ROLE OF VENDOR MANAGED INVENTORY ON SUPPLY CHAIN PERFORMANCE IN MILK PROCESSING FIRMS IN KENYA: A CASE OF NEW KENYA COOPERATIVE CREAMERIES
Naomy Jepchumba - Masters Student, Jomo Kenyatta University of Agriculture and Technology, Kenya
Dr. Noor Ismail - Jomo Kenyatta University of Agriculture and Technology, Kenya
ABSTRACT
The past 15-20 years have seen an increase in research focusing on operational issues relating to supply chain management. Most of the research has been related to multi-echelon inventory models. These ideas were first implemented in the retail and manufacturing industries. The general objective of this study was to examine the role of vendor managed inventory on supply chain performance in milk processing firms in Kenya. The study was built upon the theories of resource based view theory, E- technology perspective, supply chain operations theory and transaction cost economics theory. The specific objectives of the study were to determine how ICT systems, top management support, lead time and supplier demand affects chain performance in Kenya. The study target population was 500 respondents. The sample size of the study was 50 respondents. A descriptive research design was used in the study. Primary data was collected using a questionnaire. A pilot study was conducted to pretest the validity and reliability of instruments for data collection. The raw information was analyzed to yield qualitative and quantitative data with help of SPSS version 20 and Excel at 5% level of significance and 95% confidence level. The study also established that a unit increase in ICT systems would lead to an increase in the supply chain performance of the new KCC by a factors of 0.231 thus the study concludes that ICT systems had a positive effect on supply chain performance, a unit increase in top management support would lead to an increase in supply chain performance of the new KCC by factors of 0.257, a unit increase in lead time would lead to an increase in supply chain performance of the new KCC by a factor of 0.246, a unit increase in supplier demand would lead to an increase in supply chain performance of the new KCC by a factors of 0.286 . The study recommends that the management of New KCC should show full commitment in the entire supply chain. The organization need to adopt the use of ICT systems, effective top management support and accommodate supplier demand efficiently for improved supply chain performance.
