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1. Leadstar University College
Faculty of Business and Leadership
Department of Business Administration, MBA Program
Specialization: SUPPLY CHAIN MANAGEMENT
FACTORS AFFECTING PROCUREMENT PERFORMANCE
(The Case of Ethiopian Industrial Inputs Development Enterprise)
For Partial Fulfillment of Master Of Business Administration (MBA)
ADVISOR NAME: DR. MERGIYA MEKURIA
BY: FETENE WORKU EWUNETIE
ID NO: DE/GRD/BA/3984/09/4
October, 2019
Addis Ababa, Ethiopia

2. CHAPTER ONE
1.1 Introduction
This study sought to investigate the factors affecting the performance of procurement at the
Ethiopian industrial inputs development enterprise (EIIDE). Ethiopian industrial inputs
development enterprise is faced with the problems of not complying with the procedures and
is therefore unable to determine their efficiency and effectiveness. This introductory chapter
discusses the background, the statement of the problem, general and the specific objectives of
the study, research questions, the significance of the study, scope of the study, and limitation
of the study.
1.2 Background of the Study
Nowadays, organizations have been forced to reinvent their regulations with customers and
suppliers due to the weakening global economic conditions. Procurement being a crucial role
in most organizations can assist in achieving sustainability and the ultimate performance
goals through lowering of costs throughout the procurement process by focusing on value
addition (Ebrahim, 2010). Procurement involves the whole process of acquiring goods and or
services and it begins the moment an organization identifies a need and decides on its
procurement requirement. Procurement continues through the processes of risk assessment,
seeking and evaluating alternative solutions, contract award, delivery of and payment for the
property and or services and, where relevant, the ongoing management of a contract and
consideration of options related to the contract (Musau, 2015).
A substantial portion of firm’s resources and time is utilized in the procurement process
hence its proper management is paramount. It is necessary for every firm to maintain an
efficient and effective procurement function to cut administration cost and to keep abreast of
the market conditions to procure material and services at the right price, quality and time
(Kasisi, Mumo&Mwangi, 2014). To achieve an efficient and effective procurement process,
bottlenecks must be removed and rewards distributed in an equitable way to key players in
the process with the working principle being the creation of customer satisfaction at the end
(Chimwani, Iravo&Tirimba, 2014). For decades, procurement performance has been
attracting great attention from practitioners, academicians and researchers due to poor
performance. An adoption of e-procurement has rapidly increased since 1990’s yet
organizations still face challenges associated with its advent and use (Kimani, 2013). Studies
on procurement performance on Ethiopian firms especially in the public development sector

3. is core to the Ethiopian economy, are not explicit. It is therefore, important to focus on the
procurement performance in the public development sector in these developing economies.
Public procurement is a key tool to promote objectives of an economic, environmental and
social nature gaining much attention globally over the past decades. In developing countries,
it is one of the main instruments to the achievement of development goals such as reducing
poverty and providing health, infrastructure, education and other services Mlinga, (2009).
Public procurement accounts for 15-30% of the gross domestic products (GDP) for many
countries in the world (United Nations Office on Drugs and Crimes (UNDOC), 2013). While
public procurement represents an estimated 15% of GDP in Organization for Economic Co-
operation and Development (OECD), countries and up to 25% of GDP in developing
countries OECD, (2007).The share is believed to be much higher in developing and least
developed countries, where development of basic infrastructure is still the prime focus of
governments and consumes huge budget Basheka&Bisangabasaija, (2010). In developing
countries, public procurement is increasingly recognized as essential in service delivery and it
accounts for a high proportion of total expenditure. For example, public procurement
accounts for 60% in Kenya Akech, (2013), 58% in Angola, 40% in Malawi and 70% of
Uganda’s public spending Basheka and Bisangabasaija, (2010).
In Ethiopia, more than 60% of the total public expenditure has been spent through public
procurement in a year. It is a huge amount of money that public bodies spent via public
procurement. The expenditure on public procurement is increasing from year to year.
However, the resource spent on public procurement is not used properly and in an economical
manner and in the current Ethiopian public procurement process, the compliant on public
procurement process shows increment from year to year. Efficiently and effectively handling
this size of Procurement outlay has been a policy and management concern as well as a
challenge for governments PPA Annual Report, (2014).
Public Procurement procedures are decision making processes. The procuring authority has to
compare the proposals against pre-set criteria specified on the bid and needs to choose one of
them or reject all of them. The decision logic of procurement can be characterized as "One
Winner" selection process from known alternatives, where the alternatives are compared at
the same time using a previously determined, and unified criteria system. Procurement
procedures are also group processes, and negotiations among the stakeholders is an essential
part of completing the task Thai, (2011).
In a developed or developing country, employees who work on public procurement have and
will face always many challenges. Some of them are lack of employee's competency in the

4. area of procurement profession, using IT in procurement activities is very minimal, and
preparing procurement plan is very poor. Each country has its own economic, social, cultural
and political environment and each country's public procurement experts face different types
of challenges or the same types of challenges but at different levels from their counterparts in
other countries. All the challenges and factors need attention since they could influence the
performance of the procurement function. Due to these reasons the researcher will examine
the factors that affect public procurement performance in EIIDE. It is against this background
therefore, that this research study seeks to assess the factors affecting procurement
performance in Ethiopian industrial inputs development enterprise.
1.3 Statement of the Problem
According to Wanyonyi, (2015), procurement is the nerve center of performance in every
institution, whether public or private, and thus, needs a serious attention and tight system to
be adopted and followed.
The procurement function has become increasingly important over the past decades since
purchasing and supply has become a major determinant of corporate success. Significant
business pressure as a result of globalization, innovations, technological changes, cost
pressure, and regulatory compliance has forced the procurement function to focus on cost
reduction and attaining more value for money.
The Procurement function usually takes large amounts of organizations' resources. Hence it is
becoming an expensive undertaking for many organizations and if not properly done it can
lead to significant regret.
Ethiopian public procurement manual (2011) counsels that a procurement plan is an
instrument for implementation of the budget and should be prepared by the user departments
with a view to avoiding or minimizing excess votes in the entities' budgets and to ensure that
procurements do not proceed unless there are funds to pay for them. This implies that all
procurement plans must be well integrated into the budget process based on the indicative
budget as appropriate and in compliance with the procurement law.
Mamiro (2010) found that indications which underscores these facts. He concluded that one
of the major setbacks in public procurement is poor procurement planning and management
of the procurement process which include needs that are not well identified and estimated,
unrealistic budgets and inadequacy of skills of procurement staff responsible for procurement
in his research entitled the limping pillar in public Procurement.
Kakwezi and Nyeko, (2010) concluded in their findings that failure to establish Performance
of the procurement function can lead to irregular and biased decisions that have costly

5. consequences to any public procuring entity. During his internship program at Ethiopian
industrial inputs development enterprise, the student researcher has observed that there is a
gap between what stakeholders need and what is actually performed. There have been a lot of
complaints since the quality of goods purchased doesn't fit with the specification. There is
also a big gap between purchase request and delivery of time. These observed problems
initiated student researcher to study factors affecting procurement performance of Ethiopian
industrial inputs development enterprise. Additionally, as an employee of the enterprise , it
could be easily observed that there were instances of shortage of items, quality problems
and/or mismatch of items requested with procured and delivered(wrong quality); excessively
delayed purchases(wrong timing); and incurring additional costs as result of long duration of
the purchase process. Furthermore, it has been becoming serious hurdle for the supply chain
process which is the major goal of the enterprise. Thus, the focus of this study is examining
the relationship between procurement performance and factors such as procurement planning,
contractual management, staff competency, information technology in Ethiopian industrial
inputs development enterprise as one case among Ethiopian public development enterprise.
Moreover, though there were a lot of international and local empirical studies on Procurement
and procurement performance, none of these studies focused on the influence of information
technology, employee competency, contract management, and procurement planning on
procurement performance. Likewise, most of these studies have been conducted in other
countries with varying contexts of demographics, economic, political and environmental
factors and institutional settings than Ethiopian industrial inputs development enterprise.
Hence their findings couldn't be generalized to the Ethiopian industrial inputs development
enterprise as subject of the study. This study sought to fill this research gap by assessing the
factors affecting procurement performance in industrial inputs development enterprise. To
this end the investigation is attempt answering the following research questions.
1.4 Research Questions
Based on the identified problems above, the researcher has developed the following questions that
need to be researched in the context of Ethiopia with special focus on Ethiopian industrial inputs
development enterprise to examine the factors that affect procurement performance in EIIDE.
1.How procurement planning affect the performance of public procurement in EIIDE?
2.How staff competency influence public procurement performance in EIIDE?
3.How does procurement contract management influence public procurement performance in
EIIDE?

