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THE EFFECT OF SUPPLY CHAIN MANAGEMENT PRACTICES ON SERVICE

QUALITY IN HEALTH FACILITIES IN WEST NILE -UGANDA

BY

ERMA ISAAC EREJO

A PROJECT REPORT/RESEARCH SUBMITTED IN PARTIAL FULFILMENT FOR

THE AWARD OF POST GRADUATE DIPLOMA IN LOGISTICS AND SUPPLY CHAIN
MANAGEMENT

AUGUST 2021
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TABLE OF CONTENTS
DECLARATION..............................................................................................................................3
APPROVAL.....................................................................................................................................4
DEDICATION..................................................................................................................................5
ACKNOWLEDGEMENT................................................................................................................7
ABSTRACT.....................................................................................................................................8
CHAPTER ONE...............................................................................................................................9
General objective of the study........................................................................................................12
Scope of the study...........................................................................................................................13
Conceptual frame work..................................................................................................................13
Significance of the study................................................................................................................16
CHAPTER TWO: LITERATURE REVIEW.................................................................................17
2.1 Introduction..............................................................................................................................17
2.7 Conceptual Framework.............................................................................................................36
CHAPTER THREE........................................................................................................................40
METHODOLGY............................................................................................................................40
3.0 Introduction..............................................................................................................................40
3.1 Research Design.......................................................................................................................40
3.5 Data Quality Control................................................................................................................41
Summary of reliability coefficient for each latent construct..........................................................44
3.5.3 Validity..................................................................................................................................45
3.6 Data analysis and presentation.................................................................................................46
3.7 Measurement of research variables..........................................................................................46
3.8 Ethical consideration................................................................................................................46
CHAPTER FOUR..........................................................................................................................48
Table 4.5: Pearson Correlation analysis.........................................................................................48
Interpretation of the regression results...........................................................................................51
CHAPTER FIVE............................................................................................................................53
Conclusion......................................................................................................................................55
Recommendation............................................................................................................................55
Areas for further study....................................................................................................................56
REFERENCES...............................................................................................................................57
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DECLARATION

I, Erejo Isaac Erima declare that this research proposal on “THE EFFECT OF SUPPLY CHAIN
MANAGEMENT PRACTICES ON SERVICE QUALITY IN HEALT FACILITIES IN WEST
NILE -UGANDA” is my original work and it has never been submitted to any Institution or
University for the award of higher education.

Date; 09/08/2021

Name: Erejo Isaac Erima

REG.NO: A9921920000041 (el)

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DEDICATION

This work is dedicated to my beloved mother and the academia who inspired and guided me in
the overall success of the project.

May the Almighty bless you.

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ACKNOWLEDGEMENT

I wish to extend special thanks to my supervisor Madam Amviko Gloria for the encouragement,
good will and professional guidance throughout my report writing. I

I am specifically delighted to mention the following; my friends who have patiently endured the
challenging times and have always encouraged me greatly, the participating respondents from
Health facilities. I am also greatly indebted to all the people whose support made this study a
success. I would like to thank them all as I will not be able to mention all of them by names, their
contributions will always be in my memory.

May all of you out there consider this to be a token of my gratefulness to you.
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ABSTRACT

Quality service delivery in the public health sector has received increasing attention in recent
years as both a priority and a challenge for many countries as healthcare institutions find
themselves with increasing number of products, programs and patients to manage. SCM practices
involve a set of activities undertaken in an organization to promote effective management of its
supply chain. The objective of the study was to explore the effect of supply chain management
practices on service quality in health facilities in West Nile- Uganda, the impact of these on
service quality among the health service delivery in West-Nile and the challenges that health
facilities encounter in service delivery. Among the areas reviewed include: the effect of
Standards and specifications on service quality and the effect on compatibility on Service quality,
effect of delivery on service quality in health facilities, the effect of after procurement services on
service quality in health facilities, the quality of service at health facilities in west-Nile-Uganda.
The Conceptual framework was also covered. The study adopted a case study descriptive design.
The researcher conducted data on the on the study from a sample of 50 health facilities were
selected from a population of 70 health facilities of grade 3 health facilities within the West-Nile
region. From each facility 4 procurement staff were selected as a respondent using simple
random sampling which gave a sample size of 200 respondents. The study used primary data
collected through a structured questionnaire. Data collected was analyzed using descriptive and
regression analysis. The research established a positive correlation between service quality and
SCM practices in health facilities namely; relationship with suppliers, compatibility, standards
and specifications, delivery and after procurement services. The present study used only health
facilities in West-Nile, future studies should consider expanding their scope to include private
hospitals. Further studies related to the health sector can be conducted especially in areas of
comparative studies between public, private and military health service sectors.
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CHAPTER ONE

Introduction and background

Improving the health of the nationals of any given country is an international priority and a
Millennium Development Goal. To this effect since late 1980s Uganda has instituted numerous
health sector reforms and policies aiming at improving the functioning and performance of the
health sector and, ultimately, the health status of the population. Despite these reforms and
policies, including an overall decentralization of government, health services and health status
remain largely unchanged in Uganda. In fact the health care and health status indicators for
Uganda have remained poor. For example data from the Uganda Demographic Health Survey of
2000–2001 suggest further declining health status and health service delivery compared to the
situation five years earlier. A case in point, the Maternal Mortality Ratio (MMR) was estimated in
2006 at 435 maternal deaths per 100,000 live births (Uganda Bureau of Statistics and Macro
International Inc. 2007), showing little progress towards the government‘s own goal of reducing
maternal mortality from 500 to 300 between 2001 and 2008. Considering these developments, an
overview is necessary to analyze the current status as well as past trends regarding health service
delivery in Uganda with an object to identify the various challenges and barriers in the system
and possibly come up with recommendations in this paper. Health services in Uganda are
provided by the Ministry of Health (MoH), Ministry of Local Government (MoLG), Private and
non-government organizations (NGOs) particularly religious groups. MoH is responsible for
planning and developing health policies and for providing health care in all government hospitals
while the MoLG is in charge of health care delivery at the district level and below. The NGOs
provide services both in hospitals and in smaller medical units. The current health system is
organized under four levels of health care: primary, secondary, tertiary and quarternary. The
primary level care (comprising of health centers and other lower units; the secondary level
comprises a network of district and rural hospitals; the tertiary level includes all General Referral
Hospitals based at regional capital; and the two national hospitals (Mulago and Butabika)
comprise the quarternary and highest level of care. Usually each of original 39 districts in the
country has at least one hospital and several other smaller health units (Health Center IVs & IIIs).
With this arrangement, it was estimated that some 27% of the population are within 5 km of the
nearest health unit, while 57% are within 10km (Uganda Government, 1992)
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Therefore, the sources of health care in Uganda include Government and Non-Governmental
Organization (NGO) health facilities, Community Medicine Distributors (CMDs), traditional
healers, drug shops and private clinics. With an aim to increase access to health care for people,
the government removed user fees in all government health units (Burnham et al. 2004;
Nabyonga et al. 2005) and started the Home Based Management of Fever (HBMF) in 2002 using
CMDs to distribute antimalarial’s for free in the villages (Government of Uganda,2002).

Problem Statement

The delivery of quality service in Uganda has faced numerous challenges, the health care and
health status indicators for Uganda have remained poor, and the existence several barriers and
challenges to the use of health service delivery, including distance, transportation, bribery,
informal costs or low perceived quality etc. Barriers against use of services include internal
factors such as the popularity of the facility (which may reflect perceived quality of care or costs
incurred by users), as well as external barriers such as distance and transportation problems. As a
result of differences in these barriers, certain facilities may be utilized dramatically more than
others, even within a reasonably small geographic area such as a district (where socio-cultural
norms of facility use may be fairly homogenous). So while the typical barriers are known, there is
little information available to national and local level planners or district health officials on how
to identify which barriers to service use are pronounced in an area, or crucially limiting the use at
a specific facility. In this way, using routinely available local data from various studies, hospital
records and census information, it was possible to draw preliminary conclusions about which
barriers are more or less important in particular health facilities and service delivery.

Service Quality

Service quality can be viewed as the difference between customer expectations and perceptions;
expectation means service provider performance during deliverance of services whereas
perception is measurement of delivery by the service provider

(Parasuraman et al., 1985, 1988). According to Asubonteng et al. (1996, p-24),

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Service quality can be defined as “the difference between customers‟ expectations for service
performance prior to the service encounter and their perceptions of the service received”. Gefen
(2002) adds that it is a comparison made by the customers between the quality of services they
want to receive and what they actually received from the service provider. Measuring service
quality is one of the most important activities to improve perceived service quality, make a
difference, gain competitive advantage, and sustain profit levels of the hospitals. As a result, the
measurement of service quality deserves special attention (Baki, Basfirinci, Ilker Murat, &
Cilingir, 2009).

