EFFECTS OF ICT ADOPTION ON THE OPERATIONAL EFFECTIVENESS OF FORWARDING

AND CLEARING COMPANIES IN KENYA.

CYNTHIA ITUTE
BPSMC01/3413/2021

A RESEARCH PROPOSAL SUBMITTED TO THE SCHOOL OF BUSINESS AND ECONOMICS

UNDER THE DEPARTMENT OF ECONOMICS AND ENTREPRENEURSHIP FOR PARTIAL
FULFILLMENT IN THE AWARD OF BACHELORS OF PURCHASING AND SUPPLY CHAIN
MANAGEMENT AT THE CO-OPERATIVE UNIVERSITY OF KENYA.

NOVEMBER, 2023.
DECLARATION.
I declare that this research proposal paper is my original work and has never been submitted to any
other university for assessment or award of a degree.

Signature…………………………. Date…………………………….
Cynthia Itute
BPSMC01/3413/2021

This research proposal has been submitted for examination with my approval as the university
supervisor.

Signature……………………………. Date………………………………
DR. Kamau Muthoni.
DEDICATION.
I dedicate this research proposal to my mother for her encouragement, guidance and support while I
was writing this research proposal. I would also like to dedicate the research proposal to myself for
showing up and doing what was required of me. Last but not the least I place a deep sense of gratitude
to my friends and relatives who have been constant source of inspiration during the preparation of this
research proposal.
ACKNOWLEDGEMENTS.
I wish to thank the Almighty God for giving me the ability, Health and strength to write this research
proposal. I also feel deeply honored in expressing my sincere thanks to my Supervisor Dr. Kamau
Muthoni for guiding me through the proposal. Last but not the least I place a deep sense of gratitude to
my class mates and friends who have made writing of this proposal fun and have been constant source
of inspiration during the preparation of this project work.
Table of Contents
DECLARATION.............................................................................................................................2
DEDICATION.................................................................................................................................3
ACKNOWLEDGEMENTS.............................................................................................................4
LIST OF FIGURES.........................................................................................................................7
LIST OF APPENDIXES.................................................................................................................8
LIST OF ACRONYMS...................................................................................................................9
DEFINATION OF TERMS...........................................................................................................10
ABSTRACT..................................................................................................................................11
CHAPTER ONE............................................................................................................................12
1.0 INTRODUTION......................................................................................................................12
1.1 BACKGROUND OF THE STUDY....................................................................................12
1.1.1 Global Perspective on the Study...................................................................................13
1.1.2 Regional Perspective.....................................................................................................13
1.1.3 Local Perspective..........................................................................................................14
1.1.4 ICT Adoption................................................................................................................14
1.1.5 Operational Effectiveness..............................................................................................15
1.1.6 Clearing and Forwarding Companies............................................................................15
1.2 Statement of The Problem....................................................................................................16
1.3 Objective of the Study..........................................................................................................16
1.3.1 General Objective..........................................................................................................16
1.3.2 Specific Objectives........................................................................................................17
1.4 Research Questions..............................................................................................................17
1.5 Justification of the Study......................................................................................................17
1.5.1 Clearing and Forwarding Companies............................................................................17
1.5.2 The Government............................................................................................................17
1.6 Scope of the Study...............................................................................................................18
CHAPTER TWO...........................................................................................................................19
LITERATURE REVIEW..........................................................................................................19
2.0 Introduction..........................................................................................................................19
2.1 Theoretical Literature Review.............................................................................................19
2.2 Conceptual Frame Work......................................................................................................22
2.2. Electronic Supplier Communication...................................................................................23
2.2.2 Procurement Software Adoption...................................................................................23
 2.2.3 Data Analytics and Reporting.......................................................................................24
2.3 Empirical literature review...................................................................................................24
2.3.1 Electronic Supplier Communication.............................................................................24
2.3.2 Procurement Software Adoption...................................................................................26
2.3.3 Data Analytics and Reporting.......................................................................................27
2.4 Critique of Literature...........................................................................................................28
2.5Summary of the literature.....................................................................................................29
2.6 Research gaps.......................................................................................................................29
CHAPTER THREE.......................................................................................................................31
3.0 Introduction..........................................................................................................................31
3.1 Research Design...................................................................................................................31
3.2 Population of the Study........................................................................................................31
3.3Target Population..................................................................................................................31
3.4Subject Frame.......................................................................................................................31
3.5 Sampling Technique and Sample Size.................................................................................32
3.6 Data Collection Instrument..................................................................................................32
3.7 Data Collection Procedures..................................................................................................32
3.8 Data Analysis.......................................................................................................................32
REFERENCE................................................................................................................................33
APPENDICES...............................................................................................................................35
LIST OF FIGURES.
figure 2. 1 concepual framework...................................................................................................22
LIST OF APPENDIXES
Appendix 1 RESEARCH QUESTIONNAIRE.............................................................................35
Appendix 2. Time Lines................................................................................................................38
Appendix 3 Budget........................................................................................................................38
Appendix 4 List of Firms..............................................................................................................39
LIST OF ACRONYMS

