CONTRACT MANAGEMENT ON PROCUREMENT

PERFORMANCE IN PUBLIC UNIVERSITIES IN

KENYA

MATHIAS NZOMO MUINDE

DOCTOR OF PHILOSOPHY

(Supply Chain Management)

JOMO KENYATTA UNIVERSITY

OF

AGRICULTURE AND TECHNOLOGY

2022
 Contract Management on Procurement Performance in Public
Universities in Kenya

Mathias Nzomo Muinde

A Thesis Submitted in Partial Fulfilment of the Requirements for

the Degree of Doctor of Philosophy in Supply Chain Management of
the Jomo Kenyatta University of Agriculture and Technology

2022
 DECLARATION

This thesis is my original work and has not been presented for a degree in any other
University.

Signature ……………………….……………. Date ……………………………….

Mathias Nzomo Muinde

This thesis is submitted for examination with our approval as the University
Supervisors.

Signature ……………………….……………. Date ……………………………….

Prof. Elegwa Mukulu, PhD

JKUAT, Kenya

Signature ……………………….……………. Date ……………………………….

Dr. Sammy Odari, PhD

JKUAT, Kenya

ii
 DEDICATION

This thesis is dedicated to my family for the material and moral support. Also, I
would like to dedicate this research study to my brothers and sisters for their
encouragement and immense valuable concern. Your definitive support and resolute
zeal for me to succeed always remained discernible in the course of compiling this
work.

iii
 ACKNOWLEDGEMENT

I wish to express my sincere appreciations for the invaluable guidance and tolerance
to my university supervisors, Prof. Elegwa Mukulu and Dr. Sammy Odari for their
intellectual insights and suggestions that helped me to clarify many of the ideas
expressed in this study. The considerable ingenuity of my supervisors infused new
thoughts and this contributed to the hallmark of this research study.

I would like also to extend my profound gratitude to Jomo Kenyatta University of

Agriculture and Technology (JKUAT) for giving me an opportunity to undertake a
Ph.D. in Supply Chain Management. By and large JKUAT has remained a pinnacle
of excellence and knowledge over the years and the realization of this unparalleled
trait ushered a renewed impetus during the time I was undertaking the research.

Special thanks to Prof. Henry Bwisa, Prof. Willy Muturi, Prof. Gregory Namusonge,
Dr. Alice Simiyu, Dr. Mary Omondi and Dr. Rukia Atikiya for their scholarly advice
in perfection of this thesis. Also, I feel highly indebted to my colleagues in the Ph.D.
Supply Chain Management class 2013/2014 for their immense support.

Staff of Public Procurement Regulatory Authority (PPRA) deserves more accolades

for provision of indispensable information in line with the study. The unequivocal
answers you offered culminated to completion of this research study. Lastly, for
those not mentioned but played a key role behind the scene in making this thesis a
success, thank you so much. God bless you.

iv
 TABLE OF CONTENTS

DECLARATION ........................................................................................................ ii

DEDICATION ........................................................................................................... iii

ACKNOWLEDGEMENT ........................................................................................ iv

TABLE OF CONTENTS ........................................................................................... v

LIST OF TABLES ................................................................................................... xii

LIST OF FIGURES ................................................................................................ xiv

LIST OF APPENDICES ......................................................................................... xv

ACRONYMS AND ABBREVIATIONS ............................................................... xvi

DEFINITION OF TERMS ..................................................................................... xix

ABSTRACT ............................................................................................................. xxi

CHAPTER ONE ........................................................................................................ 1

INTRODUCTION ...................................................................................................... 1

1.1 Background of the Study.................................................................................... 1

1.1.1 Global Perspective of Contract Management ............................................. 9

1.1.2 Regional Perspective of Contract Management ........................................ 11

1.1.3 State of Contract Management in Kenya .................................................. 13

1.1.3 Procurement Performance in Public Universities in Kenya ...................... 16

1.2 Statement of the Problem ................................................................................. 21

1.3 Objectives of the Study .................................................................................... 23

1.3.1 General Objective...................................................................................... 23

1.3.2 Specific Objectives.................................................................................... 23

v
 1.4 Research Hypotheses ....................................................................................... 24

1.5 Justification of the Study.................................................................................. 24

1.5.1 Public Universities .................................................................................... 24

1.5.2 Regulators ................................................................................................. 25

1.5.3 Academicians ............................................................................................ 25

1.6 Scope of the Study ........................................................................................... 25

1.7. Limitations of the Study .................................................................................. 26

CHAPTER TWO ..................................................................................................... 28

LITERATURE REVIEW........................................................................................ 28

2.1 Introduction ...................................................................................................... 28

2.2 Theoretical Review .......................................................................................... 28

2.2.1 Resource Dependence Theory .................................................................. 28

2.2.2 Theory of Constraints................................................................................ 30

2.2.3 Deontological Theory................................................................................ 32

2.2.4 Records Continuum Model ....................................................................... 33

2.2.5 Legal Theory ............................................................................................. 36

2.2.6 Supply Chain Operations Reference Model .............................................. 38

2.2.7 Relational Contract Theory ....................................................................... 41

2.3 Conceptual Framework .................................................................................... 42

2.3.1 Buyer-Supplier Collaboration ................................................................... 44

2.3.2 Procurement Risk Management ................................................................ 46

2.3.3 Transparency and Accountability ............................................................. 48

2.3.4 Contract Records Management ................................................................. 50

vi
 2.3.5 Legal Compliance ..................................................................................... 53

2.3.6 Procurement Performance ......................................................................... 55

2.4 Empirical Review ............................................................................................. 57

2.4.1 Buyer Supplier Collaboration ................................................................... 57

2.4.2 Procurement Risk Management ................................................................ 59

2.4.3 Transparency and Accountability ............................................................. 60

2.4.4 Contract Records Management ................................................................. 61

2.4.5 Legal Compliance ..................................................................................... 62

2.4.6 Procurement Performance ......................................................................... 63

2.5 Critique of Existing Literature Relevant to the Study ...................................... 64

2.6 Research Gaps .................................................................................................. 66

2.7 Summary .......................................................................................................... 68

CHAPTER THREE ................................................................................................. 69

RESEARCH METHODOLOGY ........................................................................... 69

3.1 Introduction ...................................................................................................... 69

3.2 Research Design ............................................................................................... 69

3.2.1 Research Philosophy ................................................................................. 70

3.3 Target Population ............................................................................................. 71

3.4 Sampling Frame ............................................................................................... 72

3.5 Census .............................................................................................................. 73

3.6 Research Instruments ....................................................................................... 74

3.7 Data Collection Procedure ............................................................................... 75

3.8 Pilot Test .......................................................................................................... 76

vii
 3.8.1 Validity of the Research Instruments ........................................................ 76

3.8.2 Reliability of the Research Instruments .................................................... 77

3.9 Data Processing and Analysis .......................................................................... 78

3.9.1 Diagnostic Tests ........................................................................................ 80

3.9.2 Regression Model ..................................................................................... 83

3.9.3 Moderating Effect Model .......................................................................... 85

3.9.4 Operationalization of Variables ................................................................ 86

CHAPTER FOUR .................................................................................................... 87

RESEARCH FINDINGS AND DISCUSSION ...................................................... 87

4.1. Introduction ..................................................................................................... 87

4.2 Pilot Study Results ........................................................................................... 87

4.2.1 Validity of the Research Instruments ........................................................ 87

4.2.2 Reliability of the Research Instruments .................................................... 88

4.3 Response Rate .................................................................................................. 89

4.4 Demographics and General Information .......................................................... 90

4.4.1 Respondents Designation .......................................................................... 90

4.4.2 Highest Academic Qualification ............................................................... 91

4.4.3 Respondents Membership to Professional Bodies .................................... 91

4.4.4 Participation in sensitization forums of Public Procurement and Asset

Disposal Act, 2015 .................................................................................... 92

4.4.5 Knowledge on Contract Management in Kenyan Context ....................... 93

4.4.6 Years of Experience in Contractual Activities in Procurement Process ... 94

4.5 Contract Management on Procurement Performance ...................................... 95

viii
 4.5.1 Influence of Contract Management on Procurement Performance ........... 96

4.5.2 Key Considerations when Constituting an Award of Contract to Suppliers

................................................................................................................... 97

4.5.3 Frequency of Contract Variations during Contract Implementation......... 98

4.5.4 Causes of Contract Variations in Contract Implementation ..................... 99

4.5.5 Special Committee for Handling Complex and Specialized Contracts .. 100

4.5.6 The Role of Special Committee that Handles Complex and Specialized
Contracts .................................................................................................. 101

4.5.7 Remedial Actions for Breach of Contract ............................................... 102

4.5.8 Rating of Suppliers Performance on Contract Administration ............... 103

4.6 Descriptive Analysis of the Study Variables ................................................. 104

4.6.1 Buyer Supplier Collaboration ................................................................. 106

4.6.2 Procurement Risk Management .............................................................. 107

4.6.3 Transparency and Accountability ........................................................... 109

4.6.4 Contract Records Management ............................................................... 111

4.6.5 Legal Compliance ................................................................................... 113

4.6.6 Procurement Performance ....................................................................... 115

4.7 Diagnostic Tests (Test of Multivariate Assumptions) ................................... 118

4.7.1 Linearity Test .......................................................................................... 118

4.7.2 Test of Normality .................................................................................... 120

4.7.3 Autocorrelation Test ............................................................................... 124

4.7.4 Homoscedasticity Test ............................................................................ 124

4.7.5 Test of Multicollinearity ......................................................................... 126

ix
 4.8 Inferential Statistics........................................................................................ 127

4.8.1 Correlation Analysis ............................................................................... 127

4.8.2 Regression Analysis ................................................................................ 129

4.8.3 Test for Moderating Effect of Legal Compliance ................................... 135

4.9 Hypothesis Testing ......................................................................................... 138

4.10 Optimal Model ............................................................................................. 140

CHAPTER FIVE .................................................................................................... 141

SUMMARY, CONCLUSIONS AND RECOMMENDATIONS ....................... 141

5.1.Introduction .................................................................................................... 141

5.2.Summary ........................................................................................................ 141

5.2.1 To find out the Influence of Buyer Supplier Collaboration on Procurement

Performance in Public Universities in Kenya ....................................... 143

5.2.2 To establish the Influence of Procurement Risk Management on

Procurement Performance in Public Universities in Kenya .................. 144

5.2.3 To determine the Influence of Transparency and Accountability on

Procurement Performance in Public Universities in Kenya .................. 144

5.2.4 To establish the Influence of Contract Records Management on

Procurement Performance in Public Universities in Kenya .................. 145

5.2.5 To examine the Moderating Influence of Legal Compliance on the

relationship between Contract Management and Procurement
Performance in Public Universities in Kenya ....................................... 146

5.3. Conclusions ................................................................................................... 146

5.3.1 Buyer Supplier Collaboration ................................................................. 147

5.3.2 Procurement Risk Management .............................................................. 147

5.3.3 Transparency and Accountability ........................................................... 147

x
 5.3.4 Contract Records Management ............................................................... 148

5.3.5 Legal Compliance ................................................................................... 148

5.3.5 Procurement Performance ....................................................................... 149

5.4. Recommendations ......................................................................................... 149

5.5. Areas for Further Research ........................................................................... 151

REFERENCES ....................................................................................................... 153

APPENDICES ........................................................................................................ 168

xi
 LIST OF TABLES

Table 3.1: Target Population ..................................................................................... 72

Table 3.2: Cronbach's Alpha Internal Consistency Levels ....................................... 78

Table 3.3: Operationalization of Variables ............................................................... 86

Table 4.1: Summary of Cronbach Alpha Reliability Coefficient.............................. 88

Table 4.2: Response Rate .......................................................................................... 89

Table 4.3: Respondents Designation ......................................................................... 90

Table 4.4: Highest Academic Qualifications ............................................................ 91

Table 4.5: Respondents Membership to Professional Bodies ................................... 92

Table 4.6: Participation in Sensitization Forums of PPADA, 2015 .......................... 93

Table 4.7: Respondents knowledge on Contract Management in Kenyan Context .. 93

Table 4.8: Years of Experience in Contractual Activities on Procurement Process . 95

Table 4.9: Influence of Contract Management on Procurement Performance .......... 96

Table 4.10: Key Considerations when constituting an award of Contract to Suppliers

.............................................................................................................. 97

Table 4.11: Frequency of Contract Variations during Contract Implementation ..... 98

Table 4.12: Causes of Contract Variations in Contract Implementation .................. 99

Table 4.13: Special Committee that Handles Complex and Specialized Contracts 100

Table 4.14: Role of Special Committee that Handles Complex and Specialized
Contracts ............................................................................................. 101

Table 4.15: Remedial Actions for Breach of Contract ............................................ 102

Table 4.16: Rating of Suppliers Performance on Contract Administration ............ 103

Table 4.17: Descriptive Statistics ............................................................................ 105

xii
Table 4.18: Opinion of the respondents on the various aspects of Buyer-Supplier
Collaboration in relation to Procurement Performance ...................... 106

Table 4.19: Opinion of the respondents on the various aspects of Procurement Risk
Management in relation to Procurement Performance ....................... 108

Table 4.20: Opinion of the respondents on the various aspects of Transparency and
Accountability in relation to Procurement Performance .................... 110

Table 4.21: Opinion of the respondents on the various aspects of Contract Records
Management in relation to Procurement Performance ....................... 112

Table 4.22: Opinion of the respondents on the various aspects of Legal Compliance
in relation to Procurement Performance ............................................. 114

Table 4.23: Responses on the various aspects of Procurement Performance ......... 116

Table 4.24: Model Summary Statistics and Coefficients ........................................ 119

Table 4.25: Test of Normality ................................................................................. 120

Table 4.26: Autocorrelation Test ............................................................................ 124

Table 4.27: Test of Homogeneity of Variance ........................................................ 125

Table 4.28: Test of Multicollinearity ...................................................................... 126

Table 4.29: Pearson Product Moment Correlation .................................................. 128

Table 4.30: Overall Model Summary...................................................................... 130

Table 4.31: Analysis of Variance ............................................................................ 131

Table 4.32: Regression Analysis ............................................................................. 132

Table 4.33: Summary of Regression Output ........................................................... 136

xiii
 LIST OF FIGURES

Figure 2.1: Records Continuum Model..................................................................... 35

Figure 2.2: Supply Chain Operations Reference Model ........................................... 41

Figure 2.3: Conceptual Framework .......................................................................... 43

Figure: 4.1: Normal Q-Q Plot of Buyer Supplier Collaboration ............................ 121

Figure 4.2: Normal Q-Q Plot of Procurement Risk Management .......................... 122

Figure 4.3: Normal Q-Q Plot of Transparency and Accountability ........................ 123

Figure 4.4: Normal Q-Q Plot of Contract Records Management ........................... 123

Figure 4.5: Optimal Model...................................................................................... 140

xiv
 LIST OF APPENDICES

Appendix I: Letter of Authorization ....................................................................... 168

Appendix II: Letter of Introduction ........................................................................ 169

Appendix III: Questionnaire................................................................................... 170

Appendix IV: Interview Guide ............................................................................... 179

Appendix V: Secondary Data Collection Form ...................................................... 181

Appendix VI: Analysis Of Data Tables .................................................................. 183

Appendix VII: List of Public Universities in Kenya .............................................. 184

xv
 ACRONYMS AND ABBREVIATIONS

AG Attorney General

AIE Authority to Incur Expenditure

ANOVA Analysis of Variance

CBA Cost Benefit Analysis

CIPS Chartered Institute of Procurement and Supply

CLM Contract Lifecycle Management

COD Chair of Department

COMESA Common Market For Eastern and Southern Africa

CUE Commission for University Education

DW Durbin Watson

EAC East Africa Community

EDI Electronic Data Interchange

ERA Electronic Reverse Auction

ERP Enterprise Resource Planning

EU European Union

FAR Federal Acquisition Regulation

GDP Gross Domestic Product

ICC International Chamber of Commerce

ICPAK Institute of Certified Public Accountants of Kenya

INCOTERMS International Commercial Terms

IFMIS Integrated Financial Management Information System

IHRM Institute of Human Resource Management

JKUAT Jomo Kenyatta University of Agriculture and Technology

KII Key Informant Interview

KISM Kenya Institute of Supplies Management

KPI Key Performance Indicators

xvi
KS Kolmogorov-Smirnov

LS Levene Statistics

LPO Local Purchase Order

LSK Law Society of Kenya

NACOSTI National Commission for Science, Technology and

Innovation

OECD Organization for Economic Co-operation and Development

OLS Ordinary Least Squares

PE Procurement Entities

PESTLE Political, Economic, Social, Technological, Legal,

Environment

PPADA Public Procurement and Asset Disposal Act

PPOA Public Procurement Oversight Authority

PPRA Public Procurement Regulatory Authority

RCM Record Continuum Model

RDT Resource Dependence Theory

RII Relative Importance Index

ROI Return on Investment

ROK Republic of Kenya

SCOR Supply Chain Operations Reference Model

SLA Service Level Agreements

SMART Specific, Measurable, Achievable, Relevant, Time-Bound

SPSS Statistical Package for Social Sciences

TOC Theory of Constraints

TS Tolerance Statistics

UK United Kingdom

UNDP United Nations Development Programme

USA United States of America

VFM Value For Money

xvii
VIF Variance Inflation Factor

WIP Work in Progress

xviii
 DEFINITION OF TERMS

Buyer-Supplier Collaboration Is an obligation to both customers and

suppliers, regardless of size to a long-term
relationship based on clear mutually agreed
objectives to strive for world class capability in
line with the envisioned goals of the
organizations (Larson, 2014).

Contract Management It is defined as the process of planning,

organizing, controlling and embracing terms
and conditions that are embedded on the
agreement reached by the parties to a business
transaction (Elliot & Quinn, 2019).

Legal Compliance This is the practice of observing and

conforming to the peripheral statutory laws and
regulations in a given jurisdiction (Sammons,
2017).

Procurement Is the act of finding, soliciting, acquiring,

buying goods, works or services from an
external source, often through a tendering or
competitive bidding process (Lysons &
Farrington, 2012).

Procurement Performance This is the quantitative or qualitative

assessment score index over a given time
towards the achievement of corporate or
operational objectives relating to purchasing
economies, efficiency or effectiveness (Perera
& Colverson, 2012).

Procurement Risk This is putting measures in place to reduce the

severity of peril event in procurement process

xix
Management should that event occur (Christopher, 2018).

Contract Records Is a set of activities required for systematically

Management controlling the creation, distribution use,
maintenance and disposition of contractual
documented information maintained as
evidence of business activities and transactions
(Freda, 2014).

Transparency and These are qualities of openness, fairness,

Accountability honesty, integrity and taking responsibility in
various activities in a business set up (Carter,
2014).

xx
 ABSTRACT

The upsurge of public universities in Kenya has culminated in extra budget

allocation to these institutions by the national treasury over the last decade. Close to
60-70% of the budget is used in procurement related activities. This phenomenon has
led the public universities to instill procurement contract management action plans to
enhance procurement performance. Despite the introduction of regulatory bodies,
there are numerous lawsuits of defaulted contracts, annulled contracts and
incomplete contracts. These problems end in big financial losses and time overruns.
It is against this backdrop that this research sought to assess the influence of contract
management on procurement performance in public universities in Kenya. The study
specifically focused on the influence of: buyer-supplier collaboration, procurement
risk management, transparency and accountability, contract records management as
well as the moderating influence of legal compliance on the relationship between
contract management and procurement performance in public universities in Kenya.
The study employed descriptive research design and prior to data collection, pilot test
was undertaken at 4 public constituent university colleges. A census method was
adopted in this study, whereby a target population of all the 31 public universities
(Unit of Analysis) was involved in the study. One hundred and twenty-four (124)
university officials (Unit of Observation) were randomly sampled. Primary data was
collected by use of questionnaires whereby, a drop and pick method was used in the
administration of the questionnaires. Key informant interviews were also conducted
to deduce qualitative data. Secondary data was derived from the auditor general’s
and PPRA reports. Descriptive statistics measures of central tendency were used and
statistical output was generated using SPSS version 22. Inferential statistics was also
used to infer correlation analysis as well as multiple linear regression and this
depicted the relationship between independent and dependent variables. The study
data was tested for adherence to the assumptions of multiple linear regression
analysis and it was found to be free from linearity, normality autocorrelation,
heteroscedasticity and multicollinearity. The findings of the study revealed that,
buyer supplier collaboration, procurement risk management, transparency and
accountability and contract records management influence procurement performance
in public universities in Kenya. The study further established that legal compliance
had significant moderating influence on the relationship between contract
management and procurement performance in public universities in Kenya.
Inferential statistics results exhibited strong R square while the results of ANOVA
for the regression model showed an F statistic that was within the predictable range.
All the predictor variables had significant joint influence thus the model fitted in the
multiple regression was fit. The study concluded that buyer supplier collaboration
strongly influences procurement performance while procurement risk management,
contract records management and legal compliance have modest influence on
procurement performance. Further, the study concluded that transparency and
accountability slightly influences procurement performance. The study recommends
that public universities should maintain the existing synergy based initiatives with
suppliers, risk management strategies, professional probity policies automated
contract records management procedures and ensure high degree of adherence of the
procurement law as anchored in PPADA, 2015.

xxi
 CHAPTER ONE

INTRODUCTION

1.1 Background of the Study

In the contemporary business environment, it is becoming increasingly significant for

procurement professionals to keep abreast of legal developments relevant to the
acquisition of goods, works and services within the public universities in Kenya.
Best practices in contract management emphasis the need for inculcating the inherent
tenets of success in procurement process (Lysons & Farrington, 2012). This include
understanding fully what constitute a valid contract, terms and conditions of the
contract, synergy driven initiatives with suppliers or contractors, records trail of
contractual obligations, business trends in the ever volatile markets, continuous
improvement discourse, degree of contractual probity and most importantly the
applicability of key performance indicators (KPI) when defining procurement
performance (Sammons, 2017). According to Rok (2012) better contract
management turns out to be a springboard towards efficient government spending in
this period of fiscal austerity. The ultimate result when contractual obligations are
adhered to by the parties to the contract is sound public service delivery and
maintenance of stake-holders confidence in government’s undertakings.

From a legal perspective, contract management in public universities is inevitable if

excellent procurement performance is to be achieved. It does not only ease contract
negotiations, contract formation, contract implementation or perhaps dispute
resolution and audit preparation and protection but it is an important part of the
public universities risk management strategy towards a sustainable provision of
customer service and cost reduction in the market environment (Elliot & Quinn,
2019). Schuhmann and Eichhorn (2019) alludes that there is escalation of demand by
the stakeholders for the public entities to reduce costs, improve financial and
operational performance and increase the level of customer service. Though this
approach brings a trade-off on issues of cost effectiveness and customer satisfactions,
buyers are obligated to confine themselves to the best options that reflect the policies
of the institutions. New statutory requirements, bubbling issues like supply base
1
optimization, lean supply, mass customization, globalization, enhancement in
contract volumes and complexities of activities in supply chain management have
also resulted in an increase of the importance of effective contract management
(Alan & Ray, 2012).

Lysons and Farrington (2012) postulates that the growing acknowledgment of the
need to automate and improve contractual processes and satisfy increasing
compliance and analytical requirements have equally led to an increase in the
adoption of more formal and controlled contract management procedures. As more
organizations are upgrading their contract management platforms to include
increased levels of automation, there are several benefits that are derived. These
include increased visibility of the contracts, reduction of errors and oversights within
the contract, heightened security on the contract records, easier retrieval of the data
and analysis of the contract progress. Automated contract management also comprise
features for contract initiation, drafting and negotiation, review and approval, digital
signing, lifecycle management, notifications, contract renewal, archiving, ability to
organize contracts by clients, installation of dashboards to view contract status and
milestones. All these underlined benefits have a far reaching implications to the
contractual obligations of buying organizations. In unlikely event litigations are
advanced to the learning institutions, then the concerned parties will be equipped
with the necessary documentations to avert any unlawful ruling of the lawsuit (Baily
et al., 2015).

Howard (2015) confirms that procurement officers are invariably engrossed by

complex transactions in terms of both the type and range of goods, works or services
being procured. In order to have some semblance of efficiency in the procurement
process it is crucial for the buying entities to be clear about the overall objective of
the procurement and identify ways and means on how to oversee the contractual
obligations from onset. This allows a better understanding of the expectations of the
parties participating in the contract hence this necessitates clear focus on execution
of the tasks ahead. To this extent, therefore, public entities must have a detailed
understanding of what they are buying, from whom and perhaps the delivery
schedules of the supplier in order to analyze the value and risks that may accrue in

2
the business process. This business perspective should correspond with the overall
goals, values and the underpinned business strategy. In a nutshell, both the
procurement representatives of public universities, suppliers and contractors should
fully be cognizant of their role in the procurement process and should provide better
services that are efficient and effective in order to ensure value for money (VFM) to
their respective entities (Elliot & Quinn, 2019).

Baily et al. (2015) asserts that the fundamental success factors for post-award
contract management rely upon careful, complete and comprehensive
implementation of the upstream supply chain activities. During the pre-award stages,
the emphasis should be focused on the underlying need for the contract and whether
the suppliers will be in a position to deliver in service based on the requirements of
the buyer. On the contrary, careful considerations are only looked upon when the
contract has been awarded and therefore, any aggrieved party may have very limited
options in pursuance of the law. The institution’s high-level requirements should be
thoroughly researched so that there is a better understanding of purpose from
inception in all aspects of the procurement process. This approach creates a roadmap
on how contract will be formed, implemented and the monitoring and control
mechanisms that will be put in place to ensure a seamless transactional process
between buyers and suppliers (Schuhmann & Eichhorn, 2019).

Keith et al. (2013) designates that administration of contracts, more so partnerships,

requires flexibility on both sides and a willingness to adapt the terms of the contract
to be in tandem with changing circumstances. It is worthwhile to recognize that
problems are bound to arise which could not be envisaged when the contract was
awarded. It is important to demystify the fact that all contracts are predicated on the
need to obtain management commitment and authorization at the relevant level. This
entails the formulation of an ideal business case linked to the organization’s
corporate, business unit and operational strategies. The business case formulates the
guideline, business and contract objectives and the issues that affect the decision and
the investment. It should seek to establish whether the projected contract meet the
need and that it is feasible and fiscally sound (Macintyre, 2015).

3
Lowe (2013) affirms that in order to have an effective contract management it is
prudent to develop a contract strategy. The established strategical framework ought
to be used as the guiding principle when discharging contract related activities from
time to time. The overriding standard in contract management is that organizations
are duty bound to accord a particular contract with the university’s overall
procurement strategy. The formulation of a contract strategy is planned to institute
the form of the procurement and provide support in determining the generation and
award of the contract, the style and type of management to be adopted for the
subsequent service delivery, relationship management and contract administration
(Gulshan & Kapoor, 2018).

Lysons and Farrington, (2012)) argues that in developing the contract strategy it is
important to address issues based on the scale, nature and importance of the need to
the organization, type of specification, value of the need, complexity of the need
including innovation level, market capacity, attractiveness to the market, timescale
and phasing, level of understanding of the need by potential suppliers and
stakeholders. The use of supplier positioning matrices always assists in establishing
the action plan towards a contract, the nature of any deliberation that may need to be
conducted and the form of the supplier relationship following the award of contract.
Possible supplier relationship types range from the fixed contracts, spot buy through
call-off contracts, long term partnerships as well as strategic alliances. Issues of
relationship style such as partnership, hands- on or proactive should also be
considered (Hines, 2014).

Overby et al. (2017) cited that when establishing the contract strategy, a lot of
emphasis should be given to the evaluation roadmap which gives the direction for the
overall evaluation of suppliers and the predetermined tender process. It encompasses
such considerations as business purpose, relative priorities of the requirement,
critical success factors, communication guidelines, the modalities for determining
quantifiable and non-quantifiable items, evaluation procedures including appraisal
methodology, persons involved in the evaluation, supplier selection process
including direction on interpretation and marking of the responses. Another vital
consideration in determining contract strategy is utilization of Service Level

4
Agreements (SLA). The rationale behind SLAs is to let the customer to examine and
control the performance of the service received from the supplier(s) against the set
standards (Perera & Colverson, 2012).

Lysons and Farrington (2012) emphasizes that service levels should be established
and benchmarked for both customers and suppliers. It is imperative to ensure that the
service levels are established at a logical level; prioritized by the customer in order of
significance and on an agreed level for example essential, major, urgent, minor,
easily monitored, such as objective, tangible and quantifiable, unambiguous and
understandable by all parties and should be open to re-negotiation at any time. This
allows the parties participating in the contract to conduct a cost-benefit analysis
(CBA) and deduce the possible returns once the contract has been effected (Overby
et al., 2017).

Burt (2012) indicates that in contract management it is important to attest the fact
that various changes are bound to take place. Basically, changes within the contract
are almost mandatory during the time of a contract, particularly in the case of major,
complex construction and service contracts. Ideally, changes should not necessarily
be seen as causes for concern but should be managed effectively since they serve as
opportunities to advance the contract outputs. It is worthwhile to understand the
implication of change for both parties in business transaction. A change of any
significance is always deemed to affect the scope and potentially the viability of the
contract for either party. If a change results in a decrease in the value of the contract,
the organization could be faced with claims for increases in charges and legal claims
that there was, for example, misrepresentation in relation to the likely volumes
required over the time of the contract. If the change results in a substantial increase
in the value or scope, it is important that the organization continues to ensure that
value for money is maintained (Perera & Colverson, 2012).

Keith et al. (2013) suggests that public sector organizations should be aware of the
requirements of the state’s procurement directives that need considerable changes
during the contract period. Change can be determined by a number of factors;
amongst the more common are adjustments to the strategies and objectives of the
parties, the changing business requirements of the organization, market changes,

5
advancement in technology, economic trends which affect the feasibility of the
contract and statutory changes. These in turn can translate to changes in the service
required, the parameters needed, service infrastructure and workload. The end result
of contract management is service delivery and therefore, the ad hoc inspection and
acceptance committee members of the public universities are primarily concerned
with ensuring that the actual service provided by the suppliers or contractors is
commensurate with the agreed standards (Macintyre, 2015).

Hines (2014) states that the aptitude to measure the performance of the supplier and
provision of feedback is essential to successful contract management and supplier
development. Performance measures to cover every aspects of a contract should be
designed to fit the requirements of a given contract and should be set out in the
contract documentation to ensure suppliers are aware of the measurement
methodology before any contract is awarded. It is vital that the performance
measures selected provide clear and verifiable evidence of the success of the
relationship and in principle, issues such as financial outlay and value obtained
performance and customer satisfaction, delivery enhancement and added value,
delivery ability, benefits realized, relationship strength and openness (Roy & Adrian,
2013).

Hines (2014) submits that the criteria that is employed to justify supplier’s
performance in business activities should be specific, measurable, achievable,
relevant and time-bound (SMART). It is important to ensure that the actual
parameters selected are not over-specified, that they are, as far as possible, readily
derived from the direct performance of the contract and that they are linked to key
procurement issues. Once selected, the requirements supporting the performance
measures should be the main focus for contract management. They should form the
structure on which information needs and flows and contract management teams,
skills, activities and processes are developed (Macintyre, 2015).

Alan and Ray (2012) reveal that the ‘‘battle of forms’’ in contract management
indicates that the last entity in business transactions to submit conditions that the
other party accepts directly, or through implication or even through terms implied by
the statutes would have conditions that bind the contract. The terms of a contract are

6
said to be direct (express terms) if the parties themselves advertised to them at the
time of negotiations and actually agreed upon them (i.e. incorporated them into the
contract, either verbally or in writing). A term which the parties did not expressly
incorporate into the contract may nevertheless be regarded by the court as one of the
terms of the contract by implication. This will be done only when it is necessary in
the business sense to ‘give efficacy to the contract’. Terms implied by the statutes
entail sale of goods and hire purchase Acts. Normally, the terms will be implied
unless they are expressly excluded by the parties in case of contracts for the sale of
goods. It is imperative to reconcile the buyer’s terms and conditions with those of the
suppliers when faced with the battle of forms in business transactions (Keith et al.,
2013).

Macintyre (2015) affirms that for an agreement to constitute a binding and

enforceable contract it must have been entered in a form or manner prescribed by the
law. The general rule of common law is that a contract can be entered orally, in
writing, partly orally and partly in writing, or may be merely implied from the
conduct of the parties to it. Basically a valid acceptance of a valid offer results in a
valid contract. A valid contract is one that is legally effective and enforceable in
court. A void (also called invalid) agreement cannot be enforced in court by either
part since it has no legal force or effect. Under the circumstances, only one of the
parties has the power to compel legal enforcement. If that party chooses otherwise, or
decides to withdraw from the transaction, then the contract will not be enforced.
Such an agreement is a voidable contract. For example, when one party persuades the
other to contract by means of fraud, the sales contract is voidable, by the buyer who
has been misled. But if it was personal whims to enter into a contract knowingly and
the substance of the contract turns out to be fraud oriented, then the party in question
is guilty (Elliot & Quinn, 2019).

Keith et al. (2013) upholds that the difference between a void agreement and
avoidable contract is important in business transactions to avoid any confusion. A
voidable contract can be enforced or avoided by one of the parties. A void agreement
on the other hand cannot be enforced by either party. A valid contract sometimes
becomes an unenforceable contract because the time limit for filing suit to enforce it

7
has passed. Therefore, a key consideration in contract management is contract
enforcement which entails the attributes taken by the parties to a contract to make it a
success. Generally, when the parties enter in a contract the focus is primarily based
on its implementation. However, one party may fail to honour the contractual
obligations. This gives rise to the aggrieved party to seek legal redress and perhaps
enforce the contract as per the terms and conditions replicated in the contract. The
ability to make and enforce contracts and resolve disputes is fundamental if markets
are to function properly without interference from the parties to the contract
(Gulshan & Kapoor, 2018).

According to Sammons (2017) when entering into a contract the terms and
conditions should not be contradictory or repugnant to the subject matter of the
contract. Where the contract contains terms that are vague or ambiguous, the terms
are always interpreted by the court as contra proferentem meaning the clause will be
interpreted against the party seeking to rely on it. Good enforcement procedures
enhance predictability in commercial relationships and reduce uncertainty by
assuring investors that their contractual rights will be upheld promptly by local
courts. When procedures for enforcing commercial transactions are bureaucratic and
cumbersome or when contractual disputes cannot be resolved in a timely and cost
effective manner this attribute will destabilize the commercial transactions (Gulshan
& Kapoor, 2018).

