THE IMPACT OF TECHNOLOGICAL ADVANCEMENT ON PROCUREMENT EFFECTIVENESS: A CASE STUDY OF SPEDAG INTERFREIGHT UGANDA

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1.0 Introduction

This chapter presented the background of the study, the statement of the problem, purpose of the study, objectives of the study, research questions and the significance of the study.

1.1 Background

1.1.1 General background of the study

Technological advancement covers vast areas of technologies such as mobile and wireless technology, telecommunications, software development, security. Intelligent systems etc. technological advancement has had a huge impact on industries, the community in general and our daily lives. Technology can be applied to many fields. One of the emerging applications in recent years is in procurement (Kwok Hung Lau and Haibo Huang 2012). Technology is fast becoming one of the main drivers of change, posing new strategic challenges (Somuyiwa, 2010). The business environment today has been undergoing unprecedented change and many companies are seeking new ways to stand out from the competition by sustaining their competitive advantage. In today’s highly competitive global marketplace, the pressure on organization’s to find new ways of creating and delivering value to customers is growing stronger.

Technology is today being applied in many organizations in a wide range and operations areas. It has provided new ways to store, process, distribute and exchange information both within companies and with customers and suppliers in the supply chain (Somuyiwa and Oyesiku, 2010).  It is now commonly accepted that technology and systems provide many benefits to companies, including small enterprises to make them more efficient, effective and competitive (Chapman, et al,2000; Sarkis, et al, 2004; Fink and Disterer, 2006). Many companies conduct business using electronic commerce (e-commerce), whether focusing on business-to-business (B2B) or business-to-consumer (B2C) activities. They realize that easy access to information and communication and the delivery of their products or services are important drivers in developing and sustaining market competitiveness nationally and internationally. Having a supportive electronic procurement (e-procurement) system is very important to maintain the company’s competitiveness and efficiency in purchasing effectiveness operations (Sarkis, et al, 2004). E-procurement is an emerging area of procurement field. Alike other emerging disciplines, there is not a widely accepted definition yet.

Procurement means the acquisition of goods, services or works from an outside external source. It is favourable that the goods, services or works are appropriate and that they are procured at the best possible cost to meet the needs of the purchaser in terms of quality and quantity, time, and location. Corporations and public bodies often define processes intended to promote fair and open competition for their business while minimizing exposure to fraud and collusion Weeleetal  (2010).Public Procurement, as per the Public Procurement Act (2003) can be defined as the acquisition of goods, works and consultancy services with the Government appropriated fund for public use through the Ministries, Departments and Agencies (MDAs) and the disposal of government assets on behalf of the Government. Globally procurement is of great importance to both government and large multinational companies a according to European Commission, Public procurement Indicators 2009, The public procurement indicators for 2009 show that the estimated value of tenders published in the Official Journal had increased steadily between 2005 and 2009 and reached about 420 billion Euros in 2009, equivalent to 3.6% of GDP. This was estimated to amount to 18.3% of the total expenditure on public works, goods and services of the EU27. Direct cross-border procurement was estimated to account for only 1.5% in 2009. This data clearly show that procurement is of utmost importance. A public procurement process can be said to be well functioning if it achieves the objectives of Transparency, competition, economy and efficiency fairness and accountability World Bank (2004). Procurement simply means acquisition by purchase, rental, lease, hire purchase, license, tenure, franchise, or any other, contractual means, of any type of works, service, or supplies or any combination PPDA ACT 2003. According to Country procurement Assessment Review (CPAR 2004) Proper procurement of public goods and services is imperative for good economic management and addressing leakages of government funds. Thai et al, ( 2004) considers procurement planning to involve the identification of procurement needs  this will promote procurement effectiveness, According procurement news July 2011 the high level of procurement inefficiency is evidenced in CHOGM in which the government of Uganda lost billions of shillings during the course of importing CHOGM cars from Europe this therefore poses many questions as to what could be the possible reason that need to be examined if procurement is to be effective . spedag interfreight has faced several procurement challenges over the past years , evidenced by high cost of raw material,  delayed delivery of goods, low quality supplies, this has therefore puzzled management as to what could be the cause of such abnormally, basing on this back ground therefore this study therefore intends to investigate into the impact of technological advancement on procurement effectiveness, with specific reference to crown beverages ltd , located at plot M124 , NAKAWA  Kampala, (u) .