ICT- Information and Communication and technology.

DT- Digital Transformation
UNECA- United Nations Economic Commission of Africa.
KIFWA- Kenya International Warehousing and Freight Association.
TAM- Technology Acceptance Model.
PEOU-Perceived ease of use.
PU- Perceived Usefulness.
BI- Behavioral Intention
RBT- Resourced Based Theory
DOI- Diffusion of Innovation Theory
ERP- Enterprise Recourse Planning
WMS- Warehouse Management Systems
IoT- Internet of Things.
MINECOFIN- Ministry of Finance and Economic Planning.
CPO- Chief Procurement Officer.
KRA- Kenya Revenue Authority.
DEFINATION OF TERMS

Adoption - is a decision to make full of or to accept with approval or favorable reception of something
for example an innovation.
Clearing and Forwarding Agents- experts who provide assistance to get goods cleared through customs
formalities, coordinate with the carrier and handle shipping and delivery
ICT- a diverse set of technological tools and resources used to transmit, store, create, share or
exchange information
TAM- The Technology Acceptance Model is a theory that states the intention to use technology is
determined by perceived ease of use and perceived usefulness.
Diffusion of information Theory (DOI)- DOI is concerned with the manner in which new
technological ideas migrate from creation to use and that technological innovation is communicated
over time.
ABSTRACT.
This research proposal seeks to investigate the impact of Information and Communications
Technology (ICT) adoption on the operational effectiveness of clearing and forwarding companies in
Kenya, particularly within the context of the global logistics industry. The logistics sector, crucial for
facilitating international trade, relies heavily on efficient procurement processes. The study aims to fill
a critical gap in understanding how ICT influences the operational aspects of clearing and forwarding
companies in Kenya, exploring the potential advantages and disadvantages associated with technology
adoption. Drawing on global, regional, and local perspectives, the research will employ a combination
of qualitative and quantitative methods, including surveys, interviews, and data analysis. The research
proposal will use a comprehensive methodology that will be employed in conducting the study on the
impact of Information and Communications Technology (ICT) adoption on clearing and forwarding
companies in Kenya. The research design will adopt a qualitative approach, aiming to accurately
describe existing phenomena within the context of the logistics industry. The findings aim to
contribute valuable insights and recommendations for industry professionals, policymakers, and
stakeholders navigating the evolving landscape of a technologically advanced and competitive future,
ultimately enhancing the operational effectiveness of clearing and forwarding companies in Kenya.
 CHAPTER ONE

1.0 INTRODUTION
In this centuries competitive business environment an effective and efficient procurement of goods and
services is an important aspect of success, especially in the logistics industry. Clearing and forwarding
companies, play a big role in facilitating global trade and normally rely on efficient and cost-effective
procurement of goods and services thus ensuring the smooth flow of products across borders. The
adoption of ICT has had a significant impact on this companies. Generally, firms that have adopted IT
have achieved high levels of efficiency and effectiveness in their day-to-day business operations hence
improving their performance by gaining a competitive advantage, increased profitability and increased
market share over their competitors (Capgemini, 2008)
The purpose of this research proposal is to explore and analyze the effects of ICT adoption on the
operational effectiveness of clearing and forwarding companies operating in Kenya. As the logistics
and supply chain management sector evolves in response to global changes and technological
advancement, ICT has emerged as a critical driver of process optimization, cost reduction and
operational efficiency.
The findings of this research will not only contribute to the body of knowledge related to ICT adoption
but will also offer valuable insights and recommendations to forwarding and clearing companies,
policy-makers, and stakeholders, as they navigate the path toward a more technologically advanced
and competitive future.

