EFFECT OF INVENTORY MANAGEMENT ON CUSTOMER SATISFACTION IN PUBLIC INSTITUTIONS OF HIGHER LEARNING IN KENYA
Rukiya Amina Mohamed - Masters of Science in Procurement and Logistics, Jomo Kenyatta University of Agriculture and Technology, Kenya
Dr. Yusuf Kibet - Lecturer, Department of Procurement and Logistics, Jomo Kenyatta University of Agriculture and Technology, Kenya
ABSTRACT
Inventory management is one of the greatest factors in a company’s success or failure. Due to the fact that some of the most important inventory control areas had not been well The purpose of this research study was to examine effect of inventory management on customer satisfaction in public institutions of higher learning in Kenya. The study was guided by the following specific objectives; to determine the impact of inventory control system on customer satisfaction; to establish the effect of variable demand (re-order) on customer satisfaction; to examine the effect of economic order quantity on customer satisfaction and to examine the effect of ABC analysis on customer satisfaction. The study was guided by Expectancy Disconfirmation theory, Inventory theory, Lean theory and Constraint theory. This study was carried out within Moi University Main Campus. The study was limited to inventory control system, variable demand, economic order quantity and ABC analysis and their effect on customer satisfaction. The study employed use of survey research design. A questionnaire was used to collect primary data. A good response rate of 85% was witnessed. A pilot study was done at the University of Eldoret to ascertain the reliability of the instruments before the study was done. University of Eldoret has similar characteristics as the area of study. To ascertain the reliability of the research instrument, the results from the pilot study was subjected to Cronbach Coefficient Alpha. The study adopted the lowest alpha value as 0.5 upward and the results for all the variables were above 0.7 threshold with overall mean value of 0.856. The target population was the procurement unit staff of Moi University; heads of schools, heads of departments and registered suppliers of Moi University. The sample size of 232 was used. Data was analyzed using Quantitative analysis with both descriptive and inferential statistics. The finding was presented in tabular, graphs, pie charts and percentages. Data was analyzed using descriptive statistics and statistical package for social studies (SPSS). Correlation analysis was used to find the correlation between the variables and this revealed there was a positive and significant correlation between all independent variables and dependent variable; inventory control system(r=0.493, p=0.000),variable demand (r=0.575, p=0.000), Economic Order Quantity (r=0.679, p=0.000) and ABC analysis (r=0.576, p=0.000). Multiple regression analysis with ANOVA technique was used to determine the effect of independent variables on the dependent variable. The findings showed that 84.4 % of the customer satisfaction is explained by the four variables that are inventory control system, variable demand, economic order quantity and ABC analysis and the remaining 15.6 % can be accounted by the standard error.
