Effect of procurement process management on construction project cost variations in local governments in Uganda: a case of Mbarara municipality

Abstract

Procurement process management has been attracting great attention from practitioners, academicians and Researchers due to high construction project cost variations resulting from non-adherence to proper processes and procedures. This study describes the effect of procurement process management on cost variations on construction projects in Local Governments of Uganda with Mbarara Municipality being used as a case study. Regardless of the enactment of the PPDA Act, (2003) and operationalization of various regulations to enhance performance of the procurement function in Uganda, Local Governments have persistently exhibited high variances with regard to cost variations and over costing of construction projects for the last five successive years. A case study research design was employed. A survey instrument was developed and administered to the public entity with a sample of ninety one (91) respondents out of the population of 129; selected using purposive and random sampling techniques. Data sets from questionnaires were analyzed using descriptive statistics (weighted mean and weighted standard deviation) and regression analysis. Findings revealed that: the extent to which project planning and development predicts cost variation was moderate (R2 = 0.450). Results further indicate that bidder selection stage in the procurement process management impacts the variations in the project costs moderately (R2 = 0.686) the extent to which contract management predicts project cost variation was high (R2 = 0.755). However, findings revealed that procurement process management moderately influences the construction cost variations (R2 = 0.403). This implies that where each of the variables has a moderate or high impact on project cost variation, a combination of variables result in a moderate impact on project cost variations. Although the procurement process management practices are quite commendable, project performance remains average and project cost variations are always present. This is an indicator that there are other factors that cause variations in construction projects costs in Local Governments in Uganda besides procurement process management as observed from the framework. This study thus recommends that relevant staff in Mbarara Municipality, mainly engineers, auditors, procurement unit officials and contracts committee members should be in charge of contract preparation and approvals. This will ultimately ensure efficiency, effectiveness and timely accomplishment of contracts. Therefore, those endowed with skill and experience in the area should spearhead the procurement process management. Key words: Procurement process, management, construction project, cost variations.