CONTRIBUTION OF SUPPLY CHAIN MANAGEMENT PRACTICES ON PERFORMANCE OF CEMENT MANUFACTURING COMPANIES IN KENYA

Naomi Mwongeli Mbithe, Dr. Nelson Lambaino

Abstract


With the growth of cement production and consumption, competition is more intensified, eating into the industry’s margins. The industry’s net profit margin averaged 10 per cent in 2015 down from 15 percent in 2011. The general objective of the study was to establish the contribution of supply chain management practices on performance of cement manufacturing companies in Kenya. In order to fulfill the purpose of the study, the specific objective of the study were; To establish the contribution of Information, Communication and Technology on performance of cement manufacturing companies in Kenya and to examine the contribution of distribution management on performance of cement manufacturing companies in Kenya. The study utilized a descriptive survey research design. The population of this study comprised senior managers who include heads of procurement related departments and sections whose portfolio hold a crucial role in developing supply chain management in the targeted companies. At least 1040 respondents were targeted to fill the questionnaires. The study employed Yamane’s formula (1973) to determine the sample size. Simple random sampling was adopted to select 289 respondents. The questionnaire was used to collect primary data. Descriptive, correlation and regression analysis were used in the analysis of data. The study concluded that ICT and distribution management has a positive and significant effect on performance of cement manufacturing companies in Kenya. The study recommends that the management of cement manufacturing companies in Kenya should ensure adoption of electronic order, electronic requisition and order receipt, payment& dispatch to improve performance. In addition, the management should ensure adoption of E-Procurement, Electronic Data Interchange (EDI) and Enterprise Resource Planning to improve performance.

 

Keywords; Information Communication and Technology, Distribution Management, Performance


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