Roy and Adrian (2013) opines that the concept of contract enforcement can be
embraced fully if there is a well-structured contract administration guideline.
Contract administration is concerned with the mechanics of the relationship between
the customer and the provider, the implementation of procedures defining the
interface between them and the smooth operation of routine administrative and
clerical functions. Contract administration handles the formal governance of the
contract and changes to the contract documentation. Clear administrative policies and
procedures ensure that all parties to the contract understand who does what, when,
and how. The procedures that combine to make up contract administration include:
Contract maintenance and change control, charges and cost monitoring, ordering

8
procedures, payment procedures, budget procedures, Resource management and
planning, management reporting and asset management (Gulshan & Kapoor, 2018).

1.1.1 Global Perspective of Contract Management

Carter (2014) indicates that contract management is an integral approach to many

countries across the globe on public procurement related activities. In most
jurisdictions, contract law is adjudicated by judges according to the rules of judicial
precedent. The UK procurement system spends a tune of EUR 316 billion annually
on contractual transactions. UK public entities favour restricted tendering procedures
when buying goods or services and this is necessistated by the need to limit the
number of tenders per contract and in most cases the cost of evaluating bids from the
suppliers is greatly reduced. However, the two- stage tendering procedure takes
longer period than open tender and can be more restrictive for prospective suppliers
to comply with, due to the value of tender submission required. The UK’s
administrative formation also affects its contract system in procurement related
activities with exclusive legal regimes for England, Wales and Northern Ireland and
Scotland on the other hand (CBI, 2014).

Based on the UK’s contractual framework, procurement is constituted by two sets of

laws. In England, Wales and Northern Ireland, EU Directive 2004/18/EC is
transposed as Public Contracts Regulations 2006, and 2004/17/EC as Utilities
Contracts Regulations 2006. These legal frameworks form the basis on how contract
management is executed and hence all the parties confining themselves to this
transaction are required to strictly adhere to the regulations. In Scotland, the same
regulations are transcribed as Public Contracts (Scotland) Regulations 2006 and
Utilities Contracts (Scotland) Regulations 2006. Similarly, the set regulations ought
to be followed when the staff of various public organizations are executing
procurement activities.

In USA, the procurement performance of public entities is entrenched on contract

management guidelines. The public sector in the United States procures half a trillion
dollars worth of products and services annually. This significant public expenditure
is harnessed through a well-structured contract administration. Public procurement is

9
done at two distinct levels, the State level and the Federal level. The legal attribute
binding all federal agencies is the Federal Acquisition Regulation (FAR) that
provides procedural guidelines to control procurement processes. Cost savings and
competitive processes are considered as key principles in all procurement decisions.
State governments are not regulated by FAR policies. However, they learn from
federal practice and conform to its principles when putting in place rules for state
agencies (Vonortas, 2015).

The magnitude of contract administration varies across Organization for Economic

Co-Operation and Development (OECD) countries. Portugal and Greece reports 20%
of the government expenditure while countries like Japan, Estonia and South Korea
registers 35% of the government expenditure. In terms of Gross Domestic Product
(GDP), OECD countries reported an average share of 12.1% spent on contractual
transactions in public procurement in year 2013. Most industrialized countries across
the globe spend at least 10% of their GDP on procurement contracts. This calls for
well-functioning public procurement systems to address contractual obligations of
the parties concerned in order to ensure cost effectiveness and value creation in the
holistic supply chain management (OECD, 2013).

Howard (2015) asserts that procurement has become global in scope and this has
paved way to the need for contract management in international transactions. Rolling
out a contract lifecycle management (CLM) solution globally brings forth enormous
unique challenges. Contracts need to be in line with both international standards and
local requirements. Organizations need to maintain visibility to key contract data
required to effectively comply with international requirements and government
standards while still optimizing revenues and minimizing costs. Global contract
management should enable contract effectiveness, contract compliance and efficient
risk management across numerous countries as well as multiple regulatory and
business environments. In global transactions, customer relations exceed borders as
well as business practices and controls (Christopher, 2018).

Burt (2012) confirms that in order to resolve any issue emanating from contract
disputes the international chamber of commerce (ICC) came up with International
Commercial terms (Incoterms) which entail set of rules for interpreting trade terms in

10
international transactions. The main purpose of Incoterms is to provide a set of
international rules for the interpretation of the most commonly used trade terms in
foreign trade. Howard (2015) indicates that Incoterms have put in place international
procurement in the following ways: Defines responsibilities regarding title, risks and
costs, and eliminates possibilities of misunderstandings and disputes. Incoterms deal
with a number of identified duties imposed on the parties such as the seller’s
obligation to place the goods at the disposal of the buyer or hand them over for
carriage or deliver them at destination and with the distribution of risk between the
parties in these cases. Burt (2012) supports this by confirming that Incoterms deal
with the mandate to clear the goods for export and import, the packing of the goods,
the buyer’s responsibility to take delivery as well as the duty to provide evidence that
the respective requirements have been duly satisfied. All these developments are
geared to provide a legal direction in a situation whereby the buyer or the seller seeks
legal redress in case there is a dispute in international transactions.

1.1.2 Regional Perspective of Contract Management

According to COMESA (2018) contract management has been the key tenet of
redifing the contractual obligations in the regional perspective. The proximity of
most of the countries to Kenya, has necessitated multilateral trade to gain an upward
trajectory. The Common Market for Eastern and Southern Africa (COMESA) is one
of the classical regional economic community in Africa with twenty-one member
states. COMESA countries have a combined Gross Domestic Product of US$ 768
billion and this signifies vibrant contractual activities. In order to ensure seamless
contract administration, the member countries of COMESA have endeavored to
streamline the laws surrounding the establishment of the trading block. The backdrop
of this phenomenon has created a sense of synergy and enrichment of business in all
spheres of the economy to the member states (Lungu, 2020).

To enhance governance and regional integration in COMESA, modern public

procurement systems have been inculcated and these considerations have improved
the legal framework on transactional activities. Notably, published procurement
systems of COMESA Member States conform to internationally acceptable standards

11
for good governance (Wignaraja, 2019). In order to improve public procurement
systems of COMESA Member States, the laws, regulations and procedures
pertaining commercial activities have been strengthened. This phenomenon has far
reaching implications on transparency and accountability in public procurement
undertakings. The embedded laws, regulation and procedures as per the trading block
treaty, paves way to effective contract administration among the member countries.
Public and private sectors are cognizant of the principles and workings of the
national and regional public procurement systems as per the COMESA guidelines.
The promulgation of national legislation on public procurement in at least 60% of the
Member States is an indicative viewpoint of how COMESA countries are giving the
requisite consideration on transformative contractual undertakings (COMESA,
2018).

The East African Community (EAC) is another intergovermental organisation

composed of seven countries in the Great Lakes region of East Africa. These
countries comprise: Kenya, Uganda, Tanzania, Rwanda, Burundi, South Sudan and
Democratic Republic of Congo. According to EAC Statistics (2019), the EAC
countries have a combined Gross Domestic Product of US$ 240 billion. As one of
the fastest developing regional commercial blocs in the world, the EAC is
broadening and deepening partnership among the member States in various key
domains for their joint advantage. These domains include political, economic and
social discourse (EAC, 2022).

The clarion call, in EAC countries has been provision of uninterrupted flow of goods
and services to member countries through efficient contractual activities. The
premise of this underlying philosophy, enables the EAC countries to transact without
interference hence the reason for the proliferation of the trading block (Akinyi,
2019). A regional trade agreement (RTA) that is underpinned in the statutes of the
member countries, contains rules and regulations that are mainly geared to reinforce
cooperation and strengthen the contractual protocols to ease commercial
undertakings. Since the member countries are signatories to the established rules and
regulations, adherence to such guidelines are very critical in curbing disagreements
(EAC, 2022).

12
1.1.3 State of Contract Management in Kenya

According to Ochieng (2014) contract management and in general the public

procurement system in Kenyan context has transformed from a rudimentary system
free from conventional standards to a lawfully regulated procurement structure in
line with international principles. Since the start of the millennium, the country has
endeavored to change and update its public procurement methods and this has
translated to a clear understanding of contract management in public entities. The
changes in public procurement in Kenya commenced through issuance of treasury
circulars in the 1970s, 80s and 90s and further to a systematic legally regulated
procurement system since March, 2001 under the Exchequer and Audit (Public
Procurement) Regulations.

The greater strides made as part of the overall Public Finance Reform, a result of the
implementation of this reform program a Public Procurement and Disposal Act
(herein after referred to as PPD Act) was approved by parliament in 2005. In 2007
the PPDA Act was operationalized and established the Public Procurement Oversight
Authority (PPOA) as regulatory body for advancement and oversight of the Kenyan
Public Procurement System. The public procurement and disposal act, 2005 became
the reference point on contractual obligations of the public entities. In order to meet
the aspirations of the new constitution dispensation that was enacted in year 2010
and more importantly to enhance procurement performance in the public sector the
public procurement and disposal act 2005 has been replaced by the Public
Procurement and Asset Disposal Act, 2015 as per the Kenya Gazette Supplement
No.207 (Acts No.33).

Contract management is very conspicuous in line with the PPADA, 2015. Ideally, the
accounting officers of all public entities are responsible for preparation of contracts
in line with the award decision. They should also ensure that all contracts exceeding
a value of Kenya shillings five billion are cleared by the Attorney-General (AG)
before being signed. The country’s constitution gives the AG unfettered discretion to
provide a legal framework on the provision of these contracts although the AG can
provide interlocutory submission if the contract turns out to be complex. On regular
basis each Cabinet Secretary ought to inform the Cabinet and national treasury of all
13
government contracts exceeding Kenya Shillings five billion. The existence of a
contract is invariably confirmed through the signature of a contract document
incorporating all agreements between the parties and such contracts are signed by the
accounting officer or an officer authorized in writing by the accounting officer of the
procuring entity and the successful tenderer (Rok, 2015).

Procuring entities should enter into a written contract with the person submitting the
successful tender based on the tender documents and any clarifications that emanate
from the procurement proceedings. The written contract should be entered into
within the period specified in the notification but not before fourteen days have
elapsed following the provision of that notification provided that a contract shall be
signed within the tender validity period. It is important to note that a procuring entity
may amend the tender documents at any time before the deadline for submitting
tenders by issuing an addendum without materially altering the substance of the
original tender. As annexed in the tender document the latter information forms the
basis of the discussions in the tendering process. No contract is formed between the
person submitting the successful tender and the accounting officer of a procuring
entity until the written contract is signed by the parties. It is important to note that an
accounting officer of a procuring entity should not enter into a contract with any
person or firm unless an award has been made and where a contract has been signed
without the authority of the accounting officer, such a contract shall be declared null
and void (Rok, 2015).

Ogachi (2014) concurs with PPADA Act 2015, on the provision that the tender
documents form the basis of all procurement contracts and constitute at a minimum-
contract agreement form; tender form; price schedule or bills of quantities submitted
by the tenderer; schedule of requirements; technical specifications; general
conditions of contract; special conditions of contract and notification of award.
According to section 58(2) of PPADA 2015 the tender documents used by the
procuring entity under subsection (1) shall contain sufficient information to allow
fairness, equitability, transparency, cost effectiveness and competition among those
who wish to submit their application. A person who contravenes the provisions of
this section commits an offence. All suppliers participating in the tendering process

14
should provide a tender security which is absolute value of not more than two
percent of the tender as valued by the procurement entity. The tender security shall
be forfeited if the person submitting the tender withdraws the tender after the
deadline for submitting tenders but before the expiry of the period during which
tenders shall remain valid.

Rok (2015) asserts that if the person submitting the successful tender refuses to enter
into a written contract as required under section 135 and section 61 of the
Procurement Act 2015, he or she losses his or her tender security and the
procurement process should proceed with the next lowest evaluated tenderer.
Likewise, subject to the regulations a successful tenderer shall submit a performance
security equivalent to not more than ten percent of the contract amount before
signing the contract. In case the contract is not fully or well executed, the
performance security shall unconditionally be fully seized by the procuring entity as
compensation without prejudice to other penalties provided for by the Act. However,
the tenderer shall not be liable for forfeiture of its performance security or
termination for default if and to the extent that it’s delay in performance or other
failure to perform its obligations under the contract is the result of an event of force
majeure.

Rok (2015) suggests that, the accounting officer of a procuring entity should publish
and publicize all contract awards on their notice boards at noticeable places and
website if available within a period as prescribed. An accounting officer of a
procuring entity should report all contract awards to the public procurement
regulatory authority (PPRA) as prescribed. Ideally, the director general of PPRA
plays an ombudsman role on contract management related activities in public entities
in Kenya and this calls for the person in charge of the position to be adept at
investigating procurement malpractices and show the unrelenting drive to get rid of
corruption (Rok, 2015). Any interested party or supplier who feels short changed in
any tendering process has the leeway to lodge his/her complaint with director general
who takes up the matter for adjudication before a procurement review board. Any
party to the review aggrieved by the decision of the review board may appeal to the
high court and the decision of the high court shall be final. A procuring entity which

15
disobeys the decision of the review board or the high court shall be in breach of this
act (PPADA, 2015) and any action by procuring entity contrary to the decision of the
review board or the high court shall be dismissed on the grounds that the entity is in
violation of the rules and the regulations.

Section 85 of PPDA, 2015 indicates that subject to prescribed thresholds all tenders
shall be evaluated by the evaluation committee of the procuring entity for the
purpose of making recommendations to the accounting officer through the head of
procurement to inform the decision of the award of contract to the successful tenders.
Section 86 (1) of the act, further indicates that the successful tender shall be the one
who meets any one of the following as specified in the tender document: (a) the
tender with the lowest evaluated price (b) the responsive proposal with the highest
score determined by the procuring entity by combining for each proposal in
accordance with the procedures and criteria set out in the request for proposals, the
scores assigned to the technical and financial proposals where request for proposals
method is used (c) the tender with the lowest evaluated total cost of ownership and
(d) the tender with the highest technical score, where a tender is not to be evaluated
based on procedures regulated by an Act of parliament which provides guidelines for
arriving at applicable professional charges (Rok, 2015).

1.1.3 Procurement Performance in Public Universities in Kenya

Manyenze (2013) confirms that procurement function plays a significant role

towards the envisioned goals and objectives of the public universities in Kenya.
Acquaintance of the key pillars of procurement enables procurement professionals to
understand the micro environmental and macro environmental constraints. The
former facet comprises: Customers, Employees, Suppliers, competitors, stakeholders
public and media while the latter aspect entail: political, economic, social,
technological, legal and environmental (PESTLE) challenges. Procurement officers
are involved in corporate strategy decisions to articulate the overall attributes that
bring forth an outstanding performance on all matters concerning contract
management. It is important to note that procurement provides a comprehensive
analysis of legal and policy frameworks that underpin the regulation and the best

16
approaches in all public universities in Kenya. The importance of these aspects is
paramount not only for the successful functioning of the public universities, but
mostly for the conceptual direction of the holistic public sector of the country in its
attempts to deliver services to the public in a more efficient and effective way
(Kirande & Rotich, 2014).

The procurement process in public universities is guided by the Constitution of

Kenya, 2010 and various statutory provisions including the public procurement
legislative framework, the Universities Act, statutes thereon and internal
administrative guidelines that are issued from time to time. Article 227 of Kenyan
constitution promulgates that, when a public entity contracts for goods or services, it
shall do so in accordance with a system that is fair, equitable, transparent,
competitive and cost effective. An act of parliament shall prescribe a framework
within which policies relating to procurement and asset disposal shall be
implemented and may provide for all or any of the following: categories of
preference in the allocation of contracts, the protection or advancement of persons,
categories of persons or groups previously disadvantaged by unfair competition or
discrimination, sanctions against contractors that have not performed according to
professionally regulated procedures, contractual agreements or legislation, sanctions
against persons who have defaulted on their tax obligations, or have been guilty of
corrupt practices or serious violations of employment laws and practices (Rok,
2010).

A total departure from these considerations when it comes to contractual

responsibilities in government organizations, warrants the regulatory authorities to
take punitive measures against the offenders (Rok, 2010). Just like other public
entities in Kenya, public universities ought to ensure that there is value for money in
all transactions executed, transparency and accountability should be maintained,
establishment of efficiency and effectiveness in business should be effected,
promotion of competition through competitive procurement methods should be a
reality, creation of integrity and fairness of procurement procedures ought to be
prioritized.

17
Further, restoration of public confidence in procurement process should be
compulsory, building public trust to stakeholders must be achieved, promotion of
local industry and spurring of economic development should be a priority. This
should be effected by ensuring that goods and service are obtained at the right price,
right quality, right quantity, from right source and delivered at the right place. These
public procurement objectives form the basis of contract management since any
deviation can bring adverse effects like unnecessary costs, customer dissatisfaction
and also fraud to public universities in Kenya (Chesang, 2013).

The procurement function of public universities in Kenya is anchored on the

provisions of the statutory policies, Executive orders, National Treasury circulars,
Public Procurement Regulatory Circulars, the University financial regulations, and
other enabling statutes. Prior to any initiation of a contract in the public universities,
procurement functions are mandated to come up with a procurement plan. All
procurement should be within the approved budget and should be planned by the
Universities through an annual procurement plan (Public Procurement and disposal
Act, Section 44(2) (c) and Section 53 Procurement plans define what is to be
procured, the estimated cost, and when to procure. Chairmen of departments in
public universities are entitled to submit an annual procurement plans to the Vice
Chancellors through the Directors, Supply Chain Management at least thirty (30)
days before the close of each financial year covering all items of procurement (Rok,
2015).

Gathua (2015) indicates that procurement process in public universities begins with
identification of needs by the user departments. Needs are those items or services
that should be procured to help the University achieve its strategic plans and goals.
All required items have to be budgeted for and their total value is what is referred to
as the "Annual Procurement Plan." Therefore, any requirement that has not been
budgeted for will not be processed for procurement. It is important to note that the
user departments have the responsibility of drawing up the correct specifications of
their procurement needs before forwarding them to the Supply Chain Department. If
need be, users may seek the assistance of technical experts in drawing up

18
specifications since the goods/services should be described in sufficient details in
terms of performance without displaying biases towards particular brands.

All procurement requests must be accompanied by completed Authority to Incur

Expenditure (A.I.E) forms. These should be raised by the users, who are duly
authorized by either the Chairmen of Departments, Principal of Colleges, or Deputy
Vice-Chancellor. It is only after the Finance Department or college bursar has
confirmed the availability of funds that the procurement process can commence. In
all procurement processes the procurement officers have the constitutional obligation
to provide professional advice to the accounting officers on matters of procurement
in the public universities. Upon the receipt of the professional advice the accounting
officers ought to exercise their own discretion on the way forward and not to subvert
the constitutional mandate of the procurement officers by coercing or deploying them
in other functions. However, in the event that procurement officers abdicate their role
under their service cadre ostensibly to safeguard the interest of the university, then
the accounting officers can apply the powers by instituting disciplinary actions to the
offenders (Rok, 2015).

It is worthwhile to underscore the fact that procurement is law rounded. Public

universities should follow strictly the Public Procurement and Asset Disposal Act,
2015 when deriving the viable concepts of contract management. According to
Article 227 of the Constitution, the Act provides procedures for efficient public
procurement and for assets disposal by government institutions. To be in line with
the procurement act the public procurement process should comprise: Standard
tender document, requirement identification process, procurement requisition
processes, appointment of ad hoc evaluation, inspection and acceptance committees,
determination of procurement method, procurement planning and strategy
development. Also other considerations include: solicitation of tenders guidelines,
documents preparation and publication, pre-bid/proposal meeting and site visit,
bid/proposal submission and opening, bid/proposal submission and opening,
bid/proposal evaluation, evaluation committee’s recommendations, due diligence
process contract negotiations if it is purely for service oriented activities and lastly
contract award (Rok, 2015).

19
One of the key reforms in public procurement in Kenya is application of digital
platforms in execution of procurement activities. The considerable modules that are
recommended entail use of integrated financial management information system
(IFMIS) which is an online portal where suppliers perform various procurement
processes including tendering, requisition, payments and checking notifications of
tender awards. Electronic reverse auction (ERA) is another element whereby
suppliers upon registration compete for the tenders online and the rule of the
transaction is that the identity of all suppliers is concealed and the lowest bidder at
the closure of business is awarded the tender (Rok, 2015).

Further, Enterprise resource planning (ERP) is also another common method applied
in public procurement process in public universities in Kenya. It is a business
management system that is supported by multi-module application software that
integrates all the department’s functions of the universities and it allows chair of
departments (COD) from all departments to have a consolidated view of what is or is
not taking place throughout the universities and this platform creates a clear position
of enhancing procurement performance (Lysons & Farrington, 2012).

Public universities in Kenya have increased tremendously in the last one decade.
Currently there are 31 public chartered universities and 8 public constituent
university colleges. Due to the expansion of the public universities in Kenya the
government has also increased the budget allocation all the public universities. For
example, during 2014/2015, 2015/2016 and 2016/2017 financial years the exchequer
allocated 55 billion, 52.9 billion and 57.8 billion respectively to public universities.
Cumulatively this translated to 3.5 % of the country’s Gross Domestic Product (Rok,
2017). It is important to note that 60-70% of this budget is always channeled to
issues based on procurement in order to ensure capacity building and research
developments (PPRA, 2018). It is of interest, therefore, to explore the topical issue
that is in line with the influence of contract management on procurement
performance in public universities in Kenya. This is as result of massive amount of
money directed to these public entities and therefore, this compels the need for
stringent controls in utilization of resources to meet the university’s needs in short
term as well as in the long term endeavors (Rok, 2015).

20
1.2 Statement of the Problem

Contract management in public universities is a complementary approach to more

broad-based reforms on public procurement, which is one of the very first areas of
change in the growth trajectory of developing countries (Perera & Colverson, 2012).
Procurement functions in public universities are susceptible to irregularities and the
ripple effect causes social prejudice and economic recession. Despite the introduction
of regulatory bodies in Kenya like public procurement oversight authority (PPOA),
public procurement oversight advisory board and the public procurement
administrative review board and now the new regulatory bodies that comprise
National Treasury in public procurement and assets disposal and public procurement
regulatory authority (PPRA) regulations could still be circumvented through acts and
omissions of it being rigged by public and private sector operatives. There are also
immense cases of defaulted contracts, nullified contracts as well as stalled projects
that remain work-in-progress (WIP). These myriad of problems culminate to huge
financial losses, time overruns and also inconveniences to the target beneficiaries in
public universities (Muchungu, 2012).

The audit trail on procurement performance in public universities in Kenya attests

contravention of procurement laws. The auditor general’s report for the years 2013-
2014 on the financial statements, showed that 24% of public universities in Kenya
flouted procurement laws through unprocedural acquisition of goods and services.
These anomalies included procurement of goods and services from firms that were
not in the list of the prequalified suppliers contrary to the then provisions of section
25(3) of the procurement act, which stated that the procuring entity shall invite
tenders from only the persons who have been prequalified under the set regulations.
The implications of these non-compliance related activities under the domain of
public procurement in Kenya meant that the key stakeholders that included the
government, taxpayers, donor countries and world bank did not get value for their
money hence a considerable drawback to the progress of the country was witnessed.

The subsequent auditor’s report during 2014/2015 financial year denoted a

staggering statistics on contravention of procurement law on contractual activities in

21
public universities in Kenya. These included buying of goods and services above the
predetermined threshold using direct procurement method and also awarding the
contracts to the second lowest evaluated bidders without explaining why the tenders
were not awarded to the lowest bidders. In some cases, no bids were floated for
procurement of the services. All these contracts did not comply with the
predetermined rules and regulations depicted in the PPADA, 2015 and the
procurement regulations of 2020.The magnitude and trend of these transactions in
public universities merited intensive research, discussion and sound
recommendations if efficiency and effectiveness is to be achieved by the
procurement functions in public universities in Kenya.

Although the Kenyan government has introduced contract price variation in a tune of
25% of the original contract price for contracts exceeding one year, staggering
statistics have emerged that shows increase of contract variations in public entities in
Kenya (Rok, 2015). In particular, public universities in Kenya have been subjected to
contract variations during contract implementations. This has been compelled by
price fluctuations, complexity of contracts, lack of professional probity, delays of
disbursement of funds by the exchequer, omission of the required information in the
bill of quantities and unanticipated changes in the market. The net effect of these
outcome has been debarment of contractors on subsequent contracts, cancellation of
contracts, legal redress for the liquidated damages, withholding of payments, and
stern warning of the suppliers and contractors (CIP, 2013).

A number of empirical studies have been conducted on the area of contract

management and procurement performance in public universities in Kenya.
Manyenze (2013) who carried out a research on procurement performance in the
public universities in Kenya focused primarily on ways of establishing mechanisms
to reduce the effects of procurement challenges and determinants of effective
procurement performance. On the same breadth, Ngetich (2017) conducted a
research on determinants of effective procurement contract administration in selected
public universities in Kenya. This study concentrated on staff competences,
information technology, staff professionalism and accountability. Further, Kirande
and Rotich (2014) conducted a research study on the determinants affecting public

22
procurement performance in Kenyan universities and zeroed on organizational
budget, work environment, quality management systems and organizational
structure. It is imperative to note that although the researchers provided a broad
perspective of procurement performance in public universities, these studies did not
address the key tenets of contract management that were advanced by Vasudevan
(2015) namely: buyer-supplier collaboration, procurement risk management,
transparency and accountability, contract records management and legal compliance.
This study therefore, sought to bridge this knowledge gap by exploring the influence
of contract management on procurement performance in public universities in
Kenya.

1.3 Objectives of the Study

1.3.1 General Objective

To determine the influence of contract management on procurement performance in

public universities in Kenya.

1.3.2 Specific Objectives

1. To find out the influence of buyer-supplier collaboration on procurement

performance in public universities in Kenya.
2. To establish the influence of procurement risk management on procurement
performance in public universities in Kenya.
3. To determine the influence of transparency and accountability on
procurement performance in public universities in Kenya.
4. To establish the influence of contract records management on procurement
performance in public universities in Kenya.
5. To examine the moderating influence of legal compliance on the relationship
between contract management and procurement performance in public
universities in Kenya.

23
1.4 Research Hypotheses

This study collected data on testable hypotheses and subjected them to empirical
investigation. These hypotheses were stated in a null context as follows:
H01: There is no significant influence of buyer-supplier collaboration on
procurement performance in public universities in Kenya.
H02: There is no significant influence of procurement risk management on
procurement performance in public universities in Kenya.
H03: Transparency and accountability has no significant influence on
procurement performance in public universities in Kenya.
H04: Contract records management has no significant influence on procurement
performance in public universities in Kenya.
H05: Legal compliance has no significant moderating influence on the
relationship between procurement contract management and procurement
performance in public universities in Kenya.

1.5 Justification of the Study

The in depth analysis of this study will make a great contribution to the existing
knowledge in the area of contract management and generally procurement
performance in the context of public universities in Kenya. The study will primarily
benefit stakeholders such as public universities, regulators and academicians.

1.5.1 Public Universities

The findings of this study will extensively benefit public universities in Kenya. The
top management and the signatories of crucial contractual business transactions on
procurement matters will be informed on how, when and what contracts need to be
endorsed for the interest of the respective universities. This will enable the university
staff in question to administer contracts in ways that will leverage long term
procurement performance in order to reduce procurement irregularities in subsequent
transactions.

24
1.5.2 Regulators

The regulators of public procurement and asset disposal act such as the National
Treasury in public procurement and assets disposal, Public procurement regulatory
authority and Public Procurement Administrative Review Board can use the study
findings to understand the bottom line role of contract management in public entities
in Kenya. The study will provide explicit insights on the possible approaches that can
enhance the procurement performance and hence guide in regulation and policy
formulation. This will therefore, help policy makers of the public universities to
develop and review the existing policies in order to achieve synergy in line with the
existing circumstances. Therefore, this thesis will enable the public procurement
regulators to have a new dimension on how to safeguard public resources in public
universities in Kenya. The actualization of the findings of the study by the
procurement regulatory bodies will create value for money in all the transactional
activities in public universities in Kenya.

1.5.3 Academicians

The students, researchers and academicians of all walks of life will use this study as
a basis for discussions on implementation of contract management in the public
universities. The study will be a source of material for future researchers on other
related topics and therefore, this study will be a classical reference point of inferring
relevant empirical information.

1.6 Scope of the Study

The study concentrated on the influence of contract management on procurement

performance in public universities in Kenya. The focus of the study was post contract
award phase since this step in procurement process shows the chronology of the
activities undertaken by both the buying entities (Public universities) suppliers,
service providers as well as the contractors. The choice of the public universities was
prompted by the fact that there has been a proliferation of institutions of higher
learning for the last one decade and this development has translated to a huge budget
allocation to public universities by the exchequer. Therefore, the issues of contract

25
management on procurement activities have remained very crucial over the years
since conformance or non-conformance of procurement law has huge implications to
the government. The former consideration paves way to value for money while the
latter consideration results to financial losses.

It is also important to underscore the fact that universities have been earmarked by
the government to be the key drivers of the vision 2030 and this necessitates the need
for research in institutions of higher learning in order to address the pertinent issues
that may turn out to be impediment towards this strategic plan. The study was limited
to buyer-supplier collaboration, procurement risk management, transparency and
accountability, contract records management, legal compliance and their influence on
procurement performance of 31 public universities in Kenya. The researcher derived
a data of public universities from July 2013-June 2018 fiscal years.

1.7. Limitations of the Study

The major constraints that turned out to be the stumbling block of this study were
restrains and confidentiality from the institutions to the questionnaire as some of the
public universities considered the information the researcher sought to be
confidential. In order to have a breakthrough on this impediment the researcher
provided a letter of introduction from JKUAT as well as a research permit from
National Commission for Science, Technology and Innovation (NACOSTI). The
researcher also assured the respondents that the information provided was to be used
for academic purpose and thereby the researcher was obliged to treat the information
with a sense of confidentiality.

Far-flung universities posed a serious challenge to the researcher because of the

logistical costs that was to be put in place and also the longevity of the distance since
most of the public universities in Kenya are scattered. To overcome the intensity of
these challenges the researcher added more budget for the study and sought
reinforcement from the research assistants who expedited the issuance and collection
of the questionnaires from the respondents. This considerable strategy turned out to
be panacea of the then challenge since the researcher was in a position to receive 104

26
questionnaires out of 124 questionnaires issued which translated to 84% of the
response rate.

The scientific limitation of the study was as a result of constrained by the extent of
existing knowledge in line with contract management on procurement performance
in public universities in Kenya. Some of the reviewed studies were not in tandem
with the topical issue of the study. However, this phenomenon was solved by finding
unparalleled theoretical basis that supported the research topic.

27
 CHAPTER TWO

LITERATURE REVIEW

2.1 Introduction

This chapter explores the fundamental aspects that are in line with the research topic
being studied. The chapter is divided into three distinct parts. The first part covers
the theoretical review on buyer-supplier collaboration, procurement risk
management, transparency and accountability, contract records management, legal
compliance, procurement performance and generally the concept of contract
management. This leads to the development of the conceptual framework that guided
the study. The second part deals with the review of existing literature in accordance
with the study variables. The third part deals with empirical studies carried out in the
past and in accordance with the variables presented in the research model, critique,
research gaps and summary.

2.2 Theoretical Review

Theoretical review is an explanation about the phenomenon based on conceptual

analysis, previous studies and theories that exist in the literature (Camp, 2001). There
are many theories and models advanced by different scholars to explain the influence
of contract management on procurement performance in public universities in
Kenya. This study was guided by five theories and two models discussed in this
chapter.

2.2.1 Resource Dependence Theory

The proponent of resource dependence theory (RDT) was Pfeffer (1978). The theory
started as a publication of the external control of organizations which was deemed to
be a resource dependence perspective discourse. Resource dependence theory
emphasize how organizational behavior is affected by external resources the
organization utilizes like raw materials and services. The theory is necessary because
an organization’s ability to gather, alter and exploit raw materials faster than
competitors can be fundamental to success (Collins & Hillman, 2009).
28
According to Cobb (2010) resource dependence theory is underpinned by the idea
that resources are essential to organizational performance and that access and control
over resources is a basis of power. Organizations normally build redundancy into
resource acquisition in order to reduce their reliance on single sources. The basic
argument of resource dependence theory can be summarized as follows:
Organizations rely heavily on resources, resources eventually emanate from an
organization's environment, the environment, to a considerable extent, contains other
organizations, the resources one organization needs are in most cases in the hand of
other organizations, resources are a basis of control, lawfully independent
organizations can therefore depend on each other and lastly power and resource
dependence are directly linked (Collins & Hillman, 2009).

In the recent times, resource dependence theory has been under investigation in
several review and meta-analytic studies: Collins and Hillman (2009); and Cobb
(2010); which all indicated the importance of this theory in explaining the actions of
organization such as forming interlocks, alliances, joint ventures, and mergers and
acquisitions, in striving to overcome dependencies and improve an organizational
autonomy and legality. While resource dependence theory is one of many theories
of organizational studies that characterize organizational behavior, it is not a theory
that explains an organization's performance per se. But still in many ways, resource
dependence theory predictions are similar to those of transaction cost economics and
shares some aspects with institutional theory (Drees & Heugens, 2013).

Resource dependence theory provided a distinct insight on relationship management

in business transactions albeit the empirical application of the theory being too
narrow. The scholars exploring a multiplicity of ways in which firms could manage
dependence relations failed to accomplish the envisioned tasks while resource
dependence theory narrowed its focus thus the institutional theory became expansive.
It was open to scholars who were interested in one of their main concepts, even if the
intention was completely orthogonal to the original motivations of institutional
theory (Oliver, 1991).

