1. Procurement Planning EffectivenessProcurement Planning Effectiveness
in Ethiopia: The Case of Minister ofin Ethiopia: The Case of Minister of
Urban Development, Housing andUrban Development, Housing and
Construction /MUDHCo/Construction /MUDHCo/
Anteneh GetahunAnteneh Getahun
EMBAEMBA
Advisor: Dr. Mohammed SeidAdvisor: Dr. Mohammed Seid
June, 2105June, 2105

2. Outline
1. Introduction
1.2 Statement of the Problem
1.3 Research Questions
1.4 Research Objectives
2. Methodology
3. Findings
4. Recommendations 2

3. Introduction
In public organizations, department’s
needs:-
Goods,
Services & Works
to perform work programs in due time.
3

4. Cont….
After approval of budget, they raise needs on
annual base, by describing, mainly,
The required goods/service
Data when it requires
Specification/TOR
Estimated price/cost
4

5. Cont..
Then, the procurement units consolidate
the organization annual need.
The performance report also prepare
quarterly.
5

6. Benefit of Having Procurement Plan
Economical & Efficiency of
procurement
Avoid Delay
Decrease Cost(Economic of scale)
Improve Transparency
Reduces Corruption…..
6

7. Cont…
The intend of the research was
to assess what Procurement
Planning and Implementation
Practice looks like Within the
Ministry?
7

8. 2.Statment of the Problem
Too much delay in the process
Under-utilization of the budget.
The cause of:
8
Work Programs Affected by Poor Procurement Function.
The Organization Fail to Achieve Objectives in Due Time.

9. Cont…
Unplanned Purchase which is The
major cause for:
9
Corruption
Malpractice
Fail to achieve value for money

10. Cont…
Problem in Preparing and
Properly Deploying a
Procurement Plan.
10

11. Research questions
1. What do the current procurement-
planning practice looks like?
2. Does the plan have complete
specifications?
3. Does the organization use market
assessment, to estimate price?
11

12. General Objective of the research:
To Assess The Practice of Procurement Planning
And Implementation Practice.
Specific Objectives:
Describe the Current Procurement-planning
Practice.
Find out the completeness of the specification.
Assess the trend of market price assessment.
12

13. Cont…
The study aimed to help the
Ministry to improve institutional
performance.
13

14. Conceptual Framework
Procurement-planning practice
Timely raising of needs,
Competence of staff,
Participation,
Extended process, and
Plan versus performance,
Procurement-planning practice
Timely raising of needs,
Competence of staff,
Participation,
Extended process, and
Plan versus performance,
Completeness of specifications
Easy to understand,
Clear,
Accurate & Complete
Completeness of specifications
Easy to understand,
Clear,
Accurate & Complete
Realistic price estimation
Trend in Market Price
Assessment
Realistic price estimation
Trend in Market Price
Assessment
Procurement-Planning
Effectiveness
Procurement-Planning
Effectiveness
Independent Variables Dependent Variables
(Source: Adapted from Celestine Joan Onyango, 2012)
14

15. The Scope of the Research
The study assessment considered
the Government Budget. (The
Ministry has also Fund budget)
The study assessed Internal
Factors.(External factors also
affect the procurement function) 15

16. Significance of the Study
For management,
For policy makers,
For employees,
For further research.
16

17. Methodology
Research Design
Descriptive Statistics used: As the study
is intends to describe the existing practice.
17

18. Data Sources
Primary data:
- Close-ended and
- Open-ended Questionnaires.
Secondary data - Procurement plan versus
performance of 2012/2013 & 2013/2014
were used
18

19. Target population

20. Sampling Techniques
Stratified Sampling Technique is
used to select target population.
Simple random sampling is used to
select respondents from each
strata. 20

21. Data Analysis
The Close-ended: SPSS; Mean, Standard
Deviation and Percentile.
Open-ended questions were used by
Coded.
Plan Versus performance of procurement
for the year 2012/2013 and 2013/2014 were
used.
21

22. Result and discussions
Respondent rate was 95 Percent
22

23. Qualifications of the Respondents
23

24. Profession of the Respondents
24

25. Practice of procurement planning
The user departments:
Have often raised procurement needs
The work programs had been affected by
poor procurement function.
Lack of qualified staff in user
department is moderate.
Findings
25

26. Cont…
Practice of procurement planning
Procurement Units:
Evaluation of plan versus performance,
Revising the plan when necessary,
Estimating internal and external lead-
time was very weak. 26

27. Cont…
Urgent/unplanned procurement
requisitions is challenge.
Lack of qualified staff is a
challenge.
27

28. Cont…
Planning & Reporting Format is
not coherent, it is impossible to
track the performance level.
28

29. Secondary data Findings
Method of Procurement
1. Open Bidding : all eligible potential
bidders determine their interest and have an equal
opportunity to submit the tender.
2. Restricted tendering method (Limited Tender):
- If it only available from a limited number of
suppliers.
- When open bid is fails to attract bidders.
29

30. Cont..
3. Direct procurement method:
-Available from single suppliers
-Small value contract( Only Birr 1500.00: within a
fiscal year, it shall not exceed 30,000.00)
-Emergencies
4. Two-stage Bidding Method:
-For complex goods & service purchase
-By announcing expression of interest & select the
potential suppliers 30

31. Cont..
5. Request for Quotations Method: (shopping)
-For readily available,
- ETB is 250,000 Million for construction,
- 100,000.00 for goods.
- 60,000.00 for service and
- 75,000.00 for consultancy service.
31

32. 2012/2013
Total performance is 14%.
Open bid performance is only
9.27% %(however, the plan
was 91.31%)
Request for
quotation(shopping)
is 416%(however,
the plan was 0.6%)
32

33. Frequency of Procurement
33

34. 2013/2014
Total performance is 17%.
Open bid performance is
only 13%, plan was 82%
Request for
quotation(shopping) is
292%, plan was 1%
34

35. Frequency of Procurement
35

36. Specification Completeness
User Departments:
In preparing clarified specification:
In using standard specification
format they are moderate.
36

37. Cont…
Procurement Unit:
Only 20% of user departments prepare
specifications.
From those specification only 40 percent is
preparing well.
From those only 60% have been using standard
specification format.
37

38. Market Assessment trend
Market Assessment in user
department & procurement
unit were poor.
38

39. Lack of technical know-how in bid
preparation 38%
39
15 Percent: Tender approval
committee too many other
assignments.

40. Cont…
Request for quotation (Shopping) was increased,
in the past years, which is the major corruption
and malpractice.
The open tendering is very low performance.
The procurement plan format and the
procurement reporting format were not coherent.
40

41. Cont…
Lack of technical know-how
In bid document and specification
preparation.
Extra delay
In Technical document evaluation.
41

42. Cont…
Currently, the Ministry has been affected by the
poor performance of procurement planning and
implementation practice.
Plan was not transparent, and there was a gap to
make corruption and malpractice due to
piecemeal purchasing practice without market
price assessment trend.
42

43. Recommendations
The organization should vigorously develop
continuous training programs.
The planning and reporting format should display
the lead-time in detail.
The reporting format should be coherent with the
plan.
43

44. Cont…
Prepare early the bid process.
The Ministry should establish a system
to gather market price.
The Ministry departments should try
hard to plan the required materials and
service at the most possible extent.
44

45. Recommendations for Future Research
As per the researcher, there is a need for
future to examine other variable like:
(i) Organizational Culture,
(ii) Documentation,
(iii) Contract Administration,
(iv) Risk Assessment in Procurement,
(v) E-procurement usage to procurement.
45

46. Thank you
46

47. 47