue ofprocurement laws, establishingappropriate procurementinstitutions and entities, aswell as creating adequate andtimely evaluation andmonitoring mechanisms(Government of Kenya, 2001).The reforms would alsoincrease transparency inprocurement systems and createreputable agencies. The publicprocurement reforms also aimedat ensuring that theprocurement laws werestreamlined to conform tointernational procurement lawsand standards (Odhiambo andKamau, 2003). In 1997, the Government incollaboration with the WorldBank commissioned anotherstudy to assess the country’s

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procurement processes andsystems. The World Banksupported the study throughthe Public Procurement andCapacity Reform Project. Thisstudy identified the need fora comprehensive review and animplementation of a reformprocess in the procurementsystems. The study revealedthat the public procurementsystem in Kenya lackedtransparency and faircompetition (Odhiambo andKamau, 2003).

The study further revealedthat procurement staff werenot adequately trained andlacked professionalism. Lackof a professional body thatwould oversee and instilldiscipline among procurementofficers made them vulnerableto corruption. One of themajor recommendations was thatreforms in public procurementsystems were paramount ifgovernment was to saveresources otherwise lostthrough exorbitantprocurement. The World Bankstudy argued that improvementin procurement systems had adirect and beneficial effecton the overall economicsituation in the country(Odhiambo and Kamau, 2003).

2.1.2 Procurement Methods inKenyaThe method used to procurepublic goods can have asignificant impact onparticipation of newer orsmaller businesses (Eagan,2005). The type and value ofthe contract are importantfactors that determine themethod of solicitation. Thus,public procurements aregenerally carried out usingdifferent methods. These rangefrom complex, costly tenderingmethods like open tender,restricted tender to lesscomplex methods likeinvitations for quotations andproposal and direct sourcing.

In Kenya, open tendering isthe most used tenderingsystem. It normally happens attwo levels; first, opennational tendering, which isopen to participation on equalterms by all providers throughadvertisement. Second, openinternational tendering isalso open to participation onequal terms by all providers.It is mainly used where localsuppliers may not providecompetitive bids (Odhiambo andKamau, 2003). Open tenderingis usually advertised inprescribed newspapers -

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national or international,although media advertising maybe an expensive undertakingfor public entities such aspublic schools.

Another method is restrictedtendering, whereby bids areobtained directly without openadvertisement. The method isused where the value orcircumstances cannot justifyopen tendering process in sucha case, the procuring entityuses its database of pre-qualified providers who aredirectly invited to tender.However, the procuring agentmust demonstrate that opentendering is neither viablenor prudent. Lack oftransparency in this methodand the fact that most oflocal suppliers rarely findthemselves in the pre -qualified lists, means thatthis method tends to act as abarrier to their participationin public procurement(Odhiambo and Kamau, 2003).

An invitation of quotation andproposal is another simplifiedtendering methodology wherethe procuring entity calls forquotations or proposals.Request for quotations shouldbe addressed to no less thanthree or more candidates. This

happens where the procurementagents seek to limittransactions costs, thuspreferring to contact thefirms that have a proven trackrecord. Finally, direct or singlesource method is used wherecircumstance do not allow forcompetitive bidding. It isused for small quantities incases where time may not allowfor competitive bidding.However, as this type ofcontract is conducted throughinformal networks. It isusually more difficult forsmall and medium enterprises,compared to larger, to haveinformal access to purchasingagents or departmental heads.Buyers rely on their own liststo solicit vendors inpractice, which constitutes abarrier to small businesses,especially the new entrants(Eagan 2005).

Restricted and open tenderingmethods are frequently used inthe acquisition of capitalgoods and complex services.The methods are complex, timeconsuming and bear bigtransaction costs. Invitationsfor quotation/proposals andsingle sourcing/directpurchase are carried out forgoods and services for

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maintenance and small items.They are simple, price-driven,with simple specifications aswell as numerous competingsuppliers (Talero, 2001).

