EFFECTS OF PROCUMENT METHODS ON THE PUBLIC PROGRAMS / PROJECTS PERFORMANCE. CASE STUDY OF UNBS
CHAPTER ONE
INTRODUCTI ON
1.0 Introduction
This chapter covers the background of the study, Statement of the problem, purpose of the study, objectives of the study, research questions, scope of the study, significance of the study and definition of key terms.
1.1 Background of the study
The complexity and volume of procurement drastically increased globally in the recent years. Some of the causes that can be attributed to this include globalization, out sourcing, intense competition for existing markets as well as complicated and numerous partnership. Over the last fifty years many, of the world’s largest firms have advanced from being simple manufactures of hard goods, or providers of basic services, to being sophisticated vendors using advanced business models. This means that organizations have the task of choosing the right procurement method that can enhance better performance of the organization in this competitive error, (Ahmadi, Pishvaee & Torabi, 2018).
New regulatory requirements, globalization, increasing number in signed/awarded contracts and their complexity have resulted in an increasing need to put more emphasis on the importance and benefits of effective procurement method, (Matthew, Patrick and Denise (2013). After an organization awards a contract it must monitor to ensure the service is being delivered as specified. This implies that the service has been provided as to the agreed standards and price. (Tweneboah & Ndebugri, 2017), argues that not having a formal, well defined and documented procurement method in place can have significant long term impact on the organization’s ability to track and monitor service delivery as well as meet stakeholders expectations.
According to Getuno et al. (2015), procurement encompasses the whole process of acquiring goods, works or services. It begins when an agency has identified a need and decides on its procurement requirement. Procurement continues through the process of risk assessment, seeking and evaluating solutions, contract award, delivery and payment for the goods, work or service, ongoing management of the contract and consideration of options related to the contract and extends to the ultimate disposal of property at the end of its useful life (Johnson, Leenders & McCue, 2017). According to (Keraro, 2014), public procurement is concerned with how public sector organizations spend taxpayers’ money on goods, works and services. Globally, in many developed nations, governments and organizations across the world tend to spend between 8 per cent and 25per cent of Gross Domestic Product (GDP) on goods and services.
Planning enables the establishment of the roles and responsibilities of public and private workers and is key to programme services ORC (Ondigi & Muturi, 2015), suggests that contractors should be invited to provide recommendations about the service delivery demands of the organizations. Procurement planners must describe the problem that needs to be solved and under the current level of organizational needs. (Adams et al., 2014). asserts contract planners should plan considering the objective of the organization to prevent short comings.
Amo Asante (2016) argued that the basic presumption in public procurement in all public institutions is that contracts of a specified type and value will be procured using an advertised, competitive procedure that is open, fair and transparent, ensuring equality of opportunity and
Rendon (2016) contends that choosing the right procurement method is a key activity in procurement planning. He observes that one of practices involved would be conducting among research to collect and analyze information about how a specific industry or sector process contain types of products and services and the best ways of ensuring that customer needs are delivered and met timely in order to create efficiency in service delivery system. Such information would include contract strategy, type of contract used, pricing arrangements as well as terms and conditions with a view of ensuring service delivery efficiency.
Oosterom (2007) argues that the overall goals of procurement system must be clearly understood; quality of service (the accessibility, timeliness and quality of service levels); cost of service (value for money obtained); and customer segmentation (the need for different service channels and service offerings based on comprehensive customer insight).
Traditional competitive procurement procedures cause adversarial relationships and many problems in all stages of the buying process, it’s therefore imperative for an organization to choose the right procurement method so that the organization can be in position to perform well and achieve its goals and objectives (Beckford, 2016).
According to Kiilu (2016) In order to enhance change, an increased understanding of how different procurement procedures affect different aspects of project performance in different types of projects is therefore vital. In spite of procurement procedures’ importance for project success, earlier research on this topic is limited to a few investigations focusing on how only one or a few procurement aspects affect a few project outcomes.
In developing countries, public procurement is increasingly recognized as essential in service delivery (Basheka & Bisangabasaija, 2010), and it accounts for a high proportion of total expenditure. For instance, public procurement accounts for 60% in Kenya (Akech, 2005), 58% in Angola, 40% in Malawi and 70% of Uganda’s public spending (Wittig, 1999; Gov. of Uganda, 2006) as cited in Basheka and Bisangabasaija. Moreover, in most developed countries, public procurement takes place within a framework of international obligations, such as World trade organization’s Agreement on Government Procurement Directives made under regional agreements such as the European Union or the North Free Trade Agreement
Projects Performance is a contemporary issue for most governments and researchers alike. Most scholars are in agreement that public service delivery is critical to ensuring the national welfare and stimulation of economic development. This is because often governments undertake a number of activities to provide citizens with services and at the same time guarantee that these services are provided in accordance with the procurement legal frame work requirements within the rule of law, (Mampe, 2012; Bola, 2011).
