Role of strategic purchasing and supply management practices in firm performance: A lesson from public bus transport firms in Kenya

Charles O. Ondoro¹*, Patrick B. Ojera¹ and Moses N. Oginda²

¹Department of Marketing and Management, School of Business and Economics, Maseno University, Private Bag, Maseno, Kenya

²Department of Management Sciences, School of Business and Economics, Maseno University, Private Bag, Maseno, Kenya

*Corresponding Author E-mail: charlesondoro@yahoo.com

Accepted 20 August, 2013

Abstract

In a census survey of 183 senior executives of public bus transport firms in Nairobi, Kenya, effect of strategic purchasing and supply management practices on performance was sought. A cross sectional survey design was adopted. Secondary and primary data were used. Descriptive statistics, Pearson’s correlation, multiple regressions were used to analyze data. Content analysis was performed on interview schedule results and other qualitative data. The results indicated that Strategic purchasing and supply management practices were high among the firms and positively and significantly predict public bus transport firm performance. The adjusted R² value was found to be 0.398 implying that strategic purchasing and supply management practices accounted for 39.8% of the variance in the public bus transport firm performance. The results show that public bus transport firms practicing strategic purchasing and supply management have improved performance. This is important to the practitioners in the industry and other industries and the government as it implies that more emphasis should be made on this area. The regression results indicate a high error term that should be investigated further.

Keywords: Supplier Integration, Supplier Socialization, Supply Base Flexibility, Performance, Public Bus Transport Firm.