2.2 Theoretical LiteraturePublic procurement departmenthas many functions. One ofthese functions is to minimizethe cost of goods, servicesand works that are used bygovernment departments.Theoretically, a publicdepartment is expected tominimize the costs to reducewastage of public funds andfor transparency andaccountability (Hayenga 1979).

According to Kingsman (1985),there are five key factorsinvolved in maintaining and/ordetermining the level ofsupply. First, future quantityrequirements of a good,service or work must bedetermined. This is thenobtained from supplies alreadyin inventory or ordered.Second, future requirementsmust be converted into aschedule of future purchases,specifying the timing and thesize of the product/good to bepurchased. Third, financialand operational constraintsmust be considered to

determine the minimum andmaximum lead-times needed forproduction. This helpsdetermine what forward pricingmechanisms, if any, can beused. Fourth, while conformingto constraints of the buyingtime period, the departmentdetermines the timing foractual buys. These two timeperiods can be exactly thesame, or if accurate priceforecasts can be obtained,purchases can take place indifferent time periods to takeadvantage of price swings.Fifth, buying strategies for agood, service or work must bedeveloped and connected toscheduled orders withappropriate on-time deliveries(Kingsman, 1985).

Another basic function ofpublic procurement which haslong been a department withinthe ministry of finance is tomaintain the continuous supplyof goods/services/works togovernment departments inorder to meet their demands orrequirements to carry outdaily services to itscitizens. The supply of a goodor service or work is definedas: “making available of theproducts (goods), services orworks for use by theconsumer”. These goods,

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services or works have generalquality standards that must bemet (Seitz 1994).

Ordinarily, governmentprocurement includes buying,purchasing, renting, leasingor otherwise acquiring anysupplies, services orconstruction; and allfunctions that pertain to theobtaining of any supply,service or construction,including description ofrequirements, selection, andsolicitation of sources,preparation and award ofcontract and all phases ofcontractadministration”(American BarAssociation, 2000).

Procurement strategies havedeveloped from purchasingstrategies. These purchasingstrategies that have been inplace for developed countriesinclude:Supplier Optimization; where acompany chooses an optimum mixof vendors who can provide thebest prices and terms. Thosesuppliers who cannot providequality service at the termsand prices required arediscarded.Total Quality Methods (TQM);which requires vendors toprovide an ever increasing

quality service with zeroerrors.Vendor Development; wherecompanies work hand in handwith their vendors and developprocesses that help inimproving the services of thevendors. This is common wherea firm has only one supplier.Green Purchasing; whichfocuses on the need forrecycling and purchase ofproducts that have negativeimpact on the environment.

2.2.1 Public ProcurementStrategiesMost firms’ procurementstrategies are dependent onthese purchasing strategies.Some of these procurementstrategies used by firms;which can also be applicablein public institutionsinclude: First cash or spot market,which is defined as buying thegood or service on the cashmarket and immediately takingpossession of it. The cash orspot market is whereinstitutions, have no directcontract with a supplier.Rather, they buy fromwhichever supplier has thelowest cash price at the timewhen the institution wants topossess the commodity. Thismethod involves the

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institution making purchasesof a certain commodity wheninventory drops to adetermined threshold level.Reasons for this according toArthur (1971), is that; itinvolves no development ofstrategies or market analysis;rather it merely involvesmonitoring current supply andreordering; or it minimizesinventory cost, because thereis no storage of commoditiespurchased.The spot market is applicablewhen there is little pricefluctuation or pricefluctuations cannot bepredicted and, hence, astrategy cannot be implementedto minimize or reduce the highrisk of unpredictable prices.Disadvantages of using thespot market according toArthur (1971) may include; theinherent risk of not beingable to procure enough volumewhen needed, thus leading toinefficiencies in renderingservices, eliminatesopportunities of purchasinggoods or services at lowerprices, prices are determinedsolely by the timing of theneed (Arthur, 1971).

