An analysis of delays in procurement of goods and services in KenGen
Theuri, Waitara John
MetadataShow full item record
This study identifies the effects of delayed in the procurement of goods, works and services in the public sector. Delays in the supply of goods, services and works affect almost every sphere of human activity directly or indirectly. As customers, we tend to notice procurement only when there are problems. Delayed deliveries although timely deliveries were promised; shipment of medical supplies to a disaster are could not reach in time of need because the week supply chain; an industry close down due to delayed supplies of parts and equipment essential to operate a Just-In- Time manufacturing system; an order is delivered to the wrong customer and takes several days for the mistake to be corrected. J.R. Stock, et el 92001) just to name a few examples. " We often do not think of the role that supply chain has in our lives until something goes wrong" Interviews were conducted and questionnaires sent to suppliers, buyers and users departments in KenGen. Data were analyzed and summarized using descriptive statistics. The study establishes that for plant engineers, the activity that takes most time is writing specifications and the average proportion of time spent was 25%. This is allowed by putting up tender document with the average proportion of time spent on it being 22%. Other activities like, evaluating tenders use an average 19%, identification of need-procurement planning use an average of 17%, and writing justification paper use and an average of 16% of the their time. Minimum proportion of time spent on each activity was 5% across all activities. Time spent by buyers was allocated across various activities. The activities got fairly balanced time allocation. Putting up a tender document (17%), evaluating tenders (13%) and collection of goods 11% to the larger proportions of buyers' time. The portions of delay contributed by each variable in the supply process were critically examined. Variables leading to delays in delivery of goods were lead by long procurement process, supplier bill settlement, supplier inconsistencies, and slow collection from supplier and user rejection. Other contributors to delays rather than the user, buyer and supplier these were, external delays like government inspections, custom formalities, and system failure among others. Recommendations derived mainly focused on timely placement of Purchase Order (LPO) and giving clear specifications. Others were writing alternative specifications, allowing enough time to quote, advanced planning in procurement, improved payment durations, providing sample items and proper evaluation of quotations. The tender documents need to be very specific on how the quotes will be evaluated in order to optimize on the quality and price combination. The company needs to lobby with the relevant government bodies to reduce the red tape on specific products used in electricity generation and probably to zero rate any duties or taxes as to reduce ordering time and boost efficiency. The sale of shares to the public will go a long way in improving the private sector orientation and dilute government involvement in the company. The restriction against use of brand names in specifications is also limiting and hence there should be also a provision for getting some products directly from the original manufacturer.