1.2 STATEMENT OF THE PROBLEM

According to the current trend of technological advancement, technology is an important tool to enhance efficiency and responsiveness in modern-day supply chains. The introduction, implementation and usage of technologies in procurement are usually motivated by an attempt to reduce costs. The objective is to obtain a more efficient procurement system, which reduces the lead time, increases transparency, encourages fair competition, and creates value for money etc. however despite of the effort by crown beverages to adopt technologically advancement procurement systems , procurement inefficiency still exists which is characterised by , high cost of raw materials,  delayed delivery of goods, low quality supplies, increased procurement fraud in the system, this has therefore puzzled management as to what could be the cause, basing on this therefore this study intends to investigate in to the impact of technological advancement on procurement effectiveness, case study Spedag Interfreight Uganda Limited.

1.3 PURPOSE OF THE STUDY

This study aims at establishing the impact of technological advancement on procurement effectiveness.

1.4 SPECIFIC OBJECTIVES OF THE STUDY

The overall objectives of this research are;

• To establish various technological systems used in promoting procurement effectiveness at Spedag Interfreight Uganda Limited.
• To assess the various benefits of technology in procurement at Spedag Interfreight Uganda Limited.
• To establish the different ways of promoting procurement effectiveness at Spedag Interfreight Uganda Limited.

1.5 RESEARCH QUESTIONS

The following research questions shall guide the study;

• What are various technological systems used in promoting procurement effectiveness at Spedag Interfreight Uganda Limited.
• What are the various benefits of technology in procurement at Spedag Interfreight Uganda Limited?
• What are the different ways of achieving promoting procurement effectiveness at Spedag Interfreight Uganda Limited?

1.6 SCOPE OF THE STUDY

The scope of this study will be divided into subject, geographical and time scope.

1.6.1 SUBJECT SCOPE

The study will specifically look at the impact of technological advancement on procurement effectiveness.

1.6.2 GEOGRAPHICAL SCOPE

The study will be carried out in Kampala district and Spedag Interfreight Uganda Ltd will be the case study. It’s located in Nakawa Industrial Area, Plot M284

1.6.3 TIME SCOPE

The study will cover the period from xxxxxxxxxxxxxxxxxx.

1.7 SIGNIFICANCE OF THE STUDY

The findings of the study will provide the management of Spedag Interfreight Uganda unlimited information on finding solutions to some of the challenges they are facing in implementing technologically advanced systems in their organization.

It study will also help different organizations with knowledge on different ways of promoting procurement effectiveness in the organization.

The study will also be of benefit to future researchers with information on the benefits of technological advancement to an organization.

CHAPTER TWO

LITERATURE REVIEW

2.0 INTRODUCTION

This chapter presents an overview of the existing literature based on other writers’ opinions, findings, and view points on the impact of technological advancement on procurement effectiveness.

2.1 WAYS OF ACHIEVING PROCUREMENT EFFECTIVENESS

The following are the different ways of achieving procurement effectiveness in an organization according to different scholars;

Proper procurement planning

According to procurement news (2005) it was reported that were procurement planning is inadequate; it has resulted in short comings of poor procurements made. Sakire& Unit (2006) in their analysis of the public procurement procedures in Turkey singled out more specifically that the first step as an important activity of procurement planning or procurement law is determination of needs. Therefore procurement planning has to be done after knowing needs of end-user.Procurement planning is essential in determination of needs and procurement carried out under appropriate conditions and timely manner leads to efficient use of resources. LGDP reports and guidelines (2001 to 2005) also support the above view.

Coordination of various future activities of an organization is by preparation of plans actions for future periods this minimizes risks and increases the degree of organizational success procurement plans made by the district should be to help in organization control and facilitate communication to ensure success in achievement of the required objectives (Drury et al, 2000).Planning can lead to improved efficiency and effectiveness in delivery of goods and services and planning is a deliberate attempt to design a future course of action with view to optimize the use of resources, (Cole et al, 2000).