1.1 BACKGROUND OF THE STUDY

This research proposal aims to investigate the effect of ICT adoption on the operational effectiveness
of clearing and forwarding companies in Kenya. ICT (information and communications technology),
has gained significant attention in procurement processes recent years due to its potential to streamline
supply chain operations in the context of Kenya, a country growing in the logistics and transportation
sector, understanding how technology influences clearing and forwarding companies is crucial.
Kenya’s economy heavily relies on international trade and the efficiency of clearing and forwarding
companies id essential for the timely movement of goods in and out of the country. ICT has the
potential to transform traditional procurement practices by offering more transparency, cost-efficiency
and agility in customer relationship. However, the specific impacts of ICT adoption on the operational
effectiveness of the Kenyan clearing and forwarding companies have largely remained unexplored.
This research proposal seeks to address this gap by conducting a study.
The study will include a review of relevant literature. An analysis of the current state if ICT adoption
in the Kenyan logistics industry and an investigation into how adoption of ICT systems have
influenced operational aspects such as cost management, time efficiency and overall service quality
within clearing and forwarding companies.
The study will utilize a combination of qualitative and quantitative research methods including
surveys, interviews and data analysis, to gather insights from industry professionals and stakeholders.
The findings of this research will contribute to a better understanding of the potential advantages and
disadvantages associated with ICT adoption in the Kenyan market context. It will also provide a
practical recommendation for clearing and forwarding companies to enhance their operational
effectiveness in a rapidly evolving digital market.

1.1.1 Global Perspective on the Study.

The global logistics and procurement landscape is undergoing a drastic shift due to the integration of
ICT systems. Many journals have discussed the importance of technology and digitalization in
improving procurement processes, reducing cost and enhancing supplier relationship. Digital
transformation (DT) is topical for supply chain researchers and practitioners (Choi, 2018).
Vietnam lacks the presence of large domestic logistics service providers which have enough capacity
and resources to undertake all stages of the logistics supply chain; thus, the large parts of logistics
services are falling into the hands of foreign corporations.(Kawasaki)
As a global trade hub, Singapore has leveraged ICT extensively to optimize port operations and
customs clearance. The use of the TradeNet system, an electronic platform for trade documentation
and customs declarations, has dramatically reduced paperwork and accelerated processes.
The Port of Rotterdam in the Netherlands is one of the largest in Europe. The adoption of digital
platforms for cargo tracking and efficient customs processes has contributed to its status as a major
logistics and trade hub.
China's robust e-commerce industry and global manufacturing hub status are largely driven by ICT
adoption. Companies like Alibaba and JD.com have integrated cutting-edge technologies to enhance
the efficiency of their global supply chains and forwarding operations

1.1.2 Regional Perspective

Within the African continent, trade facilitation and regional integration have become central
objectives. The United Nations Economic Commission for Africa(UNECA) and the African Union
emphasize on the importance of ICT I streamlining trade and procurement operations. In addition,
“The African Journal of Information Systems” highlights the role of technology, including ICT in
increasing supply chain efficiency.
To address concerns of port customers, the management of Nigerian ports introduced some ICT
applications to improve port productivity, safety and security, reduce overhead costs and improve port
customer satisfaction. (Onwuegbuchunam ,2021)
In Ethiopia, logistics companies have strived to implement various ICT applications in their supply
chain processes. Competition has forced logistics firms in Ethiopia to reshape their logistics operations
and systems with aims to reduce costs and improve customer satisfaction. IT has offered solutions that
make logistics and supply chain management, even more, streamline and efficient than it has ever
been. (Girima ,2019)
In a “Port Efficiency Conference,” organized by Ghana in 2017, the Vice President of the Republic of
Ghana expressed the inefficiencies in the Ghanaian port clearance processes. In an effort to battle the
inefficiencies, the government ordered the port operators to adopt total paperless operations in the
clearance procedures and integrate IT clearance on businesses and their supply chain activities.