Brady and Cronin, (2001) suggested a new model by combining four models. They improved
SERVQUAL (Parasuraman, et al., 1988) by specifying what needed to be reliable, responsive,
empathic, assured and tangible. Brady and Cronin adopted service quality perception based on
evaluation by customer in three dimensions namely: Interaction Quality (i.e., functional quality),
Physical Environment Quality, Outcome Quality (i.e., technical quality) (Gronroos, 1984; Rust &
Oliver, 1994). In addition, they accept multilevel service quality perceptions and
multidimensional (Dabholkar, Thorp, & Rentz, 1996).

Service quality has three primary level dimensions in this conceptualization such as interaction,
environment and outcome with three sub dimensions for each one:

Interaction (Attitude – Behavior – Expertise), Environment (Ambient Conditions – Design –

Social Factors), and Outcome (Waiting Time – Tangibles – Valence. A new model conceptualized
by this hierarchical model and SERVQUAL factors specified into sub dimensions. Brady and
Cronin have improved service quality framework and solved the stalemate in this theory. It
defines service quality perception and a clear form of service quality measurement. In
SERVQUAL measurement, service outcomes were not clearly considered, but Brady & Cronin’s
model seems to fill this void (Pollack, 2009).

Some researchers work on the hierarchical model found its reliability and applicability in various
services. Like all the measurements, hierarchical model has difference in factors and importance
of sub dimensions in regards to services such as Health care (Chahal & Kumari, 2010; Dagger,
Sweeney, & Johnson, 2007), Sport (Ko, 2000), Mobile health (Akter, D‟Ambra, & Ray, 2010),
hairdresser (barber) and phone service subscribers (Pollack, 2009). This model will able firms to
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recognize problems in primary stage of their delivered services - Interaction Quality, Physical
Environment Quality, and Outcome Quality - (Pollack, 2009). It can help managers find customer
needs and service weaknesses simultaneously in order to enhance service quality perception and
service experiences of customer via high quality of service. This model shows better
understanding about customer perception of service quality until today.

General objective of the study

The general objective is to study the effect of supply chain management practices on service
quality in health facilities in West Nile-Uganda.

Objectives of the study

To establish the effect of relationship with suppliers on Service quality in Health facilities in
West Nile- Uganda.

To establish the effect of Standards and specifications on service quality in health facilities in
West Nile-Uganda.

To assess the effect of compatibility on Service quality in health facilities in West Nile-Uganda

To examine the effect of delivery on service quality in health facilities in west Nile-Uganda.

To examine the effect of after procurement services on service quality in health facilities in west
Nile-Uganda.
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Research questions

What is the effect of Supplier relationship on Service quality in Health facilities in West Nile-
Uganda?

What is the effect of Standards and specifications on service quality in health facilities in West
Nile-Uganda?

What is the effect of compatibility on Service quality in health facilities in West Nile-Uganda?

What is the effect of delivery on service quality in health facilities in West Nile?

What is the effect of after-sales service on service quality in health facilities in West Nile?

Scope of the study

Geographical scope

The study was conducted within West-Nile covering health facilities Both Public and Private.

Time scope

The study covered a period of three months from April to August 2021

Content scope

The research is limited to establishing the effect of supply chain management on service quality
in health facilities in West-Nile region in Uganda
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Conceptual frame work

The conceptualized linkage between the variables was illustrated by the conceptual framework
below.

Figure2: Conceptual frame work for studying the effect of electronic procurement on
Service quality in health facilities in West Nile region in Uganda.

Independent variables - SCM Practices Dependent variable- Service Quality

Independent Variable-SCM practices Dependent variable-Service quality

Relationship with
suppliers

Compatibility
Responsiveness
Trust
Specifications and
standards Safety
Reliability
Deliery Assurance

After procurement service

Source: Author (2014)

Figure 1: Conceptual Framework

The study framework defines the relationships between supply chain management dimensions
specific to Health Facilities (relationship with suppliers, compatibility, specifications and
standards, delivery and after-sales service) on the quality of health services' dimensions among
Health Facilities in West Nile Region, Republic Of Uganda from the perspective of procurement
officers or equivalents and doctors or equivalents.
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The independent variables are the supply chain management dimensions which include:

i) Relationship with suppliers: the relationship of supply chain managers (or equivalents) in
Health Facilities with the companies that supply products to the hospital.

ii) Specifications and standards: specifications set by the supply officers as conditions for the
supply in the tender.

iii) Delivery: indicates to delivery dates between the supply officer at the hospital and the
company that supply medical equipment and supplies. Delivery represents financial or
contractual arrangements amongst physicians, Health Facilities, and patients
(Dobrzykowski et al, 2012).

iv) After procurement service: follow-up maintenance and service and supply parts and needs
by suppliers to the Health Facilities after the sale.

v) Compatibility: Compatibility in strategic objectives and cultural values of business

partners facilitates supply chain capabilities (Rajesh and Matanda, 2012). Compatibility is
the appropriateness of medical equipment and supplies to the specifications and standards
that have been agreed upon between the supply administrator in the Health Facilities and
the company that supplied such equipment and supplies.

Dependent Variable (Quality of Health Services): the delivery of health care services and it's
continuous improvements to meet the needs of patients, through work completion by highly
skilled staff members dedicated to high quality service (Shaikh, 2005). The dimensions of health
service quality are represented through:

i. Responsiveness: suppliers speed and accuracy in response to client requests (Health

Facilities). Responsiveness has high validity and reliability in measuring the quality of
services in health care sector. (Kazemzadeh, Jahantigh, Rafie, & Maleki, 2011).
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ii. Trust: The degree of reliability enjoyed by the supplier from the viewpoint of supply
officers at the Health Facility. Trust is conveyed through faith, reliance, belief, or
confidence in the supply partner (Spekman, Jr, & Myhr, 1998).

iii. Safety: Service provided to be free from uncertainty, risk and doubt to a certain degree.
By increasing the complexity of health care, the demand for improving patient safety and
monitoring the quality of services has become a critical issue (Manias, 2010).

iv. Reliability: examines the ability of the service provider to perform services right the first
time and keep service promises (Smith, Smith & Clarke 2007).

v. Assurance: knowledge and courtesy of employees and their ability to convey trust and
confidence (Smith et al. 2007; Kay & Pawitra 2001).

Significance of the study

The study will add knowledge to the field of procurement through the use of new technological
methods like internet and staff recruited in the procurement department will benefit if they adopt
the knowledge on behalf of the management.

The research provides reference material for the further studies to add on existing literature in
related studies.

The study will help the researcher to build and improve on the research skills through consulting
and using methods to produce outcome.

The study will help the management of health facilities in Westnile-Uganda to further explore the
most appropriate supply chain management practices to improve on service delivery.
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CHAPTER TWO: LITERATURE REVIEW

2.1 Introduction

The purpose of this section was to provide a critical evaluation of the available research evidence

about supply chain management practices and how they impact on service quality of service in

Health Facilities in West Nile, Republic of Uganda. It covered various studies conducted by other

researchers on supply chain management practices and service quality. Among the areas reviewed

include: supply chain management practices, health supply chain, service quality in supply chain

and challenges of supply chain management. The chapter also covers the conceptual framework

of this study.

2.2 Supply Chain Management

In 1982, Keith Oliver, a consultant at Booz Allen Hamilton introduced the term "supply chain

management" to the public domain in an interview for the Financial Times. In

1983 WirtschaftsWoche in Germany published for the first time the results of an implemented

and so called "Supply Chain Management project", led by Wolfgang Partsch.

In the mid-1990s, more than a decade later, the term "supply chain management" gained currency

when a flurry of articles and books came out on the subject. Supply chains were originally

defined as encompassing all activities associated with the flow and transformation of goods from

raw materials through to the end user, as well as the associated information flows. Supply-chain

management was then further defined as the integration of supply chain activities through

improved supply-chain relationships to achieve a competitive advantage.

In the late 1990s, "supply-chain management" (SCM) rose to prominence, and operations

managers began to use it in their titles with increasing regularity.

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Other commonly accepted definitions of supply-chain management include:

The management of upstream and downstream value-added flows of materials, final goods, and

related information among suppliers, company, resellers, and final consumers.

The systematic, strategic coordination of traditional business functions and tactics across all

business functions within a particular company and across businesses within the supply chain, for

the purposes of improving the long-term performance of the individual companies and the supply

chain as a whole

A customer-focused definition is given by Hines (2004:p76): "Supply chain strategies require a

total systems view of the links in the chain that work together efficiently to create customer

satisfaction at the end point of delivery to the consumer. As a consequence, costs must be lowered

throughout the chain by driving out unnecessary expenses, movements, and handling. The main

focus is turned to efficiency and added value, or the end user's perception of value. Efficiency

must be increased, and bottlenecks removed. The measurement of performance focuses on total

system efficiency and the equitable monetary reward distribution to those within the supply

chain. The supply-chain system must be responsive to customer requirements."

