CHAPTER 1

INTRODUCTION

1.0 Introduction

This chapter contains the introduction of the study, background of the study, statement of the

problem, objectives of the study, research questions, significance of the study, limitations of the

study, scope of the study and organization of the study.

1.1 Background to the study

Though procurement is a very ancient activity, it is only during the latter half of this present time

century that its importance is being recognized. Due to this, supply became more uncertain,

foreign buying activities heated up and the purchase of materials received heightened attention.

The position of purchasing in an organization was keen and hence the importance of having

proper procurement function became more pronounced.

Even though the position of purchasing was realized, the entire function was seen by some

businesses as an activity more appropriately performed close to the point of the need of the

goods, services and works being acquired.

However, most successful organizations have had a different view of the function and with the

passing of the Public Procurement Act (Act 663); the function is now seen to be a considerably

strategic importance to organization.

Purchasing or Procurement is defined by A.J Van Weele (1994) as a method or process of

obtaining from external sources all goods, services and works which are necessary for running,

maintaining and managing the company’s primary and support activities at the most favorable

1
condition. Therefore, procurement methods and procedures are very important in every

establishment be it a service or a manufacturing organization.

Procurement is defined by the business dictionary as the art of obtaining or buying goods,

services and works or the process which includes the preparation and processing of a demand as

well as the end receipt and approval of payments.

1.2 Problem of the study.

Procurement methods and procedures are important function of organization performance.

However following these methods and procedures has always been a problem. Changes have

been imposed on procurement methods and procedures; these include marketing environment,

legal environment, political environment, organizational environment and socio economic

environment.

Suppliers do not comply with procurement law and politicians use their offices to violate or

influence procurement methods and procedures leading to awarding of contract to ineffective

contractors. Even though procurement systems and laws are put in place to ensure effective use

of resources, little action is put to effectively observe procurement methods and procedures.

1.3 Purpose and Objective of the study

The broad objective of this study is to investigate into how procurement methods and procedures

are evaluated in the public sector and for that matter, Effia Nkwanta Regional hospital. For this

to be achieved, the study will highlight on the following objectives:

1. To determine whether the Government’s objectives for the introduction of the Public

Procurement Act 663, (2003) have been achieved.

2
2. To identify some of the problems associated with procurement methods and procedures at

Effia Nkwanta regional hospital.

3. To find out whether procedures as indicated in the procurement Act are being followed.

4. To recommend strategies to enable the institution improve upon the impact of its

procurement methods and procedures.

1.4 Significance of the study

A study of this nature will benefit all public sector organization to pursue the correct policies

relating to this function and achieve their corporate objectives there on.

The study will also enhance and broaden the knowledge of the students in the field of

procurement activities. Moreover, it will serve as a reference for further studies.

1.5 Scope of the study

There are many hospitals in Ghana, but for the purpose of the research, the researchers opted for

only Effia Nkwanta regional hospital because it’s a huge public institution with a huge public

expenditure on procurement activities.

1.6 Limitations of the study

The project undertaken was face by several limitations; due to time constraints and cost the

project was not able to cove wider scope of knowledge.

1.7 Research methodology.

Primary data are those collected first and thus happen to be in original character. Primary data

collection is in the form of collecting data from a particular field of study. The data collection

3
involves the use of questionnaire and observation, as well as field survey. For the purpose of this

research, primary data are used more, to investigate the problem.

Secondary data is collected from some source example, government journals, newspaper,

magazines, internet etc. This data refers to the information that has been already collected for a

different purpose other than what the investigator might have wanted to use it for. At certain

times it might happen that the concept has been ones considered by an investigator somewhere.

Using such data in a current research helps to either accept or reject that idea. The investigator

got this from the books written by expects on the concepts from the school’s library, internet and

any other available source the investigator had.

1.8 Organization of the study

The entire project work is put into five chapters as follows:

Chapter one consists of the background of the study, problem of the study, objectives, research

question, significance of the study, scope, limitations and organization of the study.

Chapter two covers the literature review that relates to the topic.

Chapter three dwells on the research methodology used for the study. It defines the population,

sample and sampling procedures, research instruments, procedure for data collection and method

of data analysis.

