The impact of risk assessment on procurement management: a case study of moi teaching and referral hospital- eldoret, kenya
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Date
2007-04
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Publisher
Kampala International University.College of Economics and Management
Abstract
Procurement of goods and services is a major budgetary component of many organization.
particularly, those in public sector. The increasing complexity and uncertainty in the
operating environment has increased the risks involved in procurement. There is a gro,,~ng
need for robust mechanisms to assist them assess and manage these risks. Public
institutions in East Africa lag behind in procurement risk assessment and management
capacity. Efforts to develop and implement effective risk assessment systems are often
hampered by weak policies and lack of quality data Procurement decisions are therefore
taken mainly on the basis of minimal information, perceptions, past experiences and
instincts. These has led to inefficiency and increased costs in procurement.
This project paper presents a conceptual framework for identifying key areas for risk
assessment and management and the pathways - and potential barriers - by which risk
assessment can affect the efficiency and effectiveness of procurement systems. It also
identifies methods used to evaluate the impact of risk assessment process in achieving
key objectives of procurement - improved efficiency, and cost effectiveness,
This paper focused the survey in a public institution, the Moi Teaching and Referral
Hospital (MTHR) in Eldoret Kenya as a case study. It interrogated the procurement
system with the objective of evaluating the impacts of risk assessment on procurement
decisions at the hospital. Although the hospital recognized elements of risks in their
procurement activities, their risks assessment policy and guidelines were weak and hardly
applied, and the management information system was weak and manual. In addition, the
personnel were not well trained and prepared to handle the intricacies of risk assessment
thus unduly exposing the institution to avoidable and manageable risks.
There is a call for an innovative and dynamic process of identifying risks, assess mg
exposures and developing appropriate action plans to ensure they are managed in a way
that will enable MTRH to meet its business objectives. The development and
implementation of an effective policy/protocol on risk assessment has been recommended
as a key issue. Training of relevant personnel and the involvement of all stakeholders in
the process has been recommended. To enhance the planning, implementation, monitoring
and evaluation capacity for risk assessment and management in the hospital, the existing
management information system (MIS) should be strengthened and computerized.
Description
Dissertation submitted to the school of Business And Management in partial fulfillment for the award of bachelors degree in Supplies and Procurement Management at Kampala International University
Keywords
Risk assessment, Procurement, Management, kenya