The integration of key business processes across the supply chain for the purpose of creating

value for customers and stakeholders

According to the Council of Supply Chain Management Professionals (CSCMP), supply-chain

management encompasses the planning and management of all activities involved in sourcing,

procurement, conversion, and logistics management. It also includes coordination and

collaboration with channel partners, which may be suppliers, intermediaries, third-party service
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providers, or customers. Supply-chain management integrates supply and demand management

within and across companies.

The Global Supply Chain Forum defines SCM as “the integration of key business processes from
end user through original suppliers that provide products, services, and information that add value
for customers and other stakeholders” (Lambert, 2008; Chan & Qi, 2003, p.7). The concept
Supply Chain Management spans all movement and storage of raw materials, work-in-process
inventory, and finished goods from point of origin to point of consumption (Hines, 2004).
Jabbour et al (2011) realized a survey with 107 Brazilian companies and statistics techniques
were employed to build four new dimensions by mapping 22 practices for four constructs of
Supply Chain Management namely: Supply chain (SC) integration for production planning and
control (PPC) support; Information sharing about products and targeting strategies, Strategic
relationship with customer and supplier, and Support customer order. A more complex study of
practices is presented by Prajogo and Olhager (2012).

Due the globalization and specialization of the firms supply chain integration has become one of
the most important fields of study as the performance. Integration has at least two strands: the
logistics integration, refers to specific logistics practices and operational activities that coordinate
the flow of materials from suppliers to customers throughout the value stream (Stock et al.,
2000), and the information integration which refers to the sharing of key information along the
supply chain network which is enabled by information technology (IT). Prajogo and Olhager
(2012) captures the three principal elements of an integrated supply chain suggested by Handfield
and Nichols (1999), as seen below: Information flow Product and material flows Long term
relationships between supply chain partners. Zhou and Benton Jr (2007) work on six practices to
study the impact on supply chain dynamism and delivery performance. The practices are listed
below: Plan JIT Production Delivery practice Information sharing support technology
Information content Information quality Managerial Process IS/IT Operational Process 4 With
regards to Lean practices and Supply Chain Performance, Zaman and Ahsan (2014) states that
Lean is applicable in many supply chains, particularly those seeking to improve performance by
reducing waste. Cost competitive supply chains can benefit from utilizing lean to remove waste
and reduce costs. The lean supply chain can mitigate the lack of co-ordination between
performance measures and lean tools and techniques.
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Supply Chain Management (SCM) is the management and oversight of a product from its origin
until it is consumed. SCM involves the flow of materials, finances and information. This
includes product design, planning, execution, monitoring and control.
Mentzer, Flint, & Hult, (2001), defines supply chain management as the systematic, strategic
coordination of the traditional business functions and the tactics across these business functions
within a particular company and across businesses within the supply chain, for the purposes of
improving the long-term performance of the individual companies and the supply chain as a
whole SCM practices involve a set of activities undertaken in an organization to promote
effective management of its supply chain (Koh, Demirbag, Bayraktar, Tatoglu, & Zaim, 2007).
Such activities include: demand forecasting, resource allocation, production planning and
scheduling, inventory management, and customer delivery, customer relationship management
(CRM), supplier relationship management.

Tecc.com.au (2002) defines Supply Chain as “a chain starting with raw materials and finishing
with the sale of the finished good”. Bridgefield Group (2006) defines Supply Chain as “a
connected set of resources and processes that starts with the raw materials sourcing and expands
through the delivery of finished goods to the end consumer”.

Pienaar W. (2009b) defines Supply Chain as “a general description of the process integration
involving organizations to transform raw materials into finished goods and to transport them to
the end-user”. The above definitions centralize on the core determinants of an effective Supply
Chain. They connote the need for a provenance and a destination within which goods flow and
accept the approach that overall Supply Chains start with resources (raw materials), combine a
number of value adding activities and finish with the transfer of a finished goods to consumers.
The following definitions are more complicated. They include an extended view of a Supply
Chain and integrate extra activities in the function of the Supply Chain. Little, A. (1999) defines a
Supply Chain as “the combined and coordinated flows of goods from origin to final destination,
also the information flows that are linked with it”.

According to Chow, D. and Heaver, T. (1999), Supply Chain is the group of manufacturers,
suppliers, distributors, retailers and transportation, information and other logistics management
service providers that are engaged in providing goods to consumers. A Supply Chain comprises
both the external and internal associates for the corporate. Ayers,J. B.(2001) defines Supply Chain
as life cycle processes involving physical goods, information, and financial flows whose
objective is to satisfy end consumer requisites with goods and services from diverse, connected
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suppliers. Mentzer, J., Witt, W. D., Keebler, J., Min, S., Nix, N., Smith, D. & Zacharia, Z.(2001)
defines Supply Chain as a set of entities (eg. organizations or individuals) directly involved in the
supply and distribution flows of goods, services, finances, and information from a source to a
destination (customer). The difference in approach between both definitions categories and the
all-embracing descriptions combined in the latter render it very difficult to define a Supply Chain
in practice if each of the definitions is to apply. Various systems of distribution organized to work
through transport connections and nodes and recognized as Supply Chains in industry do not
concede any of these definitions. For the objective of this study, it is consented that the role
Supply Chain is to add value to a product by transporting it from one location to another,
throughout the good can be changed through processing. 2.2 Supply Chain Management The
connections and nodes in a Supply Chain achieve functions that contribute to the valu

Supply chain management is the management of information, processes, goods and funds from
the earliest supplier to the ultimate customer, including disposal. Services have become
increasingly important as the driving force in the economy. However, there has been little
research to date on services supply chains. (Ellram, Tate & Billington, 2007). It is believed that
service businesses can benefit by applying some best practices from manufacturing to their
processes. However, the inherent differences in services create a need for supply chain
management tools specific to the services sector.
Supply Chain Management (SCM) concepts have been implemented successfully in the service
industry like retail, financial services, transportation services, courier service and logistics
providers. The classical example in retail industry is Wal-Mart. It has provided better service to
its customer by integrating Supply Chain Management to the entire operations.

P&G also implemented the SCM concept which has provided the company competitive
advantage in the market. In general, SCM offers huge benefits to the service industry. This will
enable the firm to achieve greater customer satisfaction and loyalty (Lee & Billington, 1995).

2.3 Supply Chain Management Practices

SCM practices involve a set of activities undertaken in an organization to promote effective

management of its supply chain (Koh et al., 2007). The short-term objectives of SCM are to

enhance productivity, reduce inventory and lead time. The long-term objectives of SCM are to

increase market share and integration of supply chain (Koh et al., 2007). SCM practices can be
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defined in various ways. Donlon (1996) coined SCM practices as practices that include supplier

partnership, outsourcing, cycle-time compression, continuous process flow and information

technology sharing. Li et al. (2005) defined SCM practices as the set of activities that

organizations undertake to promote effective management of the supply chain. Otto and Kotzab

(2003) termed SCM practice as a special form of strategic partnership between retailers and

suppliers.

Alvarodo and Kotzab (2001) viewed SCM practices in terms of reducing duplication effects by

focusing on core competencies and using inter-organizational standards such as activity-based

costing or electronic data interchange, and eliminating unnecessary inventory level by postponing

customizations towards the end of the supply chain. Koh et al. (2007) categorized SCM practices

from the following aspects: close partnership with suppliers, close partnership with customers,

just-intime supply, strategic planning supply chain benchmarking, few suppliers, holding safety

stock and sub-contracting, e-procurement, outsourcing and many suppliers.

Ellram, Tate and Billington (2007) identified seven theoretical processes of service supply chains

which include information flow, capacity and skills management, demand management, customer

relationship management, supplier relationship management, service delivery management and

cash flow. In general, SCM practices are categorized into demand management, customer

relationship management, supplier relationship management, capacity and resource management,

service performance, information and technology management, service supply chain finance, and

order process management (Chong, Chan, Ooi & Sim, 2010).

Baltacioglu, Ada, Kaplan, Yurt & Kaplan, (2007) ascertains that effective supply chain

management practices will reduce costs, boost revenues, increase customer satisfaction,
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assurance and improve service delivery. Boon-itt and Pongpanarat (2011) adapted the seven

service Supply Chain Management practices from Ellram et al. (2004) which are demand

management, customer relationship management, supplier relationship management, capacity and

resource management, service performance management, information and technology

management, order process management. Based on the detailed analysis, there are five main

dimensions of Supply Chain Management practices widely acknowledged by the researchers as

well as suitable to be applied in healthcare industry. These five service Supply Chain

Management practices are information & technology management, customer relationship

management, supplier relationship management, demand management, and capacity and resource

management. For the purpose of this study, the Supply Chain Management practices in healthcare

industry are conceptualized as a multidimensional construct comprising of the five dimensions.