6. 4.What is the effect of adoption of information technology on the public procurement
performance in EIIDE?
1.5. Research Objectives
Based on the questions above, the research has the following general and specific objectives:
1.5.1 General Objective
The general objective of this study is to critically examine factors affecting the
performance of procurement at EIIDE and to examine the implication of the
established procurement practice on organizational performance.
1.5.2Specific Objectives
To achieve the general objectives mentioned above the following specific objectives are set.
1. To establish the effect of procurement planning on the performance of public procurement
in EIIDE.
2. To establish the extent in which competency of staff influence the performance of
procurement in EIIDE.
3. To analyze the influence of procurement contract management on procurement
performance in EIIDE.
4. To investigate how the adoption of Information Communication Technology can
effect on procurement performance in EIIDE.
1.6 Significance of the study
The findings of this research may help EIIDE to identify the factors that affect procurement
performance and to fix the problem with remedial action. It is also expected that from the
findings of this study, EIIDE may put in place appropriate measures to improve procurement
performance levels.
This study may serves as a reference for other researchers who are interested in conducting
studies on related issue.
In addition, the study could be of importance to procurement Professionals in various public
or private sectors since it would add a body of knowledge to factors of procurement
performance. The issues which had been addressed in this research may expect to improve
public procurement practices as part of their strategic plan for the achievement of best value
for public money. The decisions given based on the research may also be important to
improve overall public procurement performance.
This research is also expected to add to the current literature. The result of the study serves
various purposes. Mainly public development enterprise would benefit from it by using the

7. information from the study to work on areas which are important to improve the performance
of procurement process by applying the recommendations, which would help to save
significant amount of public resource that otherwise, would be wasted. The student researcher
has also gain the benefits of being acquainted with research skills in the endeavor and be
honored MBA degree after successful completion of his study. Finally the study could
encourage other researchers to conduct similar researches on the subjects under investigation.
1.7 Scope of the Study
The scope of the study is delimited to the procurement activities of Ethiopian industrial inputs
development enterprise (EIIDE), specifically on the factors that affect procurement
performance such as procurement plans, staff competency, contractual management and
utilization of ICT. The subject of the study is only the head office of EIIDE.The respondents
were covers directly concerning departments like procurement, marketing, sales and project
departments in different positions, such as top level management, middle level management,
lower level management and experts.
1.8 Limitations of the Study
It is obvious that adequate and reliable information is important to undertake any kind of
study. However, the unwillingness and carelessness of some respondents while filling the
questionnaires during data collection is considered as a major constraint to the study. The
outcome of this study is based on sample from a single organization i.e. Ethiopian industrial
inputs development enterprise. Therefore, it may be difficult to generalize the findings to
other similar organizations. Nevertheless the result can shed some light on the nature of
procurement activities among different units of the enterprise. For the findings to be reliable
more similar studies need to be replicated in similar other organizations. Another limitation of
this study might be the descriptive method it employed for investigation. The other method
may use more to pin point or trace factors having the most devastated effect or could be the
most obstacles. Future research may look into this issue and could narrow the gap.
1.9 Organization of the Study
This study is organized in five consequential chapters. The first chapter deals with the
introduction part of the paper encompassing background of the study and the company under
evaluation, statement of the problem, objectives of the study and other relevant issues. The
second chapter focuses on relevant literature review. In this chapter a review the relevant
literatures in relation to the topic under discussion was made. The third chapter deals with

8. research Methodology; that is, the research design, approaches used throughout the data
collection and analysis processes are discussed. The fourth chapter presents the overall findings of
the study which prevails about the factors affecting the performance of procurement activities in
EIIDE with emphasis on Ethiopian industrial inputs development enterprise. Finally, chapter
five incorporates summary of major findings, conclusion and recommendation part of the study. [

9. CHAPTER TWO
LITERATURE REVIEW
2.1 Introduction
The main aim of literature review is to study and acknowledge the input of other researchers and
authors and their contributions to the body of knowledge in order to shed more light on the topic
of discussion.
In this chapter, the researcher has reviewed relevant literatures which are in related with the title
in the study area. The chapter thus includes concepts and ideas, practices of Procurement and
Procurement performance. Conceptual framework of the research and empirical evidences are
also included.
2.2 Theoretical Review of the Related Literatures
A theory is a supposition or system of ideas intended to explain something. Defeeet al.,
(2010) asserts that good research should be grounded in theory. There are several theories and
models that explain and describe the way public procurement operates. These studies do well
on three theories namely the agency theory, normative ethical theory and institutional Theory.
2.2.1 Agency Theory
They introduced agency theory while studying the problems of compensation contracting.
Agency theory is concerned with agency relationships. The two parties have an agency
relationship when they cooperate and engage in an association wherein one party (the
principal) delegates decisions and/or work to another (an agent) to act on its behalf
(Eisenhardt2009 ;). The important assumptions underlying agency theory is that; potential
goal conflicts exist between principals and agents.
Each party acts in its own self-interest; information asymmetry frequently exists between
principals and agents; agents are more risk averse than the principal; and efficiency is the
effectiveness criterion. Two potential problems stemming from these assumptions may
arise in agency relationships: an agency problem and a risk sharing problem (Xingxing,
2012). An agency problem appears when agents' goals differ from the principals' and it is
difficult or expensive to verify whether agents have appropriately performed the
delegated work (i.e. moral hazard).
This problem also arises when it is difficult or expensive to verify that agents have the
expertise to perform the delegated work (i.e. adverse selection) that they claim to have. A
risk-sharing problem arises when principals and agents have different attitudes towards

10. risk that cause disagreements about actions to be taken (Xingxing, 2012). The
assumptions and prescriptions of agency theory fit naturally with the issues inherent in
effective benchmarking on procurement performance. In the process of managing
procurement performance and quality, buyers in agency relations are faced with potential
problems.
By their nature, buyers expect suppliers to provide good quality and to improve the
quality of supplied products and/or services, but suppliers may be reluctant to invest
substantially in quality, especially if they perceive that buyers are reaping all the benefits.
The difference between buyers and suppliers will result in the two parties concerning
themselves only with their self-interests (Xingxing, 2012). Agency theory determines how
procurement managers execute procurement performance on behalf of public institutions.
Existence of poor principle agent relationship leads to low level of top management
commitment and this also affects the relationship between institutions and the suppliers.
The criticism of the theory has shown that there is another explanation as to why people
behave the way they do using social power and that the theory is less powerful than the
explanation. The Agency theory is more of a description and it does not really explain in
much more detail than the definition. As a result, procurement performance is greatly
reduced leading to poor service delivery by suppliers and no value for money invested.
Existence of conflict of interest amongst the agents leads to execution of procurement
performance against the procurement policies and this leads to increased procurement
budget and loss of procurement funds. This essentially leads to corruption and conflict of
interest. This study will use this theory to assess procurement planning, staff competency
and contract management and how they influence procurement performance.
From this theory it is inferred that when someone is forced to comply, dissonance is created.
Forced public procurement compliance can therefore result in cognitive dissonance
(Tukamuhabwa, 2012). However, proponents of this theory argue for the need to increase
public participation in the procurement process. The argument here is that increased public
participation in the procurement process is likely to strengthen the scope of monitoring and
enforcement of procurement decisions by public agents and shift the responsibility from the
elected representatives to the taxpayers, who are the main principals.
Agent theory was therefore relevant and useful in our study in that it assisted the researcher in
explaining the relationship between the government as the principal and the procuring
entities as agents in the implementation of the public procurement legal framework. The
theory shows how the actions and performance of the procuring entities (as the agent) affect

11. the government (as the principal) and other stakeholders. In particular, the actual
implementation of the public procurement law and regulations was discussed through this
theory.
2.2.2 Normative Ethical Theory
Darwall (2013) says that philosophers use normative ethical theory to refer broadly to principles,
concepts and ideals that can be cited in support of ethical judgments about cases. As such, the
investigation of normative ethical theory is unavoidable if we are to think about ethical issues with
any case. This is because the part of ethics we call morality is modeled on law, even if other parts are
not. What is wrong in a person’s undertaking is what one can appropriately be held accountable for
doing and that it warrants blame where there is no adequate and justified reason. Thomason (2013)
says that managers are often responsible for making a variety decisions which affect both internal and
external stakeholders for an organization. It is therefore the management’s responsibility when
making decisions to act ethically guided by the ethical or moral principles defined by society. Darwall
(2013) says that a procurement manager held accountable for wrongdoing should be capable of
accepting the judgment in some sense, of being brought to see that it is a reasonable judgment
to have been made.
This can help to foster integrity and a moral dealing among public procurement personnel. Eyaa
et al (2011) argues that the level of professionalism in public procurement is low or even non-
existent. This according to Mosoba (2012) is the reason why procuring entities brought before the
PPARB in Kenya continue ignoring the advice of the Board and commit the same mistakes while
blaming the law instead of their own deliberate interests. In response, several cases and
controversies have characterized tendering for public projects including those in critical social
areas such as the General Elections, water and human relief services. For instance, Ngirachu
(2013) says reports that procurement of sub-standard BVR poll kits cost the tax payer over KES
7.2 billion only to collapse leading to delay of the release of election results by the IEBC who
resorted to controversial manual tallying method.
2.2.3 Institutional Theory
This theory is one of the traditional approaches which are used to examine components of
public procurement (Tukamuhabwa, 2012; Obanda, 2010). The theory adopts a sociological
perspective to explain organizational structures and behavior (Dunn & Jones, 2010).There are
three pillars of institutions namely regulatory, normative and cultural cognitive. The
regulatory pillar focuses on the use of rules, regulations and procedures as basis for
compliance. The normative pillar on the other hand deals with norms and value with social
obligation as the basis of compliance. The cultural–cognitive pillar rests on shared

12. understanding (common beliefs, symbols shared understanding). Adopting from this theory,
all public entities in Ethiopia are guided by rules and regulations with the respective laws and
the attendant regulations and guidelines governing the public procurement processes and
activities. The theory therefore supports the first independent variable of this study i.e., legal
and regulatory framework.
Furthermore, the three institutional pillars as identify organizational culture, social influence,
organizational incentives and enforcement as the prerequisites of compliance with
procurement law and regulations. The implication of this is that, in order to achieve the high
level of performance in the procurement functions, institutions must first be strengthened.
This is view is also supported by Hilletofth (2009) who argued that procurement process in
the public sector need a body that is not only focused but also committed in attaining of the
set up goals and objectives.
The strategic role of procurement can only be realized when included in the corporate
strategic planning process and implementation at the same level as other functional areas.
This occurs when the importance of procurement is recognized, accepted and operationalized
by top management (Baily et al., 2015). Top management should therefore recognize the
importance procurement by explicitly involving procurement staff in the formulation of
corporate strategy (Hubbard, 2009). The easiest way to accomplish this is to make the head of
procurement department a member of the top management committee (PPA, 2011).
Furthermore, procurement performance can be enhanced if training for procurement staff is
emphasized. Failure to consider staff professional qualifications and capabilities always result
in poor procurement operations and thus prevent the full potential of strategic procurement
being realized. The theory was therefore important in explaining the institutional
arrangements (organizational structures) responsible for effective implementation of and
compliance with the PPA 2011 and PPR 2013.
2.2.4 Procurement Performance
Procurement performance covers a number of quality and quantity-enhancing benchmarks,
which narrows down transaction costs, time spent, and the quality and quantity of goods
delivered.
Procurement performance has to do with the proper management of procurement activities.
The management of procurement activities narrows down to the basic functions of the HR
departments of hiring best procurement management talent, subjecting this top talent to on-