The second is trading Futureswhich involves futurescontract. A futures contract

is an obligation to buy orsell a given quantity andstandard quality of acommodity at a designatedfuture time (Bittman 2001).Essentially, an institution isinvolved in a futures contractwith suppliers at the currenttime period which may expirewhen the good or service willbe supplied, assuming pricechanges, in order to obtainits future requirements(Bittman 2001).

Third is forward purchasing,which involves buying highervolumes when prices are lower,and lower volumes when pricesare high. A forward buy isdefined when an institutiontakes possession of acommodity in advance of itsneeds. It is in order toestablish the per-unit cost onanticipated volume required ofa good or service by advancedpurchase and storage of thatgood or service at an earliertime period. If the costsaving on the good or serviceis greater than the storagecost, an advance purchase thenresults (Hayenga, 1979).

According to Hayenga, in theconcept of forward purchasing,the timing of good or servicepurchase has a significant

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influence on a firm’s costs. Adisadvantage of a forward buyis that there is price risk.There is a chance that theprice could decrease and theinstitution/school could paymore than the market price attime of need.

2.2.2 Factors that influenceprices, settlement time andcustomer satisfaction inpublic procurementPrices, settlement time andcustomer satisfactiondependent on many factorswhich include thecharacteristics of the good,service or works it wants toacquire. These characteristicsalso include: First the Price risk, whichrefers to volatility, which ishow much the price of acommodity varies over time.The volatility is measured inannual percentage to evaluatethe historical volatility ofthe good/service/works. Highprice risk goods/services arethose with high volatility,while low price riskgoods/services have arelatively consistent price(Bittman 2001).

Second is the Volume, which isthe amount of goods/servicesneeded within a given time

frame to fulfill consumablerequirements like laboratorychemicals, foods e.t.c. Alarger institution/school mayrequire large quantities ofgoods/services to be procuredin a given time interval.While smallerschools/institutions may notrequire large quantities to beprocured in order to maintainthe learning process.

The third is Perishability,which refers to how long ittakes before goods expire, sothat it cannot be used.Perishability plays a majorrole in procurement strategiesbecause it determines theamount of goods that can bepurchased in advance. Somegoods used as foods are ofrelatively of highperishability hence aresupplied only at the time ofneed. Fourth is a Budget constraintwhich refers to the limitedbudgets that procurementcommittee’s face. There may behigh budget constraint whereprocurement committee is facedwith limited budget for acertain time period. In thiscase, institutions/schools areto be involved in fewerforward buys due to high

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execution costs as they areexpensive to execute in theshort run because thisschool/institution delay tosettle the payments for thegood/service (Kingsman 1985). Lastly is the Seasonality,which is the differencebetween price highs and lowsacross seasons historically.For example, for most goodsused in institutions e.g.food, the lowest price seasonof the year is duringharvesting when supply is atits highest while forlaboratory chemicals andbooks, prices are highest atthe beginning of the year whenschool open. A high degree ofseasonality means that thereis very strong and predictablepattern for prices ofgoods/services. Most of thegoods/services are highlyseasonal due to the growingpatterns on the supply side.

2.2.3 Impact of procurementstrategies on prices,settlement time and customersatisfaction.

Institutions with goodprocurement strategies canbenefit a lot during theirpurchasing processes. Thesebenefits may include: First,lowered overall cost where theInstitutions that have initiated

procurement strategies, theoverall cost to procurematerials and services is muchlower. Such institutions knowwhat to purchase, when topurchase it and where topurchase it from i.e. whichsupplier will offer the item atthe lowest affordable cost.Second is faster response fromsuppliers, which, in additionto lower procurement costs,institutions that haveprocurement strategies havesuppliers who are moreefficient and effective intheir supplies. This in turnreduces the supplier leadtimes risks of stock outs arealso reduced. The differencein supplier lead time could berelated to the closer supplierrelationships possessed byinstitutions with procurementstrategy programs.Institutions can use thevisibility provided byprocuring team to weed outextraneous or underperformingsuppliers. This would leave aninstitution with fewersuppliers that it can workwith to establish moreefficient procurementprocesses.