1.1.3 Local Perspective.

In Kenya, a nation poised to become a regional trade and logistics hub, the government’s efforts to
promote ICT adoption in the public sector have had significant implications for the private logistics
industry. Many publications like Kenya Institute of Supplies Management have documented these
initiatives and their potential influence on businesses, including clearing and forwarding companies.
“The government has taken into account the tremendous impact of globalization and the rapid changes
in technology these changes have invariably affected the traditional approach to the management of
public affairs and service delivery and increasingly inform the need for an adaptive policy and
regulatory response” (Kenyan Gazette,2022).
The location of Kenya as a gateway into the interior of Eastern Africa (Uganda, Rwanda, Burundi and
Southern Sudan) through the port of Mombasa has created a much vibrant trade logistics industry.
Many private logistics firms compete along this corridor. Similarly, different modes of transportation
such as road, rail and air freight compete. Inefficient public policies create serious bottlenecks
especially in infrastructure and customs (World Bank, 2005).
In Kenya, logistics companies have strived to implement various ICT applications in their supply chain
processes. Ayugi (2007) examined the effectiveness and efficiency of the supply chain model in
Wrigley’s East Africa. He indicated that efficient supply chain activities would increase the
organization’s performance significantly.

1.1.4 ICT Adoption.

ICT adoption refers to the extent to which clearing and forwarding companies in Kenya implement and
use various information and communication technologies in their daily operations. This can include the
use of software systems, hardware, communication tools, and digital platforms for managing tasks
related to customs clearance, logistics, documentation, and communication with stakeholders. this can
be through ICT a scale that assesses the level of technology integration, such as the number of digital
tools used, the degree of automation in processes, or the investment in ICT infrastructure and software.
There are various models of ICT adoption one being Technology Acceptance Model (TAM), This
model suggests that when users are presented with a new technology, a number of factors influence
their decision about how and when they will use it, notably. One being perceived usefulness, this is the
degree to which a person believes that using a particular system would enhance their job performance.
Another factor is the perceived ease-of-use and this is the degree to which a person believes that using
a particular system would be free from effort. If the technology is easy to use, then the barriers
conquered. If it's not easy to use and the interface is complicated, no one has a positive attitude
towards it. (Wikipedia, 2023). The government has introduced very many Systems over the years
expecting they will ease clearing and forwarding operations on of the systems being Integrated
Customs Management Systems (iCMS).

1.1.5 Operational Effectiveness

Operational effectiveness is the outcome or result that you want to understand in relation to ICT
adoption. It deals with the overall efficiency and performance of clearing and forwarding companies in
Kenya. This can include factors like reduced processing time, cost savings, accuracy in documentation,
improved customer service, and enhanced supply chain visibility. It can be measured through various
performance indicators, such as processing time, cost-to-revenue ratio, customer satisfaction scores,
error rates in documentation, and on-time delivery performance.
It is a core objective of enterprise and IT governance where organizations seek to maximize the
efficient use of resources in their business operations and to improve quality, productivity, or
competitive positioning in markets in which they participate. (Gantz ,2014)

1.1.6 Clearing and Forwarding Companies.

Kenya International Warehousing and Freight association(KIFWA) is the sole representative of all
freight and forwarding companies in Kenya it was formed in 1996. the formation of KIFWA was
because of the need of a national body that is cohesive enough to represent the interests of all its
members. An objective of the body is to promote the legitimate trade of clearing and forwarding
Agents, Warehouse men and such other trades as may be or may become closely allied thereto
(KIFWA,2023).
Clearing and forwarding involves the clearing of cargo from ports for example like Mombasa or
container freight stations to customers. The customers are either within Kenya or East and Central
Africa countries. Improving the countries logistics and infrastructure to the level of middle-income
countries could boost yearly growth by greater than 3% (KIFWA,2016). More recently, Kenya
Airways (KQ) was authorized to travel directly to the United States via New York City, opening a
window of opportunity to logistics firms and increasing trade between the US and Kenya.
There are many examples that provide a clear evidence that transport and logistics firms play an
important role in the country’s economic development. However, the penetration of these technologies
in the Kenyan market is still in the early stages of development. Further, despite the potential benefits
of ICT usage, a number of studies suggest that the level of ICT adoption among logistics firms in the
country has not kept pace with the rapid technological advances, meaning that the firms are unable to
properly attest to the benefits of ICT integration. logistics companies are struggling to employ
technological innovations in facilitating business success.(Getambu ,2021)
1.2 Statement of The Problem
The clearing and forwarding industry plays a pivotal role in the facilitation of international trade and
logistics operations in Kenya. However, the sector faces a range of operational challenges and
inefficiencies that impact its effectiveness. These challenges include delays in customs clearance,
documentation errors, inventory management issues, and variations in transportation logistics. To
address these issues and enhance operational effectiveness, many clearing and forwarding companies
in Kenya have recognized the potential benefits of Information and Communication Technology (ICT)
adoption.
While the potential advantages of ICT adoption are evident, the extent to which it has been
implemented and its actual impact on the operational effectiveness of clearing and forwarding
companies in Kenya remain subjects of inquiry. It is important to assess the current state of ICT
adoption and systems within the industry and examine how its utilization influences things like,
corruption, cost efficiency, error reduction, and customer satisfaction.
Air cargo operators are still limited as the service is expensive. One major challenge seen in the
logistics industry in Kenya is the limited use of ICT solutions especially at the ports and revenue
offices. The pipeline system experiences many capacity constraints forcing many oil shippers to use
the costly road transport. The growth of the industry has also been facilitated by logistics outsourcing
especially from large manufacturing companies. (Osodo ,2014) I therefore seek to examine the effect
of ICT adoption on the operational effectiveness of clearing and forwarding companies.