Porter (1985) debated that an organization‟s strengths can be mapped to two categories which are

cost advantage and differentiation. Applying the organization‟s strengths will result in cost

leadership, differentiation and focus. These are the results which will be relevant for public

healthcare organization. The differentiator of a public healthcare organization is to provide

affordable healthcare to all citizens. The focus is the well-being and quality of life for patients.

Good supply chain practices will result in cost leadership due to optimal contracting and supplier

relationship management. Supplier relationship management is defined as a process where both

customers and suppliers maintain long-term close relationship as partners. The five key

components include coordination, cooperation, commitment, information sharing and feedback

(Baltacioglu et al., 2007).

Ambe (2009:248) mentions that SCM is an essential element of sensible financial management in
the South African public sector management. It utilizes internationally accepted best practice
principles, whilst at the same time addressing government's preferential procurement policy
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objectives. The aim of SCM is to add value at each phase of the process commencing with
demand of goods or services to their acquisition, overseeing the processes of logistics and finally,
after use, to their disposal. In undertaking that, it addresses deficiencies in recent practice linked
to procurement, contract management, inventory and asset control and obsolescence planning.
The adopting of SCM policy ensures consistency "in bid and contract documentation and options
as well as bid and procedure standards, among others, will promote standardization of SCM
practices".

Baltacioglu et al. (2007) defined Customer relationship management as maintaining and

developing long-term customer relationships by developing information continuously and

understanding what customers want. A number of researchers identified interactive management,

understanding customer expectations, empowerment and personification as ways of effectively

implementing Customer Relationship Management.

Dufour and Maisonnas, (1997) affirmed that interactive management which is a component of

Customer Relationship Management comprises all actions designed to transform the prospective

client into an active and effective customer. This can be in form of attitude of staff to patient in

the hospital. A cordial and humane attitude will definitely make a patient become an effective

one. Patient feedback and suggestion can be used by the health facilities for better performance.

Power, (1998) and cited by Evans and Laskin, (1994) identified understanding customer

expectations which stressed the importance of identifying the customers‟ desires and supplying

to those customers products and services that meet their expectations through interaction with the

patients

Evans and Laskin, (1994); Herzberg, (2003) noted that empowerment which refers to the process

a firm adopts to encourage and reward employees who exercise initiative, make valuable, creative

contributions and do whatever is possible to help customers solve their problems. Evans and
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Laskin, (1994) added that partnerships are created when suppliers work closely with customers

and add desired services to their traditional product and service offering. Payne (1994) put

partnering as the extreme end of his loyalty scale and regarded it as an important step that usually

leads to the development of a close and durable relationship between supplier and customer.

Wilson (1995) considered partner selection as the first step in the Customer Relationship
Management process.

Schubert, (2003) concluded that personalization which refers to the extent to which a firm assigns

one business representative to each customer and develops or prepares specific products for

specific customers. It is about selecting or filtering information for a company by using

information about the customer profile. According to Baltacioglu et al. (2007) demand

management is the process of managing and balancing customer demand by keeping updated

demand information.

Another aspect of Supply Chain Management practice is information technology and the

deployment of e-business which are closely linked to the co-ordination and integration of

operational processes. Many studies have advocated the important role information technology

plays in supply chain practices (Breen & Crawford, 2005; Harland & Caldwell, 2007) and it will

be of no surprise therefore that many studies on health care supply chains focus on the role of e-

business technologies across hospital supply chains (Siau et al., 2002).

SAP (2003, January) defines (SRM), “Supplier Relationship Management to include both

business practices and software and is part of the information flow component of supply chain

management (SCM). Supplier Relationship Management practices create a common frame of

reference to enable effective communication between an enterprise and suppliers who may use

quite different business practices and terminology. As a result, Supplier Relationship

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Management increases the efficiency of processes associated with acquiring goods and services,

managing inventory, and processing materials.”

According to Herzlinger (2006), and Porter and Teisberg (2004), health care is considered to be

different from most other industries due to the high level of regulation, the high proportion of

governmental investment, the associated low pressure in respect of effectiveness and efficiency

of state-subsidized health care facilities and the lack of orientation towards customer benefit. As a

consequence of that, the health care sector shows a relatively underdeveloped information system

structure (Parente, 2000). However, in order to provide optimal health service delivery there is a

long-standing practice of including information beyond the traditional boundaries of a single

health care organization (Scott, 2002). Furthermore, there is an imminent obligation for

cooperation in order to comply with the requirement of both, internal (doctors, pharmacists,

nurses) and external stakeholders (patients, governmental agencies, suppliers). Baltacioglu et al.

(2007) defined Capacity and resource management as management of capacity and resources of

service that are organized effectively and operated efficiently at optimal level.

2.4 Supply Chain Management and Service Quality in Health Facilities

The effects of supply chain management on health care service quality, has to do with quality

from an administrative point of view, medical service quality can be measured from a

professionally medical perspective, or from the recipient of such services, the patient, or from an

administrative perspective, which is the focus of this study.

The service quality of health care services rendered from an administrative perspective primarily

has to do making use of available resources and the ability to attract new ones to cover the

required needs of exceptional service, which provides the right service at the right time at a

reasonable cost.
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Supply Chain Management deals with the management processes of flows of goods, information

and funds among supply chain partners in order to satisfy consumer needs in an efficient way

(Chopra & Meindl 2007).

Providing quality of health care service at a reasonable cost and rationalizing resources should

never be at the expense of a quality performance, which requires efficiency at both the planning

and executing phases, personal and professional competency and finally an internally structured

philosophy to deal with external parties (Ayers. 2010). More accurately, the search for more

resources requires the development of public relations with the health sector as a whole. This

personal relation requirement is evident in the vague and complicated administrative

organizations. The health system, in general, is vague and complicated, requiring tremendous

effort for the promotion of administrative quality. This demonstrates the great importance of

supply chain management and its role in ensuring the quality of medical services. Omar et al

(2010) also stated that supply chain management includes the management of product,

information, and financial flow from the source of supplies to the manufacture and assembly of

the product right to the delivering of the final product to consumers.

A public health supply chain is a network of interconnected organizations or actors that ensures

the availability of health commodities to the people who need them. Organizations in the supply

chain often include departments of ministries of health (procurement, planning, drug regulatory

board, human resources, and health programs); national medical stores; donors; non-

governmental organizations (NGOs); regions and districts; health facilities; teams of community

health workers; and private sector partners, such as third-party logistics providers, drug

manufacturers, distributors, and private service providers (McCutcheon & Stuart, 2000).
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The supply chain management practices are viewed to be related to supply chain responsiveness

which will increase supply chain competitive advantage and then lead to organizational

performance (Sukati, Hamid, Baharun & Huam, 2011). The effective supply chain management

practices will reduce costs, boost revenues, increase customer satisfaction, and also improve

service delivery (Baltacioglu, Ada, Kaplan, Yurt & Kaplan, 2007).

The healthcare supply chain is composed of three major players at various stages, namely,

producers, purchasers, and healthcare providers. Producers include pharmaceutical companies,

medical surgical products companies, device manufacturers, and manufacturers of capital

equipment and information systems. Purchasers include grouped purchasing organizations,

pharmaceutical wholesalers, medical surgical distributors, independent contracted distributors,

and product representatives from manufacturers. Providers include hospitals, Lower Health

facilities, systems of hospitals, integrated delivery networks, and alternate site facilities (Toba et

al, 2008).

Many different stakeholders are involved in health care supply chain practices. Therefore, the

application of supply chain management practices in a health care setting is almost by definition

related to organizational aspects like building relationships, allocating authorities and

responsibilities, and organizing interface processes. Different studies have highlighted the

importance of organizational processes when applying supply chain management practices.

Moreover, recent studies reveal that elements like organizational culture, the absence of strong

leadership and mandating authority, as well as power and interest relationships between

stakeholders might severely hinder the integration and co-ordination of processes along the health

care supply chain (McCutcheon & Stuart, 2000).

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2.5 Challenges for Supply Chain Management and Service Quality Delivery at Health
Facilities

Health Facilities encounter many challenges accompanied with new requirements, namely;

customer dissatisfaction, increasing cost of the health services, competition and reducing the

reimbursement for services. All of these factors force the health facilities to adopt a system that

can meet these requirements, dealing with the continuous changes, technology changes, increase

in the health services costing, increase in competitive position and gaining customers‟

satisfaction (Ali et al, 2012).

Meyer and Meyer (2006) in a round table discussion at MIT center for Transport and Logistics

pointed out a few important constraints in healthcare supply chain as: high cost of healthcare,

wasteful behaviors, and complex regulations and requirements. They suggested solutions focused

on making supply chain more demand driven, increasing collaboration between involved parties,

increasing visibility of practices and inventory and better standard implementation.

According to the National Health Accounts research, December 2011, the key supply chain

challenges are: the under utilization of supply chain data standards results in significant

inefficiencies across the entire supply chain continuum ,lack of representation at the top

executive level to recognize its strategic importance within the organization; supply chain silos as

many organizations still operate disparate supply chains serving individual departments and

service lines, inhibiting an organization's ability to coordinate purchases and limiting its ability to

understand total supply chain costs; and clinician resistance to change as physicians and other

clinicians like choices and autonomy and are often loyal to particular products and brands.