29
The open tent approach allowed institutional theory to develop fairly quickly from an
explanation for the rationalization of the organization to a wider theory about the
macro-cultural environment of organizations. The flexibility of institutional theory
made it attractive to management scholars who were looking for non-economic
explanations for organizational phenomena. Because institutional theory was seen as
more flexible, it became a formidable competitor to resource dependence theory in
management scholarship, which would gradually become the hot bed for influence
building in organizational theory (Sharif & Yeoh, 2014). The major philosophy in
line with Resource dependence theory emphasizes the need for synergy between
buying entities and the suppliers in business circles. This approach is one of the key
requirements on the concept of buyer-supplier collaboration and therefore, this
theory anchors the first specific objective of the study on the influence of buyer-
supplier collaboration on procurement performance in public universities in Kenya.

2.2.2 Theory of Constraints

The theory of constraints was initiated by Goldratt (1984) through his bestselling
novel entitled the goal. The theory of constraints is a methodology for identifying the
most important limiting factor that is (Constraints) that stands in the way of gaining
goal and then systematically improving that constraint until it is no longer the
limiting factor. This is accomplished by establishing a methodological approach that
devises the prone areas that create disturbance in the set organizational activities.

The theory of constraints assumes a systematic concept to improvements. It

hypotheses that every complex structure, including procurement, manufacturing
processes and distribution consists of several linked activities, one of which acts as a
constraint upon the entire system. Since the decisive goal of most of the
organizations is to make profit both in the short term and long term this theory
provides a powerful set of tools to achieve the set goals (William, 2007).

One of the appealing characteristics of the theory of constraints is that it prioritizes

improvement in activities. The top priority is always the current constraint. In
environments where there is an urgent need to improve, TOC offers highly focused
modalities for creating rapid improvements. A successful theory of constraints

30
implementation has the following benefits: Fast improvements of activities,
increased profits, improved capacity, reduced lead time and also reduced inventory
(Vorne, 2011).

Watson (2006) indicates that the underlying premise of the theory of constraints is
that organizations can be measured and controlled by variations on three measures:
throughput, operational expense, and inventory. Inventory is all the money that the
system has invested in purchasing things which it intends to sell. Operational
expense is all the money the system spends in order to turn inventory into
throughput. Throughput is the rate at which the system generates money through
sales. Before the goal itself can be reached, ideal conditions must first be met. These
typically include quality, safety, legal obligations, etc. For most businesses, the goal
itself is to make money. However, for many organizations and non-profit businesses,
making money is a compulsory condition for pursuing the goal. Whether it is the
goal or a necessary condition, understanding how to make sound financial decisions
based on throughput, inventory, and operating expense is a significant requirement
(Alexandre, 2009).

Dettmer (2003) confirms that the limiting factors of this theory are the impediments
or constraints. At any given time, an organization is faced with at least one constraint
that limits business operations. Typically, as one constraint is eliminated another
constraint will arise. The organization should then focus its attention on the new
constraint. And this process repeats itself continuously. According to the theory of
constraints, the best way for an organization to achieve its goals is to reduce
inventory, reduce operating expenses and increase throughput. Some criticisms of
this theory include the idea that Goldratt borrowed concepts and ideas from
preceding studies but failed to recognize these contributions to this theory (Wayne,
2009).

In reference to this theory, there is conspicuous action plans analyzed, discussed and
recommended based on procurement risk management e.g. risk identification, risks
mitigation and most importantly rational decisions on how to avoid risks in
procurement functions. This theory therefore, links the second specific objective of

31
the study on the influence of procurement risk management on procurement
performance of public universities in Kenya.

2.2.3 Deontological Theory

The deontological theory is primarily the work of Kant (1785) in his approach of the
grounding for the metaphysics of morals that emphasized on developing a clear
understanding of moral principles that could prevent distractions. According to Kant
actions are moral if they are put in place without concealed motive and the moral
quality of an action is judged not according to the action’s consequences but
according to the motive that produced it. Also actions are moral if they are executed
out of respect for the moral law contrary to some other motivation such as a desire or
need.

Deontology is an extensively accepted principle that involves an honest, open,

accountable and accessible approach to communication. In the spirit of sustainable
procurement organizations of all types are reporting on economic, social, ethical and
environmental impacts. The drivers for this disclosure include reputation
enhancement, demonstrating an ethical position to stakeholders and meeting investor
demand for performance information. Failing to be honest and open and about the
organization and its practices can be detrimental to the organization and damage its
image. Deontology can improve the organization’s credibility, community’s
commitment and the public trust to the organization (Micheal, 2015).

Over the years various scholars have examined the idea of deontology theory. Han
(2012) confirms that the premises of deontology enforce a totalitarian system of
honesty at the expense of other social values such as secrecy, shame and trust.
Anthropologist have long undertaken ethnographically the relation between revealed
and concealed information and have increasingly taken up the subject in relation to
transparency and accountability.

According to Birchall (2011) the rise of deontology as a political and cultural

approach has left secrecy to add negative connotations. The moral conversation that
condemns secrecy and rewards transparency may cause many people to

32
misunderstand the symbiotic link between these terms. The prime model of
governmental data driven transparency paves way to neoliberal subjectivities that
decrease the risk of politics as a ground of dissent between real alternatives.

This theory addresses the fundamental ethical standards that ought to be followed by
public entities in the entire process of procurement e.g. impartiality, openness,
confidentiality, due diligence, fidelity to professional responsibility and honesty. To
this extent, therefore, the theory supports the third specific objective of the study on
the influence of transparency and accountability on procurement performance in
public universities in Kenya.

2.2.4 Records Continuum Model

This model was pioneered by Upward (1996) with contributions from Sue
Mckemmish and Livia Lacovino as a rejoinder to the then developing debate that
was about the challenges of managing digital records and archives in the discipline of
Archival science. The records continuum model (RCM) was first published in
Upward’s 1996 paper "Structuring the Records Continuum Part One: Post custodial
principles and properties". Upward describes the RCM within the broad framework
of a continuum where activities and connections convert documents into records,
evidence and memory that are used for several purposes over time. The RCM is an
abstract conceptual model that clarifies issues based on understanding recordkeeping
activities.

According to Mckemmish (1997) recordkeeping activities take place prior to the

records creation and this is necessitated by identifying recordkeeping requirements in
action plans, systems, procedures, rules, social requirements that affect on what is
created and how it is managed over space-time. The implication of an RCM concept
to records and archives is that systems and processes can be put in place before
records are even generated. A continuum model therefore indicates that records are
both current and archival at the point of formation. The RCM is designed as a series
of concentric rings that entail dimensions of creating, capturing, organizing and
pluralizing crossed axes based on transactionality, evidentiality, recordkeeping and
identity.

33
The RCM states the enormous and diverse perspectives that contribute to records and
archives including individual, group, organizational, institutional and societal. These
frameworks disclose the need to take into account various stakeholders and co-
contributors in relation to use, access and assessment of records and archives. Over
the existence of a record numerous decisions are made by various personalities of the
records that include, but are not limited to records managers and archivists. Other
individuals can be identified at various dimensions of interaction, including those
involved in providing as well as community. Records are therefore not just physical
or digital representations of physical objects held and managed in an archive or
repository, but are proof of various perspectives, narratives and contexts that
contributed to their development (Upward, 1997).

Mutero (2011) alludes that the RCM is often described as being different or at odds
with the lifecycle records model. While the RCM is inclusive of numerous ways of
conceptualizing and performing recordkeeping, including a lifecycle concept, there
are some significant differences. Firstly, of all, where the lifecycle model shows
clearly demarcated phases in the management of records, a continuum model
conceptualizes elements as continuous with no visible parts. Secondly, the lifecycle
approach identifies clear conceptual and procedural limits between active or current
records and inactive or historical records, but a continuum approach deems records
processes as more incorporated across space-time. In the continuum it is
recordkeeping processes that carry records forward through space-time to enable
their use for various purposes. Archival records are thus not just historical, but are
able to be re-created, re-interpreted, and re-contextualized according to their place
and use in space-time. In this way, archival institutions are nodes in the system of
recorded information and its framework, rather than the end point in a lifecycle stage
for records.

Reed (2010) confirms that it is important to note that RCM is the most well-known
of all the continuum models created, but does not exist in isolation. Several other
complementary models have been developed by RCM creator Frank Upward, and
there are others created by continuum researchers that offer enhanced or alternative
ways of understanding the continuum. Basically, the new models advanced by Frank
Upward were initiated in order to compliment the records continuum model and
34
provide a solid base of conceptualizing and comprehending this model well. The
series of continuum models created by Frank Upward include: Information Systems
(Data) Continuum Model (data modeling and data flow), Cultural Heritage
Continuum Model (the stories the documents tell and the significance of those stories
to others), Publication (Access) Continuum Model (the reach of accessibility and the
way the document is issued), Information Continuum Model (Barbara Reed, Don
Schauder, Frank Upward) (the technologies driving the system and classification
methods). Other models include juridical contexts of the Records Continuum Model
(Livia Iacovino), Mediated Recordkeeping: culture-as-evidence (Leisa Gibbons).

Records continuum model focuses more on record keeping on contractual activities

in procurement function and provides a trail of evidence on transactional activities
from time to time. This include ascertaining the implementation of policies, systems,
rules, economic requirements that affect what is created and how it is managed in
specific time frame. This model, therefore, correlates with the fourth specific
objective of the study on the influence of contract records management on
procurement performance in public universities in Kenya. The records continuum
model is captured in the review of this model (see Figure 2.1).

Figure 2.1: Records Continuum Model; adapted from Upward Frank (1990)

35
2.2.5 Legal Theory

Legal theory popularly known as jurisprudence was started in year 1832 by John
Austin. This renowned scholar of law deeply explained the nature of law in its most
general form and provided a deeper understanding of legal reasoning, legal systems,
legal institutions and the role of law in society. Leiter (1998) indicates that legal
theory is a discourse that explains variety of conventional aspects that govern law in
all spheres of life. These include analytic jurisprudence, normative jurisprudence and
sociological jurisprudence. In his submission about the legal theory, Austin (1832)
argued that laws are rules, which are defined as the command. More precisely, laws
are general commands issued by a sovereign to members of an independent political
society and backed up by adverse consequences in the event of non-compliance.

Pillai (2016) asserts that contemporary philosophy of law, which deals with general
jurisprudence, addresses problems internal to law and legal systems and problems of
law as a social institution that relates to the larger political and social context in
which it exists. This aspect basically defines the judicial process that ought to be
followed by the magistrates and judges when making rulings of the cases presented
to them. The foundations of law are accessible through reason and it is from these
laws of nature that human laws gain whatever force they have. Analytic
jurisprudence rejects natural law's fusing of what law is and what it ought to be. It
espouses the use of a neutral point of view and descriptive language when referring
to aspects of legal systems. It encompasses such theories of jurisprudence as "legal
positivism", which holds that there is no necessary connection between law and
morality and that the force of law comes from basic social facts. Legal realism is also
another component of analytic jurisprudence and it indicates that the real-world
practice of law determines what law is, the law having the force that it does because
of what legislators, lawyers, and judges do with it (Raymond, 2009).

Hart (1994) indicated that normative jurisprudence is concerned with "evaluative"

theories that provide prescriptive questions about the law. It deals with what the goal
or purpose of law is, or what moral or political theories provide a foundation for the
law. It not only addresses the question "What is law?", but also tries to determine

36
what the proper function of law should be. This gives rise to the question- what sorts
of acts should be subject to legal sanctions and what kinds of punishment should be
permitted if there is a non-compliance of what is ought to be done. If complying with
the legislated laws turns out to be unsurmountable to the citizens, it’s therefore,
incumbent upon the legislative organs of the country to revise the laws with a sense
of creating sound, reasonable and practical laws that are predominantly working
towards the interest of the country in general.

Criminal laws, for example, remove certain behaviors from the range of behavioral
options by penalizing them with disciplinary measures to deter the offenders from
repeating the mistakes. Likewise, civil laws require people to take certain precautions
not to injure others and to honor their contracts. But the principle of prima facie
should always prevail in all social activities, meaning that one party to the legal
proceedings has a burden of proof which requires it to present all circumstantial
evidence for a case to be concluded (Himma, 1998). According to Devlin (1965)
legal moralism is an important aspect in normative jurisprudence. It views that the
law can legitimately be used to prohibit behaviors that conflict with society’s
collective moral judgments even when those behaviors do not result in physical or
psychological harm to others. Aquinas (1988) suggests that legal moralism, implies
that it is permissible for the state to use its coercive power to enforce society’s
collective morality for the interest of the state and possibly remedy the affected
parties from unscrupulous undertakings.

Feinberg (1985) had a different view on the offence principle advanced in normative
jurisprudence. The scholar contends that the offensive principle does not provide
sufficient protection against the wrongful behaviors of others, as it is inconsistent
with many criminal prohibitions we take for granted as being justified. The harm
principle must be augmented by the offense principle, which he defines as follows:
“It is always a good reason in support of a proposed criminal prohibition that it
would probably be an effective way of preventing serious offense to persons other
than the actor and that it is probably a necessary means to that end.”

37
Bix (1995) confirms that sociological jurisprudence is a term coined by the American
Jurist Roscoe Pound to describe his approach to the understanding of the law. This
philosophical approach to law stresses the actual social effects of legal institutions,
doctrines, and practices. In Germany, Austria and France, the work of the "free law"
theorists (e.g. Ernst Fuchs, Hermann Kantorowicz, Eugen Ehrlich and Francois
Geny) encouraged the use of sociological insights in the development of legal and
juristic theory. In the second half of the twentieth century, sociological jurisprudence
as a distinct movement declined as jurisprudence came more strongly under the
influence of analytical legal philosophy; but with increasing criticism of dominant
orientations of legal philosophy in English-speaking countries in the present century,
it has attracted renewed interest. Increasingly, its contemporary focus is on providing
theoretical resources for jurists to aid their understanding of new types of regulation
(for example, the diverse kinds of developing transnational law) and the increasingly
important interrelations of law and culture, especially in multicultural Western
societies.

This theory connects fully with the moderating variable of the study that is legal
compliance in the sense that the rallying call for the law is compliance to the
stipulated guidelines. This is evidenced in the legal theory where a clear position of
the law indicates that willful breach of the law, or unauthorized departure from the
procedures derived from constituted guidelines prompts a disciplinary action.

2.2.6 Supply Chain Operations Reference Model

The Supply chain operations reference (SCOR) model was originally developed in
1996 by PRTM, a management consulting firm and endorsed by the Supply Chain
Council (SCC) in 2004 as the cross-industry, standard diagnostic tool for supply
chain management. The SCOR model describes the business activities associated
with satisfying a customer's demand, which include plan, source, make, deliver,
return and enable. Use of the model includes analyzing the current state of a
company's processes and goals, quantifying operational performance, and comparing
company performance to benchmark data. SCOR has developed a set of metrics for
supply chain performance, and Supply Chain Council members have formed industry

38
groups to collect best practices information that companies can use to elevate their
supply chain models. This reference model enables users to address, improve, and
communicate supply chain management practices within and between all interested
parties in the extended enterprise (Rosenbaum, 2003).

Poluha (2007) suggests that by describing supply chains using process modeling
building blocks, the model can be used to describe supply chains that are very simple
or very complex using a common set of definitions. As a result, disparate industries
can be linked to describe the depth and breadth of virtually any supply chain. The
SCOR management processes replicate the following outcome in business
operations: Plan processes balance aggregate demand and supply to develop a course
of action which best meets sourcing, production, and delivery requirements while
considerations on source ensures processes that procure goods and services meet
planned or actual demand.

Make approach creates processes that transform product to a finished state to meet
planned or actual demand. As a way of providing processes that provide finished
goods and services to meet planned or actual demand deliver concept is emphasized.
Return ensure processes associated with returning or receiving returned products for
any reason is addressed. Lastly the enable approach ensures processes being
associated with the management of the supply chain e.g. business rules, performance,
data, resources, facilities, contracts, supply chain network management, managing
regulatory compliance and risk management are adhered to (Simchi et al., 2008).

According to White (2018) the supply chain operations reference (SCOR) model
helps businesses evaluate and perfect supply chain management for reliability,
consistency and efficiency. SCM is complex, but the SCOR model is intended to
help standardize the process and create a measurable way to track results. It’s meant
to work across industries using common definitions that can apply to any supply
chain process. Using the SCOR model, businesses can judge how advanced or
mature a supply chain process is and how well it aligns with business goals. There
are three levels used to measure supply chain performance. These levels help
standardize supply chain performance metrics so that companies can be evaluated
against other businesses, even if they’re operating differently. The SCOR metrics

39
that form the basis of supply chain performance comprise attributes based on:
reliability, responsiveness, agility, costs and asset management efficiency.
Businesses use these attributes to establish the requirements for the supply chain by
figuring out which performance indicator to prioritize and which areas the business
can perform at an average pace (Rosenbaum, 2012).

According to Dewicki (2015) though SCOR model have transformed transactional

and operational activities in the supply chain set up, there a scores of areas that
undermine full perfection of supply chain performance. One common criticism of
SCOR is that it is too “generic” to describe the peculiarities of a given industry or
company. But it is in that lack of specificity that its true genius is revealed. At the
task level, one or two levels of decomposition below SCOR’s processes, most
companies describe their activities using jargon, IT system entries, and other terms
unique to their products, services and customers. By masking those unique steps
within higher level “black boxes,” supply chain leaders working with counterparts in
other companies and organizations can more easily identify the actors, events and
data needed - that is, the hand-offs - to orchestrate multi-enterprise processes
(Salazar, 2012).

Stadtler (2005) confirms that a thinly veiled criticism on SCOR is also evident in the
vast array of metrics at each of the model’s three process levels. While it is true that
the hundreds of individual measures can seem daunting to say the least, it’s
important to understand what SCOR curators considers to be the fundamental
attributes of any supply chain: Reliability, Responsiveness, Flexibility, Costs and
Assets. Each process step or activity within SCOR contributes to them in some way,
so the metrics are intended to assess the outcome of each step with respect to those
attributes. This level of granularity enables practitioners to quickly identify
bottlenecks requiring the application of lean and other methods to improve process
efficiency and effectiveness. These actions lower costs and increase throughput,
quality and first-pass yield. To this extent therefore the SCOR model has limitations
that lead to gaps in the need for performance evaluation in organizations (Lemghari
et al., 2018).

40
This model relates to the dependent variable of the study that is procurement
performance which serves as a sub-set of supply chain performance. Broad analysis
on supply chain operations reference model are clearly indicated (see Figure 2.2).

Figure 2.2: Supply Chain Operations Reference Model; adapted from Supply
chain council 2010

2.2.7 Relational Contract Theory

This theory was developed in the United States by a renowned legal scholar by the
name Ian Roderick Macneil in 1969. Relational contract theory is based on the view
that contracts are relations-oriented rather than discrete business dealings. This
theory is based upon a relationship of trust between the parties involved in the
contract management. The explicit terms of the contract are just an outline as there
are implicit terms and understandings which establish the behavior of the parties.
Relational contract theory covers economic exchange in general, not just contracts
that would be acknowledged as lawfully enforceable agreements by courts in any
given jurisdiction, that relations are mostly held collectively by their own internal
values and the broad environmental, social as well as economic factors, and, at least
in relational theory in the Macneil mould, that exchange relations are governed by a
series of norms (Austen, 2009).

41
What is particularly distinctive about this concept is the postulation of a number of
"norms in a positivist sense," of which ten common contract norms relate to all
contracts: role integrity; reciprocity, implementation of planning; effectuation of
consent; flexibility; contractual solidarity; the linking norms; the power; propriety of
means; and harmonization with the economic, social and environmental matrix. This
last aspect is not to indicate that relational contract theory is normative in nature, it
sets out what ought to be the case properly and this creates a dimension that is
genuinely observable and normal factors are always at play (Campbell, 2001).

According to Baker (2009) previous writing may be taken in places to imply that the
substantive rules of contract law need to be reframed to recognize the relational, non-
discrete nature of contracts and this has not been subsequently pursued and current
scholars like (Eisenberg, 2000) have suggested that it is neither possible nor
necessary to reform the law of contract itself to work successfully with relationally-
constituted contracts. Baker who is well known scholar on matters of contact
management from England has more recently proposed a different version of
relational contract theory, called “comprehensive contract theory,” which posits
“comprehensive contract norms.” Although this scholar does not refute the validity
of Macneil’s norms as a complex tool of analysis of contract management its work
has immense glaring loopholes that make it hard for a proper direction to be followed
in dealing with procurement performance.

In the context of this theory, there are explicit attributes that address contract
management for e.g. enforcement of agreements in business transactions and the
need for procurement professionals to have clear knowledge on jurisprudence. This
theory therefore, instigated the general objective of the study and the intrinsic views
in contract management assisted in exploring how contract management influences
procurement performance in public universities in Kenya.

2.3 Conceptual Framework

Conceptual framework is a detailed description of the phenomenon under study

accompanied by a graphical or visual depiction of the major variables of the study
(Mugenda, 2008). The conceptual framework below shows the relationship between

42
the dependent and independent variables. The dependent variable in this study is
procurement performance, which is represented by cost effectiveness, customer
satisfaction and procurement agility which are proxy indicators of university’s
performance. The independent variables are the influence of: buyer-supplier
collaboration, procurement risk management, transparency and accountability and
contract records management on procurement performance in public universities in
Kenya. The relationship between contract management and procurement
performance was moderated by legal compliance which was measured by Above
Average Compliant, Average Complaint and Non-Complaint in line with PPADA,
2015 (PPRA, 2018). The conceptual framework was developed from the review of
literature and assumed a linear relationship between the variables (see Figure 2.3).

Buyer Supplier Collaboration

-Commitment
-Trust
-Continuous Improvements

Procurement Risk Management

-Contingency Plans
-Internal Controls
-Risk Sharing Procurement
Performance
-Cost Effectiveness
Transparency and Accountability -Customer Satisfaction
-Impartiality -Procurement Agility
-Due Diligence
-Procurement Probity
Legal Compliance
-Above Average Complaint
-Average Compliant
Contract Records Management -Non-Compliant
-Audit Trail
-Information Accessibility
-Information Accuracy

Independent Variables Moderating Variable Dependent Variable

Figure 2.3: Conceptual Framework

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2.3.1 Buyer-Supplier Collaboration

According to Gebert (2013) a dysfunctional relationship between the buying

organizations and suppliers or contractors is the main cause of mediocre performance
in the holistic supply chain function. Contract administration ought to be executed by
parties that have harnessed well their expectations in a way that is for the mutual
benefits of the business. It is therefore, important for buyers and service providers to
have a workable relation in order to address these negative predicaments that may
create uncertainty on the progress of the various activities that are being
implemented. Establishing long-term collaborations with capable suppliers and
working closely with them over time to achieve high levels of quality and
productivity involves communicating intentions and expectations clearly, defining
measures of success, obtaining regular feedback, and implementing corrective action
plans to improve performance (Shahzad, 2015).

Lysons and Farrington (2012) indicates that world class organizations are replacing
the conventional buyer-supplier relationship with strategic collaborations that turns
out to be an explicit part of the procurement functions. This is as a result of a
backdrop of the need for organizations to be competitive in the market. Managing
buyer-supplier collaborations is a major concern to the buyers as source
consolidation continues to be effected. The objective is to increase business with
those key suppliers that are the most capable partners. Achieving this objective
requires that these partnerships be developed, structured, administered and evaluated
to determine whether they are successful in meeting the buyer’s needs. It is upon the
buying entities and suppliers to have shared common objectives and compatible
benefits that consists: agreed problem-solving methods and shared risks according to
who can best manage them, an active search for continuous measurement
improvements and ways of managing relationships proactively in order to avoid
breakdowns in future (Waithaka, 2015).

The result of a buyer-supplier collaboration in competitive platform has been to

improve performance in business operations. In order to have a good working
relationship with suppliers it is important to undertake regular supplier assessment
since some suppliers turns out to be complacent in a period of time. This enables the
44
buyer to determine whether the supplying organizations subscribe to its vision, that
the same management teams share the same policies, that the supplying organization
has the capacity for operational expansion in line with the business requirement and
most importantly cross checking whether the supplier forms part of strategic analysis
and identify the gap between current performance and future performance that is
required (Larson, 2014).

Shahzad (2015) examined the effect of Buyer-supplier partnership and information

integration on supply chain performance. Based on the research findings buyer
supplier relationship significantly affects trust which subsequently influences quality
information as well as real-time information. According to the researcher
maintaining buyer-supplier partnerships, a high level of trust would be the first belief
of participants to be keen to take risk in establishing partnership relationship.
Without putting in place the initial conviction for their partners, the other issues in
social and economic exchange would not be possible. The finding of the study also
indicated that establishing strong relationship between supply chains parties need to
increase mutual trust aiming for achieving common benefits from their relationships.
Such common benefits have been instrumental in determining the effects of
information integration.

From the above studies it is prudent for organizations to have a common ground that
emphasizes the need for buyer supplier collaboration if a sustainable progression of
the set goals and objectives is to be achieved in the long run. This attribute is dictated
by the need for the buyers and suppliers to have a competitive advantage and be in a
position to tackle the turbulent challenges in the market. The bottom-line is the
continuous benefits that can be shared across the board through proper collaboration
when agitating for the true the interest of the organizations. Gebert (2013) denoted
that the consistency and focus of organizations in nurturing a business relationship
yields unending benefits between the parties involved hence a win-win situation for
the business operators because of the exponential returns from time to time.

45
2.3.2 Procurement Risk Management

Arjan and Van (2014) specified that procurement is a function that entail immense
risk factors that arise from internal and external environment, as well as strategic and
operational considerations. Basically, strategic risks are considered in relation to
medium and long-term goals and objectives of the organization. They include:
Political risks, economic risk, social risk, technological risk, regulatory risk and also
competitive risk. Operational risk entail: professional risk, financial risk, legal risk
and also environmental risk. Procurement’s role is to ensure that an organization has
a predictable supply of the external input/s it requires, offering demonstrable value
for money and delivered in a cost-effective manner to support the attainment of the
organization’s objectives. While its conventional role is in dealing with upstream
suppliers in a supply chain context, it may also deal with downstream transactions,
e.g. for logistic support in distribution of finished product (Liang, 2017).

Arjan and Van (2014) confirms that by its nature, procurement exposes an
organization to risk. Procurement practices have, for this reason been established
with inbuilt controls designed to deal with that risk, for example purchasing through
public or selective tendering, in the right circumstances, will encourage competition
and reduce the scope for fraud and collusion in acquisition processes. Procurement
should identify risk factors associated with each procurement, analyze the probability
of the risk occurring and consider the impending impacts. Risk management plans
should then be developed, based on the decision to avoid, assume, or transfer the
established risks.

Christopher (2018) noted that the precondition to overall risk management is the risk
assessment. Risk assessments entail analyzing the chance and the effect of every
known risk on the attainment of established objectives, as well as the corrective
action to take should that risk occur. The risk assessment is therefore a requirement
for establishing how the risks should be controlled, managed and eliminated.
Mitigation seeks to put measures in place to lessen the severity of a risk event,
should that event occur.

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Liang (2017) asserts that the procedure of the overall risk management plan is a
continuum based on the size or nature of the procurement. Planning can extend from
simple consideration or incorporation of risk registers as a part of the procurement
planning program, to inclusion of risks in more prescribed acquisition plans, to
comprehensive risk management plans on enterprise-wide projects where their
complexity and scope warrants it. To realize the maximum benefit of risk
management, the management and communication of risks needs to be fundamental
part of existing procurement and organizational functions.

A major factor leading to a greater focus on risk management in the procurement

framework is the blurring of organizational boundaries, through: increasing use of a
“contingent” workforce, that is contractors rather than employees; outsourcing of
operational and transactional functions, including business processes and logistic
services to achieve strategic, competitive, and commercial advantages; and the
establishment of collaborative relationships with suppliers and customers as
important members in the overall supply chain (Arjan & Van, 2014).

When changing to commercial environment, it is necessary to complement a process

view, where risks are identified and treated as isolated events, with a holistic view of
risk where organizational objectives and procurement are considered together and
their interrelationships and associated risks are addressed. This higher level approach
will identify opportunities to increase value through systems; including shortening
lead times, reducing inventory holdings, and supporting the development of new
market opportunities for the business (Christopher, 2018). The integration of best
practice in risk management will better position the procurement professional to
manage stakeholder expectations, and facilitate outcomes that are within the risk
tolerance of the organization. Risk Management, applied effectively, will assist the
procurement professional to identify changes to the procurement environment,
implement treatment plans and reengineer cost effective procurement process to
mitigate risk (CIPS, 2013).

Liang (2017) adds that all procurement professional should be an active participant
in risk management seeking to ensure integration between procurement risk
management and other relevant risk management activities. Desirable key activities

47
include: maintaining a procurement risk management framework which is integrated
with the procurement process and wider organizational risk framework, monitoring
sources of procurement risk for material change that may impact on the
organization’s ability to achieve its objectives, identifying tools and techniques that
will assist with the identification and assessment of risk, ensuring that the
organization’s procurement processes and methods are effective in treating identified
risks, clearly articulating the risks, in terms of uncertainty and severity when making
procurement decisions, actively participating in risk management discussion at
strategic and operational levels (Arjan & Van, 2014).

2.3.3 Transparency and Accountability

Carter (2014) indicates that transparency and accountability constitutes a central

pillar of any procurement system. Without transparent and accountable systems
enabling governments and citizens to engage in a mutually responsive way, the vast
resources channeled through public procurement systems run the danger of increased
corruption and misuse of funds. Even in a system with low levels of corruption,
public and civic oversight can help identify inefficiencies, thereby increasing
procurement efficiency and effectiveness for the benefit of improved service delivery
and ultimately citizens. According to Gaventa (2013) Public procurement is
vulnerable to fraud but the enhancement of transparency and accountability in
contract awarding mechanisms as well as fair and adequate regulations may
contribute to the efficiency of tendering practices.

Accountability exists when rights holders and duty bearers both deliver on their
duties. This conceptually connects accountability to a rights-based understanding of
development following three principles: “inclusive rights for all people, the right to
participation, and the ‘obligations to protect and promote the attainment’ of rights by
states and other duty bearers” (Acosta, 2013). In order to enhance transparency in
public organizations, the managers should instill greater disclosure, accuracy and
clarity into communications with stakeholders. Also a lot of sensitization on issues of
transparency and accountability should be a priority in organization’s strategical
plans since the outcome of this initiative can dispel the notion that procurement is the

48
epicenter of fraud in business transactions. The intricate nature of this argument
brings negative connotation to procurement profession. As such, the active
engagement of a government on one side and its citizens on the other is necessary to
achieve any measure of accountability (Zyl, 2014).

McGee and Gaventa (2013) asserts that lack of transparency and accountability has
affected procurement performance of many public entities. Conventional wisdom
indicates that all stakeholders on matters of public procurement need to do a
thorough oversight on the process applied to acquire products or services. Although
many countries have a series of regulatory bodies to oversee procurement
performance, to a great extent the media in the recent history has become the
‘watchdog’ because of its independence. Many procurement scandals have been
revealed by the members of the fourth estate and a free press is an authoritative tool
to promote transparency and accountability in public procurement on contractual
activities.

Calland and Bentley, 2013 affirms that in public procurement the role of the media is
three-fold. Firstly, it is a channel for communication regarding public procurement
and the transfer of prescribed procurement information such as tender notices, award
notices, etc. Nowadays, public entities are required by law to publicize procurement
information. The purpose of this information is to fulfill obligations related to
disclosure and transparency. Secondly, the role of the media in public procurement is
to uncover procurement irregularities, and thus strengthen the claim for transparent
and accountable government. Carlitz (2013) alludes that the intrigues of modern
public procurement can make this difficult, but many procurement authorities invite
media representatives to public procurement trainings and workshops which enable
journalists to understand and critically investigate the subject matter. Although the
media has the responsibility to examine public procurement, some consider the
media coverage to be overly focused on scandals and to have too little positive
procurement news. Thirdly, the media can serve as a means for education regarding
public procurement, sensitizing the general public on procurement rules, systems and
regulations and principles (Carter, 2014).

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Calland and Bentley (2013) alludes that there is slight doubt that under the right
circumstances improved transparency in public procurement can lead to better
accountability, improved service delivery and, ultimately, less misuse of public
resources. In the interim, a lot of factors should be considered when attempting to
strengthen transparency through improved access to information. Among the critical
areas is monitoring and controlling of the procurement process and the information it
produces e.g. tender documents, bids, minutes from technical committees, bid
evaluation records etc. Further, when investigating contravention of the procurement
law, it is prudent, practical and perhaps proactive to find out the beginning of the
malpractice and not to have a blanket condemnation to procurement function. The
giveaway signs in procurement department may be just a tip of the iceberg since in
procurement process there is segregation of responsibilities from the requisitioners,
evaluators, contract negotiators, contract validators and authorizers of the payment to
the suppliers or contractors. Each of these university representatives in the
procurement process are capable of instigating fraud.

Zyl (2014) indicates that under a system where observers are physically in
attendance during bid evaluation meetings, a key concern must be to maintain the
integrity and independence of these observers. This could be done through training
activities, rotation schemes or other actions to be considered. Transparency in public
procurement is about information. The access to key procurement information by the
media and other stakeholders, and the ways in which these actors can use the
information, directly affects accountability. More importantly, transparency is
deemed a highly cost-effective way of achieving greater accountability (Carter,
2014).

2.3.4 Contract Records Management

The prime function of contract records management is to facilitate a reference point

on contractual transactions in an organization by ensuring that information is
available when and where it is needed. Records hold vital information in line with
organization’s activities captured in all business transactions in a given time.
Procurement records present and authenticate the resolution taken, the proceedings

50
carried out and the outcome of such dealings, support action plans and decision
making in management, it protects the welfare of the organization, the right of the
company, customers, suppliers and help the organization to perform its business and
deliver its services in unwavering and impartial trend (Freda, 2014).

Contract records management is crucial to all organizations private or public, small

or big. In circumstances devoid of effective records management, it is not possible to
execute business in transparent and accountable manner since there is no guiding
document to account for what has transpired in the past or to make decisions about
the future. Procurement records are a fundamental corporate asset and are needed to
provide evidence of action and decisions. The significance of records management is
gradually being acknowledged in organizations. Procurement records forms main
sources of information and are the most dependable and lawfully verifiable source of
data that can serve as evidence of actions, decisions and transactional obligations of
organizations (Musembe, 2016).