13. the-job training and development, rewarding and motivating this top talent through
competitive salaries, benefits and career progression (Bianchi &Guidi, 2010).
Procurement performance can be realized if organizations discard their trademark paper based
procurement systems especially when procuring crucial materials that have a direct bearing
on their overall competitive advantage.
2.2.5 Procurement Performance Indicators
According to the Organization Economic Cooperation Development (OECD) (2014)
experience in working with public procurement shows that a sound procurement system
includes:
 Procurement rules and procedures that are simple, clear and ensure access to
procurement opportunities;
 Effective institutions to conduct procurement procedures and conclude manage and
monitor public contracts;
 Appropriate electronic tools;
 Suitable, in numbers and skills, human resources to plan and carry out procurement
processes; and
 Competent contract management.
However, in February 2013, the Leading Practitioners on Public Procurement asked the
OECD to help developing a set of indicators to measure the performance of public
procurement systems and their evolution over time. And thus, four areas for the development
of indicators were identified:
o Efficiency of the public procurement cycle
o Openness and transparency of the public procurement cycle
o Professionalism of the public procurement workforce
o Contract performance management
When we see them in detail the first set of key performance indicators for each involve:
Efficiency of the public procurement cycle:
 Use of contracting mechanisms
 Uptake of e-procurement
 Savings using framework agreements with second-stage competition
 Efficiency of the public procurement unit
 Public procurement award time
Openness and transparency of the public procurement cycle:

14.  Promoting competition: procurement procedure
 Promoting competition: number of bids
 Increasing the supplier base
 Transparency of public procurement information
Professionalism of the public procurement workforce:
 Number of public procurement officials according to the value and number of
contracts and unsuccessful processes
 Level of trained public procurement officials
Contract performance management:
 Are suppliers delivering the right thing?
 Are suppliers delivering at the right moments?
 Are there delays in payment?
And all of these parameters were applied in different circumstances.
2.2.6 Procurement Professionalism on Procurement Performance
Professionalism in procurement can be explained as the practical and visible use of qualities and
competencies covering knowledge, appropriate skills and behaviors. Inside a general sense,
professionalism originates from knowing one has done a great job to the better of one’s ability.
Professionalism in procurement can’t be achieved without education and learning both
technical and soft skills however it doesn’t stop there. Managing purchasing and supply
function require a thorough understanding of the procurement process that takes place within
the organization which requires competent staff (Weele, 2010). Kiplgat (2010) pointed out
that lack of requisite skills in employees was one of the challenges facing communication
commissions of Kenya. Many of the challenges and concerns relate to the fact that the
government institutions have not professionalized their procurement organization, systems
and staffs (Weele, 2010).Communications skills both on paper and verbally are also critical
on procurement professionalism. Allen (2013) argues that firms that have embraced this idea
have made better performance since procurement professionalism guarantees customer
satisfaction.
Procurement professionalism on procurement performance and ethics both connect. Ethics covers the
conduct and moral principles acknowledged as appropriate within the profession. According to
Collins (2009), organization that manages procurement appropriately lead to superior financial
performance accrued from avoiding the cost of unethical procurement practitioners. It should be noted
that all the monies given as bribes to corrupt procurement practitioners by unethical suppliers are
siphoned from the buying organization as part of quoted price of goods, services and works acquired.

15. Training as staffs is also critical as it improves procurement practitioner’s skills and knowledge thus
improved procurement performance, experience cannot also be ignored as it leads to efficiency
and effectiveness of procurement performance.
2.2.7 Adoption of ICT on Procurement Performance
Government officials and elected leaders have increasingly come to realize that public agencies
must utilize. ICT in order to enhance the procurement process in public sector faced with tight
budgets .Price Waterhouse Coopers (2011) states that an Internal Control System is a set of
procedures, methods and control measures designed by the Board of Directors and executive
management to ensure achievement of the organization’s objectives. Amudo&Inanga (2009)
indicate that Internal Control system is a contemporary issue after experiencing global
fraudulent financial reporting and accounting scandals. According to Flick (2010), internal
control system ensures proper organizational processes functioning, financial information
reliability and applicable regulation compliance.
According to Kirungu, (2011) in Kenya manual systems are a source of major inefficiencies
in regulation and operations of the function. ICT need to be adopted to ensure proper
functioning of the procurement system. This system is a product of the new world order
where everybody is going digital with globalization and internal connectivity, there is needed
to upscale the function in Ethiopia. The old way of doing business consists of buyers managing
forecasts and communicating requirements to suppliers via phone, fax and email. Spreadsheets and
manual reports are passed between the trading partners these manual processes are slow and
cumbersome. They cannot support today’s demand driven enterprises.
Strategies to help increase accountability include information systems which measure how inputs
are used to produce outputs; watchdog organizations, health boards or other civic organizations to
demand explanation of results; performance incentives to reward good performance; and
sanctions for poor performance (Hui, W., Othman, R., Omar, N., Rahman, A., and Haron, N.,
2011). In South Africa, a district health planning and reporting system was used to improve
management control and hold government agents accountable for their decisions.
Lack of access to appropriate ICT equipment, Lack of time for training, exploration and
preparation, Lack of models of good practice in ICT, Negative attitudes towards ICTs in
education, Technology anxiety and a lack of confidence, Fear of change and a lack of
personal change management skills, Unreliable equipment and Lack of technical,
administrative and institutional support.

16. 2.2.8 Procurement Performance Models
Public procurement has been the focus of successive waves of management reform
worldwide (Arrowsmith, 2010; Carol et al., 2014). These reforms have been driven by an
imperative to improve the performance and cost-effectiveness of the public service (Global
Partner and Associates, 2012). These reforms however, have frequently been confronted by
apparent conflict and debate between the basic qualities of public governance, such as
accountability and transparency versus outcomes and performance (PPRA, 2011).
2.3 Empirical Review of the related literatures
Worldwide, governments are the biggest spenders and the figure varies from country to
country. There is increasing recognition that improving economic governance and fostering
fiscal responsibility in emerging economies requires strengthening transparency and
accountability in the management of public finances. Thai (2011) in his study on showed how
public procurement is a complicated function of government. He said public procurement
requires interdisciplinary skills and knowledge (or multiple disciplines), including economics,
political science, public administration, accounting, marketing, law, operations research,
engineering, and architecture, among others. He showed how impossible it is to integrate
these disciplines into the public procurement knowledge (e.g., students/practitioners are not
expected to become experts in engineering, architecture, law, budgeting and accounting,
operations research, and economics through their public procurement training and education
programs).
According to Thai, a very important task of public procurement professionals is to
communicate effectively with those professionals who are involved in procurement projects.
Japheth (2013) in his study looked at four independent variables (planning, resource
allocation, staff competency and contract management) which, according the study,
contribute to 87.5% of the variations in procurement performance at the Ministry of Energy in
Kenya. The researcher recommends further research to investigate the other factors that affect
procurement performance.
Ayaa (2011) explaining non-compliance in public procurement in Uganda focused her study
on the Central Government Entities (CGEs) and left out the Local Government Entities
(LGEs). In Uganda, public and disposing entities are classified into two groups, the Central
Government Entities and the Local Government Entities. The findings of her study cannot be
generalized to the LGEs, implying that there is need for a study examining compliance with
procurement regulations in LGEs given that they operate in environments that are different

17. from those of CGEs. Secondly, we note that compliance is a behavior that is acquired over
time and in order to examine its true nature, a longitudinal study is necessary. We therefore
recommend a longitudinal study to examine compliance with public procurement regulations
in the public entities.
Boomsma (2009) researched on sustainable procurement in developing countries. The
countries under study were Sierra Leone, Mali and South Africa. The research found that lack
of technical and management capacity, cultural integration, funding for investment startups,
early inclusion of small producers, transparency and equal distribution of power were some of
the aspects cited as hindering sustainable procurement by the author. Boomsma (2009)
concluded that sustainable sourcing needs multi stakeholder process, as well as the primary
value chain actors, stakeholder researchers, government, support agencies, in order to be
successfully implemented. The author further highlighted the need to create synergy among
these stakeholders to manage conflicts and interests as to ensure that all actors gain.
Boomsma (2009) recommended that the three aspects of sustainability (efficiency, high
quality and social responsibility) need to be considered in the structure of an organization and
its supply chain in order to add the highest possible value to the chain. The public sector,
support agencies and donors should actively and responsibly support this process. In poorly
integrated chains, a facilitator may be needed to coordinate and mediate the process towards a
fair chain partnership.
In Ethiopia, the implementation of the procurement reforms commenced in 2000 with the
approval by cabinet. These reforms resulted into the establishment of the PPPA. This body
was given the regulatory and oversight mandate to advise Government on matters relating to
public procurement and disposal. One of its other mandates was to monitor compliance by
central and local government entities to the provisions of the new legal and institutional
procurement frameworks. To this effect, this report presents results of the compliance checks
on 120 procuring and disposing entities (PDEs) During the 1990s, a number of developing
countries including Ethiopia embarked on procurement reforms with an objective of creating
efficient and effective procurement systems. Procurement remained a big part of the
developing countries’ economy; accounting for an estimated 9%–14% of the developing
nations GDP and it is was therefore an area that needed attention since resources were not
being used properly.