Chapter four covers the presentation and analysis of data used for the study and chapter five

centers on the summary of the major findings, conclusions arrived at and recommendations.

4
1.9 Conclusion

The chapter one consist the purpose of the research, the background, the statement of the

problem, the objective and the significant of the study, the methodology and the limitations of

the study.

5
 CHAPTER 2

LITERATURE REVIEW

2.0 Introduction

This chapter seeks to review the existing literature relevant to the procurement methods and

procedures in the health sector. The idea is to develop good understanding of the research topic

and also construct the diverse views of some authors and practitioners of the purchasing

profession. It also deals with definition of purchasing and procurement.

2.1 Definition of purchasing

Work done by Lysons (1996) indicates that, purchasing is the function responsible for obtaining

by purchase, lease, or other legal means, equipment’s, materials, supplies and services required

by an undertaking for use in production.

According to Fearon et al, (1998) purchasing constitutes the body of integrated activities that

focuses on the procurement of materials, supplies and services needed to reach organizational

goals.

According to Baily (2001) defines purchasing as the process by which organizations define their

needs for goods and services, identify and compare the supplies and suppliers, negotiate with

sources of suppliers, make contracts, place orders and finally receive or accept all the goods and

services required.

Even though the definitions vary, the three authors agreed that the purchasing function has to

ensure that the right materials that the company or the organization needs are bought. In a narrow

sense therefore, purchasing describes the process of buying and in a broader contest, purchasing

6
involves determining needs, selecting suppliers, arriving at the appropriate price, terms and

conditions, issuing the contract or order, and following up to ensure delivery.

2.2 Definition of Procurement

Lysons & Farrington (2006) define procurement as the process of obtaining goods or services in

any way, including borrowing and leasing.

According to Westring, (1990), procurement includes the acquisition of both goods and services.

This means it does not only include purchasing and buying of goods but also the hiring of

contractors and consultants to carry out services but not employment of individuals. The

functional scope of procurement covers the following:

a. Specification of the kind and quantity of goods or services to be acquired.

b. Investigation of the market for the supply and contracts with potential suppliers.

c. Placing the order or contract, including negotiation of terms.

d. Supervising delivery and performance.

Procurement may also be related to the broader function of supply management, which includes

the planning function, coding and classification, stockholding policies, stock-keeping, stores

accounting, etc.

Procurement can therefore be defined as the acquisition of goods and services at the best possible

total cost of ownership, in the right quantity and quality, at the right time, in the right place for

the direct benefit or use of government, corporations or individuals, generally via a contract.

Fayol (1999) indicated that to manage is to forecast and to plan is to organize, coordinate and

control. In his view, management looks into the future and ensures that all resources needed to

7
produce certain goods and services are made available, stored and used to achieve the purpose

for which they are required.

Management can therefore be defined as the process of effectively and efficiently organizing,

planning and controlling activities and motivating people in an organization.

2.3 Procurement methods and procedures

Public Procurement Act, 2003 (Act 663) gave procurement methods and procedures which are

normally used by public procurement organizations as follows; restricted tendering, sole or

single source tendering, negotiated tendering, requested for quotation and competitive tendering.

Restricted tendering

With this method prospective suppliers are invited to compete for a contract, the advertising of

which is restricted to appropriate technical journals or local newspapers. The method usually

considers how reliable and dependable a supplier may be.

 Single-Source tendering

A procurement entity may engage in single-source tendering under Section 41 with the approval

of the Board:

1. Where goods, works or services are only available from a particular supplier or contractor, or

if a particular supplier or contractor has exclusive rights in respect of the goods, works or

services, and no reasonable alternative or substitute exists;

2. Where there is an emergency need of the goods, works or services and engaging in tender

proceedings or any other methods of procurement is impractical due to unforeseeable

8
 circumstances giving rise to the urgency which is not the result of the conduct on the act of

the procurement entity;

3. Where owing to a catastrophic event, there is an urgent need for the goods, works or technical

services, making it impractical to use other methods of procurement because of the time

involved in using those methods.

Here a tender is negotiated with only one supplier so that competition is eliminated. This is

normally used for product where there is only one supplier. Here relative evaluation of suppliers

does not arise. This method is used particularly when buying technically complex products

where advertising is not practical.