According to Mordecai (2022) the function of contract records management is to

make sure that staffs involved in different activities have the information they need,
when required. Records are used as an information resource in strategic planning.
The service provided by contract records management is of vital significance to both
employees and organizational success. Contract records management platform,
therefore, acts as a control structure that reinforces systems such as internal and
external auditing. The records management creates opportunities to discover
corruption in an organization. Records can provide a trail for investigators to track
the source of fraud. Nevertheless, for records to be meaningful in this capacity, its
accessibility is mandatory.

Freda (2014) argues that organizations are currently involved in knowledge

management. Contract records management should be seen as an enabling function
towards knowledge management. The case should be that without records, an
organization would lose an affluence of knowledge provided by its employees during
day to day operations. The business realm requires that records must be created and
maintained to support the important activities of an organization in serving as the
basis through which decisions are taken to ensure reliability, consistency in

51
providing evidence of the organization’s operations and ensuring progressive
performance. Despite the fact that businesses are increasingly being conducted
through automotive means, both within and between organization, records should
still be reserved to support and fully document all business, fiscal, legal, social and
past needs.

Musembe (2016) indicates that good contract records management system is

necessary for supporting accountability and transparency in financial management.
As a dependable tool of evidence, records make sure that the organization has
fulfilled its distinct financial, social, legal, ethical obligations. In all accountability
sessions, records are deemed as the true reflection of activities by managers, auditors,
investigators or by anyone inquiring into a decision, a process or the performance of
individual or an organization. Organizations should therefore maintain reliability and
accuracy in their record management systems. Poor contract records management has
been a contributory reason to fraud in most organizations. Members of the public
also rely heavily on records to question, criticize, and hold staff of the organizations
accountable. Authentic records present an ideal connection between an approval
assigned to a particular person and the date of the activity. This provides evidence
that identify misuse, abuse, and non-compliance with financial obligations and
regulations that have legal implications. As a result, records management provides
mitigating approaches, reliable restraint against fraud and corruption.

According to the Mordecai (2022) procurement function is engrossed by many

activities and therefore contractual work has increased in importance. It has become
a decisive element of commercial planning where the need for more effective
government underpins much of a department’s activities. Records produced in the
course of the work may be vital in providing evidence of departmental effectiveness
and in managing any lawsuit that might arise from it. Departments should ensure that
they maintain records of all contracts and related business transactions on registered
files. The files must contain correct and complete records of all internal and external
documentation so that the stages and analysis of the transactions are evident. Such
precise and dependable record keeping will ensure that a complete audit trail is
provided.

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2.3.5 Legal Compliance

The meaning of legal compliance especially in corporate legal department’s

perspective has recently been expanded to include understanding and adhering to
ethical codes within entire profession, as well. There are two requirements for an
organization to be compliant with the law, first its policies need to be in line with the
law and secondly, its policies need to be complete with respect to the law. Within the
realm of public entities strong legal governance helps procurement professionals to
comply with the stipulated guidelines an attribute that paves way to consistent
performance. The legal compliance on procurement performance is underlined under
the threshold of Above Average Complaint (81-99%), Average Complaint (51-80%)
and Non-Complaint (Below 50%) in regard to PPADA, 2015 (PPRA, 2018). Above
average complaint is the state of complying with great percentage of the stipulated
guidelines in line with procurement law. Average Complaint is modest compliance
of the procurement action plans while Non-compliance consist incomplete
fulfillment or marginal repudiation of the guidelines stipulated under the
procurement act (Orobo, 2015).

According to Baily et al. (2015) it is essential for procurement departments to act

responsibly and in compliance with the law. This approach is fundamental to
corporate culture and is the reason why suppliers, taxpayers, shareholders and the
general public place their trust to public entities. It is therefore, prudent for all
stakeholders participating in procurement proceedings to be obliged to act
responsibly and in compliance with the law. Although there is increasing complexity
of businesses that pose risk of laws being violated it is necessary for public
institutions to have a legal compliance code that should provide a direction on what
is supposed to be done. To prevent fraud, waste, corruption or local protectionism,
the law of most of the countries regulates government procurement more or less
closely. It usually requires the procuring authority to issue public tenders if the value
of the procurement exceeds a certain threshold (OECD, 2013).

It is important to note that open tender is the mainstream procurement process

although the government recognizes special exemptions for instance sole source
justification because of the monopoly of the supplier, sole source because of
53
emergency requirements and that the urgency is neither foreseeable by the procuring
entity nor the result of dilatory conduct on its part. More importantly also is the
emphasis of sole source justification because of issues of compatibility that
concentrates on standardization. Public procurement and asset disposal act, 2015 acts
as the reference point on public procurement in Kenya. The legal compliance
framework assists procurement staff to confidently manage obligations imposed by
the government in acquisition of goods and services. It formalizes existing
responsibilities and processes to help manage compliance internally and demonstrate
compliance externally. Monitoring compliance requires awareness by procurement
staff of the legal context in which they conduct their work. The act has been designed
to provide all staff with the necessary knowledge that creates a guideline hence
compliance of the law (Rok, 2015).

Kirande and Rotich (2014) confirms that procurement staffs of all public entities
should be able to instill the key objectives of public procurement that include:
ensuring public organizations get value for money, enhancing transparency and
accountability, ensuring efficiency and effectiveness, promoting competition and
ensuring that competitors are treated fairly by use of competitive procurement
methods, promoting integrity and fairness of procurement procedures, restoring
public confidence in procurement process, building public trust to stakeholders,
facilitating promotion of local industry and economic development and ensuring that
goods and service are obtained at the right price, right quality, right quantity, from
right source and delivered at the right place.

Procurement staff should be mindful of the fact that legal compliance is mandatory
requirement based on the Latin maxim that ignorantia juris non excusat (ignorance
of the law does not excuse) an argument that states that a company (which, in law, is
a legal person) and its servants, such as procurement specialists, are presumed to
know the law. This law in Kenya is encapsulated in section 7 of the penal code which
strictly denote that ignorance of the law does not afford any excuse for any act or
omission. It is also worthwhile to note that all procurement staff should have an
awareness of the possible legal consequences of their actions (Mbae, 2014).

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2.3.6 Procurement Performance

According to Kakwezi and Nyeko (2019) contract management act as a catalyst for
procurement performance through maximizing operational efficiency and reducing
financial risks. It also involves building a good working relationship between
procurement function and the suppliers. It continues through various stages and it
involves managing proactively anticipated future needs as well as reacting to
situations that arise. The central aim of contract management is to obtain the services
as agreed in the agreements and achieve value for money. This means optimizing the
efficiency, effectiveness and economy of the service or relationship described by the
contract balancing costs against risks and actively managing the customer–provider
relationship in business operations.

Vasudevan (2015) indicate that contract management affects organizations

profitability in a very large way due to the emphasis on revenue and expenses. When
a contract is phrased poorly, one organization can lose colossal amount of money
over a simple technicality they lacked the resource to identify. Effective contract
management can ultimately create a powerful business relationship and act as a
roadmap to greater returns on investment (ROI) over a long term. This sensational
outcome is possible in an environment where parties to the business transactions are
up to the tasks that govern the business activities (Sammons, 2017).

Schuhmann and Eichhorn (2019) indicates that contract enforcement forms the basis
of successful contracts management and it is one of the pillars of the rule of law. The
ability to make and enforce contracts and resolve disputes is fundamental if markets
are to function properly. Good enforcement procedures enhance predictability in
commercial relationships and reduce uncertainty by assuring investors that their
contractual rights will be upheld promptly by local courts. When procedures for
enforcing commercial transactions are bureaucratic and cumbersome or when
contractual disputes cannot be resolved in a timely and cost effective manner this
attribute will undermine the commercial transactions. Salim (2013) suggests that the
key attributes of contract management in ascertaining procurement performance
include: management of service delivery. Service delivery management ensures that
the service is being delivered as agreed, to the required level of performance and
55
quality. It is important therefore, to ensure that the services are assessed regularly to
determine procurement performance.

Basically, quality metrics ought to be created that allow the quality of service to be
assessed, even in areas where it is hard to quantify. At the most basic level, the
service must fulfill the terms of the contract. Relationship management keeps the
connection between the two parties open and constructive, aiming to resolve or ease
tensions and identify problems early. Another important attribute is contract
administration which is concerned with the mechanics of the relationship between
the customer and the provider. Also, it provides information on the implementation
of procedures defining the interface between them and the smooth operation of
routine administrative and clerical functions. Contract administration handles the
formal governance of the contract and changes to the contract documentation. Clear
administrative procedures ensure that all parties to the contract understand who does
what, when, where and how to execute the responsibilities at hand (Oluka &
Basheka, 2012).

Salim (2013) suggests that it is necessary to seek performance improvements in

contract management. The aspect of creating a mechanism for continuous
improvement to a great extent impacts positively to the parties to a contract since
exceptional services will be put in place. However, the issue will be based on
whether the parties to the contract will be ready to be governed by the new issues to
the contract. Ideally, the requirement for improvement should be embodied in the
terms of the contract. This can be at a number of levels, from simple price or
turnaround time innovation in the way services are delivered. The provider should be
involved in these considerations, and a good working relationship will be a huge help
in making improvement a reality. As always, it should be remembered that the
provider must benefit too.

Ramadhan (2012) posits that seeking improvements is not about extracting more
from the provider against their will, but about working together to improve quality,
performance, and value for money, or other aspects in such a way that benefits both
parties. Nguyen (2013) alludes that it is necessary to manage rapid changes in the

56
market. New changes in the market makes some decisions agreed upon by the parties
to the contract to be impracticable. The parties to the contract should form a basis of
being bound by the new changes. The drivers for change during the term of a
contract can come from a range of sources. These sources can be internal or external
based. Internal drivers for change include: Evolving business requirements, the
organizational restructuring of either party, significant revisions to the corporate
strategy objectives of either party.

According to Shiwa (2014) external drivers could include: developments in

technology (things which were not possible become possible, and therefore desired,
or necessary to maintain the ‘market’ efficiency of service provision), economic
trends that affect the profitability/value for money of the organizations, relationship –
from the perspective of the customer or the provider, the need to provide electronic
forms of service delivery to meet customer expectation, changes in legislation or
legal interpretation.

2.4 Empirical Review

Empirical studies have shown that effective contract management is enhanced

significantly when parties to the transaction have a mutual relationship since this
action plan culminates to a long term relationship under the premise of a win-win
approach. Shahzad (2015) indicates that the best collaboration programs focus on
segmenting the supplier base. Ideally, there is a reason why companies are selective
in choosing suppliers for collaboration programs. Not every supplier justifies the
investment. With more strategic suppliers that represent a significant part of a
buyer’s spending in some area or that provide special value from the customer’s
perspective-collaboration is the ideal approach.

2.4.1 Buyer Supplier Collaboration

In order to create successful collaboration programs, most organizations have to

develop new capabilities. One of the most important of these is cost engineering, a
way of analyzing, supplier’s products and processes to gain insights into the
economics of the extended enterprise and identify opportunities for improvement. To

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make the relationship more vibrant and productive the buyers and suppliers should
set a policy that advocates mutual interest and working as a team. It is worthwhile to
build credibility for the program at the senior level and within the organization.
There is also a need towards a dynamic of greater trust, more information sharing
and enhanced transparency (Larson, 2014).

Gebert (2013) affirms that successful companies apprises suppliers of its long term
plans, a concept that makes it easier for suppliers to improve their designs, enhance
the quality and the systems they develop. However, relative few buyers approach
their collaborative initiative in a systematic manner. They might work with their
suppliers to reduce the cost of operations, but they don’t integrate suppliers into their
organizations or work with them to reduce complexity and this fact makes the
procurement departments to miss an opportunity to leverage supplier’s capabilities in
need to focus on business changes. This is because some of the appealing goods and
services may turn out to be obsolete and be overtaken by events.

Stella et al. (2013) studied a topic based on Information Sharing, Adaptation, Trust
Commitment in Buyer-Supplier Relationships in the Ugandan SMEs. The researcher
applied cross sectional survey design and adopted a quantitative approach that
focused on describing inferences from the findings on the relationship between
buyer-supplier collaboration, trust, adaptability, relationship continuity and
commitment. The findings of the study indicated that there was a significant positive
correlation between information sharing and commitment in buyer-supplier
relationship. Information sharing was also a significant predictor of commitment in
buyer-supplier relationship. This indicates that when buyers and suppliers agree to
share pertinent information in the process of undertaking business with each other
this approach invariably promotes commitment in their business dealings. The study
recommended that great attention should be emphasized on aspects of commitment
and trust in order to ensure unwavering relationship continuity between buyers and
suppliers in procurement related transactions.

Waithaka (2015) carried out a study on the role of buyer supplier relationship on
supply chain performance in Kenya’s state corporations. The researcher adopted
descriptive research design and census sampling technique. From the findings of the

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study 90% of the respondents agreed that quality affects buyer supplier relationship,
80% of the respondents confirmed that lead time also affects buyer supplier
relationship, 57% said that cost affects buyer supplier relationship and 53% of the
respondents noted that employee morale affect buyer supplier relationship on supply
chain performance. The researcher recommended the need for buyers to have good
relationship with suppliers in order to enhance efficiency and also obtain superior
quality products at competitive prices.

2.4.2 Procurement Risk Management

Kisaka (2014) studied ways of managing supply chain risks within the state
departments in Kenya. The research design incorporated empirical, descriptive and
survey research to evaluate supply chain risks and empirically analyze the
information. The Relative Importance Index (RII) ranked the top ten risk drivers in
order of importance. The ranking of the broader risk categories using the RII
identified procurement risk as critical and needing Government attention to address
exchange rate risks, single sourcing (non-competiveness), and unrealistic contract
duration risk. The study recommended that management and classification of supply
chain risks is important attribute to effective governance in public sector and the
mandate of risk mitigation is upon all the staff at all levels in a procurement entity.

Okonjo (2014) assessed procurement risks management practices and supply chain
performance in Kenya. The research design was a descriptive study. The researcher
found out that there was a very significant relationship between procurement risk
management practices and supply chain performance represented by adjusted R2
value of 0.646 which translated to 64.6% variance explained by the ten independent
practices of procurement risk management. The study recommended that all the
parties to transactions should endeavor to fully comprehend the procurement risk
management attributes in order to oblige them to undoubted performance of their
supply chains. Procurement risk management attributes are very dynamic and keeps
on varying hence need to replicate the study in line with changes that may affect
supply chain performance.

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Chemoiwo (2016) sought to find the influence of supplier appraisal on supply chain
risk management in Egerton University. The study employed a descriptive survey
research design and a Census survey design was employed whereby all members of
the target population participated in the study. The study found out that supplier
appraisal was the most influential influencing supply chain risk management in
Egerton University with correlation of (r = 0.763, p < 0.05). In order to improve
supply chain risk management in public universities in Kenya, the researcher
recommended all procurement departments to adopt supplier appraisal consistently
since this approach could identify the ideal suppliers to deal with in business
transactions.

2.4.3 Transparency and Accountability

Oberoi (2013) conducted a study on Institutionalization of Transparency and

Accountability in Indian governance. The findings revealed that Transparency is vital
in service delivery and enables information in the hands of the citizens in a way that
they may be able to claim their entitlements. However, mere knowledge of what
entitlements are, and who is responsible for fulfilling them, is not adequate in
ensuring that public services are sufficiently and effectively delivered to the intended
beneficiaries. There is a risk also that the opening up government becomes only a
superficial process. Access to information laws can become merely paper laws if
they are not then appropriately implemented or are undermined by other laws. The
right mechanisms to ensure implementation are just as imperative as the laws
themselves. The researcher recommended that if transparency actions brings forth the
platform for the exercise of voice, the conversion of voice into accountability needs
extra scrutiny on the ways in which transparency and accountability measures are
planned, the social, economic and institutional factors which affect such relations and
how citizens are empowered with the ability to apply their voice and insist
accountability from the public entities.

Despite these linkages, scholars such as Carlitz (2013) and Carter (2014) argue that
while transparency is an important constituent for securing accountability, the link
between the two is neither unassailable nor automatic. Further the exercise of voice

60
which is seen as a critical element for reaffirming this relationship is conditioned by
various factors. Transparency of information while providing the opportunities and
the material basis for the exercise of voice is not sufficient in impelling citizens to
pressurize officials in demanding the effective delivery of services.

Mukoruru (2014) carried out a research on the effects of public procurement disposal
act (2005) on transparency and accountability on management of public finance. This
study adopted descriptive survey research design and the sample was selected using
simple random sampling to ensure representativeness. The study indicated that
67.9% of the procurement activities and procedures were not transparent in that
decisions on procurement related activities did not follow the rules and regulations of
the Act and this information was not accessible to the general public. The study
found out that there were immense appeal cases that were pending on issues of
procurement. This meant that procurement procedures were not transparent. To add
on that procurement entities had no oversight mechanisms and the activities were not
audited regularly to ascertain arbitrary expenditures and ways of achieving
accountability.

2.4.4 Contract Records Management

Ngulube (2012) indicates that in addition to providing the means whereby a

transaction can be audited, full and accurate record keeping of contractual matters
provides: Value for money, by ensuring that work can be done swiftly and
accurately, evidence of what has occurred in the event of discussion of the matter
covered by the contract, evidence in the event of allegations of fraud or impropriety
and precedent for future action, including any re-tendering process. The amount of
documentation generated by different types of contracts will differ according to the
size of the transaction. It will generally consist of some or all of the following:
conditions of contract, tender invitation, suppliers’ proposals, tender receipt record,
evaluation criteria and report, specifications, schedule of work, bills of quantity and
signed contracts. Many contractual records need to be retained for six years after the
end of the contract. Similar considerations are appropriate to other financial records.

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Some special contracts are executed under seal and the limitation period in these
cases is twelve years.

Dzifa and Reindolf (2015) studied the topic the analysis of records management and
organizational Performance. The authors used simple random sampling to select a
sample size of 30 respondents. Based on the survey results, it was discovered that
tertiary institutions often practice sound records management. It was also observed
that the institution’s records management is changing from manual to electronic
system of managing records by using automated systems. This allows the users to
complete and submit the information on stipulated time. The electronic filing system
prevents the users from making serious errors that could affect the operations and
reputation of the institution. Training, supervision and control on records
management skills are recommended for all relevant employees of the institution for
efficient records management to promote better institutional performance.

2.4.5 Legal Compliance

Dewah and Mutula (2015) conducted a study on the nexus between legal records and
human rights in the justice delivery system. The research defined the concepts of
court records management and justice delivery and explored the link between records
management and the discharge of justice. A survey research design was used on a
purposively selected sample of 30 participants employed in various sections of the
court. The findings of the study indicated that courts invariably use a range of
records to administer a justice. In most of the cases the aggrieved parties are denied
justice because of missing or incomplete records.

Awino (2014) conducted a research study on public procurement legal framework

implementation challenges and organizational performance. In line with the study
public procurement permeates the entire spectrum of supply chain management and
therefore there is need for the government to adjust legal framework to provide an
efficient system of procurement in order to address the weaknesses in the entire
supply chain. Abere (2015) also carried a study on factors affecting compliance with
the public procurement and disposal regulations in Kenya. The researcher adopted
descriptive survey research design. The study revealed that training on public

62
procurement and disposal regulations, ethical practices during tendering process and
enforcement mechanisms influences the compliance of procurement and Disposal
Regulations in public entities in Kenya. The study recommended compulsory
training for all procurement officers on the procurement procedures, methods of
procurement, professionalism and excellence in order to provide consistency in
tender decision making and minimize costs that may relate to non- compliance such
as poor quality costs and legal charges arising from litigations filed by aggrieved
suppliers for discrimination in awarding of contracts.

Marendi (2015) conducted a research study on the implementation of the public

procurement and disposal Act, (2005). The researcher adopted explanatory survey
design. The findings of the study revealed that compliance levels of procurement
activities were below the minimum compliance of 60% set out by the then public
procurement oversight authority (PPOA). The study recommended that public
entities ought to do a due diligence before award of contracts to facilitate sound
decision making and conduct internal audits continuously to measure the efficiency
of the procurement process. It is against these empirical studies that the study
attempted to examine whether legal compliance has moderating influence on
relationship between contract management and procurement performance in public
universities in Kenya or not.

2.4.6 Procurement Performance

Kiage (2013) carried out a research on factors affecting procurement performance.

The study was conducted through a descriptive design using a cross sectional survey.
Findings of the study revealed that procurement planning has a significant impact on
procurement performance. Also the study depicted diverse variations of various
variables in terms of procurement performance. Contract management accounted
23.3%, staff competency 20.1%, resource allocation 17.2% and planning 26% in
procurement performance.

Mutua (2014) carried out a research on the influence of contract management on

performance of outsourced projects in medium manufacturing enterprises in Nairobi
County, Kenya. Contract management had a positive correlation with project

63
performance. Contract management and other factors accounted for 66% variation in
project performance. Contract management was found to have the strongest influence
on performance of outsourced projects. The fixed-price contract was beneficial in
ensuring project costs were within budget. Notably, 95% of all firms surveyed
considered a clear statement of project objectives in contracts important for
successful project delivery, while project acceptance criteria and dispute resolution
mechanism were rated as important contractual devices.

Mbae (2014) sought to find out public procurement law and procurement
performance of county governments in Kenya. The study found out that when two
parties strike a bargain, there must be some mechanism to ensure that each party will
stick to the terms. However, it’s important to understand the effect of any decision
taken by the parties to the contract. From an economy-wide perspective, the issue is
not whether a contract can be enforced but rather the cost of the various enforcement
mechanisms and their effectiveness in improving confidence between contracting
parties. To be efficient, the costs of enforcement must not outweigh the gains
achieved from increased contractual commitment. The study recommended that the
public entities are required to appoint procurement oversight committee that can
oversee the implementation of the procurement law and policies on procurement.

2.5 Critique of Existing Literature Relevant to the Study

Contract management plays a major role in determining procurement performance in

public universities in Kenya. Most of the reviewed empirical studies are clearly
expressed and succinct in the sense that they bring on board compelling findings and
this contributes immensely to knowledge. Despite these positive propositions,
considerable number of studies show dissimilarities on various aspects of contract
management on procurement performance. For instance, there is no clear consensus
among various authors regarding the influence of contract management on
procurement performance. Of interest however, is how conflicting the results and
findings are. Stella et al. (2013); Waithaka (2015) differed on how buyer supplier
relationship affects procurement performance.

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The latter researcher indicated that quality, lead time, cost and employee morale are
the prime attributes that affects buyer supplier relationship. This is contrary to what
the former researcher found out since customer satisfaction, future expectations and
relationship loyalty formed the basis for an ideal buyer supplier relationship.
However, the two authors unanimously agreed that mutual trust should be the key
pillar towards buyer-supplier relationship on procurement performance of public
entities. This created concise, well-structured and thoughtful analysis that enhances
the understanding of buyer supplier collaboration on procurement performance in
public universities in Kenya.

Chemoiwo (2016) differed slightly with Kisaka (2014) and Okonjo (2014) on how to
mitigate risks in procurement functions. The authors noted that supplier appraisal
should be the starting point when addressing risk management in procurement since
this approach justifies the credibility of the suppliers that will be engaged from time
to time. On the area of transparency and accountability, Oberoi (2013) noted that,
this is a vital approach towards procurement performance. This suggestion was
echoed by Mukoruru (2014) who indicated that the performance of procurement
functions depend more on these attributes. Both studies employed statistical methods
that were meticulously chosen and applied though the granularity of the analysis
could have been improved to make the respective research studies conclusive for
easier extraction of inferences.

Dzifa and Reindolf (2015) highlighted the need for records management in
promoting organizational performance. Dewah and Mutula (2015) partly supported
this argument by emphasizing the fact that records enable courts adjudicate and
administer justice at the stipulated time. On the issues of legal compliance on
procurement performance, the authors review had a huge difference on this matter.
Awino (2014) advocated the need to adjust legal framework to provide efficient
system of procurement while Abere (2015) noted that legal compliance can only be
adhered to if proper training was to be considered by the procurement entities. On the
other hand, Marendi (2015) emphasized the need for due diligence before the award
of the contracts to cross check credibility of suppliers and contractors. Though there
is little research done in the area of legal compliance since the information in most of

65
the empirical studies appears anecdotal, these researchers added insights to the
understanding of legal compliance and this approach provided inspirational
motivation for further research.

Kiage (2013) noted that procurement planning is key towards procurement

performance and it is the responsibility of the public entities to come up with proper
policies on how to execute various tasks. Mutua (2014) had different views on what
influences procurement performance in public organizations. The researcher
indicated that the clear way of embracing a good contract management is primarily
through adherence of the terms and conditions reflected in the contracts. Many
respondents where cognizant of the fact that effective contract management leads to
the compliance of contract’s requirements.

Mbae (2014) conducted a research study in line with public procurement law and
procurement performance. The author zeroed on how public procurement process
affects procurement law and how procurement regulations affect the procurement
performance. The respondents strongly agreed that internal procurement procedures
affect the performance of public entities. It is worthwhile to note that based on the
authors report to a great extent procurement regulations affect the performance of
public entities. In regard to these studies, it is apparent that there is a sense of
disparity on the findings in line with the influence of contract management on
procurement performance. Further, some of the reviewed theories in relation to the
underpinned variables that comprise: Buyer-supplier collaboration, procurement risk
management, transparency and accountability, contract records management, legal
compliance and procurement performance are scanty. Conversely, the reviewed
theories provided a base of understanding the intrinsic aspects that are in line with
contract management in relation to procurement performance.

2.6 Research Gaps

Several studies have been done in the area of contract management on procurement
performance in public universities in Kenya. For example; Manyenze (2013) who
carried out a research on procurement performance in the public universities in
Kenya focused primarily on ways of establishing mechanisms to reduce the effects of
66
procurement challenges and determinants of effective procurement performance. To
add on that, Ngetich (2017) conducted a research on determinants of effective
procurement contract administration in selected public universities in Kenya. This
study concentrated on staff competences, information technology, staff
professionalism and accountability. Further, Kirande and Rotich (2014) conducted a
research study on the determinants affecting public procurement performance in
Kenyan universities and zeroed on organizational budget, work environment, quality
management systems and organizational structure.

Based on the reviewed empirical studies the implementation of legal compliance

should not be an oversight role for procurement regulatory bodies alone but it should
be emphasized by other regulatory agencies of the government. In view of this
argument, it is evident that there is a gap between theory and evidence in application
of contract management to help improve procurement performance in public
universities in Kenya. In addition, it is evident that research in the area of contract
management has been done but not in a comprehensive approach. All the literature
reviewed indicates that previous researchers only concentrated on a few variables of
contract management on procurement performance. These variables address more on
the outcome of contract management in relation to procurement performance.
Therefore, a gap exist on the issues of contract management since the empirical
reviews does not tackle extensively on the key elements of contact management that
influence procurement performance.

This study therefore, covers additional important variables that were omitted by
previous studies like buyer-supplier collaboration, procurement risk management,
transparency and accountability, contract records management, as well as legal
compliance on procurement performance. These are crucial building blocks of
contract management and the extent to which they are implemented within the circles
of public universities in Kenya. Generally, these pillars affect directly or indirectly
the overall performance of the business operations of the universities. It is important
to note that these policies can only work if there is an already established framework
that gives a direction on what is supposed to be done by the parties involved. In
overall, empirical evidence showing the influence of contract management on

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procurement performance in public universities in Kenya is not explicitly researched
and notably, studies that are related on contractual activities on procurement
performance in Kenya are not well documented. Therefore, a gap exists which can be
filled through more research on this area.

2.7 Summary

The chapter has discussed in details various theories and models that are
commensurate with the research variables of the study. These include resource
dependence theory, theory of constraints, deontology theory, records continuum
model, legal theory, supply chain operations reference model and relational contract
theory. The research variables included: buyer-supplier collaboration, procurement
risk management, transparency and accountability, contract records management,
legal compliance and procurement performance. The study also looked into the
conceptual framework of the study and covered a review of the empirical studies that
that are in line with contract management on procurement performance in public
universities in Kenya. Reviewed theories revealed that, contract management helps
public universities in evading deviation of the procurement procedures. This is
because procurement regulation impacts the behavior and performance of
stakeholders in the public universities. Lastly, the critique of the existing literature
relevant to the study was also ascertained as well as the research gaps of the study.

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 CHAPTER THREE

RESEARCH METHODOLOGY

3.1 Introduction

This chapter gives a description of the methods and approaches that were adopted in
conducting this study. It includes the research design, research philosophy, target
population, sampling frame, census, research instruments, data collection procedure,
pilot study, data processing and analysis. The measurements of variables and data
analysis techniques are also discussed.

3.2 Research Design

Kothari (2004) affirms that a research design is the arrangement of conditions for
collection and analysis of data in a manner that aims to combine relevance to the
research purpose with economy in procedure. It is the conceptual structure within
which research is conducted and it constitutes the blueprint for the collection,
measurement and analysis of data. As such the design includes an outline of what the
researcher is supposed to do when writing the hypothesis and its operational
implications to the final analysis of data (Orodho, 2003).

In regard to this study, the researcher adopted descriptive research design. This is a
research design that shows the state of affairs as it exists at the present (Mugenda &
Mugenda, 2003). The premise of descriptive research design is to gather information
based on what, when, where and how and it is appropriate for identifying
characteristics, frequencies, trends, correlations and categories. Therefore, by the use
of the research design, the researcher was in a position to ascertain and describe the
inherent characteristics of various variables of interest in different scenarios. This
created a possibility to observe the research phenomenon in completely natural in
unchanged environment. As a way of harnessing the study in a logical manner, the
study integrated the qualitative and quantitative methods of data collection (Sekaran,
2006).

69
The multifaceted attributes in line with the adopted research design, created in-depth
analytical approach to the study. By the virtue of using the already established facts
and information that was revealed by the respondents the researcher was in a position
to make critical evaluation of the materials. All these undertakings prompted the
researcher to explore extensively the various aspects that are in line with contract
management and procurement performance in public universities in Kenyan context.
This study design has been used by Kinoti (2013) on the Determinants of Supply
Chain Management Ethical Practices Implementation in Government Ministries in
Kenya and also Memia (2018) on the Influence of Contemporary Supply Chain
Practices on Performance of Large Manufacturing Firms in Kenya. Therefore, this
research design was deemed appropriate as research methodology of this study was
extensively related to these studies.

3.2.1 Research Philosophy

Research philosophy is a paradigm or model that involves a broad framework that

comprises perception, beliefs and understanding of several theories and practices that
are used to conduct a research (Saunders et al., 2009). Research philosophy comprise
deep inherent attributes that elicit a sense of autonomy in line with ideologies that the
researcher deems to be relevant and accommodative to a well-defined area of study
in a specific discipline. This viewpoint creates a well calculated move to the
researcher if it constitutes acceptable knowledge in that field. Research philosophy
therefore, is important in the development of the research background, research
knowledge and its nature. In the process of establishing knowledge on the study, the
researcher was guided by one of the four business oriented philosophical viewpoints
noted by (Cooper & Schindler 2008). These comprised: positivism, pragmatism,
realism and interpretivism (interpretivist) research philosophies.

Positivism is a philosophical theory stating that certain knowledge is based on

natural phenomena and their properties and relations. Pragmatism on the other hand
considers words and thought as tools and instruments for prediction, problem solving
and action and rejects the idea that the function of thought is to describe, represent or
mirror reality. In line with realism it is a view about the nature of reality in general

70
where it claims that the world exists independent of the mind, as opposed to non-
realist views. Philosophers who support realism often claim that truth consists in a
correspondence between cognitive representations and reality. Lastly, interpretivism
involves researchers in interpreting the elements of the study and it integrates human
interest into a study and hence it advocates key approaches that govern features of
the study (Bajpai, 2011).

The researcher adopted the positivist philosophy which is part of epistemological

viewpoint that is concerned with the nature and scope of knowledge. In essence,
positivist philosophy advocates for an objective interpretation of reality using hard
data from surveys that are structured, formal and have a specific and detailed plan
(Saunders et al., 2012). These attributes were commensurate with the researcher’s
framework that focused more on highly structured measurement of the variables that
was derived through qualitative and quantitative analysis. Predictions were made on
the basis of the previously observed and explained realities and their inter-
relationships. This approach enabled the researcher to see the relationship between
the influence of contract management (buyer supplier collaboration, procurement
risk management, transparency and accountability and contract records management)
on procurement performance in public universities in Kenya by establishing a causal
relationship.

3.3 Target Population

Ngechu (2006) confirms that a population is an entire group of individuals, events or

objects having common characteristics that conform to a given specification. A target
population is a well-defined set of individuals, collection of things, households,
organizations, services, components or occasions subject to investigation. Basically,
this signifies that the target population should connect to a set of requirements which
the researcher is undertaking and it is supposed to be homogenous to ensure reliable,
replicable and adequate results (Mugenda & Mugenda, 2003).

The target population (Unit of Analysis) of this study comprised all the public
universities in Kenya that have been in existence from June 2013 to July 2018.
Specifically, the study zeroed on the procurement officers, finance officers, legal

71
officers and registrars-administration and planning staff of the 31 public chartered
universities in Kenya. The main reason for choosing these employees is because they
were considered to be responsible in transactional and operational activities in the
precincts of the universities. The selected participants are also deemed to have a
broad understanding on influence of contract management on procurement
performance in public universities in Kenya.

In contractual obligations procurement officers act as the secretariat of the ad hoc

evaluation committee, Finance officers advise the universities on financial status of
the universities as well budget allocation for projects. Further, the legal officers
advise the universities on jurisprudence of various contracts being advanced by the
universities. Registrars-administration and planning on the other hand coordinate and
prepare annual departmental budgets and procurement plans for the user departments
of the universities. These responsibilities necessitate the registrars to coordinate and
implement development projects and prepare capital projects for budgeting. These
activities are crucial during contract initiation and contract implementation in public
universities.

Table 3.1: Target Population

University Management Staff Target Population

Procurement Officers 31

Finance Officers 31

Legal Officers 31

Registrars-Administration and Planning 31

Total 124

3.4 Sampling Frame

Sampling frame is a list of all the items where a representative sample is drawn for
the purpose of a study. In an ideal sampling frame in a research study, every element
of the population of interest ought to be present in the frame (Nachmias & Nachmias,
2008). Therefore, the sampling frame for this study was derived from the list of all

72
chartered public universities in Kenya that have been in operation between 1st of July
2013 to 1st June 2018. This constituted the unit of analysis for the study while the
unit of observation comprised: Procurement officers, Finance officers, Legal officers
and Registrars-Administration and planning. The period of the study consisted a
chronology of five fiscal years in the respective universities (see Appendix VII).

