ROLE OF SUPPLIER’S USE OF GREEN MANUFACTURING TECHNOLOGY ON ORGANIZATIONAL PERFORMANCE OF ENERGY AND PETROLEUM STATE CORPORATIONS IN KENYA
Joel Akumbi Omusebe - Jomo Kenyatta University of Agriculture and Technology, Kenya
Peter Wanjohi - Jomo Kenyatta University of Agriculture and Technology, Kenya
Noor Ismael - Jomo Kenyatta University of Agriculture and Technology, Kenya
Mike Iravo - Jomo Kenyatta University of Agriculture and Technology, Kenya
ABSTRACT
Kenya plans to achieve middle income development status by the year 2030 as set out in it Vision 2030. To achieve this, it is projected that there will be growth in both the public and private sectors of the economy. Growth in the private and public sectors is influenced by among other things the effective and efficient management of the different functional areas in the organizations. One such function is procurement. The function ensures availability of quality cost effective inputs to the organization which are then converted in to goods and services. As such, firm performance plays an important role in overall organizational success. Managers must therefore strive to ensure that the effectiveness of the procurement function is maintained. One way to maintain effective procurement is by continuously aligning the function to the concerns and changes in the business environment. Among the most important concerns in the world today is climate change caused by human economic activity. The negative effects of climate change is its potential to impact human lives and livelihoods, through increased incidence of natural disasters such as floods, droughts and disease outbreaks. Sustainable economic growth is also threatened by Kenya's vulnerability to climate change. It is estimated that 42% of Kenya’s GDP and 70% of overall employment is derived from natural resource-related sectors, including agriculture, mining, forestry, fishing, tourism, water supply and energy. While climate change will lead to adverse impacts across all of these sectors, agricultural sector stands apart as particularly vulnerable. With such effects, business operations are negatively affected by erosion of purchasing power, stagnation of economic activities, curtailing productivity and destruction of infrastructure among others. This realization has jolted businesses to work towards reducing their impacts on the environment by adopting green in their procurement processes. In addition, power production and distribution is among the highest contributors to environmental degradation through carbon emissions and depletion of forest cover. Although a lot of research has been done on several aspects of firm performance, there is a gap on how supplier’s use of green manufacturing technology affects organizational performance of state corporations in Kenya. This descriptive study targeted all the 10 energy and petroleum state corporations in Kenya. Two hundred and fifty five procurement department staff of all the cadres were the sampled respondents. The study established that using supplier’s use of green manufacturing technology as tender selection criteria had a negative impact on firm performance.