1.3 Objective of the Study.

1.3.1 General Objective.
The general objective of this study is to examine the effect of ICT adoption on the operational
effectiveness of clearing and forwarding companies in Kenya.

1.3.2 Specific Objectives.

1. To examine the effects ICT adoption in clearing and forwarding companies.
2. To examine the opportunities associated with ICT adoption in the clearing and forwarding sector in
Kenya.
3. To determine if adopting ICT solutions leads to cost savings for clearing and forwarding companies
in Kenya.

1.4 Research Questions.

Can the adoption of ICT affect clearing and forwarding companies?
How does ICT adoption create opportunities in the clearing and forwarding industry?
What is the relationship between the adoption of ICT solutions and cost savings for clearing and
forwarding companies in Kenya?

1.5 Justification of the Study.

There are some reasons why it is important to study the effects of ICT adoption on the effectiveness of
clearing and forwarding companies in Kenya.

1.5.1 Clearing and Forwarding Companies.

The clearing and forwarding companies play an important role in international trade facilitation.
However, this sector faces operational challenges, including too much paperwork, inefficiencies and
delays in customs clearance. ICT can address these challenges by streamlining process. Clearing and
forwarding companies that embrace ICT solutions may gain a competitive advantage in the market.
Knowledge from this research can guide companies in adopting technologies that can set them apart
from competitors and attract more clients.
Research findings from this study can provide clearing and forwarding companies with valuable
insights into the impact of ICT adoption on their operational effectiveness. This knowledge can assist
company management in making informed decisions regarding their ICT investments.

1.5.2 The Government.

The Kenyan government has shown interest in promoting the adoption of digital technologies
especially systems in various sectors, including trade and logistics. the study can help inform and
support government initiative in this regard. The government relies on customs duties and taxes on
imported and exported goods for revenue. A well-functioning ICT system can help prevent revenue
leakage by reducing fraud and errors in customs processes, ensuring that the government collects the
appropriate taxes and duties.
The government can use insights from the research to encourage investment in technology-related
education and training programs, thereby increasing employment opportunities for Kenyan citizens.
1.6 Scope of the Study.
This study will focus on the extent to which clearing and forwarding companies in Kenya have
adopted ICT practices.it will also measure the impact of ICT adoption on the effectiveness of these
companies. The studies will be conducted exclusively in Kenya. The primary unit of analysis will be
individual for clearing and forwarding companies in Kenya.
 CHAPTER TWO

LITERATURE REVIEW

2.0 Introduction
In the ever-evolving global business landscape, the adoption of Information and Communication
Technology (ICT) has become increasingly vital for the operational effectiveness of businesses,
particularly within the logistics and supply chain industry. Clearing and forwarding companies play a
pivotal role in the facilitation of the movement of goods, making their operational efficiency critical
for overall economic growth. This literature review aims to provide a theoretical perspective on the
effects of ICT adoption. This chapter reviews what other scholars have had to say about the impact of
ICT on logistics firms and how IT has transformed their operations. It also gives empirical review of
the past research both globally, international and nationally.
This chapter looks at theoretical literature review, and then analyzes the concepts of clearing and
forwarding companies including the relationship between ICT adoption on the operational
effectiveness of these companies. This is followed by conceptual frame work, empirical literature
review, the critique of the literature, the summary of the literature and the research gaps.