3.5 Census

This study adopted a census method. Basically, a census is a study of every unit,
everyone or everything, in a population (Sekaran, 2010). Since the population was
too small, census was considered to be the most preferred method for the study.
Mugenda and Mugenda (2003) affirms that census method brings forth a robust
sample in design and reliable representation of the whole population. Further,
adoption of a census in a study ensures complete enumeration of all the items in the
population and high level of accuracy in the inquiry (Kothari, 2004).

All the 31 chartered public universities in Kenya were selected for the study in order
to get proper precision of the information in line with the study as affirmed by
(Orodho, 2003). The cognizant of the fact that, it is a requirement for public
universities to undertake a segregation of responsibilities of the staff who participates
in contractual obligations through the procurement process as per the PPADA, 2015,
prompted the researcher to stratify the respondents in terms of their respective
service cadre. The university staff who were selected comprised four executives in
each of the public universities in Kenya (procurement officers, finance officers, legal
officers and registrars-administration and planning).

The selected participants, resulted into an aggregate of a sample size of 124

respondents, whom the researcher regarded to be having insightful knowledge and
expertise in the area of the study. This is because these respondents represented all
the essential extremes on contract management on procurement performance in
public universities in Kenyan. This corresponds with Saunders et al. (2009) who
indicated that the selected respondents in a research study are supposed to be
endowed with knowledge on the topical issue of the study.

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3.6 Research Instruments

The research collected both primary and secondary data. In particular, primary data
comprised use of questionnaires which were administered to the respective
respondents in all public universities in Kenya. The researcher drafted both
quantitative and qualitative questions and this is in relation to Bajpai (2011) who
indicated that this approach prompts dependable and accurate data. The qualitative
questions were open ended with the essence of deriving the authentic details about
the subject matter. The preceding Likert scale for quantitative questions was adopted
whereby the resultant measures meant: 5= Strongly Agree, 4 = Agree, 3 =Neutral 2 =
Disagree 1 = Strongly Disagree. In the drafted questionnaire, the questions were
divided into eight distinct sections.

The first section comprised demographics and general information of the university
staff, section two covered contract management, section three encompassed
questions on buyer-supplier collaboration, section four entailed questions on
procurement risk management, section five was based on questions in line with
transparency and accountability, section six covered questions on contract records
management while section seven and eight comprised legal compliance and
procurement performance questions respectively.

The researcher also carried out key informant interviews (KII) in line with the
influence of contract management on procurement performance in public universities
in Kenya. Sekaran (2006) confirms that KII is a qualitative in-depth analysis based
on a topical issue. The study carried interview on opinion of selected respondents on
influence of contract management on procurement performance. In particular, the
study conducted KII from internal auditors, procurement assistants (in charge of
stores) and estate managers of public universities in Kenya. However, only four
public universities (Chuka University, Jomo Kenyatta University of Agriculture and
Technology, Maseno University and Meru University of Science and Technology)
granted permission for key informant interview to be conducted to the selected
respondents.

74
This method was necessitated by use of interview guide that entailed the subject
matter of the study and the selected respondents were engaged to respond to the
questions raised by the researcher. This enabled the researcher to receive
clarifications pertaining issues that were addressed by the respondents hence this
initiative translated to derivation of the right information concerning the study. The
data derived from key informant interview was analyzed by use of content analysis
whereby the researcher classified the data to various themes to draw inferences to the
study.

Secondary data on the other hand was also part of the consideration in the research
study. According to Cooper and Schindler (2008) secondary data is a useful
qualitative technique for evaluating historical or contemporary confidential public
records, reports, government documents and opinions and this prompts the researcher
to collect this kind of data. The researcher used secondary data collection form to
derive the relevant data in line with this data collection method. The secondary data
was collected from auditor general’s report as well as public procurement
administrative review reports in the financial years starting from July 2013 to June
2018. The results of the secondary data were used to draw inferences to the study.

3.7 Data Collection Procedure

Prior to the data collection process, the researcher applied for letter of introduction
from the office of the chairperson, Procurement and Logistics Department-JKUAT
and later research authorization letter as well as research permit from National
Commission for Science, Technology and Innovation (NACOSTI). These letters and
the research permit were crucial for data collection process in the public universities
in Kenya. Upon the receipt of the letters and the research permit the researcher
appointed two research assistants who were engaged in fast tracking the
administration of the questionnaires to the respective respondents. Notably, before
the administration of the questionnaires to the respondents, the researcher convened a
training session in order to impart the necessary skills needed in data collection
process to the research assistants. Drop and pick method was used in the

75
administration of the questionnaires since the targeted respondents were presumed to
be busy and probably couldn’t have time for a face to face interview.

3.8 Pilot Test

Pilot test is a study that is conducted before the actual data collection to ascertain the
aptness of the research instruments. The rationale of pilot study is to administer the
instruments to small respondents who have similar characteristics with a larger group
of respondents to be involved in the main study. Pilot test enables the researcher to
refine the questionnaires and subsequently ensure the research instrument is credible
and objective (Hazzi & Maldaon, 2015). The pilot study exercise enabled the
researcher to assess the clarity and reliability of the research instruments. This
impelled simplification of the data collection process and this was evidenced in the
main data collection process since most of the respondents were in a position to
comprehend well the questions raised hence most of the questions were answered
objectively.

Before the actual data collection, pilot test was undertaken in 4 public constituent
university colleges. This amounted to 10% of the total number of population and
according to (Mugenda and Mugenda, 2003) this percentage is considered adequate
for pilot study. These public constituent university colleges included: Alupe
University College, Bomet University College, Kaimosi Friends University College
and Tom Mboya University College. In regard to this method every university was
equated to 4 purposive selected respondents perceived to be knowledgeable in
contract management and procurement performance related matters. These
respondents comprised selected staff in: procurement, finance, registrar-
administration and planning and lastly legal officer’s representatives of the public
constituent university colleges in Kenya.

3.8.1 Validity of the Research Instruments

Kothari (2004) asserts that validity is a level of precision of a concept in a study and
it specifies the degree to which an instrument measures what it is supposed to
measure. In research study the common types of validity comprise: content validity,

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construct validity and criterion validity. Content or logical validity measures the
extent to which a measure represents all facets of a given variable. This allows the
researcher to determine whether a given variable contain all aspects that should be
measured. Construct validity on the other hand is the degree to which a test measures
what it claims or purports to be measuring. This allows the researcher to understand
whether the test scores from the data obtained through the instruments can be applied
to induce inferences in line with the questions raised in the study. Lastly, Criterion
validity relates to researcher’s ability to forecast some future outcome or
approximate the existence of some current condition.

This study adopted content validity and under the framework of this method, the
researcher used competent and reliable experts in line with the supply chain
management to evaluate whether test items were in tandem with the subject matter of
the research study. The experts were in a position to compliment and critique some
of the items replicated in the questionnaire. Because of the attributes of content
validity that are simple and intuitive in nature, coupled with quality assessment of the
items of the research instruments, the verification of the questionnaire in regard to its
suitability to the study, turned out to be a distinct guideline to the researcher. This
enabled the researcher to maintain the questions that were well captured in the
questionnaire while the questions that raised eyebrows were adjusted and refined
accordingly to fit the comments of the experts.

3.8.2 Reliability of the Research Instruments

Reliability is the degree to which an instrument yields consistent results irrespective

of the number of times that method is repeated. Mugenda and Mugenda (2003)
confirms that a reliable measurement is the one that if repeated a second time gives
the same results as it did the first time. The shrinkage of the variability observed
creates a scenario of deeming the measure to be reliable and this forms the basis of
authenticating the instruments of the study. (Kenneth & Abbott, 2011).

The distinct indicators of a scale’s reliability are test-retest reliability and internal
consistency. The test-retest reliability of a scale is evaluated by administering it to
the same people on separate times and analyzing the relationship between the scores
77
derived. High degree of test-retest denotes a more reliable scale. Internal consistency
is the scale to which the items that forms the basis of the measure have the same
causal attribute. Sekaran (2010) indicates that a Cronbach's alpha is the most
accepted guideline in testing reliability of the questions and the 93 rule of the thumb
for Cronbach Alpha is that the closer the alpha is to 1 the higher the reliability and a
value of at least 0.7 is recommended (see Table 3.2).

Table 3.2: Cronbach's Alpha Internal Consistency Levels

Cronbach's Alpha Internal Consistency

α ≥ 0.9 Excellent

0.9 > α ≥ 0.8 Good

0.8 > α ≥ 0.7 Acceptable

0.7 > α ≥ 0.6 Questionable

0.6 > α ≥ 0.5 Poor

0.5 > α Unacceptable

Internal consistency was measured using the statistic Cronbach’s alpha and this
provided an indication of the average correlation among all the items of the research
study. The reliability results were used to improve on the data collection instruments
before the main data collection process.

3.9 Data Processing and Analysis

Data processing encompasses, editing, coding, classification and tabulation of data

collected before analysis. Analysis involves the computation of definite measures
and probing the patterns of correlation that are replicated in the data category
arrangement (Kothari, 2004). In this study the processed and analyzed data was
presented by use of tables and figures. During the early stages of data collection, the
researcher concentrated first on pilot study from the public constituent colleges and
thereafter, analyzed the data for these institutions of higher learning to test validity
and reliability of the research instruments. Later, upon finalization of data collection

78
from the target population (public universities) the researcher embarked on data
analysis process of the study.

In the separate data processing and analysis stages, the researcher divided two sets,
public constituent university colleges and public chartered universities and further
analysis was done on each set to eliminate the influence of the dummy variable
representing legal compliance. Descriptive statistics that is measure of central
tendency especially the mean as well as measure of dispersion (standard deviation)
were employed to analyze the characteristics of study variables (the buyer-supplier
collaboration, procurement risk management, transparency and accountability,
contract records management and procurement performance among public
universities) using the statistical package for social sciences (SPSS) Version 22 tool.

Descriptive statistics was used to summarize and profile the status of the predictor
variables with dependent variable among public universities in Kenya. For inferential
statistics regression analysis and correlation analysis was used to analyze the
relationship between independent variables and dependent variable. The correlation
analysis was used to establish strength relationships between independent variables
and dependent variable. In particular Pearson correlation was applied to establish the
strength of the linear relationship. The study also used analysis of variance
(ANOVA) to examine the existence of significant differences the influence of the
predictor variables had on dependent variable of the study.

Multiple linear regression model was employed to establish the relationship among
independent variables on the dependent variable. Test statistics was used to
determine the relative importance of each independent variable in influencing
procurement performance. In this case t-test and F-test, statistics were considered to
be statistically significant when the value of the test statistic falls in the critical
region. As a result of this, the null hypothesis was rejected and the alternative
hypothesis was upheld. This was done to determine the relative contribution of each
independent variable in influencing the performance among 31 public universities
sampled for five years (July 2013- June 2018). The moderating influence of legal
compliance was also evaluated by using it as a dummy variable (Above Average
Compliant-81-99%, Average Compliant-51-80 and Non-Compliant-Below 50% to

79
PPADA, 2015). The KII and secondary data results were used in the study to form
logical inferences.

3.9.1 Diagnostic Tests

Diagnostic tests are used in research to evaluate the model assumptions and examine
whether there are observations with large or even trivial influence on the analysis
that happens to be unnecessary in the research study. Therefore, the data is usually
tested for adherence to assumptions of regression analysis in line with linearity,
normality, autocorrelation, homoscedasticity and multicollinearity (Gujarati &
Porter, 2009). The study that is normally free from these occurrences is fit enough to
use linear regression model for inference and prediction of the subject matter being
studied (Statistics Solutions, 2013). If a data fails to adhere to the assumptions of
regression due to strong relationships amongst the predictor variables this
necessitates the data to be transformed into their natural logarithm. Further, the
regression analysis can also be done using the square of errors for the data. These
considerations create inverse function of the exponential analysis leading to the
definition and simplicity of the values applied in the study. This prompts the
researcher to be in a position to understand whether the stipulated guidelines are
being observed (Greene, 2012).

3.9.1.1 Linearity Test

Stock and Watson (2007) affirms that linearity test seeks to determine the
relationship between independent variables and dependent variable. For a research
to be good in the regression model, there should be a linear relationship between the
predictor variables and dependent variable. Violations of linearity are serious in a
research study since when a researcher fit a linear model to a data that is nonlinear
the predictions of the study is prone to errors when the researcher extrapolate beyond
the range of the sample.

Linearity test is normally assessed by examination of a scatter plot of all the

independent variables against the dependent variable to determine if there is a
straight-line relationship. Also, the linearity test can be ascertained by use of the

80
correlation coefficient statistics which is a statistical measure of the strength of the
relationship between the relative movements of the variables. The values range
between -1.0 and 1.0. The decision making process in the linearity test suggest that if
the value sig. deviation from linearity >0.05, then the relationship between the
independent variables are linearly dependent. Further, if the value sig. deviation from
linearity <0.05, then the relationship between independent variables with dependent
variable is not linear (Hansen, 1999).

3.9.1.2 Normality Test

Normality test refer to statistical tests on a data to determine whether a data set is
well modeled by a normal distribution (Thode, 2002). Normally distributed data
yields better regression results because any random variable in a data set is normally
distributed. Kolmogorov-Smirnov (KS) and Shapiro-Wilk (SW) are common
measures used to test the data for adherence to the normality assumptions. The
Kolmogorov-Smirnov test is a nonparametric goodness of fit test and is used to
determine whether two distributions differ. Shapiro-Wilk on the other hand is
designed to detect all departures from normality. Thus, if the significant value of the
K-S and S-W Test is more than p-value of 0.05, the data is normal hence the null
hypothesis is rejected. If significance value is below 0.05, the data significantly
deviate from a normal distribution and therefore, the null hypothesis is not rejected
(Razali & Wah, 2011).

Dougherty (2016) confirms that a graphical method can also be used to establish the
degree of normality in a study. A graphical tool for assessing normality is the normal
probability plot, a quantile-quantile plot (Q-Q plot) of the standardized data against
the standard normal distribution. The correlation between the sample data and
normal quantiles (measure of the goodness of fit) measures how well the data are
modeled by normal distribution. For normal data the points plotted in the Q-Q plot
should fall approximately on a straight line, indicating high positive correlation.
These plots are easy to interpret and also have the benefit that outliers are easily
identified

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3.9.1.3 Autocorrelation Test

Autocorrelation refers to the relationship of a time series with its own past and future
values. It is also sometimes called ‘‘lagged correlation’’ or ‘‘serial correlation,’’
which refers to the relationship between members of a series of numbers arranged in
time. Autocorrelation occurs when the variances of the error term are sequentially
interdependent. Once this problem occurs a given disturbance term would then be
related to the previous value (values) in a stochastic manner (Mukras, 1993).

According to the assumptions of Classical Linear Regression Model, the disturbance

occurring at one point of observation should not be related with any other
disturbance occurring at another point at the set of observation (Maddala, 2002).
Autocorrelation leads to biasness and inconsistency of parameter estimates.
Autocorrelation is detected by use of Durbin Watson (DW) test. A DW of zero
implies that there exists positive autocorrelation, while DW equal to four implies
high negative correlation level. A DW value between 2 and 2.5 implies that there is
no correlation. Presence of autocorrelation should be eliminated by use of correct
specification of functional form of the model.

3.9.1.4 Homoscedasticity Test

Homoscedasticity is the test of whether the data set has equal variances (deviations)
throughout from the first data point to the last. This is called homogeneity of
variance. The assumption of homoscedasticity (same variance) is central to linear
regression models. Data with homogeneous variances is said to be homoscedastic
while those with varying deviations is said to be heteroscedastic (Maddala, 2009).
Heteroscedasticity complicates the analysis because many methods in regression
analysis are based on an assumption of equal variance.

Homoscedastic data sets yield more accurate regression results while heteroscedastic
data present standard errors that are already biased. Levene Statistic (LS) is always
used to test the homogeneity of variance in the data sets. If the resulting p-value of
levene’s test is less than some significance level (0.05), the obtained differences in
sample variances are unlikely to have occurred based on random sampling from a

82
population with equal variances. Thus, the null hypothesis of equal variances is
rejected and it is concluded that there is a difference between the variances in the
population (Knaub, 2014).

3.9.1.5 Multicollinearity Test

Brewer (2002) indicates that in regression analysis, multicollinearity is a test of

whether the variables, other than the dependent variable have strong relationships. It
is a statistical phenomenon in which two or more predictor variables in a multiple
regression model are highly correlated meaning that one can be linearly predicted
from the others with a non-trivial degree of accuracy. In this situation the coefficient
estimates of the multiple regression may change erratically in response to small
changes in the model or data. It is therefore, a type of disturbance in the data and if
present in the data the statistical inferences made about the data may not be reliable
since the mere presence adversely affect the regression results (Mukras, 1993).

Multicollinearity arises from the presence of interdependence among the explanatory

variables in multivariate regression model. If the explanatory variables are not
intercorrelated then the variables will be orthogonal. Any departure from
orthogonality constitutes some measure of multicollinearity. Further, some
independent variables may have strong relationships which is not a good
characteristic as this could inflate the coefficients including the nature and size of R
and R-Squared. In such situations data should be transformed to trim the causation
amongst the independent variables. Tolerance Statistics (TS) and Variance Inflation
Factor (VIF) statistics are used to test the presence of multicollinearity. Tolerance is
associated with each independent variable and ranges from 0 to 1 while variance
inflation factor of more than 10 indicates high correlation and this stimulates a cause
for concern in the study (Allison, 1999).

3.9.2 Regression Model

In order to analyze the relationships between the independent variables and

dependent variable a multiple linear regression model was used. The study model
helped in analyzing the influence of contract management on procurement

83
performance among public universities in Kenya. The multiple linear regression
model that was adopted is similar to that used by many of the studies done in the area
of contract management and procurement performance (Silas, 2015). The replication
and revelation of this model showed a connection on what other researchers have
applied in earlier studies based on this topical area. The general regression model
used in this study was defined as follow:

Y= β0 + β1X1 + β2X2 + β3X3 + β4X4 +ε

For testing the moderating effect, the following model was used:
Y= β0 + β ᵢXᵢ+ ε………………………. (i=1, 2,3,4)
Y= β0 + βᵢ Xᵢ + βm M+ ε
Y= β0 + βᵢ Xᵢ+ βmᵢMXi+ ε
Where; Y=Procurement performance
β0=constant
βi is the coefficient for Xi (i=1, 2,3,4) ᵢ
X1=Buyer-supplier collaboration
X2=Procurement risk management
X3=Transparency and accountability
X4=Contract records management
M= Legal compliance (Moderating variable)
ε = error term

The regression model was contextualized as follows:

Yit=β0+X’it+ε………………………………………………...………….……...(3.1a).

This equation was transformed to random effects model by specifying Eit as shown in
Equation 3.1b.

εit = Vi + Uit …………………………………….…………...…….……….(3.1b).

Where Yit is the dependent variable denoting procurement performance of public

universities in Kenya, i at time t i denotes the legal compliance of (universities), i=
1,….,31 while t is the time period t =2013,....,2018; Xit denotes a vector of
independent variables β are coefficients to be estimated, a β0 is a constant term, and
84
εit is a composite error term. Where Vi denotes heterogeneity effects and Uit denotes
idiosyncratic disturbances. The multiple linear regression model was specified and
tested in this study (see Equation 3.1).

PPit =β0+ β1BSCit +β2PRMit + β3TAit + β4CRMit +ε……………..………….3.1

Where:

PPit=Procurement performance (Dependent variable)

β0=Constant for each public university in Kenya (Fixed effects).

(βi; i=1,2,3,4)= Regression coefficients values.

(BSCi; PRMi; TAi; CRMi; i=1,2,3,4)=Values of independent variables.

εit =composite error term (the residual error of the regression).

BSCit= Buyer supplier collaboration of public universities in Kenya i at time t.

PRMit = Procurement risk management of public universities in Kenya i at time t.

TAit= Transparency and accountability of public universities in Kenya i at time t.

CRMit= Contract records management of public universities in Kenya i at time t.

t= 2013…….2018.

3.9.3 Moderating Effect Model

To determine the moderating influence of legal compliance on the relationship

between contract management on procurement performance in public universities in
Kenya the study was specified and tested (see Equation 3.2). The predictor variables
comprised: Buyer supplier collaboration, procurement risk management,
transparency and accountability and contract records management.

PPit=β0+*LC++β1BSCit*LC++β2PRMit*LC++β3TAit*LC++β4CRMit*LC+ +ε..3.2.

Where:LC=Moderating variable=Legal compliance (Above Average Compliant-81-

99%, Average Compliant-51-80 and Non-Compliant-Below 50% to PPADA, 2015).

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3.9.4 Operationalization of Variables

According to Nachmias and Nachmias (2008), operationalization is the process of

strictly defining variables into measurable factors and defining unclear concepts in a
way that facilitate accurate replication of the research process. This allows proper
statistical analysis of the results. Therefore, constructs of each item of the variables
were measured by scale as summarized in Table 3.3.

Table 3.3: Operationalization of Variables

Type of Variables Measures Notation

Variable
Dependent Procurement performance Cost efficiency CE
Variable Customer satisfaction CS
Procurement agility PA
Independent Buyer supplier collaboration Commitment BSC
Variables Trust
Continuous improvement

Procurement risk management Contingency plans PRM

Internal controls
Risk sharing
Transparency and Impartiality TA
accountability
Due diligence
Procurement probity
Contract records management Audit trail CRM
Information accessibility
Information accuracy

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 CHAPTER FOUR

RESEARCH FINDINGS AND DISCUSSION

4.1. Introduction

This chapter presents the research findings derived from the questionnaires, key
informant interview guide and secondary data forms and links them to the objectives
of the study. The results of this study is derived from the pilot study, response rate,
background information of the respondents, descriptive analysis of the study
variables, diagnostic tests result, inferential statistics results, hypothesis test results,
qualitative and secondary data analysis.

4.2 Pilot Study Results

The pilot study was conducted between November 6th 2018 to 22nd January 2019
after approval of the research permit by NACOSTI in four public constituent
university colleges (Alupe University College, Bomet University College, Kaimosi
University College and Tom Mboya University College). This amounted to 10% of
the total number of population which is considered adequate for pilot study
(Mugenda, Mugenda 2003). Out of 16 questionnaires issued to the selected
respondents, 12(75%) were filled and returned while unreturned questionnaires
amounted to 4(25%). Subsequently, validity of the research instruments as well as
reliability of the research instruments was undertaken. These two important
approaches were undertaken primarily to fine tune the research instrument before
carrying out the main research study. The pilot study was an eye opener to the
researcher in terms of devising the strategical plans to incorporate in the main study.

4.2.1 Validity of the Research Instruments

This study adopted content validity and under the auspices of this method, the
researcher used subject matter experts to evaluate whether test items assess defined
content. Generally, the experts assessed whether the questionnaires could help in
establishing the influence of contract management on procurement performance in

87
public universities in Kenya. In perfection of the research questions, the experts
recommended replacement of order fulfilment variable with contract records
management since the former variable seemed to be more aligned with dependent
variable (procurement performance). This corresponds with Drost (2011) who opined
that the erratic, vague and perplexing statements ought to be discarded in a research
study.

4.2.2 Reliability of the Research Instruments

In this study, an internal consistency was done using Cronbach Alpha to measure
how well the items were correlated to each other for all the questionnaires issued to
the selected respondents for the pilot study. The essence of this process was to
ascertain the degree on which the research instruments yielded consisted results. The
general guideline for Cronbach Alpha is that the closer the alpha is to 1 the higher
the reliability and a value of at least 0.7 is recommended (Sekaran, 2010). The results
of Cronbach Alpha reliability coefficient are shown in Table 4.1.

Table 4.1: Summary of Cronbach Alpha Reliability Coefficient

Variables Number of items Cronbach Alpha

Buyer Supplier Collaboration 7 0.797
Procurement Risk Management 7 0.748
Transparency and Accountability 7 0.817
Contract Records Management 7 0.831
Legal Compliance 7 0.718
Procurement Performance 7 0.781
No of Items/Average Score 42 0.782

Buyer supplier collaboration had alpha of 0.797, procurement risk management

0.748, legal compliance 0.718 and procurement performance registered alpha of
0.781 which all falls in the acceptable limit which is above 0.7. Transparency and
accountability had alpha of 0.817 while contract records management had 0.831
which is deemed as good internal consistency. This implied that respondents who

88
selected high scores for one item were likely to select high scores for the others.
Further, those who selected low scores for one item were likely to select low scores
for the others. The data collection instrument was therefore, reliable for the purpose
of the study. This enhanced the ability to predict outcomes using the scores and the
aggregation of the arithmetic mean.

4.3 Response Rate

The main data collection commenced in the month of February 2019 up to May
2019. The targeted respondents in the study were procurement officers, finance
officers, legal officers and registrars-administration and planning of all public
universities in Kenya. A total of 104 questionnaires were filled out of the expected
124, translating to 83.9% (see Table 4.2). This good response rate was attributed to
well thought data collection procedure, where the researcher in conjunction with two
research assistants administered questionnaires to the selected respondents who filled
them accordingly. Drop and pick method proved to be panacea of high response rate
since the selected respondents had adequate time to respond to the questions in the
questionnaire.

Table 4.2: Response Rate

Response Rate Sample Size Percent

Filled and returned questionnaire 104 84
Un-returned questionnaires and non-response 20 16
Total 124 100

The response rate was good and representative and conforms to Mugenda (2008)
stipulation, that a response rate of 50% is adequate for analysis; a rate of 60% is good
and a response rate of 70% and over is excellent. Therefore, this response rate was
excellent for making conclusions and generalization of the study results and it can be
applied for policy development in public universities in Kenya.

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4.4 Demographics and General Information

The researcher analyzed the demographics and general information of the

respondents which included: Designation, highest academic qualifications,
membership in respective professional bodies and frequency of participation in
sensitization forums of PPADA, 2015. Further, the respondents background
information included; the degree of knowledge on contract management in Kenyan
context and the experience of respondents on contractual activities in procurement
process. The information in line with this demographical aspects of the respondents
created an avenue of understanding well the respondent’s connection on the area of
contract management and procurement performance in their respective institutions of
higher learning.

4.4.1 Respondents Designation

The respondents were asked questions on their respective designations. This question
helped the researcher to establish the extent to which they deal with activities that are
in line with contract implementation in stirring procurement performance in public
universities in Kenya. The rationale behind this question was to ensure that all the
respondents engaged had the technical knowledge of the subject matter of the study.

Table 4.3: Respondents Designation

Respondents Designation Frequency Percent

Procurement Officers 28 26.9
Finance Officers 26 25.0
Legal Officers 25 24.0
Registrars-Administration and Planning 25 24.0
Total 104 100

The results of the study indicated that, the majority (26.9%, n=104) of the
respondents drawn from public universities in Kenya, were procurement officers.
Finance officers followed with 25% while 24% were both legal officers and
registrars-administration and planning (see Table 4.3).

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4.4.2 Highest Academic Qualification

The study sought to know the highest level of academic qualification of the
respondents. This enabled the researcher to find out their acquaintance with
contractual responsibilities in their respective universities. The level of education of
the respondents was also a key indicator of establishing their understanding of the
studied area and this enabled the researcher to draw conclusions and
recommendations. The results of the study are as follows are shown in Table 4.4.

Table 4.4: Highest Academic Qualifications

Highest Academic Qualifications Frequency Percent

Doctorate Degree 9 9
Masters Degree 72 69
Bachelors Degree 23 22
Total 104 100

The majority (69%) of the respondents engaged in contractual obligations in

procurement process had masters degree, 22% had Bachelors degree while 9% had
Doctorate degree. However, none of the respondents had certitificate or diploma
qualifications. The findings showed that all the respondents were highly educated
and this enabled the researcher to get comprehensive information on the influence of
contract management on procurement performance in public universities in Kenya.
These results were in support of Manyenze (2013) results that indicated the
cumulative percentage of respondents with at least bachelor’s degree was in a tune of
70%.

4.4.3 Respondents Membership to Professional Bodies

The study sought to know the professional body the respondents had an allegiance to.
This was to ascertain the degree of values, advocacy and professional growth in their
respective area of specialization. The results of the study are depicted in Table 4.5.

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Table 4.5: Respondents Membership to Professional Bodies

Membership to Professional Body Frequency Percent

KISM 27 26.0
CIPS 3 2.9
ICPAK 29 27.9
LSK 22 21.2
IHRM 17 16.3
Any Other 4 3.8
None 2 1.9
Total 104 100

The majority of respondents 98.1% belong to specific professional bodies (see Table
4.5). A tune of 27.9% of respondents belonged to Institute of certified public
accountants of Kenya (ICPAK) followed by 26% who belonged to Kenya Institute of
Supplies Management (KISM), 21% belonged to Law society of Kenya (LSK),
16.3% belonged to Institute of human resource management (IHRM), 3.9% belonged
to other professional bodies e.g. Kenya Institute of Management (KIM), 2.9%
belonged to Chartered Institute of Procurement and Supply (CIPS) while 1.9% did
not belong to any professional body. This shows that majority of respondents are
accountable and it is easy to discipline the members who flouts their professional
code of conduct (Munene, 2014).

4.4.4 Participation in sensitization forums of Public Procurement and Asset

Disposal Act, 2015

The study sought to establish whether the respondents are sensitized on the current
procurement act either internally or use of external consultants in order to familiarize
on the contract management process envisaged in the law to reduce audit queries
from the auditor general reports. The results are shown in Table 4.6.

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Table 4.6: Participation in Sensitization Forums of PPADA, 2015

Participation Trend Frequency Percent

Annually 53 51
Semi annual 13 12.5
Quarterly 30 28.8
None 8 7.7
Total 104 100

Majority (51%) of respondents indicated that they are sensitized annually on PPDA,
2015, 28.8% said that they are sensitized quarterly, 12.5% of the respondents said
that they are sensitized twice per year (Semi annual) while 7.7% said that they are
not sensitized. It is therefore, clear that sensitization forums on PPADA, 2015 are
carried out in public universities in Kenya to familiarize the staff on the procurement
law and new trends in the market that ought to be incorporated in transactional
activities in line with procurement. This is evidenced in PPRA (2017) annual report
which indicates that pursuant to section 9(1) of the PPADA, 2015 the regulatory
body, provided technical support to public entities (public universities included) on
general aspects of the public procurement law.

4.4.5 Knowledge on Contract Management in Kenyan Context

The study sought to establish the respondent’s ratings on their knowledge on contract
management process. This was to examine whether the respondents were endowed
with crucial information based on contract management on procurement performance
in Kenya (see Table 4.7).

Table 4.7: Respondents knowledge on Contract Management in Kenyan Context

Knowledge on Contract Management in Kenyan Context Frequency Percent

Excellent 9 8.7
Very Good 34 32.7
Good 47 45.2
Adequate 12 11.5
Inadequate 2 1.9
Total 104 100

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The majority (45.2%) of the respondents were of a view that they had good
knowledge on contract management process in Kenyan context, followed by 32.7%
of the respondents who said that have very good knowledge on contract management
process in Kenyan (see Table 4.3). A marginal number of respondents (11.5%)
indicated that they had adequate knowledge on contract management process in
Kenyan while 8.7% of respondents affirmed that they had excellent knowledge on
contract management process in Kenya. Lastly, a small number of respondents
(1.9%), felt that they had inadequate knowledge on contract management process in
Kenya.

These results shows that majority (98.1%) of respondents felt that they had enough
knowledge on contract management process in Kenyan according to PPADA, 2015.
This is an indication that most of the staff who are assigned responsibilities on
contractual activities in public universities in Kenya, are conversant with public
procurement regulations of 2006. Paradoxically, according to auditor general reports
on fiscal year 2013/2014 to 2016/2017, non-compliance to the stipulated contract
management regulations is a recurring issue in most of the public universities in
Kenya. This begs the question, ‘‘what is the cause of flouting procurement laws if
most of the staff working in public universities on contractual and procurement
related activities are conversant with public procurement regulations.

4.4.6 Years of Experience in Contractual Activities in Procurement Process

The study sought to establish the number of years the respondents were involved in
contractual activities in the procurement process. This was to ascertain to what extent
their responses could be relied upon to make conclusions for the study based on their
working experience. The results of the respondents in line with this subject matter is
shown in Table 4.8.

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Table 4.8: Years of Experience in Contractual Activities on Procurement
Process

Years of experience Frequency Percent

Above 14 years 7 6.7
10-13 years 20 19.2
6-9 years 37 35.6
3-5 years 38 36.5
Below 3 years 2 1.9
Total 104 100

From Figure 4.4, majority (36.5%) of respondents were involved in contractual

activities in the procurement process for 3-5 years, 35.6% of the respondents
involved for 6-9 years, 19.2% of the respondents 10-13 years while 6.7% were
involved in contractual activities in the procurement process for over 14 years.
Cumulatively, 98% of the respondents had a working experience of more than 3
years and this indicates that they understood the contract management process as
outlined in both procurement act of 2005 and procurement act of 2015. This is also
commensurate with the best practices principles in human resource development,
which postulates that the intellectual capacity of a staff in a certain discipline is as a
result of the longevity (learning curve) in execution of the underlined tasks
(Armstrong, 2019).

4.5 Contract Management on Procurement Performance

The study sought to establish the inherent aspects of contract management on

procurement performance. The rationale behind this idea was premised on
establishing a broad perspective on how contract management influence procurement
performance in public universities in Kenya.

95
4.5.1 Influence of Contract Management on Procurement Performance

Contract management is the subject matter in the procurement since it dictates the
holistic performance in the upstream and downstream supply chain activities. In
order to understand the clear metrics in contract management that forms the basis of
procurement performance the study established varied findings. The study findings is
a reflection of the integral attributes that are deemed necessary by the public
universities in Kenya and constitutes the performance indicators in a procurement
process (see Table 4.9).