However, there are many possible barriers to the use of services beyond their perceived

popularity. Distance and transportation problems in particular may affect utilization rates, and so
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it is important to look beyond simple use rates to help guide policy on where improvements are

needed. Looking at this indicator in combination with the number of deliveries can help illustrate

the importance of distance or transportation barriers with regard to others which could be

classified as internal ‘barriers to the facility influencing its popularity’ (such as perceived low

quality, or informal costs charged in a facility). In general it appears that many people travel

outside their local area to reach the more popular services, which would indicate transportation is

not necessarily as important as the perception of the facility. However, it is unknown how far the

average travel distance was, as these data were not available. Access to treatments is poor, and

many people die from infections for which treatments or prophylaxis should be available readily

(Shabbar et al., 2004).

Willingness to travel appears to be linked with the popularity of the service, but this finding in

itself still leaves unclear how much of facility utilization can be attributed to ease/difficulty of

transportation from surrounding areas, as opposed to internal factors affecting the popularity of

the facilities. Bypassing has been described elsewhere (Akin and Hutchinson 1999), and can

present a picture of the relative importance of transportation versus popularity, showing when

individuals are willing and able to overcome distance issues to reach more desirable services.

Rapid economic growth and widening economic inequalities have been associated with increased
injuries, both unintentional and intentional, such as road traffic injuries and interpersonal
violence, in low- and middle-income countries (LMICs), necessitating establishment of
emergency trauma care systems (Mock et al. 2004). Injury is a growing public health concern
worldwide. Since severe injuries require urgent treatment, involving smooth, timely patient
referral between facilities, strengthening of the referral system would reduce injury mortality but
this has been discovered not the case in this study. Smooth referral consists of identification of
severe cases, organization of transportation, communication between facilities and prompt care at
the receiving facility. Although most of the previous studies used patients‘ individual data to
analyze factors associated with behavior and barriers to service use, many of the factors
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influencing the referral are facility specific e.g. referral guidelines, communication (practices and
systems), and transportation (availability and cost). Unavailability of transportation is a
widespread barrier to emergency referral (Kobusingye et al. 2005). A study in Uganda reported
that relatives have to obtain money by selling assets or borrowing before starting patient transfer
(Peterson et al. 2004). Financing such costs, along with treatment and indirect costs, can push
poor people into the poverty trap (Mock et al. 2003; Hardeman et al. 2004). Lack of
communication can also deter referral (Kalter et al. 2003) and reduce the quality of trauma care,
and the supply of referral and feedback letters is inconsistent or even rare in developing countries
like Uganda.

The existing information on referral included the presence of referral guidelines for injured
patients, distance of referral, commonly used transportation and its cost, communication with
receiving facilities, and fast-tracking at receiving facilities. However, formal referral systems
were not functioning well in some areas (insufficient communication and underutilization of
ambulances), and informal systems were frequently involved (patient transfer by taxi or referral
by community volunteers, and treatment by traditional healers) but were not fully integrated into
the referral network (traditional healers seldom referred patients to public facilities). The referral
distance was long for most of the surveyed facilities and transportation costs were high when
transferring from remote areas, even by ambulance (Nakahara et al., 2010). A few studies
investigating the prompt transfer of injured patients revealed a deficiency in the ambulance
system or communication devices but did not examine the referral mechanism as a whole
(Nakahara et al. 2007). The referral system fails to function and service users largely ignore it and
go directly to that level of the system which offers the best combination of quality and access
(geographical and financial) from their perspective (Okello et al., 1994)

Peng (2011 :35) states that SCM is concerned with the flow of products and information between
supply chain members' organizations. Recent developments in technology enable the organization
to avail information easily in their premises. These technologies are helpful to coordinate the
activities to manage the supply chain. The cost of information is decreased due to the increasing
rate of technologies. The importance of information in an integrated SCM environment is
therefore vital. Therefore due to continuous improvements on the world demands, as a result of
advancements in technology, supply chain technology stands as one of the primary pillars in the
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supply chain excellence strategy. However, improperly understood or implemented, it can cause
severe damage rather than improvement. It is therefore important to keep abreast.

Irfan and Ijaz, (2011) identified the service quality challenges to include: government funding,

lack of government interest in development of new healthcare projects in rural areas and

overburdened public hospitals and health centers due to rapid growth in population and people

tend to move from rural areas to major cities. Their research results showed that doctors, nurses

and supporting staff are not taking pain to attend the patient or to provide individual care to the

patients, take care of cleanliness, and sterilization of equipment’s, lack of feedback mechanism

showed a low commitment level towards their responsibilities in public hospitals and other health

facilities.

Hassan (2012) identified the following Supply Chain Management challenges, namely: poor

infrastructure, bulky materials to be transported, poor planning special materials to be

transported, poor order request form filling and late arrival of order request form. This study will

focus on the on nine Supply Chain Management challenges namely: poor infrastructure, poor

order request form filling, loyalty to certain products by pre-scribers or clinicians, lack of

financial resources, late arrival of order request form, uncertainty in terms of supplies, lack of

qualified personnel, uncertainty in terms of demand and lack of proper planning.

According to National Drug Policy and Authority Act 1993 (Ch 206), the national drug policy is
aimed at ensuring that essential, safe, efficacious and cost-effective drugs are made available to
the entire population of Uganda. Despite this, problems of access to quality essential drugs are
persistent. This is complicated by availability of few hard data regarding bottlenecks, especially
in the poorest parts of Africa and Asia where more than half the population still lacks access to
essential drugs World Health Organization (WHO, 1998).

The Global Fund to fight AIDS, Tuberculosis and malaria (2006) asserts that availability of
essential drugs and supplies in the public health sector is a continuing problem due to a
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combination of problems that include: Lack of an agreed procurement policy; lack of a single,
Ministry of Health (MOH) - led procurement strategy; lack of an integrated procurement
approach (MOH and donors, NGOs, vertical programs); lack of credible data and information for
procurement planning; poor forecasting; funding structures and arrangements not always able to
support procurement and ineffective procurement arrangements with suppliers and Others include
poor fund management and use at MOH, non- compliance to basic procurement rules and
regulations, weak regulatory infrastructure/underpinnings, poor use of advisory services from
cooperating partners. These problems result in regular emergency procurement activities with
high costs hence affecting service delivery.

Most studies have stated that one of the most important aspects for facility users in Africa is the
stock of drugs available (Jitta et al. 2003). Therefore, in addition to service use statistics, facilities
were surveyed for their availability of key drugs and supplies, as well as staff numbers, to see if
there were obvious differences between facilities that might explain their desirability to potential
users. Since significant funds are invested in pharmaceuticals, they tend to be in the focus of the
health care system, and the fact that a major proportion of the resources for health care are
invested in a commodity like drugs makes such an item extremely highly valued. Instead of
regarding pharmaceutical therapy as one among many components of the health care system,
drugs instead become central. Drugs become powerful, and they distort the interest from
preventive interventions, promotive health care services and other therapeutic interventions.
Furthermore drug-therapy becomes a symbol of biomedical care: a commodity to be consumed.
Consequently, several studies have suggested a considerable leakage of drugs from public health
facilities. According to McPake et al. (1998) the mean leakage at health facility level is estimated
at 78%. Also several scandals have rocked two of the institutions in the pharmaceutical system of
Uganda, the National Medical Stores (NMS) and the National Drug Authority (NDA). At the time
of writing, no Managing Director has been appointed to NMS; the head and two other senior
officials of NDA has been interdicted (New Vision, 1999).

While hospitals may be over-staffed, there is too little investment in maintenance of equipment
and facilities (Health Planning Department, 1998), a challenge facing health service delivery in
Uganda. The problem of the expiry of medicines in the supply chain is a serious threat to the
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already constrained access to medicines in developing countries. Some of the findings indicate
that medicines prone to expiry include those used for vertical programs, donated medicines and
those with a slow turnover. In developing countries, where budgets for medicines are often tight,
the supply cycle needs to be well-managed to prevent all types of wastage, including pilferage,
misuse and expiry. This wastage reduces the quantity of medicines available to patients and
therefore the quality of health care they receive. The expiry of medicines highlights a problem
with the supply chain, which includes medicine selection, quantification, procurement, storage,
distribution and use. In Uganda, volumes of valuable medicines have expired at the National
Medical Stores, in district and hospital stores, (Mwesigye, 2006) and the problem has also been
reported in Botswana, India and the United Republic of Tanzania. Surprisingly, all these top-
expiring medicines are either essential (with a high turnover because they are used by the
majority of the population) or vital (without them, the patient would die).