Proper coordination between end user with procurement staff

Procurement staffs decide on the contracts to take on, the tenders to award preparation of bids, advertisement of bids and also proposing appropriate procurement methods (PPDA ACT and regulations 2003).

Procurement staff also is completely aware of the market situation so they always advice end user on the better alternatives available which helps in organizational achievement, (Lysonset al, 2006).

Public procurement contracts provide the mechanisms by which the national development goals of states can be attained public procurement contracts are means of achieving national development objectives and therefore ensuring proper coordination between end user with procurement staff, ( Arrow, 2007),

Public procurement is often plagued with corruption, unfair practices and price collusion in view of the huge amounts of money involved and there should coordination between different departments to encourage effectiveness in the system, (basheka, 2009).

Corruption has been placed high on the international agenda. Corruption has taken an alarming dimension in recent years at the same time spreading in geographical and growing in intensity. Illicit payments now account for approximately ten to twenty percent of international transactions mostly due to limited coordination between the end user and procurement department.(Basheka ,2009).

Developing proper procurement policies.

If policies are ineffective, employees lack comprehension and it is difficult to explain to end users the why of the policies. Policies are only good if everyone understands them and can explain and defend them. Planning is deciding in advance what to do, how to do it, who will do it and when it will be done. If an organizations  employees don’t know why the  business does what it does, where the business is going and how the business will measure success, then it’s difficult to communicate entity’s business value to customers end users therefore good procurement policies need to be adopted and developed in order to achieve procurement effectiveness by formulating proper procurement policies, (Erridge, 2001).

Maintaining an effective communication with the supplier.

In order to supplier what is needed all correspondence and communications with the vendor regarding problems, proposed changes, or the implementation of the procurement decision should be effective,(Nicol, 2003).

Managing outsourcing relationships, communication with the vendor is of utmost importance during the life of the contract. Knowledgeable internal staff must be available to identify problems and work with the vendor to resolve them. Vendor selection should have provided a vendor whose business/functional culture aligns with that of the organization, so that communication is fostered and developed to support the effort should be documented and kept in order to resolve disputes or identify areas of strengths and weaknesses, (McIvor, 2005).

Public entities involved in procurement should practice and encourage competition and accountability.

Erridge et al (2001) point out that competition should deliberately enable bidders to compete with one another under the same terms and conditions using a relevant procurement method with a view to maximizing value for money. They point out that such competition should be non-restrictive, give sufficient time for bidding, and use standard bidding document and make bid evaluation using the same criteria. The authors describe accountability to include promotion of information sharing among all the players indicating reasons/ bases for certain actions / decisions and providing written or spoken description of what has happened under ones trust.

2.1.1 VARIOUS TECHNOLOGICAL SYSTEMS USED IN PROCUREMENT.

Electronic Data Interchange (EDI); is a technique based on agreed standards, which enables computers in different organizations to successfully send business information of transaction from one to another. They emphasize that EDI reduces on the lead-time simply because transactions are faster and more accurate (Lysons and Farrington, 2006).

According to Chaffey (2007), EDI involves business transactions like, placing orders, invoices, delivery and payment transactions. EDI works according to standards implying that the organizations using it have to agree on the systems and the soft ware that they are to use (Chaffey, 2007).

Chaffey (2007) identifies that EDI approach is associated with Electronic Point of Sale (EPOS) he cites an example in a supermarkets, when a product is purchased the check out operator scans the bar code on the label and automatically registers the price on the cash. In the same way in case of stock replenishment, the machine can order automatically as the stock reaches the re order level.

According to Sollish et-al 2007, shows that EDI. Works as follows;

Company A sets a purchase order using its internal business software, EDI soft ware transforms the order from the internal format to a standard 850-purchase order document format, Company A sends the 850 standard purchase orders to company B over a third party value added network, Company B receives 850 purchase order document and will translate it from EDI to its proprietary format.

Typically, company A will send an acknowledgement to company B

According to Clarke (1998), EDI will replace paper based purchase order with electronic one and sites the following as advantages that are associated with the use of EDI in enhancing performance in organizations, Reduction of paper work, reduced errors.