Table 4.9: Influence of Contract Management on Procurement Performance

Influence of Contract Management on Procurement Performance Frequency Percent

Improves timely delivery of goods and services 14 13.5
Increase value for money in ordering process 28 26.9
Creates customer satisfaction 13 12.5
Builds vibrant relationship with suppliers 16 15.4
Improves transparency and accountability of procurement process 4 3.8
Enhance adherence of terms and conditions of the contract 20 19.2
Minimizes occurrence of procurement risks 9 8.7
Total 104 100

Majority of respondents (26.9%) said that contract management increases value for
money in the ordering process, 19.2% said that it enhances adherence to the terms
and conditions of the contract, 15.4% indicated that contract management builds a
vibrant relationship with suppliers. Further, 13.5% indicated that contract
management improves timely delivery of goods and services, 12.5% said that
contract management creates customer satisfaction, 8.7% said that it minimizes
occurrence of procurement risks. Lastly, 3.8% indicated that contract management
improves transparency and accountability of procurement process.

These results are similar to that of Yegon (2018) who conducted a study on
determinants of procurement contract management of the selected state corporations

96
in Nakuru County, Kenya. The study found out that adherence to the terms and
conditions of the contract, cost management and contract documentation are key
pillars for sustainable contract management discourse. These findings of the study
are considerably replicated in the research study thus creating a distinct connection
on the two studies. These findings are commensurate with the findings of Key
informant interview carried out by the researcher. The results affirmed that value for
money in tendering process is the central requisite in determining viability of
contract management in relation to procurement performance.

4.5.2 Key Considerations when Constituting an Award of Contract to Suppliers

Prior to the award of the contracts to various suppliers or contractors in public

universities in Kenya, the ad hoc evaluation committee constituted by the accounting
officers according to section 46 of PPADA, 2015 have a statutory obligation to
establish the right service providers to the underpinned contracts. These committee
members are guided by the inherent specifications replicated in the standard tender
documents. Therefore, the study sought to establish the key considerations when
constituting an award of contract to the suppliers (see Table 4.10).

Table 4.10: Key Considerations when constituting an award of Contract to

Suppliers

Key Considerations when Constituting an Award of

Contract to Suppliers Frequency Percent
Production capacity of goods and services 8 7.7
Technical requirements 8 7.7
Responsiveness of the tender 51 49.1
Competitiveness of the bids (Price discounts, Warrants, After
sales services) 17 16.3
Track record of the suppliers/contractors 20 19.2
Total 104 100

Majority of the respondents (49.1%) opined that responsiveness of the tenders is the
primary consideration by the ad hoc evaluation committee when constituting an

97
award of contract to suppliers or contractors. This was followed by the track record
of the suppliers/contractors which recorded 19.2% of the ratings. Competitivess of
the bids in terms of price discounts, warrants and aftersales services had a rating of
16.3% while production capacity of goods and services as well as technical
requirements had the same rating of 7.7%.

These results concur with section 86 (1) (a) (b) (c) and (d) of PPADA, 2015 which
indicate that successful tender should be the one with the lowest evaluated price, the
responsive proposal with the highest score in regard to the technical and financial
considerations, the tender with the lowest evaluated total cost of ownership. Finally,
the results reflected the key consideration in the act, which states that the successful
tender should be the one with the highest technical score where a tender is to be
evaluated based on the procedures regulated by an Act of Parliament which provides
guidelines for arriving at applicable professional charges.

4.5.3 Frequency of Contract Variations during Contract Implementation

Contract variations should be marginal and as per PPADA, 2015 should not exceed
25% of the absolute value in any project. In order to establish the frequency of
contract variations during contract implementation, the study deduced diverse
opinions from the respondents (see Table 4.11).

Table 4.11: Frequency of Contract Variations during Contract Implementation

Frequency of Contract Variations during Contract Implementation Frequency Percent

Very often (Regularly) 19 18.3
Often 17 16.3
Sometimes (Not often, Less often) 16 15.4
Rarely (Not many times, Minimal) 38 36.5
Very rarely 14 13.5
Total 104 100

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Majority of respondents (36.5%) noted that contract variations rarely occurs during
contract implementation, 18.3% said contract variations ensues very often during
contract implementation, 16.3% indicated that contract variations often takes place
during contract implementations. Additionally, 15.4% and 13.5% of the respondents
said that contract variations sometimes and very rarely happen during contract
implementation respectively. In total 86.5% of the respondents noted that contract
variations ordinarily occur during contact implementation in public universities in
Kenya.

These results deviates slightly with Bakr (2014) who indicated that 80% of the
contracts varies during implementation process. Kimathi (2016) also carried out a
research study on investigation into estimation of building projects variation contract
period and found out that 70% of the contracts normally varies during
implementation.

4.5.4 Causes of Contract Variations in Contract Implementation

Several facets in project management prompts causes of contract variations in public

universities in Kenya. The intensity and extensity of these incidence have far
reaching implications to the success of the implementations of the contracts (see
Table 4.12).

Table 4.12: Causes of Contract Variations in Contract Implementation

Causes of Contract Variation in Contract Implementation Frequency Percent

Price fluctuations in the market 16 15.4
Complexity of the contracts 13 12.5
Lack of professional probity 10 9.6
Delays of disbursement of funds by the exchequer 5 4.8
Omission of the required information in the Bill of quantities 9 8.7
Unanticipated changes in the market 38 36.5
Not applicable 13 12.5
Total 104 100

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According to the study, the majority of respondents (36.5%) confirmed that
unanticipated changes in the market causes contract variations during contract
implementation. This was followed by price fluctuations in the market that had
15.4%. Complexity of the contracts had 12.5% and also 12.5% of the respondents
deemed the causes of contract variations in contract implementation not applicable.
9.6% of the respondents indicated that lack of professional probity was the cause of
contract variations while 8.7% of the respondents confirmed that omission of the
required information in the bill of quantities (BQs) was the cause of contract
variations. Lastly 4.8% of the respondents said delays of disbursement of funds by
the exchequer was the cause of contract variations during contract implementation.

These findings are supported by Yadeta (2014) who assessed the impact of variation
orders on public building projects in Addis Ababa and found out that complexity of
the contracts, poor procurement process, change in design by consultants and errors
and omissions in design are the prime causes of contract variations in public entities.
These findings are also evidenced in research study conducted by Mohammed et al.
(2017) who also confirmed that the main causes of contract variations comprise: lack
of stability of prices and exchange rate change as well as errors in design.

4.5.5 Special Committee for Handling Complex and Specialized Contracts

The study sought to demystify the existence of special committee for handling
complex and specialized contracts. This was a tactical move to ascertain whether
public universities have these committees since PPADA, 2015 envisages constitution
of working groups for intricate and expert-oriented contracts (see Table 4.13).

Table 4.13: Special Committee that Handles Complex and Specialized Contracts

Response Frequency Percent

Yes 103 99
No 1 1
Total 104 100

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In regard to the study, the respondents unanimously indicated that there is existence
of special committee for handling complex and specialized contracts. This was
attested by enormous number (99%) of the respondents who confirmed the existence
of these special committee. On the flip side of that 1% of the respondents indicated
that there is no existence of special committee for handling complex and specialized
contracts in their universities. These findings support (PPADA, 2015) section 151 (1)
which indicates that for every complex and specialized procurement contract, the
accounting officers of procuring entities shall appoint a contract implementation
team.

4.5.6 The Role of Special Committee that Handles Complex and Specialized
Contracts

The committee members have special responsibilities that are based on handling
multifaceted contracts. The rallying call is always to safeguard the interest of the
public universities (see Table 4.14).

Table 4.14: Role of Special Committee that Handles Complex and Specialized
Contracts

Role of Special Committee that Handles Complex and Specialized Frequency Percent
Contracts
Monitoring and evaluation of the procurement contracts 44 42.3
Modification of the contract 3 2.9
Provision of technical expertise 39 37.5
Contract review to determine the accomplished milestone 3 2.9
Ensure compliance of the stipulated terms and conditions of the
11 10.6
contract
Not applicable 4 3.8
Total 104 100

The majority of the respondents (42.3%) indicated that the role of special committee
for complex and specialized contracts is to monitor and evaluate the procurement
contracts while 37.5% of the respondents said that the special committee provide

101
technical expertise on complex and specialized contracts. In addition to that, 10.6%
of the respondents confirmed that the special committee ensure compliance of the
stipulated terms and conditions of the contract. Respondents in tune of 3.8% alluded
that the special committee is not very much applicable in handling complex and
specialized procurement. Lastly, 2.9% of the respondents indicated that modification
of the contract and contract review to determine the accomplished milestone of the
projects are key considerations by the special committee formed to handle complex
and specialized contracts. These findings are in tandem with the listed
responsibilities of the contract implementation team in (PPADA, 2015) section 151
(1) and therefore, this signifies that public universities in Kenya adhere to the
stipulated guidelines.

4.5.7 Remedial Actions for Breach of Contract

The regulatory bodies on public procurement in Kenya (National treasury on

PPADA, 2015, Public procurement regulatory authority and public procurement
administrative review board) have a very important responsibility of ensuring
compliance of the procurement act and are also duty bound to establish practicable
disciplinary actions to the suppliers or contractors that deviate from the contracts.
These action plans are geared to enforce the contracts fully or seizure non-committal
parties in public procurement transactions and this initiative ensures a smooth flow
of procurement related activities. The results are illustrated in Table 4.15.

Table 4.15: Remedial Actions for Breach of Contract

Remedial Actions for Breach of Contract Frequency Percent

Debarment on future contracts 7 6.7
Cancellation of the contract 49 47.1
Seek legal redress for the liquidated damages 16 15.4
Withholding of payments 3 2.9
Warning of the suppliers 12 11.5
Call meeting for arbitration 17 16.3
Total 104 100

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Majority of respondents (47.1%) affirmed that the remedial actions for breach of
contract is cancellation of the contract (see Table 4.14). This was followed by 16.3%
of the respondents who indicated that they always call for meeting for arbitration.
Another remedial action for the breach of contract was seeking legal redress for the
liquidated damages was supported by 15.4% of the respondents. Further, 11.5% of
the respondents said that they give warnings to the suppliers while 6.7% of the
respondents confirmed that they subject the suppliers to a debarment on future
contracts. Lastly, 2.9% of the respondents said that they withhold payment of the
suppliers. These findings support the remedial actions for breach of contracts
reflected in the PPADA, 2015 act section 61 (3), 140, 144 and 153.

4.5.8 Rating of Suppliers Performance on Contract Administration

Public universities just like any other public entities in the country have the
obligation to introduce key performance indicators (KPI) on contractual engagements
with suppliers and contractors. These metrics justifies why the suppliers or
contractors can be deemed to be excellent, very good, good, fair or very poor (see
Table 4.16).

Table 4.16: Rating of Suppliers Performance on Contract Administration

Rating of Suppliers Performance on Contract Administration Frequency Percent

Excellent 4 3.8
Very good 25 24
Good 56 53.8
Fair 18 17.3
Very poor 1 1
Total 104 100

The majority of the respondents (53.8%) said that supplier’s performance on contract
administration is good while 24% of the respondents indicated that supplier’s
performance on contract administration is very good. Further, 17.3% and 3.8% of the
respondents had the view that supplier’s performance on contract management is fair
103
and excellent respectively. A marginal rate (1%) of the respondents indicated that
supplier’s performance on contract administration is very poor. Cumulatively, the
results that were deemed good, very good and excellent amounted to 81.6%.

These results concur with (Cherotich, 2014) who conducted research study on
contract management practice and operational performance of state corporations in
Kenya. The study revealed that suppliers/contractors are highly rated in terms of
performance by most of the state corporations. According to the study, suppliers and
even contractors that are engaged on various activities in state corporations in Kenya
account for 83.6% of service level.

4.6 Descriptive Analysis of the Study Variables

Descriptive statistics is the term given to the analysis of data that helps describe,
show or summarize data in a meaningful way and this allows the researcher to
visualize what the data is showing hence simplification and proper interpretation of
the data of the study (Sekaran, 2006). The descriptive statistics enabled the
researcher, to meaningfully describe a distribution of scores or measurements using
statistics. The type of statistics used depended on the types of variables in the study
and the scale of measurements. The study used mean, frequencies and standard
deviations to present the study findings. The general objective of this study was to
examine the influence of contract management on procurement performance in
public universities in Kenya. The study analyzed descriptive statistics for the
following observed variables: buyer-supplier collaboration, procurement risk
management, transparency and accountability, contract records management, legal
compliance and procurement performance.

104
Table 4.17: Descriptive Statistics

Descriptive Statistics
Std.
N Minimum Maximum Mean Deviation Variance

Statistic Statistic Statistic Statistic Std. Error Statistic Statistic

Buyer supplier collaboration 104 23.00 35.00 30.6346 0.28402 2.89646 8.389
Procurement risk management 104 19.00 35.00 29.8365 0.31460 3.20833 10.293
Transparency and
104 20.00 35.00 32.8173 0.28062 2.86175 8.190
accountability
Contract records management 104 25.00 35.00 32.0192 0.27156 2.76939 7.670
Legal compliance 104 25.00 35.00 32.2500 0.27388 2.79302 7.801
Procurement Performance 104 14.00 35.00 29.5288 0.36047 3.67610 13.514
Valid N (list wise) 104

The researcher carried out consolidated descriptive statistics for independent

variables, moderating variable and dependent variable (see Table 4.17). Buyer
supplier collaboration had a maximum value of 35.00 with a minimum value of 23
and a standard deviation of 2.89646 and a variance of 8.389 for the sample period
2013-2018. The mean value (30.6346) implied that the constructs of buyer supplier
collaboration (commitment, trust and continuous improvement) highly contributed to
procurement performance across the sample period. Procurement risk management
had a mean of 29.8365 with a standard deviation of 3.20833 and a variance of
10.293. Transparency and accountability on the other hand had a mean of 32.8173
with a standard deviation of 2.86175 and a variance of 8.190. Contract records
management recorded a mean of 32.0192 with as standard deviation of 2.76939 and a
variance of 7.670. Legal compliance had a mean of 32.2500 with a standard
deviation of 2.79302 and a variance of 7.801. Lastly, procurement performance
registered a mean of 29.5288 with a standard deviation of 3.67610 and a variance of
13.514 across the sample period.

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4.6.1 Buyer Supplier Collaboration

The study sought the opinion of the respondents on the various aspects of buyer
supplier collaboration in relation to procurement performance. The respondents were
required to rate each statement that match the application of buyer-supplier
collaboration in their institution using a preceding 5 points likert scale were a rate of
5 represented, Strongly Agree and 1 represented Strongly Disagree. The analysis is
depicted in Table 4.18.

Table 4.18: Opinion of the respondents on the various aspects of Buyer-Supplier

Collaboration in relation to Procurement Performance

Buyer-Supplier Collaboration SA A N D SD Mean SD

% % % % %
We invariably advocate for strong 71.2 26.9 1.9 0 0 4.69 0.504
commitment with our suppliers
We believe that a full commitment 67.3 28.8 2.9 1 0 4.62 0.594
leads to buyer supplier collaboration
Maintaining credibility with our 56.7 40.4 2.9 0 0 4.54 0.556
suppliers paves way to strong buyer
supplier collaboration initiative
We have inculcated a culture of trust 47.1 41.3 11.5 0 0 4.36 0.681
with our suppliers
We leverage our suppliers capability 31.7 55.8 11.5 1 0 4.18 0.665
by analyzing their performance
We share information with our 36.5 51.9 9.6 1 1 4.22 0.737
suppliers subject for implementation
on contractual activities
We provide feedback to suppliers in 36.5 41.3 11.5 8.7 1.9 4.02 1.005
terms of their performance
Average Score 4.38 0.677
Where: SA=Strongly Agree, A= Agree, N=Neutral, D=Disagree, SD=Strongly Disagree.

From the basis of Table 4.10 majority (71.2%) of respondents strongly agreed,
26.9% agreed while 1.9% were neutral with a mean of 4.69 and with a standard
deviation of 0.504 that they invariably advocate for strong commitment with their
suppliers on contractual obligations. On the opinion that they believe that a full
commitment on transactional activities leads to buyer supplier collaboration, 67.3%
strongly agreed, 28.8% agreed, 2.9% were neutral while 1% disagreed with the

106
statement with a mean 4.62 and a standard deviation of 0.594. On the statement that
they have confidence that buyer-supplier collaboration builds credibility, 56.7%
strongly agreed, 40.4% agreed while 2.9% were neutral with a mean of 4.54 and a
standard deviation of 0.556.

On the statement that the institutions have inculcated a culture of trust with suppliers
on contractual activities in procurement processes, 47.1% strongly agreed, 41.3%
agreed while 11% were neutral with a mean of 4.36 and a standard deviation of
0.681. On the statement that the institution consistently leverage supplier’s capability
by analyzing their performance, 51.9% agreed, 36.5% strongly agreed, 9.6% were
neutral while 1% disagreed and strongly disagreed with a mean of 4.22 and a
standard deviation of 0.737. Finally, 41.3% of respondent agreed, 36.5% strongly
agreed, 11.5% neither agreed nor disagreed, 8.7% disagreed while 1.9% strongly
disagreed on the statement that the institutions always provide feedback to their
suppliers in terms of their performance with a mean of 4.02 and a standard deviation
of 1.005.

These findings correspond with Stella et al. (2013) who indicated that, a vibrant and
productive relationship between buyers and suppliers is as a result of teamwork,
dispute resolution mechanisms, communication and mutual understanding that builds
credibility on the transactional activities in the holistic business sector. Waithaka
(2015) partly differed with this results and emphasized more on the performance
metrics to be the key indicators of sustainable relationship between buyers and
suppliers in the business environment. This meant that successful relationship
between the buying organizations and suppliers depends primarily on the service
performance levels from time to time.

4.6.2 Procurement Risk Management

The study sought the opinion of the respondents on the various aspects of
procurement risk management in relation to procurement performance. The
respondents were required to rate each statement that match the application of
procurement risk management in their institution using 5 points likert scale were a

107
rate of 5 represented, Strongly Agree and 1 represented Strongly Disagree. The
analysis is illustrated in Table 4.19.

Table 4.19: Opinion of the respondents on the various aspects of Procurement

Risk Management in relation to Procurement Performance

Procurement Risk Management SA A N D SD Mean SD

% % % % %
We adopt a supplier data base in 51 42.3 3.8 1.9 1 4.4 0.744
acquisition of goods, services and
works
We are in constant contact with our 23.1 50 20.2 5.8 1 3.88 0.862
suppliers as a contingency plan tactic
of understanding the changes in the
market
We have in built quality control 35.6 51 9.6 3.8 0 4.18 0.760
systems to verify consignments from
our suppliers
We segregate responsibilities to all the 62.5 31.7 3.8 1.9 0 4.55 0.667
staff who participate in procurement
processes
Specified staff generate requisitions to 53.8 28.8 9.6 2.9 4.8 4.24 1.066
initiate procurement process
We encourage multiple sourcing as a 57.7 34.6 6.7 0 1 4.48 0.710
means of diversifying risks
We outsource non-core activities as a 45.2 32.7 12.5 5.8 3.8 4.10 1.075
strategy for risk sharing
Average Score 4.26 0.841
Where: SA=Strongly Agree, A= Agree, N=Neutral, D=Disagree, SD=Strongly Disagree.

From Table 4.18, the common number (51%) of respondents strongly agreed 42.3%
agreed, 1.9% neither agreed nor disagreed, 3.8% disagreed while 1% strongly
disagreed with a mean of 4.4 and with a standard deviation of 0.744 that they have a
vibrant supplier data base that act as the reference point in acquisition of goods,
services and works. On the statement that they are in constant contact with our
suppliers as a contingency plan tactic of understanding the changes in the market
majority of respondents (50%) agreed, 23.1% strongly agreed, 20.2% neither agreed
nor disagreed, 5.8% disagreed while 1% strongly disagreed with a mean of 3.88 and
with a standard deviation of 0.862.

108
On the statement that they have in built quality control systems to verify all consignments
from our supplier’s majority of respondents (51%) of respondents agreed 35.6%
strongly agreed, 9.6% neither agreed nor disagreed, while 3.8% disagreed with a
mean of 4.18 and with a standard deviation of 0.760. On the statement they
emphasize segregation of responsibilities to all the staff who participate in
procurement processes majority of respondents (62.5%) of respondents strongly
agreed 31.7% agreed, 3.8% neither agreed nor disagreed, while 1.9% disagreed with
a mean of 4.55 and with a standard deviation of 0.667. On the statement that only
specified employees are mandated to generate requisitions to initiate the procurement
process majority of respondents (53.8%) strongly agreed 28.8% agreed, 9.6% neither
agreed nor disagreed, 2.9% disagreed while 4.8% strongly disagreed with a mean of
4.24 and with a standard deviation of 1.066.

On the statement that they encourage multiple sourcing as a means of diversifying

risks majority of respondents (57.7%) of respondents agreed 34.6% strongly agreed,
6.7% neither agreed nor disagreed, while 1% strongly disagreed with a mean of 4.48
and with a standard deviation of 0.710. On the statement they outsource non-core
activities as a strategy for risk sharing majority of respondents (45.2%) of
respondents strongly agreed 32.7% agreed, 12.5% neither agreed nor disagreed, 3.8%
disagreed while 4.10% strongly disagreed with a mean of 4.10 and with a standard
deviation of 1.075. These results concurred with Chemoiwo (2016) study that
revealed that procurement risk is as a result of complacency of suppliers when the
buying organization does not have a framework to appraise the suppliers.

4.6.3 Transparency and Accountability

The study sought the opinion of the respondents on the various aspects of
transparency and accountability in relation to procurement performance. The
respondents were required to rate each statement that match the application of
Transparency and Accountability in their institution using 5 points likert scale were a
rate of 5 represented, Strongly Agree and 1 represented Strongly Disagree as seen in
table 4.20.

109
Table 4.20: Opinion of the respondents on the various aspects of Transparency
and Accountability in relation to Procurement Performance

Transparency and Accountability SA A N D SD Mean SD

% % % % %
We award the contract to the lowest 86.5 11.5 1.9 0 0 4.85 0.413
evaluated responsive bidders
We write bid rejection letters to 81.7 15.4 1 1.9 0 4.77 0.561
suppliers who are not successful within
a reasonable time frame
We conduct due diligence after tender 65.4 27.9 6.7 0 0 4.59 0.617
evaluations
We validate or dismiss the suppliers in 63.5 29.8 5.8 1 0 4.56 0.651
pursuant to the due diligence report
We have procurement probity guidelines 72.1 21.2 3.8 2.9 0 4.62 0.699
that govern contractual activities
We subscribe to the rules and 74 20.2 4.8 1 0 4.67 0.614
regulations in our procurement probity
guidelines
Our procurement probity guidelines is to 81.7 12.5 5.8 0 0 4.76 0.549
promote transparency and accountability
Average Score 4.69 0.586
Where: SA=Strongly Agree, A= Agree, N=Neutral, D=Disagree, SD=Strongly Disagree.

The majority of respondents (86.5%) strongly agreed 11.5% agreed while 1.9% were
neutral with a mean of 4.85 and with a standard deviation of 0.413 that they award
the contract to the lowest evaluated bidders except when circumstances of the
contract warrant use of other provisions supported by PPADA, 2015. On the opinion
that they normally write bid rejection letters to all suppliers that are not successful
within a reasonable time frame (81.7%) of respondents strongly agreed 15.4%
agreed, 1% neither agreed nor disagreed while 1.9% disagreed with a mean of 4.77
and with a standard deviation of 0.561.

On the opinion that they always conduct due diligence, after tender evaluations but
prior to the award of contracts majority of respondents (65.4%) strongly agreed,
27.9% agreed while 6.7% were neutral with a mean of 4.59 and with a standard
deviation of 0.617. On the statement that they validate or dismiss the suppliers in
pursuant to the due diligence report majority of respondents (63.5%) strongly agreed
29.8% agreed, 5.8% neither agreed nor disagreed while 1% disagreed with a mean of

110
4.56 and with a standard deviation of 0.651. On the statement that they have
procurement probity guidelines that strictly govern all the contractual activities,
majority of respondents (72.1%) strongly agreed 21.2% agreed, 3.8% neither agreed
nor disagreed while 2.9% disagreed with a mean of 4.62 and with a standard
deviation of 0.699.

On the statement that they usually subscribe to the rules and regulations anchored in
the procurement probity guidelines, majority of respondents (74%) strongly agreed
20.2% agreed, 4.8% neither agreed nor disagreed while 1% disagreed with a mean of
4.67 and with a standard deviation of 0.614. Finally, on the statement that the
premise of their procurement probity guidelines is to promote transparency and
accountability in the procurement process (81.7%) strongly agreed 12.5% agreed
while 5.8% were neutral with a mean of 4.76 and with a standard deviation of 0.549
(see Table 4.12). The findings of the study, connect well with the findings of
(Oberoi, 2013) who found out that transparency is central for making the system of
public service delivery effective.

4.6.4 Contract Records Management

The study sought the opinion of the respondents on the various aspects of contract
records management in relation to procurement performance. The respondents were
required to rate each statement that match the application of contract records
management in their institution using 5 points likert scale were a rate of 5
represented, Strongly Agree and 1 represented Strongly Disagree.

111
Table 4.21: Opinion of the respondents on the various aspects of Contract
Records Management in relation to Procurement Performance

Contract Records Management SA A N D SD Mean SD

% % % % %
We file and secure all the records 79.8 19.2 1 0 0 4.79 0.433
used in contract process to ensure
smooth audit trail
Our professional probity makes us 40.4 40.4 10.6 3.8 4.8 4.08 1.049
to be exonerated of any
wrongdoing every time an audit
trail is conducted
We provide documentary evidence 78.8 19.2 1.9 0 0 4.77 0.467
of all contractual transactions
during internal and external audits
We provide all the required records 74 25 1 0 0 4.73 0.467
to the oversight bodies for auditing
on contract related activities
Ease on information access on 51 37.5 8.7 1.9 1 4.36 0.799
contractual activities is enhanced
by structured records management
system
We provide accurate information 75 24 1 0 0 4.74 0.462
to internal and external auditors
and any other investigative
authorities
We authenticate the information in 62.5 31.7 4.8 1 0 4.56 0.636
the university contract records
before handing over to the parties
concerned
Average Score 4.58 0.616
Where: SA=Strongly Agree, A= Agree, N=Neutral, D=Disagree, SD=Strongly Disagree.

From Table 4.20, majority of respondents (79.8%) strongly agreed 19.2% agreed, 1%
while neither agreed nor disagreed with a mean of 4.79 and with a standard deviation
of 0.433 that they always file and secure all the records used in procurement process
to ensure smooth audit trail. On the statement the professional probity makes them to
be exonerated of any wrongdoing every time an audit trail is conducted majority of
respondents (40.4%) strongly agreed as well as agreed, 10.6% neither agreed nor
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disagreed, did 3.8% disagree while 4.8% strongly disagreed with a mean of 4.08 and
with a standard deviation of 1.049.

On the statement they provide vast documentary evidence of all procurement

transactions during internal and external of audits majority of respondents (78.8%)
strongly agreed 19.2% agreed, 1.9% while neither agreed nor disagreed with a mean
of 4.77 and with a standard deviation of 0.467. On the statement they We constantly
provide all the required records to the constituted oversight bodies for auditing on
procurement related activities majority of respondents (74%) strongly agreed 25%
agreed, 1% while neither agreed nor disagreed with a mean of 4.73 and with a
standard deviation of 0.467. On the statement the Ease on information access on
contractual activities in the university is enhanced by our well-structured records
management system majority of respondents (51%) strongly agreed ,37.5% agreed,
8.7% neither agreed nor disagreed, did 1.9% disagree while 1% strongly disagreed
with a mean of 4.36 and with a standard deviation of 0.799. On the statement they
normally provide accurate information to internal and external auditors and any other
investigative authorities majority of respondents (75%) strongly agreed 24% agreed,
1% while neither agreed nor disagreed with a mean of 4.74 and with a standard
deviation of 0.462.

Finally, on the statement they normally authenticate the information replicated in the
university procurement records before handing over to the parties concerned majority
of respondents (62.5%) strongly agreed 31.7% agreed, 4.8% neither agreed nor
disagreed while1% disagreed with a mean of 4.56 and with a standard deviation of
0.636. These results compliment Dewah and Mutula (2015) study that explored the
link between records management and the discharge of justice and found that the
courts jurisprudence is guided by the range of records presented to the court.

4.6.5 Legal Compliance

The study sought the opinion of the respondents on the various aspects of legal
compliance in relation to procurement performance. The respondents were required
to rate each statement that match the application of legal compliance in their

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institution using 5 points likert scale were a rate of 5 represented, Strongly Agree and
1 represented Strongly Disagree. The analysis is described in Table 4.22.

Table 4.22: Opinion of the respondents on the various aspects of Legal

Compliance in relation to Procurement Performance

Legal Compliance SA A N D SD Mean SD

% % % % %
We normally comply with PPADA, 85.6 14.4 0 0 0 4.86 0.353
2015
Compliance score on the act is as per 67.3 29.8 2.9 0 0 4.64 0.538
public procurement regulatory
authority
Compliance score of PPADA, 2015 51.9 37.5 8.7 1 1 4.38 0.767
depends on the inherent culture of the
university on procurement activities
We adhere to professional fidelity on 66.3 29.8 3.8 0 0 4.62 0.561
contractual responsibilities as a way of
complying with PPADA, 2015
We believe that legal compliance is 73.1 25 1.9 0 0 4.71 0.496
based on procurement standards set by
the public procurement regulatory
bodies
We are confident that the conduct of 60.6 27.9 6.7 2.9 1.9 4.42 0.889
executives in procurement process
forms the basis of legal compliance
Legal compliance framework assists 66.3 27.9 5.8 0 0 4.61 0.598
the staff involved on procurement
process to manage their obligations
effectively
Average Score 4.61 0.600
Where: SA=Strongly Agree, A= Agree, N=Neutral, D=Disagree, SD=Strongly Disagree

The majority (85.6%) of the respondents strongly agreed while 14.4% agreed with a
mean of 4.86 and with a standard deviation of 0.353 that they continuously comply
with PPADA 2015. On the statement that the compliance score in line with PPADA,
2015 on contractual obligations is in tandem with the public procurement regulatory
authority majority of the respondents (67.3%) strongly agreed, 29.8% agreed while
2.9% neither agreed nor disagreed with a mean of 4.64 and a standard deviation of

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0.538. The statement that they have the conviction that compliance score of PPADA,
2015 depends primarily on the inherent culture of the university on procurement
activities majority of respondents (51.9%) strongly agreed, 37.5% agreed, 8.7%
neither agreed nor disagreed, 1% disagreed while 1% strongly disagreed with a mean
of 4.38 and a standard deviation of 0.767.

Majority of respondents (66.3%) strongly agreed, 29.8% agreed while 3.8% neither
agreed nor disagreed with a mean of 4.62 and a standard deviation of 0.561 on the
statement that in the realm of procurement process, they adhere to professional
fidelity on contractual responsibilities as a way of complying with the PPADA, 2015.
On the account of the fact that they believe that legal compliance is based on
procurement standards set by the public procurement regulatory bodies majority of
respondents (73.1%) strongly agreed, 25% agreed while 1.9% neither agreed nor
disagreed with a mean of 4.71 and a standard deviation of 0.496. On the statement
that they have confident that the conduct of executives in procurement process forms
the basis of legal compliance majority of respondents (60.6%) strongly agreed, 27.9
agreed, 6.7% neither agreed nor disagreed, 2.9% disagreed while 1.9% strongly
disagreed with a mean of 4.42 and a standard deviation of 0.889.

Lastly, on the statement that they are certain that legal compliance framework assists
all the executes who are involved on procurement process to confidently manage
their obligations effectively majority of the respondents (66.3%) strongly agreed,
27.9 agreed while 5.8% neither agreed nor disagreed with a mean of 4.61 and a
standard deviation of 0.598. The results of this study are in line with (Abere, 2015)
who conducted a research study on factors affecting compliance with the public
procurement and disposal regulations in Kenya. The study found out that training on
public procurement and disposal regulations, ethical practices during tendering
process and enforcement mechanisms influences the compliance of procurement and
disposal regulations in public entities in Kenya.

4.6.6 Procurement Performance

The study sought the opinion of the respondents on the various aspects of
procurement performance. The respondents were required to rate each statement that

115
match the application of procurement performance in their institution using 5 points
likert scale were a rate of 5 represented, Strongly Agree and 1 represented Strongly
Disagree as seen in table 4.23.

Table 4.23: Responses on the various aspects of Procurement Performance

Procurement Performance SA A N D SD Mean SD

% % % % %
We register cost effectiveness in all 31.7 51.9 15.4 1 0 4.14 0.703
contractual activities
We have a framework of ensuring 29.8 57.7 9.6 2.9 0 4.14 0.703
cost effectiveness in procurement
activities
Our synergy drive in procurement 33.7 52.9 10.6 2.9 0 4.17 0.730
forms the basis of customer
satisfaction
Our customer satisfaction index 32.7 51 14.4 1 1 4.13 0.764
induces vibrant working relationship
We always respond to our internal 46.2 41.3 9.6 2.9 0 4.31 0.764
customers complaints to enhance
customer satisfaction
We constantly embrace procurement 40.4 51 7.7 1 0 4.31 0.655
agility in contractual obligations
Our strategies on procurement agility 39.4 53.8 5.8 1 0 4.32 0.627
enhances our procurement
performance
Average Score 4.22 0.707
Where: SA=Strongly Agree, A= Agree, N=Neutral, D=Disagree, SD=Strongly Disagree.

According to the study, 31.7% strongly agreed, 51.9% agreed, 15.4% neither agreed
nor disagreed while 1% of the respondents disagreed with the statement that they
often register cost-effectiveness in all contractual activities with their
suppliers/contractors with a mean of 4.14 and a standard deviation of 0.703 (see
Table 4.23). On the statement that they have a framework of ensuring cost-
effectiveness in procurement activities 29.8% strongly agreed, 57.7% agreed, 9.6%
neither agreed nor disagreed while 2.9% disagreed with a mean of 4.14 and a
standard deviation of 0.703.