Request for quotations

A procurement entity may engage in procurement by requesting quotations in accordance with

Section 43 of Public Procurement Act, for readily available goods or technical services that are

not specially produced or provided to the particular specifications of the procurement entity and

for goods where there is an established market if the estimated value of the procurement contract

is less than the amount.

Competitive tendering

 A procurement entity shall procure goods, services or works by competitive tendering except

as provided in this part.

 If the procurement entity uses the method of procurement other than competitive tendering, it

shall include in the record required statement of the grounds and circumstances on which it

relied to justify the use of that method.

9
2.4 Purchasing procedures

The Chartered Institute of Purchasing and Supply (CIPS) (1998) explains procurement

procedures as those provided to review current requirements and predict future needs, indicates

individual and departmental responsibilities for major procurement programs; taking accounts of

interdependency, workload and cash flows.

A strategic planning procedure has four principal objectives:

a. To ensure that major procurement activities are anticipated, so that time is allowed for each

stage of the procurement. Purchasing should be involved as early as possible in the process

with the objective of minimizing cost at the design planning stage.

b. To spread the workload associated with purchasing efficiently across the year.

c. To ensure that all aspects of purchasing, including on-going contract, and the application

and the appropriateness of these procedures are reviewed at appropriate regular intervals.

d. To ensure that the appropriate lessons are drawn from past experience.

2.5 Procurement Expenditure

According to Fearon, Dobbler & Killen (1993) if one considers the essential mission of

government to preserve the health, safety, welfare and well-being of it citizen, it’s clear that the

procurement function should play a substantial strategic role in accomplishing that mission.

After all, the public procurement expenditure in the United states represent $2368 billion in

goods and services in fiscal year 2006 or approximately 20% of the US gross domestic

product( GDP).However, only recently has procurement role in organization’s planning process

been recognized. In proactive procurement, practitioners plan for and initiate action. In reactive

10
procurement, practitioners merely respond to the demands placed upon them. (Jack, T. &Khi V.

Thai, 2009).

According to Agyenim Boateng, former Chief Executive Officer of the Public Procurement

Authority ,Ghana’s public procurement expenditure rose from GHC1.4 billion in 2005 to 1.78

billion in 2006.He said this at a seminar organized for Higher National Diploma student of

Purchasing and Supply at the Takoradi Polytechnic on the theme, Purchasing and Supply –A

competitive Tool to strategic Development”. He went on to state that, procurement represent

between 50-70% of the national budget apart from personnel emolument. He also said

procurement plays a central role in the delivery of all government priorities in areas such as

health, education, policies and security. At the seminar he also stressed on the business

opportunity that public procurement provides and could be used as an important instrument of

government policy to facilitate social and economic development. Source www.google.com

(Ghana’s procurement expenditure)

It can be deduced from the opinions of the practitioners above that, government spends huge

sums of money in the procurement of goods and services in areas such as health, security,

education for the welfare of its citizens. Both practitioners agree that procurement should play a

strategic role in ensuring that the mission of the government comes into reality.

2.6 Procurement systems

The Association for Project Management (APM, 2000) describes procurement as “the process of

acquiring new services or projects. It covers the financial appraisal of the option available,

development of the procurement or acquisition of supplies, pricing, purchasing and

administration of contracts. It may also extend to storage, logistics, inspection, expediting,

11
transportation and handling of materials and supplies. Within this generic definition it can be

deduced that procurement in a project management sense has a wider definition; it is really about

management on behalf of a client or user of product that is delivered using a project process.

It clearly considers procurement to be undertaken by an in-house department involved in a

buying-selling relationship with external suppliers. The six key procurement processes are;

a. Procurement planning: Factors in decision, make or buy analysis, and contract type

selection.

b. Outsourcing and partnering: Reasons to outsource, global outsourcing market,

buyer/seller relationships and partnering process.

c. Solicitation planning: Tools and techniques, specifications, procurement document

contents, evaluation criteria.

d. Solicitation: Developing qualified sellers list, contracting prospective sellers,

conducting bidder’s conference est.

e. Contract administration: Roles, responsibilities and coordination, kick-off meetings,

project performance responsibilities, changed control procedures, contract

administration and payment systems.

f. Contract closeout: Contract documentation, steps in the claim process, termination of

contract.