Electronic Fund Transfer (EFT), According to Lysons and Farrington (2006), EFT is based non-electronic transmission of receipts and payments between banks and their customers or the purchasers and suppliers. It enables paperless payments to be made to suppliers “here money travels not paper”.  EFT involves automated digital transmission of money between organizations and banks. Lysons and Farrington (2006) state that the buying organization will make payment to the supplier using EFT, in a more convenient and accurate way.

According to Chaffey (2007), EFT is associated with the following advantages; Increased accuracy of employees at work, Increased speed workers..

 Electronic Mail (e-mail), E-mail is a process by which letters, orders or other documents are sent by a computer along telecommunication lines to appear on the Visual Display Unit (VDU) at their destination. They emphasize that in caseworkers use this technique in the process of buying, sending and receiving of messages can take minutes instead of days. (Leanders et-al, 1998)

According to Chaffey (2007), e-mail will be based on sending and receiving of electronic messages, he states that e-mail will be available in the internet for over 20 years.

Chaffey (2007) emphasizes that the recent innovation is the use of websites, which provide free         e-mail facilities, and does not require any software other than the web browser.

Kennedy (2000), describes internet based on e-mail and stresses that the internet messages are sent through e-mail and thus gives examples like;

Smart Cards, Smart cards are integrated circuit chips used to store customer specific information including electronic money. They have ability to provide intelligence and store significant amount of information of up to 20 pages of text.  Smart cards will be used to purchase goods or services, store information, and above all, they can be availed to all potential users so the organizational employees will have to be efficient while using smart cards.  (Lysons 2006)

The following are the benefits of using smart cards; they offer convenience since they are of the same size like credit cards, They store reasonable amount of information and thus will be easier to be accessed by the organization for use at any time, They are economical and thus reduce on the handling and offer workers efficiency while doing their work, They provide confidentiality and security of information

According to Enslow (2006), smart cards provide effective and efficient means of storage and compatibility, especially with EDI, which facilitates easy movement and exchange of information. The global use of smart cards will depend on the introduction of global payment standards that are currently being developed.

Electronic Hubs (E-hubs), this device connects several networks together. As used in e-business it means a central repository exchange such as the star network. In the network, a server is a control computer that holds database and programs and programs for many computers (Herper and Thompson 2005).

According to Herper and Thompson (2005), the buyers PCs will be connected together with the suppliers PCs and information regarding business transactions will be conducted, since all the information is kept in the server computer.

Market place, Lysons (2006) asserts that, e-market is a web site that enables procurement officers to select the best suppliers in the market electronically. In this situation, a procurer is in control especially in open market places. This enables procurer to evaluate all potential suppliers for a particular product or service and make informed buying decisions regarding what and where to buy.  This brings efficiency in procurement since the best-evaluated bidders will be given contracts to supply.

According to Chaffey (2007), e-market is applicable where; the market is large enough, product specification and information are subject to rapid changes, suppliers have difficulties in comparing similar products from different vendors, the cost of locating, appraising and evaluating suppliers is high which is essential in improving the performance of employees.

Electronic- catalogues, E-catalogues are web pages that provide information on products and services offered and sold by the vendors. (Lysons 2006), According to Lysons (2006), e-catalogues mainly include; sell side catalogues; buy side catalogues and third party catalogues, E-catalogues support online transactions especially ordering and payment capabilities.

The advantages of e-catalogues includes; facilitation of real time communication between buyers and sellers; Allows room for the development of closer buyer-supplier relationship due to improved vendor services. Enables suppliers, respond quickly to market conditions by adjusting   repackaging (Lysons, 2006).

According to Accenture (2006), e-catalogues, is a technological system which has mainly been influential in improving the performance of employees.

Texting, with the introduction of Texting on telephone organizational employees can now send massages to organizational clients within a short time hence organizational efficiency is highly promoted and developed. Workers can now receive and send massages in an Avery short time so that organizational time and resources are saved especially through telephones, (Chaffey, 2007).

Social Networking, Social network sites such as Facebook and MySpace can be essential to getting organizational messages reach to the audience without wasting much of organizational resources and also increasing the efficiency of their employees hence efficiency at work and effectiveness by saving time and resources, (Accenture, 2006).