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The statement that the inherent synergy-focused drive in procurement process forms
the basis of customer satisfaction 33.7% strongly agreed, 52.9% agreed, 10.6%
neither agreed nor disagreed while 2.9% of the respondents disagreed with a mean of
4.17 and a standard deviation of 0.730. From the basis of the statement that their
customer satisfaction index necessitates vibrant working relationship 32.7% strongly
agreed, 51% agreed, 14.4% neither agreed nor disagreed, 1% disagreed while 1% of
the respondents strongly disagreed with a mean of 4.13 and a standard deviation of
0.764. Majority of the respondents (46.2%) strongly agreed, 41.3% agreed, 9.6%
neither agreed nor disagreed while 2.9% disagreed with the statement that they
always respond to their internal customer’s complaints as a way of sustaining and
enhancing customer satisfaction with a mean of 4.31 and a standard deviation of
0.764.

On the statement that they constantly embrace procurement agility in contractual

obligations 40.4% strongly agreed, 51% agreed, 7.7% neither agreed nor disagreed
while 1% of the respondents disagreed with a mean of 4.31 and a standard deviation
of 0.655. Finally, on the account of the statement that the respondent’s strategies on
procurement agility enhances their procurement performance 39.4% strongly agreed,
53.8% agreed, 5.8% neither agreed nor disagreed while 1% disagreed with a mean of
4.32 and a standard deviation of 0.627.

These results connect fully with Mbae (2014) who conducted a research study on
public procurement law and procurement performance of county governments in
Kenya. The results strongly support the researcher’s findings in the sense that when
two parties strike a bargain, there must be some mechanism to ensure that each party
will stick to the terms and conditions of the contract in order to ensure a smooth flow
of the contract. On another study conducted by Kiage (2013) on factors affecting
procurement performance the research study differed slightly with the results of this
study. The researcher revealed that procurement planning has a significant impact on
procurement performance since it accounts to 26%. Also the study revealed other
attributes that affect procurement performance whereby contract management
resulted to 23.3%, staff competency 20.1% while resource allocation registered
17.2%.

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4.7 Diagnostic Tests (Test of Multivariate Assumptions)

Diagnostic test has become a basic requirement in the realm of econometrics

discipline. The advances of the distinct multivariate assumptions in a research study
shows whether the coefficients of the estimates are consistent and could be relied
upon when making statistical inferences (Greene, 2002). Diagnostic tests are
conducted to ensure that the assumptions of ordinary least squares (OLS) are not
violated before conducting a multiple linear regression. Therefore, the data was
tested for adherence to the OLS assumptions and it was found to be free from;
linearity, normality, autocorrelation, heteroscedasticity and multicollinearity. The
outcome of these results enabled the researcher to proceed with other analysis of the
research study.

4.7.1 Linearity Test

The linearity test was ascertained by use of the correlation coefficient statistics which
is a statistical measure of the strength of the relationship between the relative
movements of two variables (Stock & Watson, 2007). The decision making process
was guided by the assumption that if the value sig. deviation from linearity>0.05,
then the relationship between the independent variables are linearly dependent and if
the value sig. deviation from linearity<0.05, then the relationship between
independent variables with dependent variable is not linear (see Table 4.24).

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Table 4.24: Model Summary Statistics and Coefficients

ANOVA TABLE
Sum of Mean of
Df F Sig.
Squares Squares
Procurement performance* Between Groups (Combined) 505.484 11 45.953 4.769 0.000
Buyer Supplier Collaboration
Linearity 400.244 1 400.244 41.540 0.000
Deviation from
105.240 10 10.524 1.092 0.376
Linearity
Within Groups 1069.466 92 11.624
Total 1391.913 103
Procurement Performance* Between Groups (Combined) 386.938 13 29.764 2.666 0.003
Procurement Risk Management
Linearity 269.958 1 269.958 24.176 0.000
Deviation from
Linearity 116.980 12 9.748 0.873 0.577

Within Groups 1004.975 90 11.166

Total 1391.913 103

Procurement Performance* Between Groups Combined)
Transparency & Accountability 322.448 11 29.313 2.522 0.008

Linearity 122.954 1 122.954 10.577 0.002

Deviations from
Linearity 116.980 10 19.949 1.716 0.089
Within Groups 1069.466 92 11.6
Total 1391.913 103
Procurement Performance* Between Groups (Combined)
Contract Records Management 436.490 10 43.649 4.249 0.000

Linearity 326.605 1 326.605 31.791 0.000

Deviations from
Linearity 109.885 9 12.209 1.188 0.312

Within Groups 955.424 93 10.273

Total 1391.913 103
Procurement Performance* Between Groups (Combined)
439.069 10 43.907 4.285 0.000
Legal Compliance
Linearity 295.473 1 295.473 28.839 0.000
Deviations from
Linearity 143.596 9 15.955 1.557 0.140
Within Groups 952.844 93 10.246
Total 1391.913 103

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The analysis of variance (ANOVA) output of the variables (Buyer supplier
collaboration, procurement risk management, transparency and accountability,
contract records management and legal compliance) had p-values of 0.376, 0.577,
0.089, 0.312 and 0.140 respectively. These results showed sig. values deviating from
linearity (p-value>0.05) and therefore, we rejected the null hypothesis that all
variables have no linear relationship with procurement performance in public
universities in Kenya. We concluded that all the variables of the study have a linear
relationship with procurement performance.

4.7.2 Test of Normality

The normality test used in this study was Kolmogorov-Smirnov (KS), Shapiro Wilk
(SW) as well as Q-Q plot. If the significant value of the K-S and S-W Test is more
than the p-value 0.05, the data is normally distributed hence the null hypothesis is not
rejected since the data sets follow a normal curve. On instances when the (p-
value<0.05) the data is deemed not to be normal and therefore, the null hypothesis is
not rejected. Further, if the Q-Q plot is within the straight line then the study shows a
positive correlation (Thode, 2002). The analysis of normality test is shown in Table
4.25.

Table 4.25: Test of Normality

Variable Kolmogorov-Smirnova Shapiro-Wilk

Statistic Df Sig. Statistic Df Sig.
Buyer Supplier Collaboration 0.156 104 0.200* 0.904 104 0.078
Procurement Risk Management 0.214 104 0.200* 0.860 104 0.076
Transparency and
0.155 104 0.200* 0.933 104 0.198
Accountability
Contract Records Management 0.126 104 0.200* 0.936 104 0.248
Legal Compliance 0.224 104 0.200* 0.854 104 0.134

The study results of normality which assesses the normalcy of the distribution of
scores provided significant results that supported the K-S and S-W assumptions (see

120
Table 4.25). The hypothesis was tested at 5% level of significant and p-value for the
former and latter assumption were more than 0.05 and therefore, the null hypothesis
was not rejected. It was concluded that the data was normally distributed. Also the
study used the Q-Q plot to establish the degree of normality of residuals. The
standardized data was measured against the standard normal distribution. The study
measured, the correlation between the sample data and normal quantiles (measure of
the goodness of fit) which examines how well the data are modeled by a normal
distribution. The results showed that the plotted Q-Q were within the straight line
thus indicating positive correlation.

4.7.2.1 Buyer Supplier Collaboration

The predictor variable (Buyer supplier collaboration) registered normal Q-Q plots
since the distribution of the scores does not deviate from normality to a very big
extent (see Figure 4.1). This denotes that the distributions are linearly related in the
sense that the Q-Q plot lie approximately on the line. Basically, data clustering
around the line shows normality of the distribution of scores.

Figure: 4.1: Normal Q-Q Plot of Buyer Supplier Collaboration

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4.7.2.2 Procurement Risk Management

The distribution of the scores that are based on procurement risk management are not
skewed (see Figure 4.2). Therefore, all the scores fall closely to the straight line and
basically this means that the set data of the study is well modeled by normal
distribution hence reflecting better regression results of the study.

Figure 4.2: Normal Q-Q Plot of Procurement Risk Management

4.7.2.3 Transparency and Accountability

The dispersal of scores in line with transparency and accountability illustrates a

normal Q-Q plot randomly generated with the standard normal data on the vertical
axis to a standard normal population on the horizontal axis (see Figure 4.3). The
linearity of the points suggests that the data is normally distributed.

122
Figure 4.3: Normal Q-Q Plot of Transparency and Accountability

4.7.2.4 Contract Records Management

The general trend of the Q-Q plot follows a straight line (see Figure 4.4). This
signifies a good indicator of normal distribution based on contract records
management data derived from the study. This conforms to the stipulated normality
assumption that values along the linear line presents a normal distribution scores.

Figure 4.4: Normal Q-Q Plot of Contract Records Management

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4.7.3 Autocorrelation Test

Autocorrelation test was performed to establish whether the error terms were serially
interdependent. Basically, Durbin Watson statistics is normally used to establish the
degree of autocorrelation in the study. Autocorrelation is present if the DW statistics
is close to 0 and 4. A value of 0 shows evidence of perfect positive autocorrelation
while 4 shows evidence of perfect negative autocorrelation. A Durbin Watson value
between 2 and 2.5 indicates absence of autocorrelation. Absence of autocorrelation
implies that the data is reliable and suitable for estimation (Mukras, 2003).

Table 4.26: Autocorrelation Test

Model Durbin-Watson
1 1.913
a. Predictors: (Constant), Legal compliance, Procurement risk management, Transparency
and accountability, Buyer supplier collaboration, Contract records management
b. Dependent Variable: Procurement Performance

Table 4.26 indicates that the model had a Durbin Watson value of 1.913 which
implies weak positive autocorrelation. The existence of weak positive autocorrelation
does not have statistically significant effect on the model estimation and prediction.
This results indicates that the data used in this study was reliable and suitable for
estimation purposes.

4.7.4 Homoscedasticity Test

Data with identical variances is said to be homoscedastic and data sets yields more
accurate regression results while heteroscedastic data present standard errors that are
already biased (Maddala, 2009). Levene Statistic (LS) was applied to test the
homogeneity of variance in the data sets. This study was guided by the assumption of
homogeneity of variance which states that the p-value for Levene's Test should be
above 0.05 and if Levene’s Test yields a p-value below 0.05, then the assumption of
homogeneity of variance is deemed to be violated (see Table 4.27).

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Table 4.27: Test of Homogeneity of Variance

Test of Homogeneity of Variance

Levene
Statistic df1 df2 Sig.
Buyer Supplier Collaboration Based on Mean 2.376 1 102
0.141
Based on Median 1.816 1 102
0.194
Based on Median and with 1.816 1 12011
0.203
adjusted df
Based on trimmed mean 1.871 1 102
0.122
2.240 1 102
0.152
Procurement Risk Management Based on Mean 1.752 1 102
0.145
Based on Median 1.752 1 70.243
0.148
Based on Median and with 1.871 1 102
0.122
adjusted df
Based on trimmed mean 2.095 1 102
0.087
Transparency and Accountability Based on Mean 2.026 1 102
0.115
Based on Median 1.710 1 60.336
0.170
Based on Median and with 1.710 1 102
0.174
adjusted df
Based on trimmed mean 1.94 1 102
0.132
Contract Records Management Based on Mean 2.095 1 102
0.087
Based on Median 1.752 1 102
0.145
Based on Median and with 1.752 1 70.243
0.148
adjusted df
Based on trimmed mean 1.871 1 103
0.122
Legal Compliance Based on Mean 2.095 1 103
0.087
Based on Median 1.752 1 103
0.145
Based on Median and with 1.752 1 70.243
0.148
adjusted df
Based on trimmed mean 1.871 1 103
0.122

The p-value of levene’s test on test of homogeneity variance showed that all the
variables had (p-value>0.05) hence the null hypothesis was not rejected. Since all the
variables had no homogeneity of variance, we conclude that heteroscedastic data was
not existing in the study meaning that the data sets had equal variances according to
the robust tests for homoscedasticity. This also implied that the data that was
presented was unbiased.

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4.7.5 Test of Multicollinearity

Multi-collinearity is a problem in multiple regressions that develops when one or

more of the predictor variables are highly correlated with one or more of the other
independent variables. The collinearity statistics that were used include the Tolerance
Statistic and Variance Inflation Factor (VIF). The standard rule for this test is that
Tolerance Statistic considerably larger than 1 indicates possibility of
multicollinearity between the predictor variables, and if any of the variables VIF is
larger than 10 multicollinearity is definitely present (Brooks (2008). The analysis of
test of multicollinearity is shown in Table 4.28.

Table 4.28: Test of Multicollinearity

Collinearity Statistics
Model Factors Tolerance VIF
Buyer Supplier Collaboration 0.640 1.562
Procurement Risk Management 0.715 1.399
Transparency and Accountability 0.706 1.416
Contract Records Management 0.611 1.638
Legal Compliance 0.664 1.505
Dependent Variable: Procurement Performance

According to the study’s results, the tolerance statistics for buyer supplier
collaboration had tolerance of 0.640 and a VIF of 1.562, procurement risk
management recorded tolerance of 0.715 and a VIF of 1.399. Transparency and
accountability registered tolerance of 0.706 and a VIF of 1.416 while contract
records management had tolerance of 0.611 and a VIF of 1.638. Lastly, legal
compliance had tolerance of 0.644 and a VIF of 1.505 (see Table 4.28). This shows
that all of the predictor variables and the moderating variable had a tolerance of less
than 1 and the VIFs were all below 10. This indicates that there is no multiconeriarity
among the study variables.

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4.8 Inferential Statistics

Inferential statistics allows the researcher to make predictions (inferences) and

generalization from the data drawn from the population. Inferential statistics use
statistical model to help the researcher compare sample data to other samples of
previous research (Sekaran, 2010). In line with this study, correlation analysis and
regression analysis were adopted. The correlation analysis was used to establish
strength relationships between independent variables and dependent variable. In
particular Pearson correlation was applied to establish the strength of the linear
relationship. Multiple linear regression model was employed to establish the
relationship among predictor variables on the dependent variable. Test statistics was
also used to determine the relative importance of each independent variable in
influencing procurement performance. In this case t-test and F-test, statistics were
considered to be statistically significant when the value of the test statistic falls in the
critical region.

4.8.1 Correlation Analysis

In statistics, coefficients of correlation R and R square measure the direction and

strength of a linear relationship between two variables. Their numerical value is
indicator of the direction and strength of the relation between variables. The value of
R and R square can vary from -1.00 to +1.00. Generally, R>0 indicates positive
relationship. Correlation coefficients enable a researcher to quantify the strength of
the linear relationship between two or more variables (Saunders et al., 2009).
Correlation is a measure of the degree of relatedness of variables. Several measures
of correlation are available, the selection of which depends mostly on the level of
data being analyzed. For only ordinal-level or ranked data, Spearman’s rank
correlation (r), can be used to analyze the degree of association of two continuous
variables. Pearson product-moment correlation coefficient r, requires at least interval
level of measurement for the data (Sekaran, 2010).

Correlation coefficients provide a numerical summary of the direction and the

strength of the linear relationship between two variables. Pearson correlation
coefficients (r) range from –1 to +1. The sign at the front indicates whether there is a
127
positive or a negative correlation The size of the absolute value provides information
on the strength of the relationship where; (r=0.1 to 0.29 weak; r=0.30 to 0.49
Medium; r=0.5 to 1.0 strong). A value of zero (0) mean that the variables are
perfectly independent that is no relationship exists, a value of +1 represents a perfect
positive correlation and a value of -1 represents a perfect negative correlation
(Kothari, 2004). To determine the strength and direction of the linear relationship
between independent and dependent variables. For this study, Pearson Product
Moment Correlation was used to calculate bivariate correlation values and the results
obtained are summarized in Table 4.29.

Table 4.29: Pearson Product Moment Correlation

Procurement Procurement Transparency Contract

Procurement Buyer Supplier
Performance Risk & Records
Performance Collaboration
Management Accountability Management
Pearson
1 0.536** 0.440** 0.297** 0.484**
Correlation
Sig. (2-
0.000 0.000 0.002 0.000
tailed)
N 104 104 104 104 104
Buyer Supplier Pearson **
0.536 **
1 0.512 0.102 0.357**
Collaboration Correlation
Sig. (2-
0.000 0.000 0.303 0.000
tailed)
N 104 104 104 104 104
Procurement Risk Pearson ** *
0.440 **
0.512 1 0.198 0.271**
Management Correlation
Sig. (2-
0.000 0.000 0.044 0.005
tailed)
N 104 104 104 104 104
Transparency & Pearson *
0.297 **
0.102 0.198 1 0.487**
Accountability Correlation
Sig. (2-
0.002 0.303 0.044 0.000
tailed)
N 104 104 104 104 104
Contract Records
** ** **
Management Pearson 0.484** 0.357 0.271 0.487 1
Correlation

Sig. (2- 0.000 0.000 0.005 0.000

tailed)
N 104 104 104 104 104

The results show that the correlation between buyer supplier collaboration on
procurement performance had R of 0.536 and p-value of 0.000 at 95% confidence
levels. The coefficient value was between 0.5 to 1.0 and this indicated a strong
correlation between Buyer supplier collaboration and procurement performance
hence variables are associated. The results concur with Stella et al. (2013) who found

128
that there is strong correlation between buyer supplier collaboration on procurement
performance.

The results further showed that procurement risk management on procurement

performance had R of 0.440 and p-value of 0.000 at 95% confidence levels. The
coefficient value was between 0.30 to 0.49 and this indicated a medium correlation
between procurement risk management and procurement performance hence
variables are associated. These results correspond with Okonjo (2014) who
established that there a moderate correlation between procurement risk management
on procurement performance.

On transparency and accountability on procurement performance R was 0.297 and p-

value of 0.002 at 95% confidence levels. The coefficient value was between 0.1 to
0.29 which indicated a weak correlation between transparency and accountability and
procurement performance hence variables were deemed to be slightly associated. The
results are supported by Mukoruru (2014) who found that there is a weak correlation
between transparency and accountability on procurement performance in public
sector.

Contract records management and procurement performance had R of 0.484 and p-

value of 0.000 at 95% confidence levels. The coefficient value was between 0.30 to
0.49 and this indicated a medium correlation between contract records management
and procurement performance hence variables are associated. These findings concur
with Dzifa and Reindof (2015) who found that there is moderate correlation between
contract records management on procurement performance.

4.8.2 Regression Analysis

Regression analysis is a set of statistical techniques that allow one to assess the
relationship between more than one independent variable and one dependent
variable. Regression is often used when the intent of the analysis is prediction. The
goal of regression is to arrive at the set of regression coefficients (Beta values), for
the independent variables that bring the Y values predicted from the equation as
close as possible to the Y values obtained by measurement. The regression

129
coefficients that are computed minimize the sum of the squared deviations between
predicted and obtained Y values and they optimize the correlation between the
predicted and obtained Y values for the data set (Barbara & Linda, 2007).

4.7.2.1 Overall Model Summary of Inferential Analysis

The linear regression analysis models the relationship between the dependent
variable which is procurement performance and independent variable which is
influence of contract management (Buyer supplier collaboration procurement risk
management, transparency and accountability and contract records management).
Coefficient of determination explains the extent to which changes in the dependent
variable that is explained by all the four independent variables (Buyer supplier
collaboration procurement risk management, transparency and accountability and
contract records management).

Table 4.30: Overall Model Summary

Overall Model Summary

Model R R Square Adjusted R Square Std. Error of the Estimate

a
1 0.764 0.741 0.717 0.85927
a. Predictors: (Constant), Buyer Supplier Collaboration, Procurement Risk Management,
Transparency and Accountability and Contract Records Management

The correlation of coefficient (R) was 0.764, the coefficient of correlation (R2) was
0.741 and the adjusted R square was 0.717. The correlation of coefficient indicated
that all the predictor variables accounted to 76.4% of variations on procurement
performance in public universities in Kenya. Further, the correlation of determination
indicated that all the independent variables accounted to 74.1% of variations on
procurement performance in public universities in Kenya. Lastly, the adjusted R
square showed that all the explanatory variables accounted to 71.7% of variations on
procurement performance in public universities in Kenya. This correlation showed
the explanatory power of the model.

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The R square (R2) was computed as the preliminary test for multiple linear regression
model. The goodness of fit of the model explained by R square 0.741 implies that the
independent variables accounted to 74.1% of variations on procurement performance
at 5% significance level. Only 25.9% of variations on procurement performance in
public universities is determined by the stochastic terms not included in the model.
Therefore, the independent variables greatly influence procurement performance in
public universities in Kenya which makes the model fit for policy inferences.

4.7.2.2 Analysis of Variance of Independent Variables

Gujarati (2004) confirms that analysis of variance is a collection of statistical models

and the associated estimation procedures used to analyze the differences among
group means in a sample. ANOVA provides a statistical test of whether two or more
population means are equal and therefore generalizes the t-test beyond two means.
Basically, t-test is a special case of the ANOVA and it is used to test whether there
are significant differences between two means derived from two samples or groups at
specified probability level. Further, F-test is also applicable in ANOVA and it
comprises any statistical test in which the test statistic has an F-distribution under the
null hypothesis.

Table 4.31: Analysis of Variance

ANOVAa
Model Sum of Squares Df Mean Square F Sig.
1 Regression 582.547 4 145.637 17.814 0.000b
Residual 203.616 99 8.175
Total 786.163 103
a. Dependent Variable: Procurement Performance
b. Predictors: (Constant), Buyer Supplier Collaboration, Procurement Risk Management, Transparency
and Accountability and Contract Records Management

The regression results of the ANOVA indicate an F-statistic of 17.814 which was
significant at 5% significance level (p-value 0.000<0.05). This implied that the null
hypothesis was rejected and we concluded that the overall model was significant at

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5% significance level. The coefficients fitted in the multiple regression model were
not equal to zero. Therefore, the model used was significant and of a good fit for the
variables being tested. The findings inferred that the influence of buyer supplier
collaboration, procurement risk management, transparency and accountability and
contract records management had a significant influence on procurement
performance in public universities Kenya.

4.7.2.3 Regression Analysis of the Variables

The dependent variable of the model was procurement performance of public

universities in Kenya and the independent variables of the study were buyer supplier
collaboration, procurement risk management, transparency and accountability and
contract records management. The model is presented algebraically as follows:
PP it =β0+ β1BSC it +β2PRMit + β3TAit + β4CRMit +ε………....…...…….3.1.
Where;
β0=Constant
PP=Procurement Performance
BSC= Buyer Supplier Collaboration
PRM= Procurement Risk Management
TA= Transparency and Accountability
CRM= Contract Records Management
ε= Error term (the residual error of the regression)

Table 4.32: Regression Analysis

Coefficientsa
Unstandardized Standardized
Coefficients Coefficients
Model B Std. Error Beta T Sig.
1 (Constant) 5.198 4.392 1.183 0.240
Buyer Supplier Collaboration 0.434 0.119 0.342 3.662 0.000
Procurement Risk Management 0.199 0.104 0.173 1.915 0.048
Transparency and Accountability 0.126 0.114 0.098 1.099 0.044
Contract Records Management 0.355 0.125 0.268 2.854 0.005
a. Dependent Variable: Procurement Performance

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The results in Table 4.32 generates a regression equation as follows:

PP=5.198 + 0.342BSC + 0.173PRM+ 0.098TA + 0.268CRM

The regression equation above implies that, ceteris paribus, procurement

performance had a constant of 5.198. This shows that procurement performance is
deemed to change by 5.198 units holding other factors constant in the model
implying that there exist other explanatory variables that result to variations in
procurement performance other than the study variables (Buyer supplier
collaboration, procurement risk management, transparency and accountability and
contract records management).

Objective 1: To find out the Influence of Buyer Supplier Collaboration on

Procurement Performance in Public Universities in Kenya

The regression results indicate that buyer supplier collaboration had a statistically
significant influence on procurement performance (p-value 0.000<0.05). Holding
other factors constant, a unit change in buyer supplier collaboration would lead to
change in procurement performance by 0.342. This implies that 1% change in buyer
supplier collaboration results to 34.2% change in procurement performance in public
universities in Kenya. The results concur with Otieno (2012) who conducted a
research on buyer supplier relationship in Kenya’s public universities and found that
buyer supplier relationships are very significant in enhancing procurement
performance. Further, Mejooli and Senelwa (2022) in a study entitled effect of
supplier relationship on procurement performance of public universities in Nairobi
County, established that buyer supplier relationship had a significant effect on
procurement performance. The significant value in ANOVA results was (p-value
0.000<0.05).

Objective 2: To find out the Influence of Procurement Risk Management on

Procurement Performance in Public Universities in Kenya

The results equally show that procurement risk management had a statistically
significant effect on procurement performance (p-value 0.048<0.05). Holding other

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factors constant, a unit change in procurement risk management would lead to
change in procurement performance by 0.173 units. This implies that 1% change in
procurement risk management leads to 17.3% change in procurement performance in
public universities in Kenya ceteris paribus. This result corresponds with Odongo
and Chepkwony (2019) study which affirmed that risk reduction was statistically
significant (p-value 0.051<0.05). This results indicated that risk reduction had a
positive influence on procurement performance. Also, Owuor et al. (2019) found that
supply chain risk management practices had R2=0.483 on supply chain performance.
This meant that 48.3% of supply chain performance of public universities in Kenya
is accounted for by supply chain risk management practices. This finding represent a
slight high index of supply chain risk management practices on supply chain
performance in public universities in Kenya.

Objective 3: To find out the Influence of Transparency and Accountability on

Procurement Performance in Public Universities in Kenya

Further, the regression results showed that transparency and accountability had a
statistically significant effect on procurement performance (p-value 0.044<0.05). The
results revealed that a unit change in transparency and accountability would lead to
change in procurement performance by 0.098 units. This implies that 1% change in
transparency and accountability leads to 9.8% change in procurement performance in
public universities in Kenya. This meant that the transgression of the ethical
principles that included impartiality, due diligence and procurement probity affects
procurement performance in public universities in Kenya. These results are
commensurate with Chesseto et al. (2019) study that showed that transparency was
statistically significant on influencing procurement performance in public
universities in Kenya (p-value 0.0205<0.05). To add on that, according to Wanyonyi
et al. (2018) study transparency and accountability had a positive significant effect
on procurement performance. The results showed (p-value 0.012<0.05). The results
implied that a unit increase in the adoption of transparency practice would lead to an
increase in procurement performance.

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Objective 4: To find out the Influence of Contract Records Management on
Procurement Performance in Public Universities in Kenya

Contract records management had a statistically significant effect on procurement

performance (p-value 0.005<0.05). The regression results showed that a unit change
in contract records management would lead to change in procurement performance
by 0.268 units. This implies that 1% change in contract records management leads to
26.8% change in procurement performance in public universities in Kenya ceteris
paribus. This implied that a total departure from ascertaining audit trail, information
accessibility and information accuracy adversely affects procurement performance in
public universities in Kenya. This result concurred with Chegugu and Kwasira
(2019) study that revealed a positive statistical significance on influence of
procurement records keeping practices on corporate goals (p-value 0.000<0.05). On
the same breadth, a study conducted by Kyalo et al. (2021) on the influence of
records management on tendering process in public sector showed that records
management had a statistically positive influence on tendering process in the public
sector (p-value 0.000<0.05).

4.8.3 Test for Moderating Effect of Legal Compliance

Moderator variables influence the relationship between dependent variable and other
independent variables. The direction and the magnitude of the relationship between
the dependent variable and the independent variable is reliant on the value of a
moderator (Saunders et al., 2009). The legal compliance on procurement
performance is underlined under the threshold of Above Average Complaint (81-
99%), Average Complaint (51-80%) and Non-Complaint (Below 50%) in regard to
PPADA, 2015 (PPRA, 2018). The study objective was to examine the moderating
influence of legal compliance on the relationship between procurement contract
management on procurement performance in public universities in Kenya. In this
study, legal compliance was hypothesized to be a moderator affecting the
relationship between dependent (procurement performance) and the independent
variables (Buyer supplier collaboration, Procurement risk management,
Transparency and accountability and Contract records management) for purpose of

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testing moderating effect. The moderating effect of legal compliance was represented
in regression equation below:

PP it =β0+ β1BSC it*LC+β2PRMit*LC++ β3TAit*LC+ +β4CRMit*LC+ +ε…..3.2.

The null hypothesis (H05) was that legal compliance has no significant moderating
influence on the relationship between contract management and procurement
performance in public universities in Kenya. In order to achieve this objective, the
researcher first tested whether there is a relationship between the independent
variables and the dependent variable without a moderator. Afterwards, the researcher
tested the relationship between independent variables and dependent variable with a
moderator and the regression results (see Table 4.33).

Table 4.33: Summary of Regression Output

Coefficients
Unstandardized Standardized
Coefficients Coefficients
Std.
Model B Error Beta t Sig.
1 (Constant) 5.198 4.392 1.183 0.240
Buyer Supplier Collaboration 0.434 0.119 0.342 3.662 0.000
Buyer Supplier Collaboration*M (0.387) (0.120) (0.305) (3.216) (0.002)
Procurement Risk Management 0.199 0.104 0.173 1.915 0.048
Procurement Risk Management*M (0.191) (0.103) (0.167) (1.858) (0.006)
Transparency & Accountability 0.126 0.114 0.098 1.099 0.044
Transparency & Accountability*M (0.079) (0.116) (0.062) (0.684) (0.046)
Contract Records Management 0.355 0.125 0.268 2.854 0.005
Contract Records Management*M (0.289) (0.129) (0.218) (2.243) (0.027)
a. Dependent variable: Procurement Performance

R2 before moderation 0.741 R2 after moderation (0.759)

Adjusted R2 before moderation 0.717 Adjusted R2 after moderation (0.730)
F ratio before moderation 17.814 F ratio after moderation (15.191)
(0.000)

The results in Table 4.33 indicates the moderating effect of legal compliance on the
relationship between (predictor variables) and procurement performance in public
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universities in Kenya. The goodness of fit of the model given by adjusted R squared
(0.730) implies that 73.0% of the relationship between (Predictor) and procurement
performance was moderated by the legal compliance. The overall significance of the
model given by the F-statistic (15.191) indicate that the model was significant since
the (p-value 0.000<0.05) at 5% significance level.

The result also indicates statistically significant effect of interaction term of BSC*LC
on procurement performance (p-value 0.002<0.05). This implies that BSC*LC has a
positive contribution to a unit change in procurement performance (β=0.305).
Therefore, ceteris paribus, a unit increase in interaction term of legal compliance and
buyer supplier collaboration leads to appreciation of procurement performance by
30.5% holding other factors constant. The study results imply that legal compliance
has positive significant moderating effect on the relationship between buyer supplier
collaboration and procurement performance in public universities in Kenya.
Similarly, the significant effect of PRM*LC on procurement performance (p-value
0.006<0.05). This infers that PRM*LC has a positive contribution to a unit change in
procurement performance (β=0.167). Therefore, holding other factors constant, a unit
increase in interaction term of legal compliance and procurement risk management
leads to appreciation of procurement performance by 16.7%.

Further, the significant effect of TA*LC on procurement performance (p-value

0.046<0.05). This denotes that TA*LC has a positive contribution to a unit change in
procurement performance (β=0.062). Therefore, holding other factors constant, a unit
increase in interaction term of legal compliance and transparency and accountability
leads to appreciation of procurement performance by 6.2%. Lastly, the significant
effect of CRM*LC on procurement performance (p-value 0.027<0.05). This shows
that CRM*LC has a positive contribution to a unit change in procurement
performance (β=0.218). Therefore, ceteris paribus, a unit increase in interaction term
of legal compliance and contract records management leads to appreciation of
procurement performance by 21.8% holding other factors constant.

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4.9 Hypothesis Testing

Gujarati (2004) confirms that hypothesis testing is a method of statistical inferences

on the basis of observing testable data that is modeled in a set of random variables. It
is a set of proposition put forth as an explanation for the occurrence of some
specified group of phenomena either asserted merely as provisional conjecture to
guide some investigation. Hypothesis is a predictive statement and is accepted as
highly probably in the light of established facts after objective and thorough
verification. An alternative hypothesis is proposed for the statistical relationship
between the two data sets and is compared to null hypothesis that proposes no
relationship between two data sets.

To draw inferences about the population of the sampled data t-test is widely adopted
for hypothesis testing. This test-of significance method is to verify the truth or falsity
of a null hypothesis by using sample results, showing that the means of two normally
distributed populations are equal. As a result, the key idea behind tests of
significance is that of a test statistic (estimator) and the sampling distribution of such
a statistic under the null hypothesis. In all the tests, the decision rule is that if the p-
value observed is less than the set alpha (α) that is the confidence level of 0.05, then
the null hypothesis is rejected and if the p-value observed is greater than the set alpha
of 0.05, we fail to reject the null hypothesis (Sekaran, 2010). The testing of the
hypotheses was done at level of significance of 0.05 and comprised the following
stated null hypothesis:

H01: There is no significant influence of Buyer Supplier Collaboration on

Procurement Performance in Public Universities in Kenya

The study used multiple linear regression analysis, and result on Table 4.24, show
that influence of buyer-supplier collaboration on procurement performance in public
universities in Kenya from 104 respondent drawn from 31 universities was
statistically significant. This is because it had p-value of 0.000 which is less than the
designated threshold of significance that is 0.05 and therefore, we reject the null
hypothesis and conclude that there is significant influence of buyer-supplier
collaboration on procurement performance in public universities in Kenya.
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H02: There is no significant influence of Procurement Risk Management on
Procurement Performance in Public Universities in Kenya

The second null hypothesis indicated that there is no significant influence of

procurement risk management on procurement performance in public universities in
Kenya. The p-value of the study was 0.048 which is below the alpha level of 0.05
and therefore, we reject the null hypothesis and conclude that there is significant
influence of procurement risk management on procurement performance in public
universities in Kenya.

H03: Transparency and Accountability has no significant influence on

Procurement Performance in Public Universities in Kenya

The null hypothesis that transparency and accountability has no significant influence
on procurement performance in public universities in Kenya was equally rejected
since the p-value was 0.044<0.05. Therefore, we concluded that there is significant
influence of procurement risk management on procurement performance in public
universities in Kenya.

H04: Contract Records Management has no significant influence on

Procurement Performance in Public Universities in Kenya

The p-value of null hypothesis was 0.005 below the significance level of 0.05. This
implied that the null hypothesis of the study was statistically significant and
therefore, we reject the null hypothesis and conclude that contract records
management has significant influence on procurement performance in public
universities in Kenya.

