Procurement risk management and contract performance in the public sector a case study of ngora district local government

Abstract

Achievement of Stake holders' value in any Organization is a core goal through delivery of maximum service and organizational effectiveness. Therefore recent studies have shown that effectively managing risks can lead to significant savings in resources, timely delivery and improved quality of services and relationships with clients. The purpose of the study was to examine the relationship between Procurement risk management and contract performance in the public sector with Ngora District as a case study. The study was guided by three objectives that is; to examine the risks in the procurement process, establish contract performance indicators and their relationships within the Local Government. This study involved both quantitative and qualitative approaches using a case study design. The data collection instruments used were self-administered questionnaires, observation and the structured interview guide. Data collected was analyzed using Pearson's product moment correlation co efficient to generate regressions and correlation between the variables. The findings revealed several risks like inadequate specifications and showed that contract performance indicators needed to be identified early and communicated to the service providers before contract implementation to enable each party understand their obligations. Further the findings revealed that procurement process risks had a positive significant relationship with contract performance in the public sector. It was thus recommended that if contract performance is to be improved in public sector organizations, policy makers and other stakeholders need to develop a culture of risk management as procurement risks are inherent and appears at each stage in the procurement process. This would ensure streamlined procurement planning backed by a procurement policy and a framework on risk management.