2.1 Theoretical Literature Review

Technology Acceptance Model (TAM)
The Technology Acceptance Model (TAM) posits that the intention to use technology is determined by
perceived ease of use (PEOU) and perceived usefulness (PU). PEOU refers to the extent to which an
individual believes that using technology will be free of effort, while PU relates to the belief that the
technology will enhance their performance or productivity This theory was developed by Fred Davis in
1989.
Maruping, Bala, Ventakesh, and Brown (2016) stated that to obtain a proper understanding of the
factors which promote increased use of IT, it is necessary to have theoretical and practical knowledge
of the models by means of which the use of IT is investigated. One of the limitations of the TAM is on
behavior of users, which is evaluated on behavioral intention (BI) such as interpersonal influence.
Interpersonal influence as the subjective norm is when a person is influenced by words of mouth from
a colleague, or a friend. While a superior can influence employee by directing a subordinate to perform
a specific task with the use of technology, based on their IT policy,a friend has no directive influence
over staff who is a subject to the line manager. Another limitation is that, behavior cannot be reliably
quantified in an empirical investigation, due to a number of different factors such as the norms and
values of societies and personal attributes and personality traits. Hence, the argument that a relative,
friends could influence the use of technology through exacting social pressure. (Ajibade ,2018). On the
other hand TAM has some strengths one being that, The direct effect of subjective norms on
behavioral intention has yielded mixed results in the past. This theory used perceived usefulness and
perceived ease of use to replace the subjective norm. TAM also has a robust and powerful model for
predicting user acceptance of information technologies. Lastly it has been used in many empirical
studies and proven to be of quality and statistically reliable. (Olushola ,2017)
TAM is highly relevant in my study as it provides a framework for understanding how the perceived
ease of using ICT systems (PEOU) can influence the adoption and, consequently, the operational
effectiveness of clearing and forwarding companies in Kenya. Perceived Ease of Use (PEOU) is core
component of the TAM, as it directly relates to how users perceive the ease of incorporating ICT
systems into their daily tasks within clearing and forwarding companies. PEOU encompasses factors
such as the user-friendliness of ICT interfaces, ease of navigation, and adaptability to varying levels of
technical proficiency among employees.

Resource Based Theory

This theory suggests that a firm's internal resources, such as ICT capabilities, can be a source of
sustained competitive advantage. Clearing and forwarding companies can use ICT to develop unique
capabilities, such as real-time tracking and monitoring systems, which can set them apart from
competitors. There are two underlying assumptions of the RBT related to the explanation of how firm-
based resources generate sustained competitive advantage and why some organizations may
continually outperform others by gaining higher competitiveness (Helfat & Peteraf, 2003). Resource-
Based Theory (RBT) was first put forward by Penrose (2009), who proposed a model on the effective
management of firms' resources, diversification strategy, and productive opportunities.
Emphasis on Firm-Specific Resources, RBT underscores the significance of unique, firm-specific
resources and capabilities that can lead to a competitive advantage. The dominant paradigm in
determining a company’s profits potential, such as the view of Porter (1989), suggests that a firm’s
internal factors, such as resources and capabilities, determine a firm’s profit. RBT is a flexible theory
that can be applied to a wide range of industries and contexts. RBT also has some negatives like lack
of prescriptive guidance, While RBT helps identify resources and capabilities that are valuable and
rare it doesn't offer clear prescriptive guidance on how to develop or acquire these resources.
RBT emphasizes the identification of key resources that can provide a competitive advantage. It
identifies the specific ICT resources and capabilities that clearing and forwarding companies in Kenya
possess or need to acquire. RBT posits that not all resources are equally valuable and that some
resources are rare, difficult to imitate, and non-substitutable, leading to a sustained competitive
advantage. I can whether the ICT resources and capabilities adopted by these clearing and forwarding
companies meet these criteria.

Diffusion of Innovation (DOI) Theory

Diffusion of Innovation (DOI) Theory, developed by E.M. Rogers in 1962, The diffusion of
innovations theory is a theory outlining how new technological and other advancements spread
throughout societies and cultures, from introduction to widespread adoption.
The theory allows researchers to identify key influencers and factors that facilitate or hinder the
adoption process. Innovations that are perceived as advantageous, compatible with existing practices,
and easy to use are more likely to be embraced. However, challenges arise in the form of negatives,
including resistance to change, uncertainty, and concerns about the compatibility of ICT with
established operational processes. It doesn't take into account an individual's resources or social
support to adopt the new behavior (or innovation). (LaMorte, 2022)
Clearing and forwarding companies can be analyzed through this theory to understand the dynamics of
how technological innovations spread among individuals and organizations. Clearing and forwarding
companies that embrace ICT may experience quicker and smoother clearance processes, reduced
paperwork, and improved communication with stakeholders.