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CHAPTER THREE: RESEARCHMETHODOLOGY

3.1 Research Design3.1.1 Study DesignThe research was a surveydesign in which the existingprocurement strategies wereconsidered. In the study, bothprimary and secondary datawere required. Primary datawas obtained throughadministration ofquestionnaires to respondents.The respondents included Headteachers of public secondaryschools and their Deputies,school clerks/bursars andother members of the tenderingcommittees. Secondary data wasobtained from available

procurement records in theschools but the records fromthe district education’soffice were not available forscrutiny.

3.1.2 Study AreaThe study was conducted inNdhiwa district, located inNyanza Province, Kenya. Thedistrict was curved from themother Homa Bay in theSouthern Nyanza, Homa BayCounty. The district consistsof six divisions namely: Pala,Riana, Kobama, Ndhiwa,Nyarongi and Mirogi. Currentlythe school has 35 publicsecondary schools.

3.1.3 Study Population.The study was conducted inlocal public county anddistrict secondary schoolswithin Ndhiwa district. Inthese schools, the researcherinterviewed the schooladministrations and otherstaff members of theprocurement/tenderingcommittees.

3.1.4 Sample Size and SamplingTechniqueBecause the district has 32registered public secondaryschools in total, of whichonly four are county schools,all of them formed the sample

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of study. In each school, therespondents were divided intotwo strata namely: theadministration which consistedof the school heads, theirdeputies and the clerk/bursar;and the relevant staff membersnot in the administrativepositions. A sample wasselected from the entirepopulation using stratifiedrandom sampling technique inorder to classify the entirepopulation of 51 schooladministration officers and340 staff members. The arrivalat the sample size was basedon 95% level of confidence anda margin of error of ±5% usingthe formula suggested byKothari C.R (2005) as

n=Z2.p.q.N

e2 (N−1)+Z2.p.q

Where e= Margin of error,Z= standard variant at a

given confidence level undernormal curve,

p= sample population andq= (1-p).

This formula was applied to afinite population, N=391, andthe sample size n=241, whichis also indicated in the tablebelow was arrived at.

Administration staffpopulation,

n1=(1.96)2 (0.5 ) (1−0.5 )(51)

(0.05)2 (51−1 )+(1.96 )2 (0.5) (0.5)= 45

Non Administratorspopulation,

n2=(1.96)2 (0.5 ) (1−0.5 )(340)

(0.05)2 (340−1)+ (1.96)2 (0.5 )(0.5)= 196

Table 1: Summary of SamplePopulation

TotalNo

Sample

Percentage

Administrators

51 45 88.2%

NonAdministrators

340 196 57.6%

TOTAL 391 241 61.6%

Thus for the purpose of thisstudy, a sample size of 241members of staff in all thepublic secondary schools inthe district was used (KothariC.R 2005).

3.2 Data Collection Methods

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3.2.1 Primary DataPrimary data was collectedusing structured and semi-structured questionnaires.

3.2.2 Secondary DataSecondary data was to begenerated from availablerecords in the sampled schoolsbut records from the districteducation’s office were notobtained as they were missingor unavailable for scrutiny.

3.3 Data AnalysisThe collected data wasanalyzed using descriptivestatistics which included:mean and mode.

3.4 Data PresentationThe data collected wasclassified and presented byfrequency distribution tables,charts and graphs.

3.5 Validation of DataCollection InstrumentThe researcher carried areconnaissance survey aidingin improvement ofquestionnaire, checkingambiguity of the questions andgave professionals thequestionnaires to read. Afterwhich they recommended thequestionnaires as fit for thestudy.

3.6 Reliability of DataCollection InstrumentThe research tested for thereliability of the datacollection instrument usingthe internal consistencytechnique in which the scoresobtained from the subjectswere computed to determine thecorrelation among the items.