Procurement systems are particularly suited to organizations in the manufacturing and service

industries that have procurement departments. However, although the generic principles of

buying are appropriate to all the six key processes noted above are less effective in describing the

key milestone in procurement within the construction and engineering industries. (Willey, J. and

Sons, Inc. 2007)

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2.7 Importance of procurement methods and procedures to an organization

According to Baily et al, (1994), there are some importance of procurement procedures. That is

the organization that manufactures products and pays more attention to their purchases end up

successfully. The emphasis in such organization has evolved beyond simply reacting to the needs

of users and rather concentrating on the contributions they can make to the organization. This

can be done by a qualified purchaser as a result; this has brought about proactive purchasing

which every organization must adopt.

According to (Slack et al, 1995), managers provide a vital link between the operation itself and

its suppliers. And this can be done effectively when the purchasers understand the requirements

of all the process within an organization.

According to Lysons (2001) gave the importance of the procurement methods and procedures

that; purchasing involved in the decision of a company intends to strengthen the competitive

advantage of the business unit.

The intensive competition among organizations is another factor to ensure that the best materials,

components and parts that comprise the product are of high quality and also the contribution of

procurement to the supply chain and management in the value chain concept is another factor.

2.8 Conclusion

The chapter tries to review the important of evaluation of procurement methods, procedures and

impact in the public sector.

It also reviews other theories that related to this study and other factor that need consideration in

other to develop the procurement unit.

13
 CHAPTER 3

METHODOLOGY

3.0 Introduction

This chapter focuses on data collection methods and the tools for data analysis. It covers the

population, sample and sampling procedures, research instruments and data collection

procedures.

3.1The Population/ Sample

According to Dillon (1998), defines population as the group of scores or people in whom the researcher is

interested or about whom the researcher wish to generalize. This population consists of the total number

of respondents in the business organization where the project is being taken. Basically, the population

considered for the study will come from the human resource department, account department, stores

department, and purchasing department. Total population involved is fifty (50) staff members from the

various departments mentioned of Effia Nkwanta Regional Hospital including both and female.

3.2 Sampling Methods

According to Kumar (1996), Sample size refers to the representative portion of the targeted

population which is selected for the study. Out of the population of fifty(50),of which five(5)

represent for human resource department., ten (10) represent for the account section, twenty

five(25) represent for stores dept. and five(5) represent for the purchasing department. However,

due to subject availability and expense on both time and money, it is important to select by

means of the various sampling procedure a portion of the sampling frame which will constitute

the respondent for the study.

14
From the above population, a sample size of thirty (30) respondents was selected for the study.

The method used was simple random sampling. This allowed every item in the target group to

have equal chance of being chosen.

3.3 Data collection methods

The research data was collected using instrument like interviews and questionnaire.

Questionnaires were administered to obtain the expected responses from respondents made up of

management and staff of procurement and stores. Both open-ended and close-ended questions

were used for the project work.

Interviews were also used for collecting data from four (4) procurement officers and three (3)

supply officers. The interview was done through face to face meeting with personnel’s who hold

relevant information for the study. Questions which were too complicated to be answered in the

questionnaires were asked during the face to face interview and explanations were given to those

difficult questions.

3.4 Data collection activities

Both primary and secondary data were used for the project work. Primary data are first-hand

information and thus happens to be the original character. They are derived from questionnaire,

face to face interview etc.

However secondary data are those which have already been collected by some other authors and

which have already been processed into information to satisfy some other needs. The secondary

data that the researchers used include purchasing textbooks, journals etc.

15
3.5 Data Analysis procedures

The method for analyzing the data was the descriptive statistical approach. Statistical tables

prepared after the questionnaires had been edited and tallied. The Percentage cross tabulation and

frequencies, graphs and pie charts are used to aid analysis.

3.6 Conclusion

This chapter consist of the purpose of the population, sampling method, data collection activities,

and data analysis procedures.

16
 CHAPTER 4

DATA ANALYSIS AND DISCUSSION

4.0 Introduction

This chapter is on the analysis and interpretation of data collected from the administration of

questionnaires.