Blogs, The word “blog” is short for “web log.” These sites are often written by amateurs, but getting a blogger to review a product or service can be a good way to spread the word about an organizations small business. Contact bloggers by email, usually listed on their blogs, and ask them to take a look at an organizations product or service. Organizations can spread the word informally and quickly through this technology-based communication. Many companies, from sole proprietorships to large corporations, have established their own blogs as a primary communication channel to the public and in turn the employees’ performance has greatly been improved. (Chaffey, 2010).

Video Conferencing, Organizations can save travel money by using video-conferencing. If an organization and another and its client both have cameras and the right software, they can see each other and talk to each other on their computers. This gives them the face-to-face meeting they need without having to be in the same location. When they want to convey their message with physical gestures and facial expressions, this form of technology can be an effective communication tool (Chaffey, 2007)

2.3. ADVANTAGES OF TECHNOLOGY

Marasco (1992) asserts that, information will only be meaningful to an organization in case it is; Accurate thus free from errors, complete, simple to understand by all the participants, economic where resources are utilized properly, relevant

Standardized transportation process, including improved quality control, shorter delivery  time, greater efficiency through the use of information and communication components like internets, satellites among others that enables tracking and tracing of the goods in transit, during shipment as well as giving up to date information to the buyers about the goods. This according to (Kotler 2000) enables the trading parties to minimise inefficiencies such as pilferage, theft among others during the logistics of the goods hence improving logistics efficiency and effectiveness.

Simplified logistics and supply chain process. The introduction of information and communication technology has not only simplified the logistics process but has also improved on the whole supply chain process including control over suppliers, improved process cycle time, close cooperation relationships, improved supply chain efficiency, raw materials on time for suppliers. According to (Kenneth Lysons 2000), simplified logistics and supply chain process has brought about shorter lead times and has enabled the materials to be available as and when they are required by the buyers for production purposes.

Process Automation. With the use of information and communication technology components such as Bar coding, Satellite, internets and Image processing among others in the process of managing logistics efficiency, there has been reduction on paper work thereby leading to a substantial reduction of errors, as well as increased capability to obtaining and exchanging real time information. This is possible through the use of information technology systems such as Bar code and scanners which represents a series of alphanumerical characters, bar code readers to interpret bar code symbology, and bar code printers to reliably and accurately print bar codes on labels, cartons, and/or picking /shipping documents. This review is included here because bar code systems are the foundation for many paperless warehousing systems, but the review is meant only as a brief introduction to bar code system. In logistics, bar coding is useful in receiving inbound materials. This helps in quick and accurate data entry, faster checking and clearing of shipments, automatic tracking of the shipments throughout the logistics. (Trent and Monczka 2000)

Improved Logistics process. Logistics management is the process of managing the efficient, costs effective way of transporting goods, supplies and related information from the point of origin to the point of consumption Kenneth Lysons (2000). The introduction of communication and information technology has brought in tremendous improvements in the flow of materials from the point of origin to the point of consumption including reduced arrangement costs and handling times, shortened response time for purchasing, improved order process speed and reduced labour costs.

Improved warehousing facilities. Warehousing is the primary link between the producers and the consumers; it is used for storing products (raw materials, in process inventory and finished goods) before they are finally worked upon or delivered to the ultimate consumers. Through the implementation of information and communication technology, ware house efficiency and effectiveness has improved greatly through using opportunities such as e- warehousing, e- receipts and e- issuing. These have brought about accurate operations in the warehouse hence complementing logistics management efficiency (R.J Carter, 1990)

Reduce product delivery time. Through the implementation of information and communication technologies in organizations like Spedag Interfreight company the organizations’ processes of making payments to their suppliers have improved greatly including faster payment systems like using ATMS, credit cards among others. This reduces among others interest rate, credit risk among others (Aberdeen group 2005).

