Effect of Electronic Procurement Processes on the Performance of Non-Governmental Organizations in Kisumu Central: A Case of Life for Children Welfare Organization

Abstract

Electronic procurement concept is a recent and integral focal point among the procurement practitioners. It enhances core procurement activities such as, e-ordering, e-buying, etendering, e-sourcing, and e-payment. Studies on the e-procurement have been done in different countries, with assertion that organizations adopting it are likely to be more successful. This has not been explored for Non-Governmental organizations. According to the NGO's economic survey of (2013) Kenya has more than 4,500 NGO's of which 77 have registered their operations in Kisumu central. While Survey of 2012 indicates that there are more than 15,000 households that directly benefit from the NGO's in Kisurnu Central. However, there have been a lot of challenges faced by the NGOs, such as misappropriation of funds and this has seen some donors withhold funds due to accountability issues. One such area where accountability issues arise is the procurement of services. Though many organizations opt for electronic procurement as a solution, no known study has been conducted to examine if this is the case. The purpose of the study was therefore to examine the effect of electronic procurement processes on the performance of non-governmental organizations. The objectives of the study were to establish the contributions of electronic procurement towards efficient performance of procurement departments ofNGO's, determine the causes of non-adaptation of electronic procurement in the NGO's, determine the relationship between the implementation of the electronic procurement processes on the performance of NGO's. The design was both descriptive and correlation. The target population was 88 employees. A sample size of 66 respondents was randomly selected. Questionnaire was used to obtain primary data while secondary data was sourced from sales force reports. The study was guided by a conceptual framework where the dependent variable was the performance of NGO's and the independent variable was electronic procurement processes. Descriptive results indicated that e-procurement contributed to cost savings (33%), efficiency (27.3%), transparency (24.2%) and error free transactions (15.2%). Moreover, it was established that insufficient donor funding (33.3%), mismanagement of funds (31.8%), organization policy (13.6%) and lack of skilled personnel (21.2%) were found to cause non adoption of e-procurement at the respective levels. Inferential results showed that there isa positive and significant correlation between e- sourcing and children enrolment of 0.38 (p<O.OI), e ordering and funds received at 0.707 (p<O.OI). On the other hand, the correlation between e- ordering, e-tendering and e-buying with children enrolment are positive but insignificant correlation coefficients of 0.45 (p>O.OI), 0.016 (p>O.OI), and O.l45(p>0.01) respectively. The study concluded that e-procurement contributes to higher efficiencies and that there exist a correlation between e- procurement processes and the performance of nongovernmental organizations. The study recommends increased investment on e-procurement as it influences the organization performance.