2.2 Conceptual Frame Work.

A conceptual framework is a visual or written product, one that, “explains either graphically or in
narrative form, the main things to be studied, concepts, or variables and the presumed relationship
among them (Lee & Wang, 2001).
Independent Variables Dependent variables

Electronic supplier communication.

Electronic orders
Real- time communication Operational effectiveness of
clearing and forwarding
Electronic invoices companies.

Compliance and regulatory

performance
Procurement software adoption
Cargo tracking and tracing
Custom procurement Software
Customer satisfaction
Solutions.
Enterprise resource planning
Warehouse Management systems

Data Analytics and reporting

Data mining for supplier evaluation.
Inventory data analysis
Cost savings and cargo tracking.

figure 2. 1 concepual framework

2.2. Electronic Supplier Communication.

E-ordering is the process of creating and approving purchasing requisition, placing purchase orders as
well as receiving goods and services ordered, by using a software system based on internet technology
which greatly improves the supply chain performance. In the case of e-ordering, the goods and services
ordered are indirect goods and services (Kim, 2002). The use of electronic orders can significantly
improve the efficiency and accuracy of the procurement process. Orders can be generated, transmitted,
and received electronically, reducing the potential for errors associated with manual data entry. They
can be sent and received rapidly, which can lead to quicker response times from suppliers. This sub-
indicator measures the time it takes to initiate an order and receive a confirmation or response. It can
also potentially reduce the costs associated with traditional paper-based procurement, such as printing
and mailing costs.
The real time communication is the communication in which sender and receiver exchange their
information and data over a channel without any delay (Singh&Passi, 2014). Real-time communication
facilitates closer collaboration with suppliers, enabling them to provide immediate information on
order status, availability, and any issues that may affect the procurement process. The ability to address
issues or discrepancies in real time can lead to quicker problem resolution, minimizing disruptions in
the supply chain. It also enhances the operational flexibility of clearing and forwarding companies,
allowing them to adapt to changing conditions, such as delays or last-minute adjustments in orders.
Invoicing is essential to any business, but traditional paper-based invoicing methods are often time-
consuming and error-prone (Stening ,2023). Electronic invoices reduce the need for manual
processing, including data entry and paper handling. This sub-indicator assesses the extent to which
manual processing is reduced or eliminated. They often lead to faster payment processing, which can
positively impact cash flow and financial management. They can enhance accuracy and compliance
with tax and accounting regulations. they can also evaluate the accuracy and compliance levels
achieved through the adoption of electronic invoicing systems.

2.2.2 Procurement Software Adoption

Custom software solutions refer to the development or deployment of software applications tailored to
meet the specific needs and requirements of clearing and forwarding companies operations. These
custom software solutions are designed to enhance and streamline the various facets of clearing and
forwarding processes, from cargo tracking to document management. Our mission it to help freight
forwarders worldwide streamline their operations, scale their businesses, and thrive in technology-
driven and integrated supply chains. (Logistaas,2023)

ERP systems are comprehensive software solutions designed to facilitate the integration of various
business processes and functions. In the context of clearing and forwarding companies, the adoption of
ERP systems is expected to significantly impact operational effectiveness. The adoption of ERP
systems enhance resource allocation, reduce redundancy, and improve the overall management of
critical processes, ultimately contributing to more effective operations.

WMS refers to software solutions specifically designed to manage and optimize warehouse operations.
In clearing and forwarding companies, the adoption of WMS is crucial for efficient cargo handling and
storage. The adoption of WMS is instrumental in improving cargo tracking, reducing errors in storage,
and enhancing overall warehouse productivity. It plays a vital role in the efficient movement of goods
through the supply chain, contributing to operational effectiveness by ensuring goods are readily
accessible, well-organized, and easily traceable. Leveraging the latest supply chain technology and the
Internet of Things (IoT), a “smart warehouse” can now serve as a hub to boost efficiency and speed
throughout the entire supply chain. From wearables on workers to sensors and intelligent equipment,
internet-enabled devices and technology can profoundly change logistics management. (Business
market insights ,2023)
2.2.3 Data Analytics and Reporting.