On further analyzing this challenge on contributing factors in the supply chain, the main ones
found included neglect of stock monitoring, lack of knowledge of basic expiry prevention tools,
non-participation of clinicians in medicine quantification in hospitals, profit- and incentive-biased
quantification, third party procurement by vertical programs and overstocking. Poor coordination
appears to be responsible for some expiry incidents. For example, expiry due to treatment policy
change and duplicate procurement can be prevented by sound coordination between key
stakeholders. Even though a medicine procurement and supply management task force was set up
by Uganda‘s Ministry of Health to plan the phasing out of chloroquine and
sulfadoxine/pyrimethamine, the expiry of large stocks of the latter suggests a serious lapse in
coordination. Countries undertaking similar ventures should involve their national medicine
regulatory agencies at all stages of the transition process to guide local production and to curtail
entry of phased-out.

Another factor that can affect use of a particular facility is costs charged. In Uganda, maternal
health care is meant to be free. As such, expenses accrued tend to be classified as informal ‘costs-
payments made unofficially, or expenditure on drugs or supplies intended to be free (McPake et
al. 1999; UNFPA 2004). Barriers against use of services include internal factors such as the
popularity of the facility (which may reflect perceived quality of care or costs incurred by users),
as well as external barriers such as distance and transportation problems. As a result of
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differences in these barriers, certain facilities may be utilized dramatically more than others, even
within a reasonably small geographic area such as a district (where sociocultural norms of facility
use may be fairly homogenous).

It was noted that during the 1980s, the government health services largely collapsed due to the
civil strife in the country. Health workers were not paid their salaries, and had to develop their
own survival strategies, often not in line with official government strategies. Payments for staffs
in government health facilities especially doctors, medical assistants and those with nursing
training was less than a half of the comparable private & NGO‘s pay who in addition also receive
other in-kind benefits. Since the task of the ministry was to deliver the services, and since this did
not happen, it lost much of its legitimacy. During the same time external sources but administered
largely by unmotivated civil servants. The external sources do not generally improve the salaries,
but sometimes supports the officers with per diems and other non-monetary benefits such as
travels outside the country. The result is a focus on benefits rather than the objectives of the
funds, which skews the system. One experience is that of investment in infrastructure. Since the
plans for constructing health facilities are often carried out without sufficient involvement by the
local community, there is often a limited sense of ownership of the items procured or the
infrastructure built. When there is no sense of ownership or even involvement of the local
community or district leaders, maintenance and sustainability becomes a problem and many of
such units soon end up in a deplorable state (Jeppsson et al., 2005). The goal, to build a health
care system involving the beneficiaries is left out and health becomes a biomedical product that is
handed over to the beneficiaries for their consumption. They have, however, little influence over
what the services will look like.

Among the major challenges facing the Health Facilities are stock outs and expired drugs occur at

all levels in the public systems including distribution outlets, National Medical stores, and Health

Facilities MOH, (2009b) particularly in the public system in rural communities (Elliot, 2008).

The causes, as suggested by previous studies and during recent interviews with stakeholders are

related to lack of funding MOH,(2009c) and limited control of drug quality and pricing Elliot,

(2008) such as counterfeiting Wendo, (2008), mark ups Elliot (2008): expired drugs Tebajjukira,
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(2009) and lack of transparency and regulation concerning price MOH, (2009b; Kiapi, (2008;).

Problems also constitute leakages including commissions and pilferage Kaheru, (2009) and lack

of coordination with the private sector in procurement MOH, (2009c); forecasting Izama, (2009),

problems of unsolicited drug donations, parallel production and lack of overview of available

stocks MOH, (2008b). While some of the above are closely linked with logistic problems,

specific challenges with the drug supply chain are pointed out including: Lack of efficient

funding and ordering processes means it can take six months to even a year to complete tendering

process, lack of competent staff, drug thefts (MOH, 2009b; Kimera, 2008; All Africa, 2009;

Okuonzi, 2009) and poor coordination between stores staff and medical clinicians.

The Ugandan health service delivery has also faced corruption issues. Bribes in the Ugandan
public sector appear to be fees-for-service extorted from the richer patients amongst those
exempted by government policy from paying the official fees. Bribes in the private sector appear
to be flat-rate fees paid by patients who do not pay official fees. Uganda is a low-income country
(GNI per capita of US$1500) classified as one of the most corrupt countries in Transparency
International‘s Corruption Perceptions Index, with an excellent source of data on bribes by
individuals in the 2002 Second National Integrity Survey (Transparency International,2004). In
the study by Hunt (2010), data showed that 37% of Ugandan bribes are paid in the health sector,
due to widespread use of the health system, and a comparison between bribery in the public and
private health care systems was made for this study. Almost every focus group notes that medical
attention at public hospitals and health units can only be obtained in exchange for payment
despite the official abolition of user fees at health units. They state that patients have to bribe to
attract the attention of medical staff and pay for all medical supplies, no matter how small.

Furthermore, the participants in the study highlighted that the only drug available at Ugandan
health facilities is Panadol (Tylenol) but other most drugs must be purchased at pharmacies, drug
shops or private practices with connections to the doctor recommending the drug, despite the fact
that they should be available free in the public health units (Jitta et al.,2003). Some groups noted
that the corruption and poor service in the public health sector lead people to use private clinics,
despite their cost.McPake et al. (1999) estimated that 68– 77% of revenues from official fees
Running page

were misappropriated and that 76%of drugs at the facilities they studied disappeared before
reaching patients. Given this, it seems highly unlikely that any bribe revenue is used to fund
health facility activities, rather than following the embezzled money into health workers‘pockets.
The abolition of most user fees shortly before my study period may simply have led health
workers to extract more bribes as a way of maintaining their illicit revenue.Additional results
combined with anecdotal evidence suggest that the public sector health staff extort bribes
particularly from the richer among the patients who officially need not pay. The results suggest
that well-intentioned policies to reduce health care payments for the poor may be thwarted by
health workers seeking to supplement their own incomes. In addition to undermining the goal of
increased access to health care, the effect could be to contribute to a culture of bribery which
helps bribery flourish in other institutions. XI. Culture and attitudes However, geographic barriers
are not the only factors that compel carers to figth

Corrupt transactions may occur in networks that are highly organized as well as opportunistically.
Lamour and Wolanin (2013:222) indicate that corrupt transactions occur between the corruptors
as a result of social interaction. They state that for corruption to occur there is usually
communication between two or more individuals that intend to do corruption. Even though
differences may exist in the nature and scope of corrupt behaviour, and the extent to which anti-
corruption measures are enforced, the phenomenon can be found at all times and within virtually
every government organ. It can also be found within the private sector. The term "corruption" is
used as a summarized mention referring to a large range of illicit or illegal activities. Although
there is no universal or comprehensive definition as to what constitutes corrupt behaviour, the
most prominent definitions share a common emphasis on the abuse of public power or position
for personal advantage. Klitgaard (2000:46) maintain that important conditions must be in place
to fight corruption in procurement, including a well delineated civil service system (merit based
and adequately paid) and law enforcement services that can investigate problems

2.6 Summary of Literature Review

The research concludes that SCM practices that are suitable to public healthcare management at

the Health Facilities, namely information and technology management, demand management,
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customer relationship management, supplier relationship management, capacity and resource

management to be included in the research framework.

2.7 Conceptual Framework

Based on the above literature review, the following conceptual framework can be drawn.

Independent variables Dependent variable

SCM Practices Dimensions Service Quality Dimensions

Relationship with
suppliers

Compatibility

Responsiveness

Trust
Specifications and
standards Safety

Reliability

Delivery Assurance

After procurement service

Source: Author (2014)

Figure 1: Conceptual Framework

Running page

The study framework defines the relationships between supply chain management dimensions

specific to Health Facilities (relationship with suppliers, compatibility, specifications and

standards, delivery and after-sales service) on the quality of health services' dimensions among

Health Facilities in West Nile Region,Republic Of Uganda from the perspective of procurement

officers or equivalents and doctors or equivalents.

The independent variables are the supply chain management dimensions which include:

vi) Relationship with suppliers: the relationship of supply chain managers (or

equivalents) in Health Facilities with the companies that supply products to the hospital.

vii) Specifications and standards: specifications set by the supply officers as

conditions for the supply in the tender.

viii) Delivery: indicates to delivery dates between the supply officer at the hospital and

the company that supply medical equipment and supplies. Delivery represents financial or

contractual arrangements amongst physicians, Health Facilities, and patients

(Dobrzykowski et al, 2012).

ix) After procurement service: follow-up maintenance and service and supply parts

and needs by suppliers to the Health Facilities after the sale.

x) Compatibility: Compatibility in strategic objectives and cultural values of

business partners facilitates supply chain capabilities (Rajesh and Matanda, 2012).