Improved distribution process. According to Donald W Dobler and David Burt (2001) With improved tracking and tracing as a result of using internet, satellites among others, the company that is to say the distributing company is assured of efficiency and effectiveness in the distribution process as their trucks are properly tracked and traced so that in case the deliveries are made to a different location, the mistake can easily be rectified. This has therefore, improved Logistics efficiency in organizations and this has all been because of the introduction of information and communication technology. Other benefits include; delivering on time, reduced delivery enquiring time and improved distribution management.

Proper monitoring. The introduction of information and communication technology in logistics management has brought about efficient and effective monitoring of the materials during transit to their various destinations. This is done through use of technologies that allows communication across a very wide geographical area. Satellite communication provides a fast and high volume channel for information movements. Satellite technology facilitates real time interaction which provides up to date information about location and delivery information about the products in transit. The satellite devices can also be used in tracking and tracing the materials in transit. Tracking is specifically achieved through the use of internet and others, this therefore enables both the delivering organization or the supplier and the buyer to know where specifically the goods in transit is and also in case of any problem encountered say by the truck being used for the transportation purposes, it can easily be recognised by the parties concerned (Kenneth Lysons 2003)

Better communication and connection links. According to Nair N.K (2006), the introduction of information communication technology, communication between the buyers and the suppliers has been eased. Logistics is an old age industry that has been one of the greatest holdouts against the waves of computerization that has swept the world. Until recently, most organizations were still using traditional systems like fax and letter writing among others as a means of communication. However with the introduction of information and communication technologies such as telephones, internets and satellites among others, communication has not only been eased but also made efficient and effective.

Faster information transfer. Information and communication technology equipments like internet, satellite and telephones enables a speedy transfer of information between the supplier and the buyer. Therefore, all the necessary information that the supplier needs to give to the buyer regarding how the goods in transit should be handled, stored and packed are given to the buyer prior to delivery so that special attention is taken by the buyer where necessary( Van Horne 1994)

Reduce inventory levels. According to (Thomson and Singh 2001) information and communication technology helps the buying organisation to order the needed items at the right time and once the need arises then an order will be placed. This helps the organisation to do away with bulk stock levels hence solving the problem of inventory costs like obsolescence and dampness leading to losses this leads to efficiency and effectiveness in the logistics operations.

2.3.1. Globalization

According to Marasco (1992), ICT has not only brought the world closer together, but it will allow the world’s economy to become a single interdependent system. This means that we will not only share information quickly and efficiently, but we will also bring down barriers of linguistic and geographic boundaries. The world will developed into a global village due to the help of information and communication technology, allowing countries like Chile and Japan who are not only separated by distance but also by language to share ideas and information with each other.

2.3.2. Communication

Chaffey (2007) asserts that with the help of information and communication technology, communication become cheaper, quicker, and more efficient. We can now communicate with anyone around the globe by simply text messaging them, or sending them an email, for an almost instantaneous response. The internet has also opened up face-to-face direct communication from different parts of the world, thanks to the help of video-conferencing.
2.3.3. Cost effectiveness

According to Crake Richard (1998), information and communication technology helps to computerize the business process, thus streamlining businesses to make them extremely cost effective money-making machines. This, in turn, increases productivity, which ultimately gives rise to profits; that means better pay and less strenuous working conditions.
2.3.4. Bridging the cultural gap

Cortesao L., Martins F., Rosa A., Carvallio P. (2005) argues that information and communication technology helps to bridge the cultural gap by helping people from different cultures to communicate with one another, and allow for the exchange of views and ideas, thus increasing awareness and reducing prejudice.

2.3.5. More time

ICT makes it possible for businesses to be open 24 x7 all over the globe. This means that a business will be open anytime, anywhere, making purchases from different countries easier and more convenient. It also means that you will have your goods delivered right to your doorstep without having to move a single muscle (Kennedy A, 2001).

2.3.6. Creation of new jobs

Kennedy A, (2001) argues that probably, the best advantage of information and communication technology is the creation of new and interesting jobs. Computer programmers, Systems analyzers, Hardware and Software developers and Web designers are just some of the many new employment opportunities created with the help of ICT.

2.4. Disadvantages of information and communication technology.

2.4.1. Unemployment

Crake Richard, (1998) emphasized that while information and communication technology may have streamlined the business process, it will also create job redundancies, downsizing and outsourcing. This means that many lower and middle level jobs will be done away with, causing more people to become unemployed.