18. 2.3.1 Influence of Procurement Planning on Procurement Performance
According to Shiundu and Rotich (2014), evaluation or measurement of procurement
performance has always been a vexing problem for procurement professionals. They
explain two types of goals in the procurement system: non procurement goals and
procurement goals. Procurement goals are primarily associated with quality, reduction of
financial and technical risks, and protection over competition and integrity in the system.
Non procurement goals usually involve the economic, social, and political goals within
the system.
Achieving efficiency in public procurement is an ambitious task, as procurement faces
numerous challenges, especially due to the market structure, the legal framework and the
political environment that procurers face. Procurement performance should be based on
total cost, quality, and enhancement of competitiveness of suppliers using best
procurement practice. Kiage (2013) explored the determinants affecting procurement
performance with a case of Ministry of Energy. The study posits that public procurement
has increasingly become prominent, thus the public entities need to plan on how to handle
the entire process. The findings show that procurement planning has a substantial impact
on procurement performance. Planning, resource allocation, staff competency and
contract management impact on the variations in procurement performance.
Procurement planning is one of the primary functions of procurement with a potential to
contribute to the success of public institution’s operations and improved service delivery.
Similarly, Mamiro (2010) in his findings underscores these facts and concludes that one
of the major setbacks in public procurement is poor procurement planning and
management of the procurement process which include needs that are not well identified
and estimated, unrealistic budgets and inadequacy of skills of procurement staff
responsible for procurement. Likewise, procurement performance is not usually measured
in most public entities as compared with the human resource and finance functions.
Failure to establish performance of the procurement function can lead to irregular and
biased decisions that have costly consequences to any public procuring entity. A
procurement plan describes and documents all of the purchases from outside suppliers
that will be needed to support the needs of a particular department (Kiage, 2013).
Wile (2010) describes it as the process used by companies or institutions to plan
purchasing activity for a specific period of time which is usually completed during the
budgeting process; each department is required to request a budget for staff, expenses and

19. purchases. Procurement plans serve as a road map and the goal should be to enable
efficient use of available resources.
According to Kiage (2013), a procurement plan is used to implement the budget; it should
be prepared by user departments so as to minimize excess votes in an entities budget and
to ensure there are funds to make payments before procurement is done. Resource
confirmation and resource allocation helps make procurement effective when carried out
appropriately (Kiage, 2013). The ultimate goal of any public procurement is to satisfy the
public interest as entrusted in the public procurement Act (Ouma&Kilonzo, 2014). In
their study, Ouma and Kilonzi (2014) find that resource planning is significant and
contributes to public entity procurement and it is an important aspect in determining how
effective the procurement process will be.
Therefore public entities should balance resource allocation and even allocate more funds
to procurement departments. According to Arrowsmith (2010), conflicts may sometimes
arise between the objective of preventing corruption and ensuring efficiency in the
administration of the procurement process. Measures to prevent corruption may add to the
cost of procurement, therefore the prevention of corruption is so important.
2.3.2 Influence of Staff Competency on Procurement Performance
According to Banda (2009), many procuring organizations have staffs that do not have the
right competence needed for good procurement management Barsemoi et al. (2014) found
that most of the personnel carrying out procurement functions in the local authorities in
Kenya have not been sensitized on procurement regulations. The Public Procurement law
requires that each procuring entity establishes a procurement unit with procurement
professionals. The lack of professionalism has been explained as a cause of non-
compliance to procurement laws.
Professionalism in public procurement relates to the levels of education and qualifications
of the workforce as well as the professional approach to the conduct of business.
Another cause of non-compliance is the lack of staff training. The PPOA Audit Report
(2008 as cited in (Ndumbi&Okello, 2015)shows that inadequate training is high amongst
public procurement officers in Kenya, although this may be attributed to the profession
still being relatively young in Kenya.
According to Sultana (2012), technological developments and organizational change have
led employers to the realization that their success relies on the skills and abilities of their
employees, which means that they have to continuously invest in training and

20. development. Employees begin to realize that learning and continuous training is as big as
job itself.
Training one another, or “train the trainer”, is another important aspect of continuous
learning. It allows employees to develop new applications and techniques and share them
with their peers or supervisors. Moreover, Smith (2009) contends that lack of professional
training on procurement functions and lack of continuous training on implementation of
best procurement performance hinders the procurement staff in public sector
organizations to effectively execute procurement procedures. According to Hall (2009),
efficiency and the effectiveness of procurement procedures are hindered by absence of
effective continuous employees training programs that help in equipping the employees
with competitive procurement management skills.
Ebrahim (2010) contends that from management viewpoint, training is associated with
higher organizational productivity, it can improve the adaptability and flexibility of their
employees and their responsiveness to innovation, it can be regarded as a means of
engaging the commitment of employees to the organization and training programs specific
to the organization are of paramount importance not least because they bind the employee
and cannot be used by rival organizations.
2.3.3 Influence of Contractual Management on Procurement Performance
Deva raj, Vaidya Nathan and Mishra (2012) concluded in their study that the presence of
poor contract management that is characterized by payments delays to suppliers obstructs
greatly their ability to offer timely service delivery leading to delays that derails
organizational procurement timelines and schedules. The presence of a high frequency of
procurement plans formulation and evaluation contributes to organizational procurement
performance. According to SIGMA (2011), contracts are frequently complex, they may
involve multiple actors, last a long time and may consume many resources. It is therefore
vital that they are properly managed. According to Kiage (2013), resource allocation,
procurement planning, contract management and staff competency positively affect
procurement performance.
Planning ensures that available resources are utilized in order to achieve overall procurement
objectives. The presence of procurement planning ensures that sound purchasing plans are
adopted so as to enhance both efficiency and effectiveness in achieving projected purchasing
outcomes. In so doing, it addresses deficiencies in current practice relating to procurement,
contract management, inventory and asset control and obsolescence planning (Nyaboke et al.,

21. 2013).According to Onyango (2012), procurement; a function that was traditionally viewed as
a clerical and reactive task has since positioned itself among core organizational functions,
and its management is becoming increasingly critical for the well-functioning of any
organization. In addition, Kibogo (2014) reported that the Kenya government had been losing
hundreds of millions of taxpayer's money through cancelled contracts, unfinished projects,
poor service or product delivery, corruption and extended contract periods in the previous
eight years without major improvement. The study further stated that of the 10% – 30% of
GDP spent by the government of Kenya on procurement alone, 5% is wasted due to lack of
proper management of the contracts.
As a result, the World Bank and the International Monetary Fund (IMF) had to intervene by
putting in place stringent conditions for lending funds to the government which slowed down
economic development by 2.1%. The PPDA second integrity survey (2011) reported that up
to 69.8% of service providers surveyed agreed that corruption influenced procurement and
that acknowledgement of the presence of corruption was assented to by up to 81.1% of the
service providers. Integrity Baseline 2011 survey indicated that the majority of the service
provider respondents had offered a bribe of between 10 to 20% of the contract value (33.3%)
with a further 6.3% saying they paid over 20% for the contract awarded. Key informants also
confirmed instances of procurement officers in key government agencies as allocating works
to their relatives or cronies.
2.3.4 Influence of Information Communication Technology on Procurement
Performance
The provision of adequate professional support by management through training and
educational has a positive impact on procurement performance (Nzau&Njeru, 2014).
Wanyonyi and Muturi (2015) concluded that staff competency, information technology and
ethics positively affect procurement function performance. Organizations should therefore
strive to adopt modern technologies, promote employees competence and enhance the
implementation of good organizational moral code of conduct so as to attain improvements in
their procurement departments.
At the public sector level, technology enhances infinite and non-restricted access to
government information and increases market transparency and economic incorporation
based on complementarities.Wanyonyi and Muturi (2015) explored the determinants
impacting performance of procurement function in reference to public technical training
institutions in Kisumu County, Kenya. The study concludes that ICT, staff competency and
ethics have a direct impact on performance of the procurement function among technical

22. training institutions. Thus recommends the use of ICT in technical institutions in an effort to
improve the performance of procurement functions.
According to Mumo et al (2013), ten years after the e-government directorate was set to
manage ICT in the government, most ordinary Kenya citizens are still using the manual
system to access government services making it difficult for the private sector to engage
profitably with the government. This particular platform has made the government entities
prone to exploitation resulting to poor service delivery and dismal performance in
procurement system. Government officials and elected leaders have constantly insisted that
public entities should automate their procurement processes and must utilize ICT in order to
enhance the procurement processes in the public sector.
The key elements in implementing an organization’s wide strategic quality planning are seen as
identifying customers and their needs, establishing optimal quality goals, creating measurements
of quality, planning processes capable of meeting quality goals under operating conditions and
producing continuing results in improved market share, premium prices and a reduction of error
rates in the office (Patrick, 2010).
Evidences from the reviewed empirical literature show that most of the studies conducted on
performance of the public procurement focused on compliance with the existing legal and
regulatory procedures. Despite this, there is no specific study that has demonstrated the effect
of legal and regulatory framework on performance of the procurement function. Studies by
Ntayi (2009); Eyaa and Oluka (2011); Gaigo (2011); Mwangi and Kairuki (2013); Gesuka
and Namusonge (2013); Mugo (2013); Onyinkwa (2013) and Eyitopeet al. (2014) studied on
factors influencing compliance with the procurement law and regulations, but did not explain
the effect of the same on performance of the procurement function or department. For
example, a study by Gesuka and Namusonge (2013) on factors affecting compliance in public
procurement regulations in Kenya found that complying with the procurement law and
regulations is far from being satisfactory, most of procurement proceedings in the procuring
entities don’t comply with the legal framework requirements fully. Nevertheless, the study
did not demonstrate the effect of such non- compliance on performance of the procurement
function in terms of its ability to achieve the departmental objectives.
Eyitopeet al. (2014) investigated reasons for non- compliance in the procurement proceedings
of procurement of works in Nigeria. They found that institutional and political reasons are the
major reasons for non- compliance with procurement proceedings in procurement of works in
Nigeria. However, the study failed to explain how such institutional and political