In Uganda Baseline Survey Report on Public Procurement Systems in Uganda (PPDAA, January 2015), indicated significant variances between the actual and indicative time frames in contract completion. In addition, Sabiiti notes that the Government at times pays for no work done or very shoddy work and sometimes, purchases are not delivered on time which has affected the ability of the Government to deliver quality services to the general public (as cited in Rwothungeyo, 2013).Meanwhile the Public Procurement and Disposal of Public Assets Authority (PPDA) Audit reports of Uganda National Bureau of Standards, (2005 and 2016) indicate high risks with 27% and 19% in 2009 and 2013 respectively accruing from project management where there were missing procurement management records, delayed payment for received goods and services and delayed deliveries.
PPDA regulations (2014), has re-emphasized the need for procurement planning to all public bodies, Although the UNBS strategic plan for 2010-2015 has put in place mechanisms for tracking and reporting procurement departmental work-plan activities whose key outputs are as a result of good service delivery through good procurement planning processes, service delivery is still not up to the UNBS stakeholder expectations and this is evident in the complaints of poor quality of products/services received, high cancellation of contracts, high priced goods/services, lack of delivery or partial delivery, delayed completion of contracts, missing contract management documents among others (Mubangizi, 2013).
1.2 Statement of the problem:
Good procurement method is instrumental to an organization in order to be in position to achieve; value for money, prevent emergencies in procurement, improve on the performance and competitiveness of an organization and above all achieve better project performance, (Fiedler (2015). UNBS PDU annual report, (2016) indicates that over 200 awarded procurement contracts in financial year 2014/2015 but the levels of project performance received/delivered on most of these procurements remain unknown, in addition to that PPDA, (2016)reports that there has been a delay in both execution and completion of most of the projects which has been executed by the UNBS this has led to failure by the organization to achieve value for money in most of its projects since projects delays makes the UNBS face high costs in executing its projects. The report further indicates that since the government of Uganda borrows the money from international development partners a delay in the execution of a given project costs the government a lot since the government pays interest rates on these loans. It is against this background that this study intends to investigate into the effects of procurement methods on the public programs / projects performance with specific reference to UNBS.
1.3 Purpose of the study
The purpose of the study is to investigate into the effects of procurement methods on the public programs / projects performance, with specific reference to UNBS.
1.4 Objectives of the study:
- Influence of domestic competitive bidding on project performance.
- Influence of international competitive bidding on project performance.
- Influence of direct procurement on project performance.
1.5 Research Questions:
- What is the influence of domestic competitive bidding on project performance?
- What is the influence of international competitive bidding on project performance?
- What are the effects of direct procurement on project performance?
1.6 SCOPE OF THE STUDY
This section will include; subject scope, geographical scope, and time scope
1.7 Subject scope
The scope of the study will include; influence of domestic competitive bidding on project performance, Influence of international competitive bidding on project performance and effects of direct procurement on project performance.
1.7.1 Geographical scope
The researcher will consider, UNBS headquarters in Nakawa, this is because the period from 2010 to 2019 is when UNBS intensified its efforts to improve project performance.
1.7.2 Time scope:
The study will cover a period of eight months i.e. March to October 2019.
1.8 Significance of the study
The study may assist future researchers by adding to the existing body of knowledge, by giving good interventions on ways of improving project performance.
The study may also help the management of UNBS with enough knowledge on how project management effectiveness can be achieved and above all help them in implementing good procurement methods.
The study will help me acquire the skills in procurement planning.
The research study will enable the research will enable the research gain knowledge and skills in procurement planning.
1.9 Definition of key terms
1.9.1 Procurement
Procurement, According to Kenneth Lysons and Brian Farrington (2006), procurement refers to the acquisition of goods, services or works through purchase, rent, lease, franchise or any other legal means considering the 3 Rs like from the Right: place, time, price, quantity, and quality by use of shareholder’s money.
1.9.2 Procurement planning
Procurement planning is the process of deciding what to buy, when and from what source
1.10 Conceptual frame work
Procurement Methods Project Performance
Source: Primary Data