2.4.2. Privacy

Simon Harper & Lora Thompson (2007) assert that though information and communication technology may make communication quicker, easier and more convenient, it will also bring along privacy issues. From cell phone signal interceptions to e-mail hacking, people are now worried about their once private information becoming public knowledge.

2.4.3. Lack of job security

Industry experts believe that the internet will make job security a big issue, since technology keeps on changing with each day. This means that one has to be in a constant learning mode, if he or she wishes for their job to be secure (Crake Richard, 1998).

2.4.4. Dominant culture

While information and communication technology may make the world a global village, it will also contribute to one culture dominating another weaker one. For example, it is now argued that US influences how most young teenagers all over the world now act, dress and behave. Languages too have become overshadowed, with English becoming the primary mode of communication for business and everything else.

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Chaffey (2007) identifies the following as disadvantages of information and communication technology;

• Information and communication technology normally requires the use of machines like computers that rely on electricity, hence will limit their reliability
• Information and communication technology requires a capital making it expensive especially in terms of buying computers, maintaining and updating the system.
• Information and communication technology may also result into health problems like finger and eyesight disorders among others.

From the above information and communication technology benefits the organization by reducing on the routine activities at the same time it requires huge investment on purchasing machines, maintenance and training off staff

 In conclusion, a number of key factors that inhibit the widespread adoption and use of ICT, include the cost of technology, uncertainty over the business benefits and impacts, and the lack of relevant internal ICT expertise. Day today challenges such as dependence on external consultants and vendors and the unreliability of systems, potentially owing to technological obsolescence and technical complexity, were also important constraints on ICT use.

The findings therefore will have important implications for policy aimed at ICT adoption and use by manufacturing companies in the sense that governments should facilitate manufacturing companies’ gain full participation in global value chains through policy initiatives in specific areas.

Promotion of technological upgrading is critical in order to encourage manufacturing companies to capture more value added from participation in logistics activities. Policy in this area should aim to support training and capacity building via skill development programmes; promote partnerships between manufacturing companies and organizations overseas that can develop or transfer technology, products, processes or management practices; and to facilitate the technological upgrading through various financial schemes, such as credit lines for upgrading.

Facilitation of compliance procedures through adoption of product and process standards has several well-known benefits for firms. It enables them to introduce new technology and integrate business practices that ameliorate their overall performance.

However, different and concurrent standards can become barriers to transmission of information and to trade. Also, the costs of compliance to required standards are proportionally too high for firms. The problem is aggravated when these firms have to cope with an increasing number of private standards set by customers in addition to mandatory ones. Governments should ensure that national certification systems do not impose an excessive burden on firms and encourage manufacturing company’s participation in the standard-setting process. Promotion of skills development as the effectiveness of aforementioned policy measures, to a certain degree, is contingent on having skilled human resources in manufacturing companies. Participation in logistics activities can accelerate manufacturing companies upgrading of human and technological resources, through technology and knowledge transfer and implementation of new business practices.

CHAPTER THREE

METHODOLOGY

3.0 INTRODUCTION

After reviewing the literature in the previous chapter, the researcher came up with methods which were used in the data collection exercise. This chapter therefore presents the methods and processes that the researcher used in the study. The description of the selected methodology included the sample size, research design and procedure of the study

3.1 THE RESEARCH DESIGN

In carrying out the research, the researcher used descriptive methods to analyse the data about the assessment of information and communication technology in logistics management efficiency. The data was analysed manually which allowed the use of both quantitative and qualitative methods.

Qualitative data was used to analyse in narrative form, then interpretations related to the study questions were obtained and then conclusions were drawn.

Quantitative data was in tabular format, graphs, measures of correlation based on percentages to point out the salient relationships and trends.

3.2 Area and population of the study

The study was conducted from Spedag Interfreight Uganda limited. This population mainly comprised of managers, heads of departments, the procuring and disposal entity and other staff members from the related fields in the organisation.