23. interferences affect the performance of the procurement function in terms of quality, cost and
on time completion of the works projects in Nigeria.
Studies by Juma (2012); Kechibi (2012); Kiage (2013); Amayi and Ngugi (2013); Kioko and
were (2014); by Guccioet al. (2014) investigated on factors influencing performance of the
procurement function in public organisations. In these studies and others, there was no
specific independent variable addressing on the effect of Private Sector Participation or the
effect of Integrity in the performance of public procurement was discussed. A study by Wahu,
Namusonge, Mungai and Chilioni (2015) determined factors affecting performance of the
procurement function in Kenyan public secondary schools: a case of Gatundu District. The
performance of the procurement function was measured in terms of efficiency and
effectiveness. Of the three independent variables under consideration, ‘competitive bidding’
was found to affect procurement performance of the procurement function to the greatest
extent. However, the study did not explain how the ‘competitive bidding’ contributes to
efficiency and effectiveness of the procurement function in terms of on time delivery, right
quality and price/cost of the procured items. Moreover, the concepts ‘efficiency’ and
‘effectiveness’ were not clearly defined and linked in the context of public procurement.
More specifically, there is no known study on public procurement that measured performance
(as a dependent variable) in terms of its process (compliance) and outcome (objectives). It is
this study that bridges that existing gap.
The reviewed literature envisaged above obviously has left a research gap that must be filled.
The main gap that exists is two-fold, first how performance of the procurement function can
best be assessed, whether in terms of compliance with rules and regulations or achievement of
its departmental objectives, and secondly, is the relationship as proposed in the conceptual
framework, it is not known as to what is the contribution of each of the proposed independent
variables on the performance of the procurement departments. Previous and reviewed studies
have not come to the consensus on the effect of the proposed independent variables on
performance of procurement departments measured in terms of both Compliance with the
rules and regulations and Achievement of the procurement objectives. This study therefore
intended to fill the observed gaps that shall suffice to answer the research questions in an
attempt to assess the contribution of procurement function in attainment of institutional and
national goals.
2.4Conceptual Framework
Colin Fisher (2010) defines a conceptual framework as a set of broad ideas and principles
taken from relevant fields of inquiry and used to structure a subsequent presentation. It is

24. formed of patterns of concepts and their interconnections. A conceptual framework,
according to Chakraborty (2009), is a scheme of concepts (or variables) which the research
operationalizes in order to achieve set objectives. Mugenda and Mugenda (2012) define a
conceptual framework as the main structure that gives the research its form and shape and
holds together all the elements in the logical configuration.
From the conceptual framework, procurement performance was the dependent variable and
procurement planning, staff competency; contractual management and ICT were the
independent variables.
Figure 2. 1: Conceptual framework
Procurement planning
o Adherence to plans
o Budgeting
o Resource allocation
o Goal setting
Staff competency
o Employee experience
o Employee skills
o Professional qualifications
o Employee Training procurement performance
-efficiency
-effectiveness
- Transparency
Contract Management -Service delivery
oInternal controls
oNegotiation
oPeople and skills
 Dependent variables
Information communication
Technology
o E-tendering
o Communication
o Variety of capable suppliers
Independent Variables

25. 2.4 Summary
The central focus of this study was on factors that determine performance of the procurement
in public entities. As required by the best practice and indeed in academic research, related
literatures were reviewed to shade light on theoretical and empirical evidences of the study
topic under investigation. Specifically, the topic drew attention on what literature to be
considered; what content and context of theories and models to be considered and what
empirical evidences are needed for justification of the research framework (conceptual
model) under consideration.
The study is grounded by three theories. The theories adopted, were agency theory, normative
ethical theory and Institutional Theory. These theories are of great value as they provide a
framework upon which those involved in the procurement process and decisions can rely on
and later being accountable for their actions.
From the theories and empirical evidences the conceptual framework consisting of
independent and dependent variables is developed. Four independent variables, namely
procurement planning, staff competency; contractual management and ICT were discussed.
The dependent variable discussed in the study was Performance of Procurement assessed in
terms of level of Compliance with the procurement law and regulations and Achievement of
the procurement objectives (that is, timeliness, quality and cost).
From the reviewed theoretical and empirical literature, it is evident that a number of studies
on public procurement have been conducted both in developed as well as in developing
countries. Most of the studies however, concentrated on legal and regulatory compliance and
little on attainment of the procurement performance. Even those which focused on
performance failed to explain the relationship among the variables so as to show the share of
each independent variable on procurement performance. The reviewed theories, practices and
evidences from East Africa and beyond therefore, provided the rationale for the research that
will be undertaken to show the interface of the variables in responding to the research
questions. However, further researches on public procurement are necessary in order to
explain on what actually influence performance of procurement in the public sector and how
best can the same be assessed.

26. CHAPTER THREE
RESEARCH METHODOLOGY
3.1 Introduction
This chapter covers the methodology and techniques underlying the execution of this
particular study. Specifically, it consists of research design, target population, sampling
frame, determination of sample size and sampling techniques; data collection procedures and
pilot testing. Furthermore, the chapter describes how the collected data were processed and
analyzed. Finally, the statistical model applied in analyzing and testing the research
hypotheses have also been described in this chapter.
3.2 Research Design
This study adopted a descriptive research design in which data was collected for the
objectives of the study. The choice of this research design was motivated by its suitability for
the instrument to collect a large amount of data. The design also provided a practical
framework for collecting a large sample of groups and strong data reliability (Oso&Onen,
2005).The study further adopted a quantitative approach by using a structured questionnaire
to collect primary data from the respondents.
Quantitative research approach was preferred because it allowed the researcher to measure
and analyze data in detail to establish the relationship between the independent and
dependent variables. Quantitative research was used to test the research hypotheses because
of its ability to measure data using statistics. This was advantageous because it allowed for
objective analysis of the study findings.
3.3 Target Population
Population according to Kothari, (2013) is the universe of interest. It is the total number of
subjects or the total environment of interest to the researcher. This study targeted 598
participants from Ethiopian industrial inputs development enterprise who comprised of top
level manager , middle level manager, lower level managers and experts in different
departments that is concerning to procurement performance directly or indirectly.
3.4 Sample Design
According to Silverman (2005), the sampling frame should be large to allow the researcher to
make inferences of the entire population. The sample frame for this study was comprised of
598 participants.

27. Table 3.1: Target Population Distribution Table
Participant Target population Percentage
Top Managers 5 1
Middle level manager 25 5.4
Lower level manager 40 8.6
Expert 395 85
Total 465 100
Source: Ethiopian industrial inputs development enterprise HR.
3.5 Sample Size and Sampling Technique
This section described the determination of sample size and sampling technique this
study employed.
3.5.1 Determination of Sample Size
The term sample refers to a segment of the population selected for research to represent the
population as a whole (Kotler and Armstrong, 2006).
The sample was calculated using the mathematical approach developed by Miller and Brewer (2003).
Given a population of 465 and precision level of 0.05 the sample size was calculated as;
n = N
1+N (e) 2
Where; n is the sample size; N is the population size and e is the level of precision (0.005)
n= 465
1+465(0.05)2
n= 215
The sampling frame of the study constituted of 465 participants while the sample size comprised of
215 participants.
Table 3. 2: Sample Size Distribution
Participant Target population Sample Size
Top Managers 5 5
Middle level manager 25 25
Lower level manager 40 35
Expert 395 150
Total 465 215

28. 3.5.2 Sampling Technique
The choice of a sample size is vital so as to avoid wastage by not being too large and
to give confidence to the results of the study by not being too small (Kothari, 2004).
Stratified random sampling was used to select 61 respondents from the EIIDE.
According to Bryman and Bell (2007), stratified sampling ensures that the resulting
sample is distributed in the same way as the population in terms of the stratifying
criterion. In addition, stratified sampling is a good approach and method when there is
a good statistical database available. It gives flexibility to the researcher to make a
decision on identification and allocation of the units for the strata. It also gives
possibilities to use and make more than just one stratifying criterion. Simple random
sampling was also used to select the sample size of participants from each stratum.
3.6 Data Collection Instrument
The study employed a structured questionnaire to collect data from the participants.
Questionnaires are research instruments used to collect information geared towards
addressing specific objectives (Kombo& Tromp, 2006). The questionnaire items is
scaled on a five point likert scale. The close-ended Likert rating scaled the items on
(5, 4, 3, 2 and 1) where 5-strongly agree, 4-agree, 3-undecided/neutral 2-disagrees and
1-strongly disagree.
3.7 Instrument Reliability
Reliability is a measure of the degree to which a research instrument yields consistent
results after several trials (Mugenda & Mugenda, 2003). According to Kombo and
Tromp (2006), reliability is the extent to which results are consistent overtime.
Reliability of the research instrument will be calculated using Cronbach‟s Alpha
coefficient for either even or uneven items based on the order of the number of
arrangement of the questionnaire items. Test re-test method was used to pilot the
questionnaires. A Cronbach correlation coefficient greater or equal to 0.7 is
acceptable (George &Mallery, 2003).
3.8 Data Collection Procedure
Data collection as defined by Kombo and Tromp (2006) is the process of gathering
specific information aimed at proving or refuting some facts. The primary data will be
collected through a self-administered structured questionnaire on a drop and pick later
basis to allow participants enough time to fill the questionnaires. Moreover secondary
data from EIIDE reports, magazines and other related documents will also be

