Assessing Procurement Planning Practices in Motor Vehicle Assembly: Implications for Organizational Performance

Abstract

Procurement planning is pivotal in organizations, guiding acquisition of goods and services through strategic goal setting and coordination. However, challenges persist in implementing these plans effectively, particularly within the motor vehicle assembly industry in Kenya. This research aimed at assessing how procurement planning practices impact procurement performance, ultimately influencing organizational effectiveness within the motor vehicle assembly sector. The study objectives were identifying procurement practices that significantly affect performance and investigating the hurdles faced in implementing procurement plans within motor vehicle assembly. Using goal setting theory and grey system theory, a descriptive survey design was employed. The study conducted a census on 24 motor vehicle assembly and franchise companies in Kenya. The population comprised motor vehicle assembly and franchise companies in Kenya. A census approach was used to include all 24 relevant organizations. Data was collected through a structured questionnaire, ensuring comprehensive insights into procurement planning practices and their outcomes. The study employed exploratory factor analysis, using the varimax rotation method on Kaiser Normalization technique, to discern underlying factors influencing procurement performance. The findings illuminate the significant procurement practices impacting performance and the key challenges hindering effective implementation of procurement plans within the motor vehicle assembly industry. Understanding the relationship between procurement planning and performance informs strategic decision-making within motor vehicle assembly companies. Recommendations based on the findings focus on enhancing procurement practices, to improve organizational effectiveness and efficiency.