Effect of supplier relationship management and regulatory policies on the organizational performance of commercial state corporations in Kenya

Empirical research has shown that state corporations in Kenya are facing serious challenges, especially in procurement, where millions of shillings have been paid to the unscrupulous supplier. Despite the increasing performance problems among commercial state corporations such as Kenya Airways, Mumias Sugar Company, and National Bank of Kenya, there has been a dearth of literature examining the commercial state corporations. The current research sought to establish the effect of supplier relationship management on the performance of state corporations in Kenya with specific reference to supplier communication, supplier segmentation, and supplier collaboration. The study was premised on the lean sigma theory and the theory of constraints. The study adopted a descriptive research design with the unit of observation for the research being the 34-commercial state corporations. The research targeted three senior managers within state corporations. The study sample size was 102 managers drawn from the state corporations. The study administered a structured research questionnaire with a five-point Likert scale for data collection. The study conducted a pre-test of the research instrument, with 10% of the sample respondents. The collected research data was analyzed using statistical techniques. The descriptive and inferential results were presented graphically and in a tabular manner, followed by a detailed discussion on the outcomes. The study ensured that all ethical considerations are observed in the course of the research work, and areas for further research were advanced. The study was able to obtain a 74% response rate, with most of the participants, 46% being procurement managers. The study established that there is a significant and positive relationship between supplier relationship management and organization performance. The study revealed there is a positive and significant moderating effect of regulatory policies on the relationship between supplier relationship management and organization performance. The research concluded that supplier communication and supplier segmentation had a positive and significant influence on organizational performance. The study concludes that supplier collaboration had an insignificant influence on organizational performance. The research recommends that policymakers should come with standardized guidelines and enforcement frameworks to guide supplier relationship management in Kenyan commercial state corporations. The study further recommends that managers within the corporations should rely on market data and supplier information to guide supplier communication and segmentation practices.
A Thesis submitted in partial fulfillment of the requirements for the award of the Degree of Masters of Business Administration at Strathmore University Business School
Supplier relationship management, Regulatory policies, Organizational performance, Commercial state corporations