29. consulted to triangulate the data collected through primary data collection method.
The importance of data collection is to promote decision making and response
allocation that is based on solid evidence rather than on isolated occurrences,
assumption and emotions.
3.9 Data Analysis and Presentation
The data collected was coded and analyzed using the Statistical Package for Social
Sciences (SPSS version 24) tool. Descriptive statistics will be used as a measure of
central tendencies and measures of dispersion (mean and standard deviation).
Regression analysis was conducted to test whether the strength of the relationship
between the independent variables and the dependent variable are statistically
significant. A t-test will be conducted to test the significance of the results at the 5%
level of significance. The regression analysis was guided by the following model:
y= + 1X1+ 2X2+ 3X3+ 4X4+ ……………………………Equation
Where,
Y Represents procurement performance
X1 Represents procurement planning
X2 Represents staff competency
X3 Represents contractual management
X4Represents ICT
ℇ represents error term
Α represents Y intercept
β1, β2, β3… are the net changes in Y
Assumptions of the model
i. There is a linear relationship between procurement performance and the four variables
(X1,X2,X3,and X4)
ii. There is a statistically significant relationship between procurement performance and
the four variables (X1,X2,X3,and X4)
iii.Taking all factors into account constant, procurement performance will be =

30. CHAPTER FOUR
RESEARCH FINDINGS AND DISCUSSION
4.1 Introduction
The purpose of the study was to assess factors affecting procurement performance in
Ethiopian industrial inputs development Enterprise. This chapter presents and discusses
the research findings of the demographic characteristics followed by both the descriptive,
inferential and regression analyses of the study objectives respectively.
4.2 Reliability Test Results
The Cronbach‟s Alpha Test was conducted on all the study variables and gave Cronbachs
Alpha values greater than 0.7 as shown in Table 4.1. A Cronbach correlation coefficient
greater or equal to 0.7 is acceptable (George &Mallery, 2003).
Table 4.1: Reliability Test Results
4.2 Response Rate
The study targeted a sample size of 215 participants out of which 198 questionnaires were
completely filled and returned for analysis giving a response rate of 92%. The higher
response rate was occasioned by the frequent follow up and clarification of the questions
by the researcher. According to Mugenda and Mugenda (2003), Rogelberg and Stanton
(2007) and Saunders et al., (2007), a response rate of 50% is adequate, a rate of 60% is
good, and a response rate of 70% and over is very good.
Table 4.2: Response Rate
No. of Questionnaires Questionnaires Filled and Percentage
Participants Administered Returned
215 215 198 92%
Based on this awareness, the response rate in this study was considered to be very good
for the study.
Cronbach's Alpha N of Items(number of items)
0.727 29

31. 4.3 Demographic Characteristics of the Participants
The study analyzed the demographic characteristics of the participants based on gender
distribution, age categories, highest level of education, Positions held and working
experiences of the participants.
4.3.1: Gender Distribution of the Participants
The study sought to establish the gender distribution of the participants in the Ethiopian
industrial inputs development enterprise. From the findings illustrated in Table 4.3, the
males were the majority 11 8(59.6%) followed by the females 80 (40.4%).
Table 4.3.: Gender Distribution of the Participants
Gender Frequency Percent (%)
Male 118 59.6
Female 80 40.4
Total 198 100.0
4.3.2 Age of the Participants
In addition, the study sought to investigate the age categories of the participants in the
Ethiopian industrial inputs development enterprise. From the findings shown in Table 4.4,
majority of the participants were aged between 31-35 years 106 (53.5%) and above 35
years 52 (26.3%) respectively. Those aged between 20-25 years were 5 (2.5%) while
those aged between 26-30 years were 35 (17.7%). The findings imply that majority of the
participants were young in age because they were aged below 35 years. This age range
was consistent with what is often used in national policies in Sub-Saharan Africa
countries (Blum, 2007).
Table 4. 4 : Age of the Participants
Age Categories Frequency Percent (%)
20-25 years 5 2.5
26-30 years 35 17.7
31-35 years 106 53.5
35 years and Above 52 26.3
Total 198 100.00

32. 4.3.3 Positions Held by Participants
The study further sought to establish the positions held by the participants in Ethiopian
industrial inputs development enterprise. The results illustrated in Table 4.5 shows that
majority of the participants were experts 140 (70.7%). Further, 4 (2%) were top
managers, 22 (11.1%) were middle level manager while 32 (16.2%) were lower level
manager.
Table 4.5: Positions Held by Participants
Position Frequency Percent (%)
Top managers 4 2
Middle level managers 22 11.1
Lower level managers 32 16.2
Experts 140 70.70
Total 198 100.0
4.3.4 Participants Highest Level of Education
Additionally, the study sought to find out the highest education levels of the participants.
The findings in Table 4.6 indicates that majority of the participants 159 (80.3%) had
attained degree level of education followed by those who had degree level of education
followed by those who had master degree and above 31 (15.7%). Moreover, 8 (7%) of the
participants attained diploma level.
Table 4. 6: Participants Highest Level of Education
Level of Education Frequency Percent (%)
Diploma 8 4
Degree 159 80.3
Masters and Above 31 15.7
Total 198 100.0

33. 4.3.5 Working Experience of the Participants
The study also sought to find out the working experience of the participants in Ethiopian
industrial inputs development enterprise. The findings illustrated in Table 4.7 shows that
majority of the participants 94 (47.5%) had worked for between 6-10 years, followed by
those who had worked for above years 54 (27.3%). As well, 46 (2%) of the participants
had worked for less than one year while 46 (23.2%) had worked between 1-5 years. The
findings imply that the participants had adequate experience and therefore were able to
provide the required information sought by the study.
Table 4.7: Working Experience of the Participants
Experience in years Frequency Percent (%)
Less than one year 4 2
1-5 years 46 23.2
6-10 years 94 47.5
10 years and Above 54 27.3
Total 198 100.0
4.4 Descriptive Statistics
Descriptive analysis focuses on describing the basic feature of the data in a given study
(Cooper & Schindler, 2013). In this section, descriptive analysis was used to summarize
findings on the influence of procurement planning, staff competency, Contractual
management and information communication technology on procurement
Performance.

34. 4.4.1 Influence of Procurement Planning on Procurement Performance
Table 4. 8: Influence of Procurement Planning on Procurement Performance
N/
S
Procurement planning n SA A N D SD Mean S.D
1 Procurement plan at EIIDE
enables efficient use of
available resources
198 4.5% 39.4% 6.6% 41.9% 7.6% 2.91 1.139
2 Proper procurement
planning contributes to the
success of service delivery
198 31.8% 44.9% 8.6% 7.6% 7.1% 3.87 1.155
3 Poor procurement planning
is a major setback in cost
estimation for services and
works
198 51.5% 32.3% 6.1% 5.6% 4.5% 4.21 1.082
4 Failure to adhere to
procurement plans leads to
irregular and biased
decisions
198 62.1% 27.1% 9.1% 4% 3% 4.36 1.011
5 procurement plan prepared
through involvement and
participation of
management and all staff
members
198 13.1% 9.6% 3% 20.2% 54% 2.08 1.463
6
End user are raised their
procurement need on time
with clear specification
198 3% 10.6% 10.1% 55.6% 20.7% 2.20 0.985
In order to determine the influence of procurement planning on procurement performance at
the Ethiopian industrial inputs development enterprise, the participants were asked to respond
to a set of statements on a five point scale. The first statement asked the participants whether
Procurement plan at EIIDE enables efficient use of available resources. From the results
shown in Table 4.7, the mean score for responses was 2.91 indicating that a majority of the
participants (41.9%) were in disagreed with this statement. The standard deviation indicates
that a majority of responses did not vary from the mean by less than 1.139. The second
statement sought to determine whether proper procurement planning contributes to the
success of service delivery. A mean of 3.87 imply that a majority of the participants

35. (44.9%) were agreement with the statement. The standard deviation indicates that the
responses did not vary from the mean score by more than 1.155. This finding is congruent
to that of Kiage (2013) who indicated that procurement planning has a substantial impact
on procurement performance.
The third statement asked respondents whether poor procurement planning is a major
setback in cost estimation for services and works. A mean score of 4.21 implies that
majority of the participants were strongly agreed (51.5%). The standard deviation was
more than 1 at 1.082 implying that the participants were cohesive in their responses to the
statement. This finding supports those of Ouma and Kilonzi (2014) who posited that
resource planning is significant and contributes to public entity procurement and it is an
important aspect in determining effectiveness of the procurement process.
The fourth statement sought to establish whether failure to adhere to procurement plans
leads to irregular and biased decisions. Majority of the participants were strongly agreed
(62.1%) with a mean score of 4.36 and standard deviation of 1.011 implying that the
participants had congruent opinions in their responses to the statement. The fifth
statement sought to determine whether procurement plans at EIIDE enables procurement
plan prepared through involvement and participation of management and all staff
members. The majority of the participants were strongly disagreed (54%) with a mean
score of 2.08 and standard deviation of 1.463. The study further sought to establish
whether End users are raised their procurement need on time with clear specification. The
mean score of 2.20 and standard deviation of 0.985imply that majority of the participants
were in divergent with the statement.
4.4.2 Influence of Staff Competency on Procurement Performance
The study further sought to find out the influence of staff competency on procurement
performance. The first statement asked the participants whether there is regular staff
training programs on procurement procedures. From the results in Table 4.9, the mean
score was 1.87 implying that the participants were strongly disagreed (40.9%) with the
statement. The standard deviation of 0.954 implies the participants had divergent opinions
on the responses to the statement. Further, the study sought to find out whether The
EIIDE department employees competent and qualified procurement staff. The mean score
of 2.93 imply that the participants were disagreed (28.8%) with the statement.