4.1 Demographic

Thirty (30) questionnaires were administered during the survey, fifteen (15) were given to

procurement officers. Seven (7) questionnaires were given to the supply officers Again, five (5)

questionnaires were administered to the stores officer’s and.three (3) questionnaires were

administered to the clerical staff.

4.2 Analysis / Discussion

In order to make the gathered data meaningful, the researcher use both tables and chart to

convert the gathered data into meaningful information.

Table 4.2.1: Gender of respondents

Gender Frequency Percentage (%)

Male 18 60

Female 12 40

Total 30 100

Source: Field survey, 2019

17
Table 4.2.1 result shows the gender distribution of respondents. Twelve (12) respondents are

females representing 40% and eighteen (18) are also males representing 60%.

Figure 4.2.1: Number of years worked in the institution

12

10

6
Series 1

0
Less 1 year 1 - 3 years 3 - 5 years More than 5 years

Source: Field Survey, 2019

Figure 4.2.1 result shows the number of years of the respondents in the institution. Ten (10)

respondents have less than one (1) year of working experience. For those who are between 1-3

years, respondents were eight (8); for years 3-5 respondents were six (6) and six (6), has spent

more than 5 years.

18
Table4.2.2: Description of Procurement activities

Response Number of Respondents Percentage (%)

Interesting 21 70

Difficult 9 30

Total 30 100

Source: Field survey, 2019

Result in table 4.2.2 indicates that twenty-one (21) respondents described procurement activities

to be interesting thus with 70%, whereas nine (9) respondents described procurement activities to

be difficult, representing 30% of the respondents. It can be deduced from the table above that,

majority of the respondents describe procurement activities to be interesting.

Table 4.2.3: Placement of Purchasing in the organization

Response Number of Respondents Percentage (%)

Top Management 6 20

Middle Management 24 80

Routine Clerical Function - -

Total 30 100

Source: Field survey, 2019

19
From table 4.2.3 results, it is observed that 80% of the respondents claimed that purchasing is

placed at the middle management level whereas 20% of the respondents perceive purchasing as a

top management level.

Figure 4.2.2: Problems faced by the purchasing department

Source:
Field Problem faced by the purchasing de- survey,
2019
partment
Shortage of materials; 3
In response Uncomprising to the
Supplier; 9 Financial Approval ; 12

problems faced by

the

purchasing Lead-time; 6

Financial Approval Lead-time

department, Uncomprising Supplier Shortage of materials
twelve

(12) respondents representing 40% mentioned problems of financial approval, six (6)

respondents representing 20% mentioned lead-time, another nine (9) respondents, representing

30% indicated the problems faced are due to uncompromising suppliers. Three (3) respondent

mentioned shortages of materials, which represents 10% of the survey conducted. From the

above information, it can be deduced that the major problem that the institution faces has to do

with financial approval, followed by uncompromising suppliers, lead-time duration and

shortages of materials.

20
Table 4.2.4: In -service training in purchasing and supply

Response Number of Respondents Percentage (%)

Yes 24 80

No 6 20

Total 30 100

Source: Field survey, 2019

Table 4.2.4 shows that twenty-four (24) respondents (80%) said the organization conducts in

service training in purchasing and supply whereas six (6) of the respondents (20%) said no.

Table 4.2.5: Extensive survey being carried out before potential suppliers are selected

Response Number of Respondents Percentage (%)

Yes 30 100

No - -

Total 30 100

Source: Field survey, 2019

Table 4.2.5 shows that all the thirty (30) respondents (100%) said extensive survey is done

before potential suppliers are selected. This means that extensive survey is done before potential

suppliers are selected.

21
Table 4.2.6 Selection of potential supplier for the supply of items.

Response Number of respondents Percentage (%)

Administrator - -

Accountant - -

Purchasing Officer 9 30

Evaluation team 21 70

Total 30 100

Source: Field survey, 2019

From table 4.2. 6, it is noted that nine (9) respondents representing 30% said purchasing officers

does the selection of potential suppliers. Whereas twenty-one (21) respondents representing 70%

said the evaluation team is responsible for the selection of potential suppliers. From the

information given by the respondents of Effia Nkwanta Regional Hospital, it can be deduced that

the evaluation team is responsible for the selection of potential suppliers.