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4.10 Optimal Model

Buyer Supplier Collaboration

-Commitment

-Trust
Procurement Performance
-Continuous Improvements
-Cost Effectiveness

-Customer Satisfaction
Contract Records Management
-Procurement Agility
-Audit Trail

-Information Accessibility

-Information Accuracy

Legal Compliance

-Above Average Complaint

-Average Compliant

-Non-Compliant

Independent Variables Moderating Variable Dependent Variable

Figure 4.5: Optimal Model

Based on the tests carried out and concluded in this study, the overall regression
results established that from the four independent variables (Buyer supplier
collaboration, Procurement risk management, Transparency and accountability,
Contract records management) and the moderating variable (Legal compliance) used
in the study, two predictor variables and the moderating variable had statistical
significance with dependent variable. The proposed study model was therefore,
revised based on the significance of the independent variables on dependent variable
(see Figure 4.5).

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 CHAPTER FIVE

SUMMARY, CONCLUSIONS AND RECOMMENDATIONS

5.1.Introduction

This chapter provides a summary of the major findings of this study and also sets to
draw conclusions and make recommendations for practice and suggestions for
further research based on the results of this study. The summary captures the key
findings which are categorized based on the study objectives buyer-supplier
collaboration, procurement risk management, transparency and accountability and
records management on procurement performance in public universities in Kenya.
Further, conclusions are presented which are based on the study findings and finally
recommendations drawn from the conclusions as per the study objectives are
presented.

5.2.Summary

The overall objective of this study was to determine the influence of contract
management on procurement performance in public universities in Kenya. In
particular, the study sought to determine the influence of buyer-supplier
collaboration, procurement risk management, transparency and accountability and
contract records management on procurement performance in public universities in
Kenya. The study found that contract management increases value for money in the
ordering process, enhances adherence to the terms and conditions of the contract,
builds a vibrant relationship with suppliers, improves timely delivery of goods and
services, creates customer satisfaction, minimizes occurrence of procurement risks
and improves transparency and accountability of procurement processes.

The study also established that the key considerations when constituting an award of
contract to suppliers comprise: responsiveness of the tenders, track record of the
suppliers or contractors, competitiveness of the bids, technical requirements as well
as production capacity in terms of goods and services. Further, the study revealed
that the frequency of contract variations in public universities is minimal and in

141
unlikely event these variations occurs the main cause is in line with unanticipated
changes in the market, price fluctuations in the market, complexity of the contracts,
lack of professional probity, omission of the required information in the BQs and
delays of disbursement of funds by the exchequer.

As anchored in the PPADA, 2015 section 151 (1) all public universities except one
case have special committee members that handles complex and specialized
contracts. The role of this committee members is to: monitor and evaluate the
procurement contracts, provide technical expertise, ensure compliance of the
stipulated terms and conditions of the contract, review the contracts to determine the
accomplished milestones and modify the contracts in case there are some changes in
scope of the work design. Public universities in some cases face partial performance
or even non-performance from the suppliers or contractors in line with the existing
contracts. The remedial actions for breach of contract consist: cancellation of the
contract, call meeting for arbitration, legal redress for the liquidated damages,
warning of the suppliers, debarment on future contracts or withholding of payments.
However, these litigation advancements don’t occur often since the rating of the
suppliers in terms of their overall performance in public universities in Kenya is
considered to be good.

In regard to procurement performance the respondents had the view that public
universities in Kenya have a framework of ensuring cost-effectiveness which result
to seamless contractual activities with suppliers and contractors. The inherent
synergy-focused drive in procurement process forms the basis of customer
satisfaction. Further, the respondents opined that customer satisfaction index
necessitates vibrant working relationship, public universities always respond to their
internal customer’s complaints as a way of sustaining and enhancing customer
satisfaction. Lastly, the study showed that public universities in Kenya, constantly
embrace procurement agility in contractual obligations and hence strategies on
procurement agility enhances the general procurement performance.

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From inferential statistics results the regression model had strong adjusted R square
and this denoted that the four predictor variables (Buyer supplier collaboration,
procurement risk management, transparency and accountability and contract records
management) that were studied could explain high influence of contract management
on procurement performance in public universities in Kenya. This revelation,
therefore, means that other factors not studied in this research study contribute to
minimal percentage of procurement performance in public universities in Kenya. The
results of the ANOVA for the regression model used showed an F statistic within the
expected range. This meant that the explanatory variables had significant joint
influence upon consolidation and this implied that the model fitted in the multiple
regression model was fit.

5.2.1 To find out the Influence of Buyer Supplier Collaboration on Procurement

Performance in Public Universities in Kenya

From the findings, buyer-supplier collaboration influences procurement performance

in public universities in Kenya. For example, the respondents had the opinion that
full commitment on transactional activities leads to buyer supplier collaboration,
public universities have inculcated a culture of trust with suppliers on contractual
activities in procurement processes, public universities consistently leverage
supplier’s capability by analyzing their performance and the universities always
provide feedback to their suppliers in terms of their performance. From regression
results the study found that a unit increase in Buyer supplier collaboration would lead
to increase in procurement performance by a positive factor. The study, further,
indicated that influence of buyer-supplier collaboration on procurement performance
in public universities in Kenya was significant because it had a p-value within the
expected range and therefore, we concluded that there is significant influence of
buyer-supplier collaboration on procurement performance in public universities in
Kenya.

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5.2.2 To establish the Influence of Procurement Risk Management on
Procurement Performance in Public Universities in Kenya

From the findings, public universities in Kenya have a vibrant supplier data base that
act as the reference point in acquisition of goods, works and services, public
universities are in constant contact with suppliers as a contingency plan tactic of
understanding the changes in the market. Also, the public universities have in built
quality control systems to verify all consignments the suppliers, emphasize
segregation of responsibilities to all the staff who participate in procurement
processes and only specified employees are mandated to generate requisitions to
initiate the procurement process. Further, the public universities encourage multiple
sourcing as a means of diversifying risks and outsource non-core activities as a
strategy for risk sharing. From the regression results the study found that a unit
increase in procurement risk management would lead to increase in procurement
performance by a positive factor. The study further, found that influence of
procurement risk management on procurement performance in public universities in
Kenya was significant because it had a p-value which was less than the set threshold
and therefore, resolved that there is significant influence of buyer-supplier
collaboration on procurement performance in public universities in Kenya.

5.2.3 To determine the Influence of Transparency and Accountability on

Procurement Performance in Public Universities in Kenya

The study found that public universities award the contract to the lowest evaluated
bidders except when circumstances of the contract warrant use of other provisions
supported by PPADA, 2015. Also, the study revealed that public universities
normally write bid rejection letters to all suppliers that are not successful within a
reasonable time frame and always conduct due diligence after tender evaluations but
prior to the award of contracts. Similarly, public universities validate or dismiss the
suppliers in pursuant to the due diligence report and have procurement probity
guidelines that strictly govern all the contractual activities. Further, public
universities usually subscribe to the rules and regulations anchored in the
procurement probity guidelines that promote transparency and accountability in the

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procurement process. From regression results the study found that unit increase in
transparency and accountability would lead to increase in procurement performance
by a positive factor. The study also established that influence of transparency and
accountability on procurement performance in public universities in Kenya was
significant because it had a p-value which was commensurate with the standard
range. Therefore, the study concluded that there is significant influence of
transparency and accountability on procurement performance in public universities in
Kenya.

5.2.4 To establish the Influence of Contract Records Management on

Procurement Performance in Public Universities in Kenya

The study found that public universities always file and secure all the records used in
procurement process to ensure smooth audit trail and the professional probity makes
the universities to be exonerated of any wrongdoing every time an audit trail is
conducted. Equally, the universities normally provide vast documentary evidence of
all procurement transactions during internal and external of audits and also provide
all the required records to the constituted oversight bodies for auditing on
procurement related activities. Further, the study revealed that the universities have
ease on access of information on contractual activities through well-structured
records management system and provide accurate information to internal and
external auditors and any other investigative authorities. The universities also
authenticate the information of the procurement records before handing over to the
parties concerned for audit review. From regression results the study found that a
unit increase in contract records management would lead to increase in procurement
performance by a positive factor. Further, the study found that the influence of
contract records management on procurement performance in public universities in
Kenya was significant because it had a p-value which is less than the standard
indicator and therefore the null hypothesis was rejected. The study concluded that
there is significant influence of contract records management on procurement
performance in public universities in Kenya.

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5.2.5 To examine the Moderating Influence of Legal Compliance on the
relationship between Contract Management and Procurement Performance in
Public Universities in Kenya

The study established that legal compliance influences the relationship between
contract management and procurement performance in public universities in Kenya.
For instance, the respondents had the view that public universities continuously
comply with PPADA 2015 and the compliance score on contractual obligations is in
tandem with the public procurement regulatory authority. Further, the respondents
had a strong conviction that compliance score of PPADA, 2015 depends primarily on
the inherent culture of the universities on procurement and in the realm of
procurement process the universities adhere to professional fidelity on contractual
responsibilities as a way of complying with the PPADA, 2015. Also the respondent
had a believe that legal compliance is based on procurement standards set by the
public procurement regulatory bodies and the conduct of executives in procurement
process forms the basis of legal compliance. Further, the study denoted that certain
legal compliance framework assists all the executes who are involved on
procurement process to confidently manage their obligations effectively.

The moderating role of legal compliance had slight influence on the relationship
between contract management and procurement performance in public universities in
Kenya. This implied that there is no significant difference on the coefficients of
parameters after being moderated by the legal compliance. Therefore, the study
concluded that legal compliance has moderating influence on the relationship
between contract management on procurement performance in public universities in
Kenya.

5.3. Conclusions

The general objective of the study was to assess the influence of contract
management on procurement performance in public universities in Kenya. The
specific objectives included the influence of buyer supplier collaboration,
procurement risk management, transparency and accountability contract records
management and moderating influence of legal compliance on the relationship
146
between contract management and procurement performance in public universities in
Kenya.

5.3.1 Buyer Supplier Collaboration

The general findings from the regression analysis is that the buyer supplier
collaboration positively influences procurement performance, the relationship is
strong at 95% confidence levels that implies that the stronger the relationship
between buyer supplier collaboration, the higher the procurement performance. Thus,
the general conclusion of the analysis is that stronger buyer supplier collaboration,
positively influence the procurement performance. Therefore, public universities in
Kenya should aim to establish a good working collaboration with their suppliers or
contractors for better contract and procurement processes since close mutual
relationship adds significant value to each of the transacting organizations.

5.3.2 Procurement Risk Management

Procurement risk management had a moderate influence on procurement

performance in public universities in Kenya at 95% confidence levels. Thus, the
general conclusion of the analysis is that procurement risk management moderately
influences procurement performance. Public universities procurement practices have
established inbuilt controls designed to deal with risks for instance open tendering,
due diligence practices, segregation of responsibilities etc. Equally, it is important to
identify risk factors associated with each procurement practices, analyze the
probability of the risk occurring and consider the impending impacts. The risk
assessment is therefore a requirement for determining how the risks should be
managed and mitigated.

5.3.3 Transparency and Accountability

Transparency and accountability positively influences procurement performance at

95% confidence levels though the relationship according to the study is weak. Thus,
the general conclusion of the analysis is that transparency and accountability slightly
influences procurement performance. Transparency and accountability constitutes a

147
central pillar of any procurement system. Without transparent and accountable
systems public universities cannot serve the stakeholders diligently and therefore, the
vast resources channeled through public procurement systems run the danger of
increased corruption and misuse of funds. Even in a system with low levels of
corruption an oversight can help to identify inefficiencies, thereby increasing
procurement efficiency and effectiveness and ultimately improvement of the general
procurement performance.

5.3.4 Contract Records Management

Contract records management had a moderate influence on procurement performance

in public universities in Kenya at 95% confidence levels. Thus, the general
conclusion of the analysis is that contract records management moderately influences
procurement performance. Contract records management present an essential
function to public universities. The records should provide authentic information to
compliment the resolutions taken. Similarly, the deliberations carried out and the
outcome of such dealings during procurement processes should be supported by the
proper records management. Records forms the main source of information and are
the most dependable and lawfully verifiable source of data that can serve as evidence
of actions, decisions and transactional obligations of public universities. The service
provided by contract records management is of vital significance to both employees
and public universities success. Contract records management platform therefore,
acts as a control structure that reinforces internal and external auditing processes and
provide a trail for investigators to track the sources of frauds. Nevertheless, for
records to be meaningful in this capacity, its accessibility is mandatory.

5.3.5 Legal Compliance

The moderating role of legal compliance had a slight influence on the relationship
between contract management and procurement performance in public universities in
Kenya. In reference to the study findings, it can be concluded that, within the realm
of public entities strong legal governance helps procurement professionals to comply
with the stipulated guidelines an attribute that paves way to consistent procurement
performance. The legal compliance on procurement performance is underlined under
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the threshold of full compliance, partial compliance and non-compliance of PPADA,
2015. However, from the findings of the study, it can be concluded that full
compliance or non-compliance of legal requirements on procurement performance
does not apply in practical sense. More particularly, legal discourse in procurement
processes is a herculean task in public universities and it is simply a matter of what
extent compliance score is achieved hence implying that partial compliance is the
resultant phenomenon.

5.3.5 Procurement Performance

From the basis of the explanatory variables of the study, contract management
practices had a moderate influence on procurement performance in public
universities in Kenya at 95% confidence levels. Thus, the general conclusion of the
analysis is that contract management practices moderately influences procurement
performance. In regard to the findings of the study it can be concluded that cost
effectiveness, synergy oriented mechanism, consistent customer satisfaction index,
internal customer complaints review and procurement agility are yardstick of
evaluating procurement performance in public universities in Kenya.

5.4. Recommendations

This study was premised on assessing the specific objectives that included the
influence of buyer supplier collaboration, procurement risk management,
transparency and accountability, contract records management and moderating
influence of legal compliance on the relationship between contract management and
procurement performance in public universities in Kenya.

Buyer supplier collaboration had a strong influence on procurement performance in

public universities in Kenya. Therefore, the study recommends that public
universities should maintain the existing synergy based initiatives with suppliers with
focus on long-term collaborations through framework agreement and working
closely with them over time to achieve high levels of quality and productivity. This
should involve communicating intentions and expectations clearly, defining

149
measures of success, obtaining regular feedback and implementing corrective action
plans to improve performance.

Procurement risk management had positive moderate influence on procurement

performance in public universities in Kenya. Therefore, the study recommends that
public universities should sustain the existing management strategies to avert any
imminent crisis in procurement process. In the same breadth, universities should
create more focus on identify risk factors associated with each procurement, analyze
the probability of the risk occurring and consider the impending impacts. Further,
universities should develop risk management plans based on the decision to avoid,
assume, or transfer the established risks.

Transparency and accountability slightly influences procurement performance in

public universities in Kenya. It constitutes a central pillar of any public entity
procurement system. The study recommends that public universities managers
should instill professional probity policies that ought to be the reference point in all
transactional activities in the holistic supply chain management. The guidelines
should reflect on the fundamental ethical principles in procurement that addresses
issues of impartiality, confidentiality, full disclosure, due diligence, conflict of
interest, business gifts and hospitality as well as fidelity to professional
responsibility. A greater disclosure, accuracy and clarity into communications with
stakeholders on transactional activities will invariably build public trust and
confidence in all public universities in Kenya.

Contract records management had a moderate influence on procurement performance

in public universities in Kenya. Automation of contract records management should
be a priority of every public university. As a dependable tool of evidence automated
procurement records are geared to ensure that the universities have visible audit trail
in all transactional activities. Therefore, members of the public and all the
stakeholders should rely heavily on procurement records available to question,
criticize, and hold staff of the universities accountable. Authentic procurement
records present an ideal connection between an approval assigned to a particular
person and the date of the activity hence public universities managers should

150
maintain complete procurement file. Further, public universities management staff
should develop and make use of quotation and tender registers and more importantly
submit statutory reports to PPRA as prescribed.

Legal compliance had a modest influence on the relationship between contract

management and procurement performance in public universities in Kenya. The
study therefore, recommends that public universities should ensure high degree of
adherence of the procurement law as anchored in PPADA, 2015. The adherence of
the procurement law can be effected well if the universities management remain
steadfast on establishing inherent culture that govern all the employees. This should
include regular sensitizations of the procurement guidelines that ought to be
practiced as well as advocacy for the rule of law. The public universities have also an
obligation of undertaking regular stock of legal compliance score in order to work on
continuous improvement discourse.

Procurement performance in public universities in Kenya is pegged on concerted

efforts inculcated by different stakeholders in the entire procurement process. Since
the clarion call in public procurement is advocacy on value for money the study
recommends adoption of the best practices of averting unnecessary costs. These
practices comprise procurement planning, cost benefit analysis contract negotiation,
consortium buying, value analysis, value engineering, total cost of ownership review
and standardization.

5.5. Areas for Further Research

The study’s general objective was to assess the influence of contract management on
procurement performance in public universities in Kenya. The respondents
comprised the implementers of contract management that included procurement
officers, finance officers, legal officers and registrars-administration and planning. It
could be imperative for a similar study to be undertaken but respondents to be
sampled from signatories of procurement contracts in public universities who
include: Vice chancellors (accounting officers), chief procurement officers, chief
legal officers and deputy vice chancellor finance planning and development. The

151
underpinning proposition is to provide an unequivocal ground for triangulation in
regard to the researcher’s topical issue.

The specific objectives of this study focused on the following building blocks of
contract management: influence of buyer supplier collaboration, procurement risk
management, transparency and accountability and contract records management on
procurement performance. The results of the explanatory variables accounts to
74.1% of variations on procurement performance at 5% significance level. This
revelation means that other factors not studied in this research contribute 25.9% of
procurement performance in public universities in Kenya. Therefore, there is need
for further studies on other facets of contract management on procurement
performance in institutions of higher learning in Kenya. Further studies could focus
on other sectors of the economy in line with contract management and procurement
performance. The prime topical issues could comprise: influence of contract
management on procurement performance in county governments in Kenya and
effect of contract management on procurement performance in state corporations in
Kenya.

152
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 APPENDICES

Appendix I: Letter of Authorization

The Vice Chancellor

Name of the University………………………………………..

P.O. Box ………………………………………………………

Dear Sir/Madam,

RE: ACADEMIC RESEARCH DATA ON “INFLUENCE OF CONTRACT

MANAGEMENT ON PROCUREMENT PERFORMANCE IN PUBLIC
UNIVERSITIES IN KENYA”

I am a student pursuing a Doctorate Degree in Supply Chain Management at Jomo

Kenyatta University of Agriculture and Technology. I am undertaking a research
thesis as partial fulfillment for the award of this doctoral degree. The purpose of this
letter therefore is to request for permission to collect relevant data from the following
staff members: Procurement officers, Finance officers, Legal officers and Registrars-
administration and planning. The information collected will be treated with utmost
confidentiality and will be exclusively used for purposes of this academic research
study.

Attached find the request letter for data collection from department of Procurement
and Logistics-JKUAT, Research Authorization letter and Research License from
National Commission for Science, Technology and Innovation.

Thank you for your time and cooperation.

Yours faithfully,

Mathias Nzomo Muinde

168
Appendix II: Letter of Introduction

Date………………………………………………………………

To…………………………………………………………………

Dear Sir/Madam,

RE: REQUEST FOR PARTICIPATION IN ACADEMIC RESEARCH

I am a Ph.D. student in Supply Chain Management at Jomo Kenyatta University of

Agriculture and Technology. Currently, I am carrying out a research study on the
“Influence of contract management on procurement performance in public
universities in Kenya”. I am in the process of gathering relevant data for this study.
You have been identified as one of the collaborators and respondents in this study. I
request for your assistance towards making this study a success. I therefore request
you to take some time to respond to the attached questionnaire. I wish to assure you
that your responses will be treated with confidentiality and will be used solely for the
purpose of this study.
I will appreciate so much if you fill the questionnaire within the next 10 days since
this will enable me to finalize the study at the stipulated time.

Yours faithfully.

Mathias Nzomo Muinde

Reg No: HD411-1354/2012, Phone No: 0724309134

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Appendix III: Questionnaire

This questionnaire seeks to collect data from public universities with the explicit goal
of examining ‘‘Influence of Contract Management on Procurement Performance
in Public Universities in Kenya’’. To achieve this objective, relevant questions
have been provided to gather data for analysis. Kindly spare some time to provide the
requested information as accurately as possible. Data obtained will be treated with
utmost confidentiality and the identity of the respondents will be kept anonymous.
Your cooperation in data collection exercise is highly appreciated.

SECTION A: DEMOGRAPHICS AND GENERAL INFORMATION

Respondents Details:

1. Please state your designation…………………......................................................

2. Kindly indicate your highest academic qualification. Tick (√) as appropriate.

[ ] Certificate [ ] Diploma [ ] Bachelor’s Degree [ ] Master’s Degree [ ] Doctorate

Degree [ ] Any other. Please indicate……………………………………………….

3. Indicate your membership category in your professional body.

[ ] KISM [ ] CIPS [ ] ICPAK [ ] LSK [ ] IHRM [ ] NONE [ ] Any other. Kindly

specify………………………………………………………………………………...

4. How often do you participate in sensitization forums of Public Procurement and

Asset Disposal Act, 2015?.......................................................................................

5. How would you regard your knowledge on contract management in Kenyan

context?

[ ] Excellent [ ] Very good [ ] Good [ ] Adequate [ ] Inadequate

6. How many years have you been involved in contractual activities in procurement
process?.....................................................................................................................

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SECTION B: CONTRACT MANAGEMENT

7. How does contract management influence procurement performance in your

institution?…………………………………………………………………………
…..…………………………………………………………………………………
…………………………..…………………………………………………………
…………..

8. What do you consider when constituting an award of contract to suppliers in your

institution?.................................................................................................................
...................................................................................................................................
...................................................................................................................................
...................................................................................................................................
....................

9. How often do you encounter contract variations during procurement

proceedings? Please explain……………………………………………………….

……………………………………………………………………………………
……………………………………………………………………………………
……………………………………………………………………………………
………………

10. What are the causes of contract variations in a procurement process in your
institution?.................................................................................................................
...................................................................................................................................
...................................................................................................................................
...............

11. Does your institution appoint contract implementation team especially when
handling complex and specialized procurement contracts? Kindly
explain……………………………….......................................................................
...................................................................................................................................
...................................................................................................................................
...............

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12. What is the role of contract implementation team especially when handling
complex and specialized procurement contracts?....................................................

……………………………………………………………………………………
……………………………………………………………………………………
…………

13. What are the remedial actions you apply against the suppliers who fails to
comply with terms and conditions of the contract?………………….

……………………………………………………………………………………
……………………………………………………………………………………
…………

14. Explain the overall performance of the suppliers in terms of contract

administration in your institution?............................................................................

……………………………………………………………………………………
……………………………………………………………………………………
……………………………………………………………………………………
………………

SECTION C: BUYER-SUPPLIER COLLABORATION

15. This section seeks your response to various aspects of Buyer-Supplier

Collaboration in relation to Procurement Performance. Kindly indicate the extent to
which each statement matches the application of buyer-supplier collaboration in your
institution. Please tick as appropriate in the spaces provided, where: 5=Strongly
Agree (SA), 4= Agree (A), 3=Neutral (N), 2=Disagree (D), 1=Strongly Disagree
(SD).

Buyer Supplier Collaboration SA A N D SD

a)We invariably advocate for strong commitment with

our suppliers on contractual obligations

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b)We believe that a full commitment on transactional
activities leads to buyer supplier collaboration

c) Our concerted efforts on maintaining credibility with

our suppliers paves way to strong buyer supplier
collaboration initiative

d)We have inculcated a culture of trust with our

suppliers on contractual activities in procurement
processes

e)We consistently leverage our suppliers capability by

analyzing their performance

f)We share information with our suppliers in line with

the best practices that are subject for implementation on
contractual activities

g)We always provide feedback to our suppliers in terms

of their performance

SECTION D: PROCUREMENT RISK MANAGEMENT

16. The following statements relate to Procurement Risk Management

characteristics. Kindly indicate the extent to which each of the statement connects to
procurement risk management in your institution. Please record your answers by
ticking in the spaces provided, where: 5=Strongly Agree (SA), 4= Agree (A),
3=Neutral (N), 2=Disagree (D), 1=Strongly Disagree (SD).

Procurement Risk Management SA A N D SD

a)We have a vibrant supplier data base that act as the

reference point in acquisition of goods, services and

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works

b)We are in constant contact with our suppliers as a

contingency plan tactic of understanding the changes in
the market

c)We have inbuilt quality control systems to verify all

the consignments from our suppliers

d)We emphasize segregation of responsibilities to all the

staff who participate in procurement processes

e)Only specified employees are mandated to generate

requisitions to initiate the procurement process

f)We encourage multiple sourcing as a means of

diversifying risks

g)We outsource non-core activities as a strategy for risk

sharing

SECTION E: TRANSPARENCY AND ACCOUNTABILITY

17. This section contains a number of statements regarding transparency and

accountability. Please indicate how your organization rates each statement. Kindly
record your answers by ticking in the spaces provided, where: 5=Strongly Agree
(SA), 4= Agree (A), 3=Neutral (N), 2=Disagree (D), 1=Strongly Disagree (SD).

Transparency and Accountability SA A N D SD

a) We award the contract to the lowest evaluated

responsive bidders

b)We always write bid rejection letters to all suppliers that

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are not successful within a reasonable time frame

c)We always conduct due diligence, after tender

evaluations but prior to the award of contracts

d)We validate or dismiss the suppliers in pursuant to the

due diligence report

e)We have procurement probity guidelines that strictly

govern all the contractual activities

f)We usually subscribe to the rules and regulations

anchored in our procurement probity guidelines

g)The premise of our procurement probity guidelines is to

promote transparency and accountability in the
procurement process

SECTION F: CONTRACT RECORDS MANAGEMENT

18. Please indicate the extent to which contract records management influence
procurement performance in your institution. Kindly record your answers by ticking
in the spaces provided, where: 5=Strongly Agree (SA), 4= Agree (A), 3=Neutral (N),
2=Disagree (D), 1=Strongly Disagree (SD).

Contract Records Management SA A N D SD

a) We file and secure all the records used in contract

process to ensure smooth audit trail

b)Our professional probity makes us to be exonerated of

any wrongdoing every time an audit trail is conducted

c)We provide vast documentary evidence of all

procurement transactions during internal and external

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audits

d)We constantly provide all the required records to the

constituted oversight bodies for auditing on procurement
related activities

e)Ease on information access on contractual activities in

the university is enhanced by our well-structured records
management system

f)We normally provide accurate information to internal and

external auditors and any other investigative authorities

g)We normally authenticate the information replicated in

the university procurement records before handing over to
the parties concerned

SECTION G: LEGAL COMPLIANCE

19. Please indicate the extent to which legal compliance influence procurement
performance in your institution. Kindly record your answers by ticking in the spaces
provided, where: 5=Strongly Agree (SA), 4= Agree (A), 3=Neutral (N), 2=Disagree
(D), 1=Strongly Disagree (SD).

Legal Compliance SA A N D SD

a)We continuously comply with PPADA, 2015

b)Our compliance score in line with PPADA, 2015 on

contractual obligations is in tandem with the public
procurement regulatory authority

c)We have a conviction that compliance score of PPADA,

2015 depends primarily on the inherent culture of the
university on procurement activities

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d)In the realm of procurement process, we adhere to
professional fidelity on contractual responsibilities as a way
of complying with the PPADA, 2015

e)We believe that legal compliance is based on procurement

standards set by the public procurement regulatory bodies

f)We are confident that the conduct of executives in

procurement process forms the basis of legal compliance

g)We are certain that legal compliance framework assists all

the executes who are involved on procurement process to
confidently manage their obligations effectively

SECTION H: PROCUREMENT PERFORMANCE

20. This section contains a number of statements regarding procurement

performance. Please indicate how your organization rates each statement. Kindly
record your answers by ticking in the spaces provided, where: 5=Strongly Agree
(SA), 4= Agree (A), 3=Neutral (N), 2=Disagree (D), 1=Strongly Disagree (SD).

Procurement Performance SA A N D SD

a)We often register cost-effectiveness in all contractual

activities with our suppliers/contractors

b)We have a framework of ensuring cost-effectiveness in

procurement activities

c)Our inherent synergy-focused drive in procurement

process forms the basis of customer satisfaction

d)Our customer satisfaction index necessitates vibrant

working relationship

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e)We always respond to our internal customers complaints
as a way of sustaining and enhancing customer satisfaction

f)We constantly embrace procurement agility in contractual

obligations

g)Our strategies on procurement agility enhances our

procurement performance

THANK FOR YOUR COOPERATION

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Appendix IV: Interview Guide

Introduction:

Iam a Ph.D student in Supply Chain Management at Jomo Kenyatta University of

Agriculture and Technology. Iam carrying out a research study on the ‘‘Influence of
contract management on procurement performance in public universities in Kenya’’.
Kindly allow me to ask you few questions pertaining my area of study.

i) Name………………………………………………………………… (Optional).

ii) Designation………………………………………………………………………....

iii) Department………………………………………………………………………...

iv) Name of Public University……………………………………...……………...

a) Buyer- Supplier Collaboration

i) Does your institution embrace buyer-supplier collaboration on contractual related

activities? If yes or no, please explain the extent to which this supplies phenomenon
is handled in your institution.

ii) What is your view on the statement that contract management influences
procurement performance in public universities in Kenya?

b) Procurement Risk Management

i) What are the common procurement risks that your institution faces during contract
management?

ii) What are the mitigation measures that your institution has put in place to curb the
escalation of risks on contractual activities?

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 c) Transparency and Accountability

i) How do you ensure transparency and accountability in your institution prior and
during contract implementation?

ii) Are there staffs in your institution who have been seizured for disciplinary matters
on grounds of flouting contract and procurement management guidelines?

d) Contract Records Management

i) How do you manage procurement records on contractual activities in your

institution?

ii) Do you provide fully procurement records on contract and procurement activities
to internal and external auditors for audit review?

e) Legal Compliance

i) How often does the internal and external auditors declare unqualified opinion on
contract and procurement activities during the audit reviews?

ii) What are the corrective actions does your institution embrace in order to ensure
marginal cases of qualified opinion on matters of contract management on
procurement performance?

f) Procurement Performance

i) What strategies do you apply in your institution in order to ensure sustainable

value for money (VFM) on contract and procurement related activities?

ii) What is the blueprint of ensuring internal and external customer satisfaction in
your institution?

THANK FOR YOUR COOPERATION

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Appendix V: Secondary Data Collection Form

Part 1: Buyer Supplier Collaboration

Fiscal years Supplier Visits (%) Debt Settlement (%)

(a) 2017/2018
(b) 2016/2017
(c) 2015/2016
(d) 2014/2015
(e) 2013/2014

Part 2: Procurement Risk Management

Fiscal years Contract Variations (%) Stalled Projects (%)

(a) 2017/2018
(b) 2016/2017
(c) 2015/2016
(d) 2014/2015
(e) 2013/2014

Part 3: Transparency and Accountability

Fiscal years Audit Queries (%) Corrective Measures

(a) 2017/2018
(b) 2016/2017
(c) 2015/2016
(d) 2014/2015
(e) 2013/2014

Part 4: Contract Records Management

Fiscal years Information Accessibility (%) Information Accuracy (%)

(a) 2017/2018
(b) 2016/2017
(c) 2015/2016

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(d) 2014/2015
(e) 2013/2014

Part 5: Legal Compliance

Fiscal years Unqualified Opinion (%) Qualified Opinion (%)

(a) 2017/2018
(b) 2016/2017
(c) 2015/2016
(d) 2014/2015
(e) 2013/2014
Total

Part 6: Procurement Performance

Fiscal years Value for Money (%) Cost Overruns (%)

(a) 2017/2018
(b) 2016/2017
(c) 2015/2016
(d) 2014/2015
(e) 2013/2014
Total

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Appendix VI: Analysis of Data Tables

Overall Model Summary

Model R R Square Adjusted R Square Std. Error of the Estimate

1 a
0.764 0.741 0.717 0.85927
a. Predictors: (Constant), Buyer Supplier Collaboration, Procurement Risk Management,
Transparency and Accountability and Contract Records Management

Analysis of Variance Results

ANOVAa
Model Sum of Squares Df Mean Square F Sig.
1 Regression 582.547 4 145.637 17.814 0.000b
Residual 203.616 99 8.175
Total 786.163 103
a. Dependent Variable: Procurement Performance
b. Predictors: (Constant), Buyer Supplier Collaboration, Procurement Risk Management,
Transparency and Accountability and Contract Records Management

Regression Analysis Results

Coefficientsa

Unstandardized Standardized
Coefficients Coefficients
Model B Std. Error Beta T Sig.
1 (Constant) 5.198 4.392 1.183 0.240
Buyer Supplier Collaboration 0.434 0.119 0.342 3.662 0.000
Procurement Risk Management 0.199 0.104 0.173 1.915 0.048
Transparency and Accountability 0.126 0.114 0.098 1.099 0.044
Contract Records Management 0.355 0.125 0.268 2.854 0.005
a. Dependent Variable: Procurement Performance

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Appendix VII: List of Public Universities in Kenya

S/N PUBLIC CHARTERED UNIVERSITIES

1 Chuka University

2 Dedan Kimathi University of Technology

3 Egerton University

4 Garissa University

5 Jaramogi Oginga Odinga University of Science and Technology

6 Jomo Kenyatta University of Agriculture and Technology

7 Karatina University

8 Kenyatta University

9 Kibabii University

10 Kirinyaga University

11 Kisii University

12 Laikipia University

13 Maasai Mara University

14 Machakos University

15 Maseno University

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16 Masinde Muliro University of Science and Technology

17 Meru University of Science and Technology

18 Moi University

19 Multimedia University of Kenya

20 Murang’a University of Technology

21 Pwani University

22 Rongo University

23 South Eastern University of Kenya

24 Taita Taveta University

25 The Co-Operative University of Kenya

26 Technical University of Kenya

27 Technical University of Mombasa

28 University of Eldoret

29 University of Embu

30 University of Kabianga

31 University of Nairobi

PUBLIC CONSTITUENT UNIVERSITY COLLEGES

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 1 Alupe University College

2 Bomet University College

3 Kaimosi Friends University College

4 Tom Mboya University College

5 Turkana University College

Source: CUE, 2021

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