36. The standard deviation of 1.173 indicates that the participants were not cohesive in their
responses to the statement. The third statement sought to establish whether Lack of
continuous professional training on procurement hinders procurement performance. The
majority of the participants (55.1%) were in agreement with a mean score of 4.12 and
standard deviation of 1.203. Moreover, the study asked the participants whether EIIDE
procurement staff have the necessary skills and competency to handle complex and
strategic procurement items. The findings indicate that majority of the participants were
disagreed (26.3%) with a mean of 3.23 and standard deviation of 1.220 implying not
cohesive in responses to the statement.
These findings are congruent to those of Barsemoi et al., (2014) who posited that most of
the personnel carrying out procurement functions in the local authorities in Kenya have
not been sensitized on procurement regulations. The fifth statement asked participants
whether Procurement staff have ability to apply public procurement principles and
evaluate bidding document. The mean score of 3.83 and standard deviation of 1.073
imply that majority of the participants (28.3%) were in agreement with the statement
though with divergent views as indicated by the standard deviation. This finding supports
that of Christianne (2008) that employees must begin to realize that learning and
continuous training is as big as job itself. Furthermore, the study asked the participants
whether Procurement staffs have the ability to negotiate with users and suppliers. A mean
score of 3.22 and standard deviation of 1.152 indicates that majority of the participants
were in divergent with the statement.

37. Table 4.9: Influence of Staff Competency on Procurement Performance
n/s Staff competency n SA A N D SD Mean S.D
1 There are regular staff
training programs on
procurement procedures
198 2.5% 4% 12.1% 39.9% 40.9% 1.87 0.954
2 The EIIDE department
employees competent and
qualified procurement staff
198 8.6% 27.8% 23.2% 28.8% 11.6% 2.93 1.173
3 Lack of continuous
professional training on
procurement hinders
procurement performance
198 55.1% 21.2% 9.1% 10.1% 4.5% 4.12 1.203
4 EIIDE procurement staff
have the necessary skills
and competency to handle
complex and strategic
procurement items
198 19.2% 24.2% 23.7% 26.3% 6.6% 3.23 1.220
5 Procurement staff have
ability to apply public
procurement principles and
evaluate bidding document
198 18.7% 27.3% 28.3% 25.3% 0.5% 3.38 1.073
6
Procurement staffs have the
ability to negotiate with
users and suppliers
198 15.2% 29.8% 20.7% 30.3% 4% 3.22 1.152
4.4.3 Influence of Contractual Management on Procurement Performance
Additionally, the study sought to analyze the influence of contractual management on
procurement performance. The participants were asked whether there were no delays in
service delivery by suppliers as spelled in contract timelines. The findings are as
illustrated in Table 4.10. The responses mean score 2.26 and standard deviation of 1.033
imply that majority of the participants (55.1%) were impartial with the statement. These
findings are congruent to those of Deva raj, Vaidya Nathan and Mishra (2012) who
concluded that the presence of poor contract management that is characterized by
payments delays to suppliers obstructs greatly their ability to offer timely service delivery
leading to delays that derails organizational procurement timelines and schedules.
Further, the study sought to determine whether there are minimal contract cancellations,
unfinished procurement and extended contract periods. The mean score of 3.25 indicate
that the Majority of the participants (36.9%) were in agreement with the statement.

38. The standard deviation of 1.232 implies that the participants were cohesive in their
responses to the statement. The participants were also asked whether there is proper
management of procurement contracts. A mean of 2.69 and standard deviation of 1.155
indicates that majority of the participants were disagreed (46%). The findings support
those of SIGMA (2011) that contracts are frequently complex, may involve multiple
actors, last a long time and may consume many resources. It is therefore vital that they
are properly managed. The fourth statement asked participants whether there is poor
contract monitoring and control in EIIDE. The mean response score of 3.68 indicates that
majority of the participants were strongly agreed (34.3%) with the statement. The
standard deviation of 1.281 indicates that majority of the participants had divergent
opinions in their responses.
The study further asked the participants whether Contract management is conducted
according to the bidding and contract document terms and conditions. A mean score of
3.20 and standard deviation of 1.129 imply that majority of the participants (35.4%) were
disagreed with the statement.
Table 4. 10: Influence of Contractual Management on Procurement Performance
n/s Contractual management n SA A N D SD Mean S.D
1 There are no delays in
service delivery by suppliers
as spelled in contract
timelines
198 6.1% 6.6% 13.6% 55.1% 18.7% 2.26 1.033
2 There are minimal contract
cancellations, unfinished
procurement and
extended contract periods
198 14.6% 36.9% 17.2% 21.2% 10.1% 3.25 1.232
3 There is proper management
of procurement contracts
198 6.1% 25.8% 10.6% 46% 11.6% 2.69 1.155
4 There is poor contract
monitoring and control in
EIIDE
198 34.3% 28.3% 15.2% 15.2% 7.1% 3.68 1.281
5 Contract management is
conducted according to the
bidding and contract
document terms and
conditions
198 12.6% 34.8% 14.6% 35.4% 2.5% 3.20 1.129

39. 4.4.4 Influence of Information Communication Technology on Procurement
Performance
The study asked the participants whether adoption of ICT greatly improves service
delivery and procurement performance as shown in Table 4.11. Majority of the
participants (32.8%) strongly agreed) with the statement. The mean response score of
3.51 and the standard deviation indicates that the responses did not vary from the mean
by more than 1.273. The participants were also asked whether the use of ICT in
procurement enhances quality information and communication flow. The majority were
in agreement (39.4%) with a mean of 3.77 and standard deviation of 1.174. Moreover,
the study sought to find out the adoption of e-tendering in procurement cuts costs of
operation across the supply chain. The results revealed that majority of the participants
(36.3%) were in agreement with a mean of 3.79 and standard deviation of 1.102.
The findings are congruent to those of Deva and Vaidya (2008) sought to investigate the
quality in e-procurement performance and concluded that e-Procurement undertakes to
cut operational costs across the supply chain. The study also sought to find out whether
suppliers are able to access tender information and apply online. The mean score of 3.21
and standard deviation of 1.265 imply that majority of the participants (34.3%) were in
agreement. Additionally, the study sought to find out whether there were continuous ICT
training programs for procurement staff. A mean score of 2.01 and standard deviation of
1.088 imply that majority of the participants (43.9%) were disagreed and had divergent
opinions in their responses to the statement. The findings support those of Wanyonyi
and Muturi (2015) who concluded in their study that staff competency, information
technology and ethics positively affect procurement function performance.

40. Table 4.11: Information Communication Technology on Procurement
Performance
n/s Statement on ICT n SA A N D SD Mean S.D
1 Adoption of ICT greatly
improve service delivery
and procurement
performance in EIIDE
198 25.8% 32.8% 16.2% 16.7% 8.6% 3.51 1.273
2 Use ICT in procurement
enhances quality
information and
communication flow
198 30.8% 39.4% 10.1% 15.2% 4.5% 3.77 1.174
3 Information Communication
Technology has speed up
the procurement process
198 30.3% 36.3% 17.2% 12.6% 3% 3.79 1.102
4 Adoption of e-tendering in
procurement cuts costs of
operation across the supply
chain
198 32.8% 34.3% 10.6% 15.2% 7.1% 3.71 1.265
5 There are continuous ICT
training programs for
procurement staff
198 7.6% 7.6% 9.6% 44.9% 30.3% 2.17 1.167
6
Suppliers are able to access
tender information and
apply online
198 6.6% 3% 10.6% 43.9% 35.9% 2.01 1.088
4.4.5 Procurement Performance
The study procurement performance and the participants were asked whether
procurement planning activities directly determine procurement performance. The
findings are as illustrated in Table 4.12. The responses mean score 4.63 and standard
deviation of 0.714 imply that majority of the participants (72.2%) were strongly agreed
their responses to the statement. These findings are congruent to those of Shalle et al.,
(2014) who posited that procurement performance can be assessed by focusing on
delivery, flexibility, quality, cost and technology.
Furthermore, the study sought to find out whether there were accountability measures to
track performance of procurement function. The mean score of 4.76 indicate that the
majority of the participants (77.8%) were strongly agreed with the statement. The
standard deviation of 0.461 implies that the participants were congruent in their responses
to the statement. This finding contradicts that of Thai (2011) who posited that the basic
principles of good procurement performance must include accountability.

41. The participants were also asked whether the use of ICT cuts down costs of operations
and improves procurement efficiency. A mean of 4.78 and standard deviation of 0.452
indicates that majority of the participants were strongly agreed (79.3%). The fourth
statement asked participants whether contractual management practices are directly linked
to procurement performance. The mean response score of 4.76 indicates that majority of
the participants were strongly agreed (77.8%) with the statement. The standard deviation
of 0.461 indicates that majority of the participants had congruent opinions in their
responses.
The study further asked the participants whether staff competency determines the
performance of procurement function. A mean score of 4.8 and standard deviation of
0.435 imply that majority of the participants (81.8%) were in agreement with the
statement. The study also asked the participants whether irregular procurement practices
affects transparency and performance of procurement. A mean of 4.8 and standard
deviation of 0.435 indicate that majority of the participants (81.8%) were in strongly
agreed with the statement.