Compatibility is the appropriateness of medical equipment and supplies to the

specifications and standards that have been agreed upon between the supply administrator

in the Health Facilities and the company that supplied such equipment and supplies.
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Dependent Variable (Quality of Health Services): the delivery of health care services and it's

continuous improvements to meet the needs of patients, through work completion by highly

skilled staff members dedicated to high quality service (Shaikh, 2005). The dimensions of health

service quality are represented through:

vi. Responsiveness: suppliers speed and accuracy in response to client requests

(Health Facilities). Responsiveness has high validity and reliability in measuring the

quality of services in health care sector. (Kazemzadeh, Jahantigh, Rafie, & Maleki,

2011).

vii. Trust: The degree of reliability enjoyed by the supplier from the viewpoint of

supply officers at the Health Facility. Trust is conveyed through faith, reliance, belief, or

confidence in the supply partner (Spekman, Jr, & Myhr, 1998).

viii. Safety: Service provided to be free from uncertainty, risk and doubt to a certain

degree. By increasing the complexity of health care, the demand for improving patient

safety and monitoring the quality of services has become a critical issue (Manias, 2010).

ix. Reliability: examines the ability of the service provider to perform services right

the first time and keep service promises (Smith, Smith & Clarke 2007).

x. Assurance: knowledge and courtesy of employees and their ability to convey trust

and confidence (Smith et al. 2007; Kay & Pawitra 2001).

The service quality includes two dimensions; the first dimension deals with procedures and

specific systems which are established to provide the service, while the second is a personal and
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concerned with the interaction among workers and their attitudes and behaviors with customers

(Abu-Kharmeh, 2012).

CHAPTER THREE

METHODOLGY

3.0 Introduction

This chapter focused on the research methodology, laying particular emphasis on research design,
the study population, sampling procedure and selection, source of data, methods of data
collection, processing and analysis and measurement of the study variables.

3.1 Research Design

The study adopted a cross sectional design (Amin, 2005) using a quantitative approach. The
cross-sectional design was used to ensure that current events at the point in time of the study are
captured. The study employed Pearson correlation coefficient and regression analysis to
determine the relationship between variables and regression coefficients to establish the effect of
the independent variables on dependent variable while demographic characteristics of the
respondents was analyzed using descriptive statistics.

3.2 Study Population

The study population will consist of all the health facilities in West-Nile comprising of all health

centers three, fours, hospitals and regional referral hospitals both public and private.
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3.3 Sample Size determination and Sampling method

A sample of 50 health facilities were selected from a population of 70 health facilities of grade 3
health facilities within the West-Nile region. From each facility 4 procurement staff were
selected as a respondent using simple random sampling which gave a sample size of 200
respondents. The Krejcie and Morgan (1970) sample size determination table was used. The
study used proportionate sampling followed by a simple random sampling to select the
respondents to have equal chances to be selected to constitute the sample size. The unit of
analysis was the health facilities in westnile and unit of inquiry were procurement staff in the
selected health facilities.

3.4 Data Collection Methods and Source

Primary sources of data will be used. This data will be collected by surveys using structured
questionnaires as a tool. The structured questionnaires will enable the researcher to collect
quantifiable data. The use of a structured questionnaire is in line with the choice of measuring the
constructs on a five-point likert-scale. According to Roopa &Rani (2012) most scales use
structured questionnaires including the likert scales.

3.5 Data Quality Control

3.5.1 Exploratory factor analysis (EFA)

Exploratory factor analysis was done in order to ascertain whether the indicators under each
latent variable could measure that variable.

KMO and Bartlett's Test for the independent variable

Kaiser-Meyer-Olkin Measure of Sampling

.806
Adequacy.
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Approx. Chi-Square 1272.489

Bartlett's Test of
Df 325
Sphericity
Sig. .000

From the analysis, the Kaiser –Meyer-Olkin verified that the sample was adequate for
Exploratory Factor Analysis i.e. The KMO=0.806 for the independent variable latent constructs
and KMO=) = 0.737 for the dependent variable latent constructs respectively were above Kaisers
recommended threshold of 0.6 (Kaiser, 1974). The Bartlett’s test of sphericity for both the latent
constructs of the independent variable and the dependent variable returned Chi-square
(1272.489), 325 degrees of freedom with PV =0.000 and Chi-square (18.866), 3 degrees of
freedom with PV=0.00 were both significant at 1% indicating that the correlation between items
were sufficiently large for conducting Exploratory Factor Analysis (EFA).

The EFA results are summarized in the pattern matrix table below which shows the retained
indicators of latent constructs for both the dependent and the independent variables

Component

1 2 3 4

SR4 .822

SR5 .852

SR6 .873

SR7 .723

SS1 .770

SS2 .703
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SS4 .769

SS5 .793

C1 .672

C2 .863

C3 .820

C4 .629

C6 .528

C7 .638

SQ3 .741

SQ5 .895

3.5.3 Reliability

Sullivan M.G (2011) defines reliability and validity as whether an assessment instrument gives
similar results every time it is used with similar subjects in similar settings and how a study an
accurately answer the study questions or the strength of the conclusions drawn from the study
respectively.

A pilot study was conducted to check the reliability of the instrument.

Salvia and ysseldyke (1998) defined internal consistency as reliability for generalization to other
test items.

The researcher used chronbach’s alpha to check the internal consistency of the measurements.
 Running page

The researcher used Cronbach Alpha coefficient test to determine the internal consistence of the
scales that was used to measure study variables (Cronbach, 1951). The Cronbach Alpha which is
above 0.7 is sufficient to prove that the items in the instruments are reliable. The questionnaires
were given to 30 individuals to give their opinion regarding the relevancy of the questions using
a 4-point likert scale.

Summary of reliability coefficient for each latent construct

Latent constructs Cronbach’s Alpha

Relationship with suppliers (SR) 0.758

Standards and specifications (SS) 0.848

Compatibility (C) 0.822

Delivery 0.65

After procurement services (AS) 0.834

Service quality (SQ) 0.72

Reliability Statistics for all the latent constructs

Cronbach's Alpha N of Items

.814 12

Source: Primary data

According to Grayson (2004) and Nunnally (1978), a cut-off alpha coefficient of 0.7 is sufficient
to prove that the instrument is reliable. Therefore, the reliability coefficients of the research
instruments were higher than 0.7, implying that the instrument was reliable.
Running page

3.5.3 Validity

A pretest for validity of the tools was done where by the questionnaires were given to 5 technical
persons in the marketing field to check for consistency of the tools. The formula that was used:
CVI = K/N, where CVI = content validity index, K = total number of items in the questionnaire
declared valid and N = total number of items in the questionnaire. The result was in the table 3
below.

Summary of for the validity of the instrument

Latent constructs Content validity index

Relationship with suppliers (SR) 0.822

Standards and specifications (SS) 0.881

Compatibility (C) 0..852

Delivery 0.873

After procurement services (AS) 0.832

Service quality (SQ) 0.847

Source primary data

From the above table 3 the overall content validity index was above 0.8 which is acceptable.
Furthermore, the items in the instruments were discussed with three supervisors to check for
internal accuracy and relevancy for the study and base on the discussions, a consensus was
reached on the items that were included in final instruments to ensure that the instrument has
content validity.
Running page

3.6 Data analysis and presentation

Data was collected using questionnaires and sorted, coded and analyzed using SPSS software
version 20.0. Descriptive, frequency, Pearson correlation coefficient and regression analysis
statistics were used to examine the study variables. Statistical tools such as frequency
distributions and tables were used to describe and present the demographics characteristics of the
sample.

3.7 Measurement of research variables

The research variables supply chain management practices and Service qualitywere measured on
5 point likert-scale

3.8 Ethical consideration

These was followed by the researcher so as to ensure social responsibility, maintain the integrity
of human values and protect the welfare of the subjects involved. The researcher took heed of the
following ethical considerations;

Voluntary and informed Consent; this involved seeking the participants/respondents take part in
the study willingly. The researcher ensured that participants had a complete understanding of
the purpose and methods to be used in the study, the risks involved, and the demands placed
upon them as a participant. The participants were also informed that they have the right to
withdraw from the study at any time should they find any reason to do so in the due course of
the study.

Anonymity, confidentiality and privacy; the researcher refrained from referring to the
respondents by their names or divulge any other sensitive information about a participant.
The researcher promised to protect any information given. Should there arise any need for
any information to be revealed, the researcher then sought the consent of the respondent in
that regard.
Running page

Non-maleficence; the researcher ensured that no harm was caused/done to the respondents
by ensuring that questions asked were not embarrassing and did not force the respondents to
give information which could result into fear or anxiety.

CHAPTER FOUR

DATA PRESENTATION AND ANALYSIS

Introduction

This chapter presents the analysis of the data which was collected from the field.
 Running page

Analysis of gender.

Of the 200 respondents, 60% were male meanwhile 40% were females as shown in the above pie
chart.

