International Journal of Civil and Structural Engineering Research ISSN 2348-7607 (Online) Vol. 9, Issue 2, pp: (1-15), Month: October 2021 - March 2022, Available at: www.researchpublish.com
CONSIDERING CENTRALIZED PURCHASING SYSTEMS AS A PREDICTOR FOR PERFORMANCE OF CONSTRUCTION SECTOR IN RWANDA USING A CASE OF REAL CONTRACTORS LTD Rugamba Evariste1, Rugira Filipo2 Author email id: erugamba@real.rw (+250 788 533339) and frugira@uok.ac.rw (+250784559788)
Abstract: Procurement is a key activity in organization and major activity in the economies both developing and developed countries. Their management has contributed to the success of projects and overall performance of organizations. However, there are several challenges in the implementation of this activity and for that reason different strategies developed and deployed. Procurement is characterized by inventory management, volume ordering and adherence to best practices that safeguard the organization from losses. These activities vary in their outcomes depending on what procurement strategy has been chosen. This study sought to investigate the effect of centralized procurement systems on performance of construction companies in Rwanda. with specific reference to Real Contractors Ltd. The study used a sample of 55 participants including staff of financial, procurement and marketing departments. The study adopted the correlational research design. A questionnaire with open-ended questions was used to collect data. Data was analyzed using descriptive statistics (frequencies, mean and standard deviation) and inferential statistics (correlational and regression analyses) along with the use of SPSS which was used in all calculations and creation of tables. The findings revealed that Real Contractors Ltd. has been able to obtain higher organization performance as a result of centralized purchasing timeliness, quality of goods and services, and customer satisfaction the study also found that inventory management is essential in ensuring that adequate supplies are within the firm’s storage to support continuous production process. The study recommends that the firm should enhance the bulk ordering process by undertaking a value chain analysis which will help the firm in selecting suppliers who will foster the firm savings and enhance its economies of scale. Keywords: Centralized Procurement, Organization performance and Inventory Management.
1. INTRODUCTION The process by which global business partners connect with one another for faster and efficient operations in supply chain has been transformed through the proliferation of Globalization (Nagurney & Nagurney, 2010). Obiso (2011) argues that the unprecedented growth in business competition across different industries is as a result of globalization. The result has been the current adoption of sound procurement management practices that give an organization a competitive advantage (Msimangira & Tesha, 2009). Strategic purchasing process that climaxes into an interconnection between the firm suppliers and the organization strategic objectives have found a place in organizations (Hutt & Speh, 2012). These Procurement strategies are enabling organizations‟ success and with Technological development in the field of procurement more opportunities to achieve more efficient and effective procurement currently made possible.There is now an emphasis on Cost driven strategies with the aim of controlling and managing profitability and other non-financial performance of the organization.
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