42. Table 4. 12: Procurement Performance
n/s Statement on procurement n SA A N D SD Mean S.D
1 Procurement planning
activities directly determine
procurement performance
198 72.2% 22.2% 1.5% 4% - 4.63 0.714
2 There are accountability
measures to track
performance of procurement
function
198 77.8% 20.7% 1.5% - - 4.76 0.461
3 Use of ICT cuts down costs
of operations and improves
procurement efficiency
198 79.3% 19.2% 1.5% - - 4.78 0.452
4 Contractual management
practices are directly linked
to procurement performance
198 77.8% 20.7% 1.5% - - 4.76 0.461
5 Staff competency
determines the performance
of procurement function
198 81.8% 16.7% 1.5% - - 4.8 0.435
6
Irregular procurement
practices affects
transparency and
performance of procurement
198 81.8% 16.7% 1.5% - - 4.8 0.435
4.6 Inferential Statistics
4.6.1 Correlation Analysis
Inferential analysis focuses on the strength and direction of relationship between
variables and inferring the findings from the sample to the population (Bryman& Bell,
2015).The researcher undertook a Pearson’s correlation to explain the relationship
between the independent variables, procurement planning, staff competency,
contractual management, information communication technology and the dependent
variable, procurement performance.
a) Relationship between Procurement Planning and Procurement Performance
From Table 4.13, the study established a strong positive significant relationship (r =
0.754, P=0.045) between procurement planning and procurement performance. This
implies that enhancing procurement planning has the potential to enhance procurement
performance.

43. Basing on the rule for significance level, the study rejects the null hypothesis (Ho1) and
concludes that there is a significant relation between procurement planning and
procurement performance. This findings support those of Mamiro (2010) who concluded
that one of the major setbacks in public procurement is poor procurement planning and
management of the procurement process which include needs that are not well identified
and estimated, unrealistic budgets and inadequacy of skills of procurement staff
responsible for procurement.
Table 4. 13: Relationship between Procurement Planning and Procurement
Performance
Procurement Planning
Procurement
Performance
Pearson Correlation 0.754**
.045
Sig. (2-tailed)
N 198
**. Correlation is significant at the 0.01 level (2-tailed).
b) Relationship between Staff Competency and Procurement Performance
The coefficient of Correlation in Table 4.14 shows a strong positive significant
relationship between staff competency and procurement performance (r = 0.825,
P=0.025). These results therefore imply that improving staff competency enhances
procurement performance. Thus, the study rejects the null hypothesis (Ho2) and
concludes that there is significant relation between staff competency and procurement
performance. According to Hall (2009), efficiency and the effectiveness of procurement
procedures are hindered by absence of effective continuous employee training programs
that help in equipping the employees with competitive procurement management skills
Table 4. 14: Relationship between Staff Competency and Procurement
Performance
Staff Competency
Pearson Correlation .825*
Procurement
Sig. (2-tailed) .025
Performance
N 198
*. Correlation is significant at the 0.01 level (2-tailed).

44. C) Relationship between Contractual Management and Procurement Performance
The findings in Table 4.15, shows a strong positive significant relationship between
contractual management and procurement performance (r = 0.752, P= 0.025). The study
therefore rejects the null hypothesis (Ho3) and concludes that there is a statistically
significant relationship between contractual management and procurement performance.
The findings support that of Kibogo (2014) who reported that the Kenya government has
been losing hundreds of millions of taxpayer's money through cancelled contracts,
unfinished projects, poor service or product delivery, corruption and extended contract
periods without major improvement. This ultimately impacts procurement performance of
an organization or department.
Table 4. 15: Relationship between Contractual Management and Procurement
Performance
Contractual Management
Pearson Correlation .752*
Procurement Sig. (2-tailed) .025
Performance N 198
*. Correlation is significant at the 0.01 level (2-tailed).
d) Relationship between ICT and Procurement Performance
The findings in Table 4.16, shows a strong positive significant relationship between
information communication technology and procurement performance (r = 0.685,
P=0.030). The study therefore rejects the null hypothesis (Ho4) and concludes that there is
a statistically significant relationship between information communication technology and
procurement performance. The findings support those of Carayannis and Popescu (2005)
that at the public sector level, technology enhances infinite and non-restricted access to
government information and increases market transparency and economic incorporation
based on complementarities. Additionally, Wanyonyi and Muturi (2015) concluded that
ICT, staff competency and ethics have a direct impact on performance of the procurement
function.

45. Table 4. 16: Relationship between ICT and Procurement Performance
Information Communication Technology
Pearson Correlation .685*
Procurement Sig. (2-tailed) .030
Performance N 54
* Correlation is significant at the 0.01 level (2-tailed).
4.6.2 Regression Analysis
The R value shown in the model was 0.868 while the value of R square was 0.754 as
shown in Table 4.17. The R square statistic indicates that the model as fitted explains
75.4% of the total variability in procurement performance. This means that 75.4% of the
total variability in procurement performance can be explained by procurement planning,
staff competency, contractual management and information communication technology.
However, the model did not explain 24.6% of the variations in procurement performance.
It also shows that the predictor variables were good predictors of procurement
performance at Ethiopian industrial inputs development enterprise.
Table 4. 17: Model Summary
Std. Error of the
Model R R Square Adjusted R Square Estimate
1 .868a
.754 .741 1.0480
a. Predictors: (Constant), Procurement planning, Staff competency,
Contractual Management and Information communication technology
A) Analysis of Variance of the Model
The ANOVA test result shows F statistic value as f (3, 50) at 95% level of significance =
2.79. The calculated F value is 2.891˃2.79, p=0.014 as shown in Table 4.18. The F
calculated value of 2.891 is an indication that the model is a good fit. This is because it
shows a statistically significant relationship between the variables. This implies that
procurement planning, staff competency; contractual management and information
communication technology have a significant statistical influence on the procurement
performance of the Ethiopian industrial inputs development enterprise.

46. Table 4. 18: Analysis of Variance of the Model
Model Sum of Squares Df Mean Square F Sig.
Regression 7.963 3 2.654 2.891 .0140a
Residual 45.922 50 0.998
Total 53.885 53
a. Predictors: (Constant), Procurement planning, Staff competency, Contractual Management
and Information communication technology
b. Dependent Variable: Procurement performance
B) Model Regression Coefficients
The coefficients of the regression model relating procurement planning, staff
competency, contractual management, information communication technology and
procurement performance are presented in Table 4.19. The model shows that the
predictors have a significant p-value = 0.028, which means that they were significant
In predicting changes in procurement performance of the Ethiopian industrial inputs
development enterprise.
Y= β0+ β1X1+β2X2+ β3X3+ β4X4
Y= 2.713+ 0.671X1+ 0.650X2+ 0.644X3 + 0.638X4
From the regression equation above, taking all the predictor variables constant (zero), the
dependent variable will be 2.713. Further, the regression equation above shows that the
coefficient (β1) of procurement planning was 0.671. This meant a unit increase in
procurement planning would result in a 67.1% increase in procurement performance.
Thus, procurement planning has a strong positive influence on procurement performance.
Similarly, a unit increase in staff competency would result in 65% increase in
procurement performance. This finding is congruent to that of Sultana (2012) that
technological developments and organizational change have led employers to the
realization that their success relies on the skills and abilities of their employees.
Moreover, a unit increase in contractual management would result in 64.4% increase in
procurement performance and a unit increase in information communication technology
would result in 63.8% increase in procurement performance.

47. Table 4. 19: Model Regression Coefficients
Unstandardized Standardized
Coefficients Coefficients
Model B Std. Error Beta t Sig.
(Constant) 2.713 .558 .028
1.278
Procurement Planning .671 .202 .552 .848 .040
Staff Competency .650 .240 .520 .782 .036
Contractual Management .644 .214 .530 .833 .046
Communication Technology
.638 .231 .541 .701 .025
Information
a. Dependent Variable: Procurement performance
c) Stepwise Regression Analysis
The study conducted a stepwise regression analysis to determine the best fitting model.
An Alpha-to-Enter significance level was set at αE = 0.15, and Alpha-to-Remove
significance level was set at αR = 0.15.
T-test p-value less than 0.15 were accepted for entry into the model while a t-test p-Value
greater than 0.15 was removed. After, regressing y on x1, regressing y on x2, regressing y on
x3, and regressing y on x4, the results are illustrated in Table 4.20.
Each of the predictors was a candidate to be entered into the stepwise model because each
t-test P-value is less than αE = 0.15. The predictors X4 had the smallest p-values of 0.025
followed by X2 at 0.036 respectively. As a result X4 was first entered into the stepwise
model. This was followed by the predictor variables of X2, X1 and X3 respectively. The
Alpha-to-Remove significance level set at αR = 0.15 was not used because all the
predictor variables had t-test p-values of less than 0.15.
Table 4. 20: Stepwise Regression Model
Predictor Coef SE Coef T P-Value
Constant 3 1.278 .558 .028
X1 .671 .202 .848 .040
X2 .650 .240 .782 .036
X3 .644 .214 .833 .046
X4 .638 .231 .701 .025

48. CHAPTER FIVE
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
5.1 Introduction
This chapter presents the summary of key findings, the conclusions drawn from the
findings and recommendation made to the study. The objectives of the study included the
influence of procurement planning, Staff competency, Contractual Management and
Information communication technology on procurement performance of the Ethiopian
industrial inputs development enterprise.
5.2 Summary of Findings
This section summarizes the findings based on the objectives of the study.
5.2.1 Influence of Procurement Planning on Procurement Performance
The first objective sought to establish the influence of procurement planning on
procurement performance of Ethiopian industrial inputs development enterprise. The
findings revealed that there was adequate budgeting for procurement planning at
Ethiopian industrial inputs development enterprise. Further, the study established that
proper procurement planning contributes to the success of service delivery. Similarly, the
study found that poor procurement planning was a major setback in cost estimation for
services and works. Therefore, resource planning is significant and contributes to public
entity procurement performance. On the contrary, the study established that majority of
the participants were impartial that failure to adhere to procurement plans leads to
irregular and biased decisions. The study also established that procurement plans at the
EIIDE did not adequately enable efficient use of available resources.
5.2.2 Influence of Staff Competency on Procurement Performance
The second objective study sought to find out the influence of staff competency on
procurement performance. The findings revealed that lack of professionalism is a major
cause of non-compliance to procurement laws. There was no regular staff training
programs on procurement procedures for employees. Similarly, the study