22
Figure 4.2.3: How existing suppliers are assessed

How existing suppliers are assessed

Existing suppliers
20%

Monitoring their
performance
50%

Past per-
formance
30%

Source

: Field survey, 2019

Result in figure 4.2.3 depicts how management and staff of Effia Nkwanta Regional Hospital

(Procurement unit) assess existing suppliers. From the table above, fifteen (15) respondents

representing 50% of the survey conducted stated that the institution assess existing suppliers by

constantly monitoring their performance, nine (9) respondents which represent 30% indicated

that the institution assess existing suppliers based on their past performance, while six (6)

respondents representing 20% gave several modes of assessing existing suppliers apart from past

performance and monitoring supplier’s performance, like financial performance and compliance

to specification.

Table 4.2.7: How items that fail to correspond to specification are treated.

23
 Response Number of respondent Percentage (%)

Reject 30 100

Accept - -

Accept with reduction in - -

price

Total 30 100

Source: Field survey, 2019

Table 4.2.7 shows the actions that are taken by the procurement unit when items fail to

correspond to specification. From the table, it can be seen that all the thirty (30) respondents,

representing 100% said items that fail to correspond to specification are rejected.

Table 4.2.8: The use of computerized systems in the procurement of goods and services.

Responses Number of Respondents Percentage (%)

Yes - -

No 30 100

Total 30 100

Source: Field survey, 2019

From table 4.2.8, it is observed that the institution does not use any computerized systems in

their procurement of goods and services. This is evident by the 100% response rate.

24
Table4.2.9: Relationship between the purchasing department and other functional

departments.

Response Number of respondent Percentage (%)

Very Good 15 50

Good 15 50

Bad - -

Total 30 100

Source: Field survey, 2019

Table4.2.10: Problems associated with procurement methods and procedures

Response Number of respondents Percentage (%)

25
Tedious, cumbersome and 12 40

bureaucratic

Financial problem 6 20

Not good for emergency 12 40

situation

Total 30 100

Source: Field Survey, 2019

Tables 4.2.10: Problems associated with procurement methods and procedures.

Figure 4.2.10 shows the problems associated with procurement method and procedures at the

procurement units of Effia Nkwanta Regional hospital. From the survey conducted, twelve (12)

respondent representing 40% of the respondents indicated that the procurement methods and

procedure are mired by tedious, cumbersome and bureaucratic, thereby making the procurement

of goods and services difficult. Again, six (6) respondent representing 20% of the survey gave

financial problem has been a hindrance to the procurement of goods and services in the

institution, and twelve (12) respondent representing 40% of the survey indicated that, the

procurement method and procedures are not good for an emergency situations.

4.3: Conclusion

26
From the thirty (30) questionnaires administered to the Effia Nkwanta Regional Hospital, the

researcher managed to retrieve all the thirty (30) questionnaires from respondents. From the

thirty (30) questionnaires that was retrieved eighteen (18) happened to be males and twelve (12)

were females.

After the research was conducted and analysis made, it revealed that the evaluation of

procurement methods, procedures and its impacts on the public sector was achieved as stated in

the Public Procurement Act 663 (2003).

From the analysis made by the researcher, the procurement departments of Effia Nkwanta

Regional Hospital faced several problems but the one they made emphasis on was the financial

approval which about 40% over the other problems.

CHAPTER 5

27
 SUMMARY, CONCLUSIONS AND RECOMMENDATIONS

5.0 Introduction

The objectives of the research was to evaluate the procurement methods, procedures and its

impact on the public sector, case of Effia Nkwanta regional hospital-Takoradi.

This chapter is the conclusion of this project work. It gives a summary of the major findings

obtained from the research. It further provides conclusions and recommendations.

5.1 Summary of research findings

This section provides a summary of the findings in relation to the research questions. Findings

from the study revealed that:

 From the demographic of the respondents, majority of the staff of Effia Nkwanta regional

hospital-Takoradi have spent at least a year of service with the hospital.

 Most of the respondent are interested in the procurement activities of Effia Nkwanta

regional hospital.