CHAPTER FOUR: DATA ANALYSIS,FINDINGS AND DISCUSSION

4.1 Results

The study had targeted 241public secondary schools’staff, which included the headteachers, Deputy Headteachers, teachers, bursarsand clerks. Of the two hundredand forty one questionnairesgiven out to respondents, twohundred and thirty six wererealized. This gives aresponse rate of 97.9%. Thiscould be attributed to thecooperation between theresearcher and therespondents, simplifiedquestions and the quest toknow more about procurement ingeneral.

4.1.1 Type of institution

The institutions which wereunder study included mixedday, mixed day and boarding,girls’ and boys’. Respondents

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on the type of institutiongave the following findings;mixed day at 14.0%, mixed dayand boarding at 72.5%, Girlsat 8.5% and Boys at 5.1%. Thisis illustrated in the table4.1 and figure 4.1 below.Schools that were mostlysurveyed were the mixed dayand boarding having 71% andthe least surveyed schoolswere boys’ schools which wasonly 5%.

4.1.2 Position in SchoolLooking at the positions therespondents were holding inthe school, there were 20 Headteachers, 16 Deputy Headteachers, 191 teachers and 9Bursars or Clerks. Thistranslates to 8.3%, 6.6%,79.3%, and 3.75% respectively.This shows that the majorityof the respondents wereregular teachers, most of whoare presumed to be members ofthe tendering committee. 4.1.3 Type of goods purchasedThe results of the survey showthat schools dwell more onconsumable commodities. Thesewere at 46.1% showing thatregular while those that dwellin non-consumable commoditieswere 41.5%. Only 10.4% of theschools dwell in consumableand non- consumablecommodities.

4.1.4 Frequency of purchasinggoodsMajority of the schools prefermaking their purchasesannually as the resultscommands this at 61%. Thosemaking purchase monthly were7.5%, purchasing weekly were16.2%, while those makingdaily purchase were only 2.9%.Schools in the respondentswere not aware of how oftenpurchases are made stood at10.4%. This was an indicationthat yearly purchases werepreferred as this could bereducing order costs andimproving in efficiency of theschool operations. 4.1.5 School has regularcontracted suppliersIn most schools there were noregular contracted suppliers.This was justified by 69.3% ofthe schools having nocontracted suppliersindicating that these schoolsmade purchases from anysupplier who could provide forthe goods. Only 28.6% agreeingthat they have regularcontracted suppliers, whoprovided for their needs.

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4.1.6 Members sitting intendering committeeA majority of schoolscommanding 54.4% have sixmembers sitting in theprocurement committee, 19.9%have five members, 10.8% haveseven members, and 4.1% havefour members, while 8.7% havemore than seven memberssitting in the procurementcommittee.

4.1.7 Procurement methods usedby tendering committeeMost of the purchases are donestrictly following the laiddown procurement procedures.This is done in 49% of theschools surveyed, 29.5% of theschools use open procedure,15.4 uses Negotiatedprocedure, while 4.1% of theschools use other methods.

4.2 Status of different procurement strategies in public secondary schools.Data for this research wascollected based on: existenceof procurement committees, useof existing strategies,application of otherstrategies and presence ofgoverning rules. Of the dulycompleted questionnairesrealized, the results scored

weighted means as per table4.10 in appendix II. Thisgives an indication mostschools have strategies andgoverning rules in placecompared to using otherstrategies not in place.However, most schools tend notto have well establishedtendering committees.

4.3 Factors that influence prices, settlement time and customer satisfaction in public procurementThe other objective of thisstudy was to identify factorsthat influence the choice ofprocurement process in publicsecondary schools and whetherthe factors had had anysignificant effect on theprices, settlement time andcustomer satisfaction. Datafor this objective was basedon three factors namely:political, social and legal.The opinions of therespondents concerning thefactors having any influenceon the prices, settlement timeand customer satisfaction weresought. The results providesan indication that the threefactors were almost having thesame influence with politicalhaving the highest influencewith weighted mean of 2.3517,followed closely with social

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at weighted mean of 2.2712 andlegal at weighted mean of2.2331,as indicated in table4.11 of the appendix. This mayimply that the procuremententities in most publicschools in the district arenot autonomous as theirprocesses are still influencedby external factors.