Table 4.5: Pearson Correlation analysis

1 2 3 4 5 6

Relationship with Suppliers (1) 1

Standards & specifications (2) .360** 1

Compatibility (3) .420** .400** 1

Delivery (4) .600** .540** .420** 1

After procurement (5) .660** .658** .717** .590** 1

Service quality (6) .815** .795** .846*** .717*** .747*** 1

Source: Primary data

Running page

Relationship between relationship with suppliers and service quality

From the table above the correlation results show that there is a strong positive relationship
between relationship with suppliers and service quality which is significant at 5%.

Relationship between standards and specifications and service quality

The results indicate that there is a strong positive relationship between standards and
specifications and service quality which is significant at 5%.

Relationship between compatibility and service quality

There exists a strong positive relationship between compatibility and service quality which is
significant at 1%.

Relationship between delivery and service quality

The results indicate that there is a strong positive relationship between delivery and service
quality which is significant at 1%.

Relationship between after procurement services and service quality

The results indicate that there is a strong positive relationship between after procurement services
and service quality which is significant at 1%.

Multiple regression output for the effect of Supplier Relationship management, Standards
and specifications, compatibility, delivery and after procurement services on service quality
in health facilities in westnile-Uganda.
Running page

Model summary

Model R R Square Adjusted R Std. Error of F statistic Sig.

Square the Estimate

1 .808a .652 .642 .363 60.067 0.000

a. Predictors: (Constant), SR (Supplier relationship), SS

(standards and specifications), Compatibility (C), Delivery
(D) and After procurement services (AS)

b. Dependent Variable: SQ (Service quality)

Based on the regression analysis results the model was fit with an F-statistic of 60.067 which is
significant at 1%.

The R-squared value of 0.652 implies that up to 65.2% of the variations in service quality
measured by responsiveness, trust, safety, reliability, assurance in health facilities in westnile-
Uganda can be explained by the variations in supplier relationships, standards and specifications,
compatibility, delivery and after procurement services.

Model Unstandardized Standardized t Sig.

Coefficients Coefficients

B Std. Error Beta

(Constant) .506 .266 1.902 .060

Running page

SR .191 .073 .204 2.606 .011

SS .538 .078 .536 6.891 .000

C .196 .083 .194 2.373 .020

D .236 .004 .192 2.600 .000

AP .423 .006 .246 3.250 .005

Interpretation of the regression results

Based on the regression results in the above table, all the coefficients of the predictors are
significant. The intercept coefficient with P-Value 0.60 is significant at 10%, the slope
coefficients for supplier relationship and compatibility with p-values 0.011 and 0.020 are both
significant at 5% respectively. While the slope coefficient for standards and specifications,
delivery and after procurement services with P-Value 0.000, 0.000 & 0.005 respectively are all
significant at 1%

Based on the regression coefficients, the model for predicting the effect of relationships with
suppliers, standards and specifications, compatibility, delivery and after procurement services on
service quality in health facilities in Westnile-Uganda is given by;

SQ= 0.506 +0.191SR+0.538SS+0.196C+0.236D+0.42AP

Where;

SQ=Service Quality, SR=Supplier Relationship, SS=Standards and Specification and

C=Compatibility

Implying that;
Running page

Without the influence of any independent variable, there is still a level of performance of 0.506
units.

When supplier relationship management increase by a unit, service quality increases by 0.191
units, when standards and specification are increased by a unit, service quality increases by 0.538
units, when compatibility increase by a unit, service quality increases by 0.196 units, when
delivery increases by a unit, service quality increases by 0.236 units and when after procurement
services increases by a unit, service quality increases by 0.42 units.

CHAPTER FIVE

DISCUSSION, CONCLUSION AND AREAS FOR FURTHER RESEARCH.

Introduction

In this study the author sought to establish the relationship between e-procurement and at Health
facilities in Westnile region.
Running page

Demographic data of the respondents

120 respondents out of the 200 were women representing 60%. While 80 respondents out of the
200 were male representing 40%.

The effect of relationships with suppliers on Service quality in Health facilities

According to the data analyzed on chapter four customer relationship management was found to
have a positive relationship with service quality in health facilities in westnile which was
significant at 5%% level of significance. The regression results indicate that a unit increase in
supplier relationship management leads to 0.11 increase in service quality which was significant
at 5%. Therefore, it is prudent for the facility management to improve the relationships with
suppliers in order to improve the service quality within their facilities

The effect of standards and specifications on Service quality in Health facilities

According to the data analyzed on chapter four standards and specifications was found to have a
positive relationship with service quality in health facilities in westnile which was significant at
5% level of significance. The regression results indicate that a unit increase in standards and
specification leads to 0.538 increase in service quality which was significant at 1%. Therefore, it
is important for health facilities to improve their standards and specifications in order to improve
service quality.

The effect of compatibility on Service quality in Health facilities

According to the data analyzed on chapter four, the correlation results show that compatibility
has a positive relationship with service quality in health facilities in westnile which was
significant at 1%level of significance. From the regression results, a unit increase in
compatibility leads to 0.196 increase in service quality which was significant at 5%. Therefore, it
is prudent for the facility management to improve the relationships with suppliers in order to
improve the service quality within their facilities
Running page

The effect of delivery on Service quality in Health facilities

According to the data analyzed on chapter four delivery was found to have a positive relationship
with service quality in health facilities in westnile which was significant at 1% level of
significance. The regression results indicate that a unit increase in supplier relationship
management leads to 0.236 increase in service quality which was significant at 1%. Therefore, it
is prudent for the facility management to improve the relationships with suppliers in order to
improve the service quality within their facilities

The effect of after procurement services on service quality in health facilities

The results showed a positive relationship exists between after procurement services and service
quality which was significant at 1% level of significance. Also, the effect of after procurement
service was found to be positive with a co-efficient of 0.423 units implying that a unit increase in
after procurement services leads to 0.423 units of increase service quality.

Conclusion.

The purpose of the study was to establish the effect of supply chain management practices on
service quality in health facilities in west-nile. The regression results indicated that up to 64.2%
of the variations in service quality in health facilities in west-nile are explained by the variations
in supply chain management practices. It can therefore be concluded that, it is important for the
management of these facilities to improve on the five dimensions of supply chain management
practices namely relationships with suppliers, standards and specifications, compatibility,
delivery and after procurement service.
Running page

Recommendation.

It is important for procurement policy makers to pay keen attention to the critical aspects of
procurement policies so to ensure incorporate issues that enhance supply chain management
practices.

The management of health facilities should put emphasis on effective implementation of the
supply chain management practices so as to enhance the service qualities in their facilities.

Areas for further study

The research was done in westnile, it will be nice for further research to be undertaken to cover a
wider geographic area. Further it could possibly include other lower health facilities which were
not included in this study.

The results show that the predictor variable could explain up to 64.2% of the variations in service
quality. Therefore, it would be nice to have further research conducted to find out the factors that
explain the remaining 35.8%.
Running page

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Table: 11 PROPOSED BUDGET SCHEDULE

S/No. Item Description Estimated Source

Amount
(UGX)

1. Stationery 1 ream of ruled paper 15,000 Self,relatives

@15000 and friends

Extended
Computer,Typesetting and
Abstract@35000
Printing
35,000
Project full report

Spiral
binding@80,000

80,000

2 Personal Field work-data 40,000 Self,relatives

collection: and friends

Travels to and from

Arua - Health
facilities
@5000/=(Eight
Times)

Movement within
Arua town to My
Home@5000/=(Eight
Times
40,000
Running page

Feeding for Eight

Times@5000

40,000

3 Miscellaneous Miscellaneous 150,000 Self,relatives

and friends

Total 400,000

Source:Self extract.

Table: 12 Work plan-Time frame

S/No. Activity Period

1 Topic development and approval One Week

2 Proposal development Two Weeks

3 Development and piloting of instrument One Week

4 Data collection Two Weeks

5 Data collection Two Weeks

6 Analysis and interpretation Two Weeks

7 Report writing Five Weeks

8 Submission One Week

Sixteen Weeks
Running page

Table: 11 PROPOSED BUDGET SCHEDULE

S/No. Item Description Estimated Source

Amount
(UGX)

1. Stationery 1 ream of ruled paper 15,000 Self,relatives

@15000 and friends

Extended
Computer,Typesetting and
Abstract@35000
Printing
35,000
Project full report

Spiral
binding@80,000

80,000

2 Personal Field work-data 40,000 Self,relatives

collection: and friends

Travels to and from

Arua - Health
facilities
@5000/=(Eight
Times)

Movement within
Arua town to My
Home@5000/=(Eight
Times
40,000
Running page

Feeding for Eight

Times@5000

40,000

3 Miscellaneous Miscellaneous 150,000 Self,relatives

and friends

Total 400,000

Source:Self extract.

Table: 12 Work plan-Time frame

S/No. Activity Period

1 Topic development and approval One Week

2 Proposal development Two Weeks

3 Development and piloting of instrument One Week

4 Data collection Two Weeks

5 Data collection Two Weeks

6 Analysis and interpretation Two Weeks

7 Report writing Five Weeks

8 Submission One Week

Sixteen Weeks