5.1.1: Benefits of procurement methods and procedures

After a thorough research into the procurement methods and procedures at the Effia Nkwanta

Regional Hospital, it was seen that the procurement methods and procedures help to ensure

transparency and fairness, prevent conflicts of interest which leads to the award of contracts to

competent suppliers and also increase competition which also leads to the reduction in prices of

items, thereby ensuring that the institution gets value for money spent.

5.1.2: Problems associated with procurement methods and procedures.

28
Despite the benefits of the procurement methods and procedures, the survey conducted disclosed

some of the problems associated with the procurement methods and procedures as tedious,

cumbersome and bureaucratic. It came to light that the methods and procedures are not good for

emergency situations, as the institution is into the delivery of health services.

5.1.3: Is the procedures provided in the procurement act been followed.

The research conducted show that, the procurement act of Ghana, 2003(663) which makes

provision as to how process and procedures must be followed are been followed by the

procurement offices of Effia Nkwanta Regional hospital to ensure efficiency in their

administration of their work.

5.1.4: The use of computerized system in the procurement of goods and services.

The research conducted has established that, the institution does not use computerized systems in

the procurement of goods and services. This is evidenced by 80% of the respondents answering

no to the questionnaires administered during the field survey.

5.2 Conclusion

From the analysis of the findings the procurement department of the Effia Nkwanta Regional

Hospital follows the right methods and procedures, strategies and policies in the acquisition of

goods and services.

The objective of this study was to determine whether the Government’s objective for the

introduction of the public procurement Act 663, (2003) have been achieved, to identify some of

the problems associated with procurement methods and procedures at Effia Nkwanta regional

29
hospital, to find out whether procedures as indicated in the procurement Act are being followed,

and lastly to recommend strategies to enable the institution improve upon the impact of its

procurement methods and procedures. The area that was chosen for the study was Takoradi

specifically Effia Nkwanta regional hospital and a sample of twenty were used to carry this

research. The instrument used was questionnaire which received 90% response from the

management and staff of Effia Nkwanta regional hospital. This research was also limited by

financial constraint, and time constraint. This research also describes in detail literature reviews

that are related to the topic. That is definitions of procurement, definitions of purchasing,

definitions of procurement expenditure, and definitions of procurement systems, important of

procurement methods and procedures to an organization the problems associated with

procurement methods and procedures in the organization. Again the study describes in detail the

way the gathered information was converted into a meaningful data and also the summary of the

research findings and draws conclusions appropriate as well as recommendations by the

researcher on the findings.

5.3 Recommendations

From the findings, the researchers hope that if the recommendations below are adopted and

implemented by the Effia Nkwanta Regional Hospital, its efficiency will be enhanced.

 The used of computerized systems in the procurement of goods and services. It was

observed during the study that the institution does not use any computerized systems in

the procurement of goods and services. The researchers strongly recommend the use of

e-procurement. E-procurement is done with a software application that includes features

30
 for supplier management and complex auctions. In achieving benefits such as increased

efficiency and cost savings and improved transparency, the institution can rely heavily

on e-procurement value chain which consists of e Tendering, e Auctioning, vendor

management, catalogue management and contract management.

 Financial Approval; the key hindrance to the successful execution of procurement task is

financial approval from the authorities in charge. This was evidenced by majority of the

respondents from the survey conducted. The investigator recommend to the procurement

unit to source for suppliers who have a sound financial background and can deliver items

to the institution and accept payment at a predetermined future date. Again, the

institution can put some internal mechanisms in place to ensure that financial approval is

granted for the purchase of critical or important materials or machines like oxygen and

other delicate items without passing through the bureaucratic processes in approving

funds, since the healthcare of patients are their priorities.

 Government should endeavor to review the PPA (663) to limit the number of steps in

procurement process so as to reduce the level of bureaucracy in the system. Bureaucracy

delays the smooth procurement process and eventually affects capital since it adds more

cost to suppliers and government if they are to pay interest rate. Additional information

gathered during the study revealed that the hospital does not have enough procurement

personnel. It is therefore recommended that qualified procurement officers who have the

necessary knowledge and requisite procurement training and competencies should be

recruited as this will help government to meet the demanding standards required to

deliver government policy of the procurement act (663) and achieve value for money

(VFM) now and in the future.