4.4 Effect of procurementstrategies on prices,settlement time and customersatisfactionOn the last objective, theresearch sought to determinethe effect procurementstrategies on the outcomes ofthe procurement process basedon prices, settlement time andcustomer satisfaction. Datafor this objective was alsobased on three factors namely:strategies suitable forprocurement; strategieseffective under circumstancesthey were applied; andconformity of outcomes to theitem specification. From theresults in Table 4.12 ofappendix II, it was observedthat procurement strategiesbecoming effective in thereduction of the spent interms of costs, lowerssuppliers’ lead times andsatisfaction of the partiesinvolved. Strategy becoming

effective under thecircumstances applied had thehighest weighted mean of3.1102, the used strategybeing most suitable had aweighted mean of 2.2288,outcome conformity to itemspecification showed aweighted mean of 2.3347. Thismay imply that most schools doprefer to applying laid downstrategies in theirprocurement and may alsochange strategy whencircumstances change. Thiscould be the reason forachievement of theirobjectives.

5.0: CONCLUSION ANDRECOMMENDATIONS

5.1 ConclusionThis study was necessarybecause of the fact thatsuppliers and governmentinstitutions have not achievedthe desired level ofprocurement practices. Thoughthe current legality providesfor decentralization ofprocurement processes, most

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local institutions are yet todecentralize their systemsfully, with only a few leavingthe process to their tenderingcommittees. Thedecentralization of theprocurement processes depictsa milestone in the reformprocess towards achievingefficient and effectiveprocurement system. However,the application of theprocurement rules in thepublic institutions need tothorough to enable them haveeffective procurementprocesses. Formation ofindependent procuring entitiessuch as tendering committeesis a necessity towardimproving procurement systemsin public secondary schools.

It is also very clear that theprocurement function needs tobe developed further and moreeffort put into definingstrategies and making opentendering the main method ofprocurement. This was evidentby procurement committeemembers having the knowledgeof procurement rules governingthe procurement process, butintentionally failing to usethem.

From the results, it is clearthat there are still manychallenges that face

stakeholders in theapplication on the procurementframework into practice andcomplying with the newprovisions and standards asper the law stipulates. As aresult efficient publicprocurement in publicsecondary schools is far frombeing achieved.

The study has also revealedthat many challenges face thestakeholders when applying theframework of procurementpractice in the publicsecondary schools and as aresult of this, the challengesof public financial managementthrough efficient procurementin secondary schools are farfrom being achieved.

5.2 RecommendationsFollowing the conclusionsabove, the study makes thefollowing recommendations.First there is need toidentify the underlyingchallenges with an aim ofreviewing the procurementprocedure. This could be doneby establishing independenttendering committees in publicinstitutions to execute theirduties with minimalmanipulation. Secondly thereis need to train all personswho are involved inprocurement like the tendering

23

committees and the suppliersto make them knowledgeable onmatters of procurement. Thiswill reduce malpractices inpublic institutions. Thirdlythere should be a free accessto procurement information bythe public as this willimprove procurement process inpublic institutions. Thingslike reasons for awarding orrejecting tenders should beput public. Lastly headteachers, Deputy Headteachers, teachers,bursars/clerks, committeemembers and suppliers found tobe flouting the laid downprocurement procedure shouldbe prosecuted.

5.3 Suggestions for FurtherResearchThis study suggests that afurther research be conductedon:

i. Challenges facingeffective implementationof Public procurementRegulations of 2006.

ii. The impact of the PublicProcurement Regulationsof 2006 on micro, smalland medium enterprises.

REFERENCES

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Duncan, L.(2004): ProcurementStrategy; University Court, May.

Government of Kenya (2005):Public Procurement and Disposal Act

Government of Kenya(2009):Public Procurement and DisposalGeneral Manual, First Edition; March.