3.3   Sample size and population

3.3.1 Population Sample

The study was carried out in Spedag Interfreight Uganda Limited located in Nakawa Industrial Area Plot M284. The company has a population of over 35 employees of both the staff and the managers. In order to have a balanced view of the stakeholders, the entire stake holders were interviewed both directly and indirectly especially those involved in making logistics a feasible and profitable department. Because of that, basically people from the logistics and the procurement departments were consulted.

3.3.2 SAMPLE SIZE

The sample size comprised of 35 respondents taking considering  issues of procurement and logistics- stores management at Spedag Interfreight Uganda Limited in Nakawa Industrial Division.

Table 1: Categorization of respondents

3.4 SAMPLING TECHNIQUES

The researcher used stratified random technique which emphasized obtaining appropriate sample size. In this case the researcher derived the study population into groups (strata) according to their titles giving each group of personality equal opportunity of representation in the study. The researcher used stratified random sampling because it was cheap, reduces the level of biases, time saving, improves on the level of accuracy and enhanced cooperation in the field.

3.5 DATA COLLECTION SOURCES

The researcher collected data using both the primary and the secondary sources.

3.5.1 Primary sources

This helped to obtain data in its raw form from the field. This was done by use of questionnaires to collect people’s views, opinions and perspectives about the study. With this kind of source of data collection method, first hand information was obtained.

3.5.2 Secondary sources

This was obtained through the review of internal documents of Spedag Interfreight Uganda Limited. For example reports on the subjects under the study that showed the past performance. Also information was got from the external records which include journals, magazines, newspapers reports and research papers relevant to the topic at hand. This helped the researcher to make informed judgement about the study since it was compared with the primary source

3.6 DATA COLLECTION INSTRUMENTS AND TOOLS

The researcher used various methods of data collection and they included direct observation, questionnaires and interviews as presented below.

3.6.1    Questionnaires

These were designed with appropriate questions for managers and heads of departments and members of staff enough to make sure the objectives of the study were met, since these people have little time for interviews with the researcher because of their tight schedules in nature.

The researchers personally administered questionnaires because they were cheap and easy to administer, they saved much time compared to focus group discussion and they also required less skills to administer them.

3.6.2 Interviews

Here the researcher asked questions and at the same time recorded the responses. A semi- structured Interview guide was used for reasons like; Provision of first-hand information, Rich data was collected, it is less costly and speedy, it has the ability to clarify questions, it cleared doubts and allowed addition of new questions where necessary among others.

3.6.3 Direct observation

This was used to confirm the availability of the information technology systems in place and read through facial expressions, feelings of pleasantness and unpleasantness or stress which was expressed in emotions or vocalization.

3.7 PROCEDURE OF THE STUDY

The researcher picked an introductory letter from the Dean of School of Management and Entrepreneurship. The researcher then used the letter to introduce her to the area of study. Then the researcher then identified the respondents and proceeded to distribute questionnaires or interviewing them.

3.8 DATA PROCESSING, ANALYSIS AND PRESENTATION

After gathering the data from both sources (primary and secondary), the data was edited first for accuracy and completeness, organized by use of tabulations and percentages thereby creating a platform for summarization of data. Appropriate analytical methods were applied so as to manipulate the data, its relationship and quantitative meanings were then derived.

3.9 DELIMITATIONS OF THE STUDY

The researcher met the following challenges while carrying out her research.

• Unwillingness by some of the respondents to provide information thus rendering the questionnaires improperly answered. Also some respondents felt bothered and uneasy to let certain company facts and details to the researcher. The researcher ensured that all respondents were assured out confidentiality in relation to the information provided by them and also rendering one personally responsible for the consequences in case such happens.
• There were also threats of time limits and deadlines that the researcher needed to work against, considering the fact that the study was conducted alongside other activities like lectures, course works, and tests. The researcher drew a plan to ensure that these questionnaires were administered to before the deadlines.
• The researcher was faced with financial constraints since data collection involved transport costs, stationery, printing, feeding, and fear of some officials whom the researcher thinks asked some money before giving out some information.
• A lot of money was spent on internet access and other e- communications. This was compounded by travel costs, secretarial expenses and other costs related to booking of appointments with respondents. The researcher must however put some money aside to fund all her activities from the employer.

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