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 It is recommended that the procurement officials comply with the contractual agreement

with contractors/suppliers by honoring prompt payment upon completion of

contracts/projects. This would enhance contractor /supplier ability to become resourceful

to improve upon their financial capabilities on subsequent execution of

projects/contracts.

32
 REFERENCES

Baily et al (1994), Purchasing Principles and Management, (7th Ed), London: Pitman

Baily P. (2001), Purchasing and Supply Management, (5th Ed), London: Britain.

Government of Ghana (2010), Public procurement Act, 2003 purchasing and supply chain

management (Act 663) Accra, Ghana

Dobler D. W. (1996), Purchasing and Supply Management, (6th Ed), Tata McGraw –Hill. New

York, US.

Lysons. K. (1996), Purchasing and supply chain management, (4th Ed) Pitman: London.

Lysons.C. K. (2000), Purchasing and supply chain management (5th Ed), Pearson Chicago, US.

Lysons.C. K. & Farrington B. (2006), Purchasing and Supply Chain Management (5th

Ed), .England, UK.

Saunders. M. (1997), Strategic Purchasing and Supply Chain Management (2nd Ed), Prentice

Hall.

Weele (1994), Purchasing Management, Analysis, Panning and Practice (1st Ed), Chapman and

Hall. Chicago, US.

http://www.google.com.

http://business dictionary.com.

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 APPENDIX

TAKORADI TECHNICAL UNIVERSITY

FACULTY OF BUSINESS STUDIES

Questionnaire design by a third year purchasing and supply student on an evaluation of

procurement methods, procedures and impact at Effia Nkwanta regional hospital Takoradi. And

this research is aimed at soliciting information for academic purpose. Any information provided

will be treated with highest confidentiality.

Thank you.

Please tick √ the appropriate answer and write where necessary.

A. PERSONAL PROFILE

i. Gender (a)Male [ ] (b)Female [ ]

ii. Position………………………………………………..

iii. Department of respondent ……………………………..

iv. Educational Background…………………………………

B. EVALUATION OF PROCUREMENT ACTIVITIES

1. How long have you been working in the institution?

1- 5yrs [ ] 6-10yrs [ ] 11-15yrs [ ] 16 yrs and above [ ]

2. How will you describe the job of procurement?

a. Interesting [ ] b. Difficult [ ]

34
3. Where is purchasing placed in your institution?

a. Top Management Level [ ]

b. Middle Management Level [ ]

c. Routine Clerical Level [ ]

4. What are some of the problems associated with procurement methods and procedures?

a…………………………………………………………………......................................................

b …………………………………………………………………………………………………….

c……………………………………………………………………………………………………..

5. In what ways has the Procurement Act benefited the institution? (i)

……................................................................................................................................................

(ii).......................................................................................................................................................

...........................................................................................................................................................

6. What problems does the purchasing department face during the performance of its duties?

a. Financial approval [ ]

b. Uncompromising suppliers [ ]

c. Lead time [ ]

d. Defective materials [ ]

e. Shortages of materials ordered [ ]

35
7. Does the institution undertake any in-service training in purchasing and supply?

5. Yes [ ] No [ ]

8. Is extensive survey done before potential suppliers are selected?

Yes [ ] No [ ]

9. Who selects potential suppliers for the supply of items?

a. Administrator [ ]

b. Accountant [ ]

c. Purchasing Officer [ ]

d. Evaluating Team [ ]

10. How do you assess existing suppliers?

a. Past performance [ ]

b. Monitoring of supplier’s performance [ ]

c. Others, please specify………………………………............................................................

11. How do you treat an item that fails to correspond to specification?

a. Reject [ ]

b. Accept [ ]

c. Accept with reduction in price [ ]

12. What is the relationship between purchasing department and other functional departments?

36
a. Very Good [ ]

b. Good [ ]

c .Bad [ ]

13. Do you use a computerized system in the procurement of goods and services?

Yes [ ] No [ ]

14. How often do you use the computerized system in the procurement of goods and services?

a. Very Often [ ]

b. Not often [ ]

c. Not at all [ ]

THANK YOU.

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