Government of Kenya(2005):Kenya Public Procurement andDisposal Act 2005

Gravetter F. J & William, L B.(2004): Statistics for BehavioralSciences. 6th ed. Belmount:Wadsworth / Thomson Learning.

Hayenga, Marvin L.(1978):Pricing problems in the food industry(with emphasis on thin markets): Acompendium of papers presentedat the Symposium on PricingProblems in the Food Industry(with Emphasis on ThinMarkets) Washington, D.C.,March 2-3.

Horst, P.: Matrix Algebra for SocialScientists. New York: Holt,Rinehart, and Winston, 1963.

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Kenyanya, P. et al,(2010): TheInfluence of Public ProcurementRegulations on Procurement Practicesamong Secondary Schools in MosochoDivision of Kisii County, Kenya

Kraig Jones (2003): AnEvaluation of Food CommodityProcurement Strategies: insightfromCase Studies, Michigan StateUniversity.

Lucy, T: Quantitative Techniques,6th Edn, BookPower

McDaniel C. and Gates R.:Marketing Essentials, 5th edn,JohnWiley & Sons Inc.

Migai Akech(2005): RepublicOf Kenya, Economic RecoveryStrategy for Wealth and EmploymentCreation 2003-2004 (2003).

Mugenda, O. M. and Mugenda, A.G.(2003): Research Methods:Quantitave & Qualitative Approaches;ACTS Press, Nairobi.

Odhiambo W. and Kamau P.(2003): Public Procurement: Lessons

From Kenya, Uganda and Tanzania:OECD Development Centre,Working Paper No.208

Ramboll management A/S,(2007); Assessment of theProcurement System in Kenya; PublicProcurement OversightAuthority, Final edn, October.

Rummel, R. J. (1970): AppliedFactor Analysis. Evanston, III:Northwestern University Press.

Sirkin, M. (1995): Statistics forthe Social Sciences. Thousand Oaks,CA: Sage.

Sue, A. et al; (2000):Regulating Public Procurement:National and International Perspectives,Kluwer Law International, TheNetherlands.

Sue, Arrowsmith et al: RegulatingPublic Procurement: National andInternational Perspectives SustainableProject Procurement Plan, Universityof SouthamptonUniversity of Southampton:Sustainable Procurement Project Plan

APPENDIX: Analysis of objectives by weighted mean:

Weighted Mean = w𝚺 ifi/ f𝚺 i Where fi = frequency wi = weightTable 4.10: Analysis of the status of different procurementstrategies used in public secondary school

25

Stronglyagree

1

Agree

2

Disagree

3

Stronglydisagree

4

𝚺fi 𝚺wifi 𝚺wifi /𝚺fi

Existence of procurement committee

185 25 14 12 236 325 1.3771

School uses strategies

27 79 30 100 236 665 2.8178

Schools applies other strategies

160 46 2 28 236 366 1.5508

School has governing rules on procurement

10 171 28 27 236 544 2.3051

Source: Field findings (2012)

Verymuch1

Much2

Little3

Verylittle

4

Not atall5

𝚺fi 𝚺wifi 𝚺wifi /𝚺fi

Politicalfactors

49 71 100 16 0 236 555 2.3517

26

Socialfactors

59 83 67 26 2 236 536 2.2712

Legalfactors

117 20 28 69 2 236 527 2.2331

Table 4.11: Analysis of factors that influence prices, settlementtime and consumer satisfaction

Source: Field findings (2012)

Table 4.12: Analysis of the effect of procurement strategies onprices, settlement time and customer satisfaction

Not atall

1

Rarely

2

Sometimes

3

Often

4

Veryoften

5

𝚺fi 𝚺wifi 𝚺wifi / 𝚺fi

Strategiessuitableforprocuringitems

53 102 55 26 0 236 526 2.2288

Strategieseffective

0 27 156 53 0 236 734 3.1102

Outcomesconform toitemspecification

51 106 28 51 0 236 551 2.3347

Source: Field findings (2012

27