Data mining is the process of analyzing a large batch of information to discern trends and patterns
(Investopedia, 2023). Data mining enables the assessment of supplier performance based on various
key performance indicators. It helps in identifying trends and patterns in supplier behavior, delivery
times, quality, and pricing. It assesses the ability to identify trends that can inform procurement
decisions. By analyzing supplier data, clearing and forwarding companies can identify potential risks
and take proactive measures to mitigate them.

Inventory analysis is the process of allowing a business to understand its inventory levels (Fresh
Books, 2022). Inventory data analysis helps in optimizing stock levels to ensure that goods are
available when needed without overstocking. Effective analysis of inventory data can lead to cost
savings by reducing carrying costs associated with excess inventory. It can aid in demand forecasting,
helping companies anticipate future stock needs and ensuring timely procurement.

The ability to identify and quantify potential cost savings and cargo tracking opportunities through
ICT-enabled procurement processes it measures the identification of opportunities. The effectiveness
of tracking and reporting on actual cost savings realized through ICT adoption. The use of cost-benefit
analysis to measure the return on investment of ICT adoption in procurement. It evaluates the ability to
perform effective cost-benefit analyses.

2.3 Empirical literature review

2.3.1 Electronic Supplier Communication.
EDI continues to be promoted as a tool that supports closer buyer supplier relationships and improving
supply chain performance (Larason& kulchitsky, 2000). Larason and Kulchitsky conducted a srearch
using the Total Design Method (Dillman 1978) on 514 respondents in Canada. The sample was drawn
from a list of members who had earned a certified professional purchaser (CPP), because the CPP are
excellent key informants as the tend to be among the most skilled and experienced purchasing
members and they are knowledgeable about buyer- supplier relationship. A total of 514 surveys were
sent and 338 were returned. In the summary of the findings Larason and Kulchitsky noted that face to
face and telephone were strongly preferred for tactical communication and the electronic media (EDI,
E-mail, Internet) were characterized by low utilization. They also stated that electronic communication
was timely and accurate and that it leads to closer buyer-seller relationship. The conclusion of the
study was that purchasing professionals must keep arrestor advancements in electronic communication
technology. That such technology offers enormous potential to increase both effectiveness and
efficiency of the purchasing effort. they also stated that purchasing professionals need to retain and
sharpen their skills using more traditional media such as face to face communication. That in the future
it will be important for purchasing managers to know how to use all communication media and when
to use a particular medium.
This study was conducted by Richard Chinomona in 2015. The data for this research was collected
from Gauteng Province of South Africa. The research sampling frame was the Gauteng Enterprise
Propeller of South Africa. Of the total of 500 questionnaires distributed, 302 usable questionnaires
were retrieved for the final data analysis. He summaries by saying that the study revealed the
importance of collaborative communication as a value adding aspect in supply chain management and
business performance. This adds considerably to B2B marketing literature and supplier relationship
practices that need to be explored within the South African context that pertains to SMMEs. Although
it is supported in literature that communication is essential for relationship longevity between the
supplier and buyer, it is important to explore the relevance of certain external market factors that
influence the maintenance of relationships with business partners that are particular to SMMEs in
South Africa.
A research study conducted by (Abbas ,2016) on the “Effects of mobile phone technology on logistics
performance of clearing and forwarding firms in Mombasa County”. Used descriptive cross sectional
research design was used for this study. The total sample 228 clearing and forwarding firms. The
summary findings of the study were Clearing and forwarding firms in Mombasa County use mobile
phone technology for placing orders, payments/pay bills and car tracking, fuel management, diver
management, routing, mapping and scheduling to a great extent. This shows that the firms recognize
that mobile phone technology impacts on logistics performance to a large extent. The conclusion of the
study was the firms have adopted mobile phone technology to a moderate extent although some uses
such as paying of bills and placing orders are being done to a large extent. Mobile phone technology
adoption faces various challenges to a great extent some of them being systems reliability, lack of
proper training/inadequate human resource development and lack of top management commitment to
technology implementation.

2.3.2 Procurement Software Adoption.

Puschmann and Alt (2005), did a research on the “Successful Use of E-Procurement in Supply
Chains”, that aimed at exploring the introduction of e-procurement systems and their contribution to
the management of indirect goods in the supply chain. The study used a two part qualitative approach;
the first part involved the summary of a 9 benchmarking study that was conducted by a consortium of
12 multinational companies and five successful practice companies were selected and analyzed in
detail. The second part involved the drawing of the success factors identified in the benchmarking
study and mapped them against the successful practice companies. In their findings, they found that
there was need for an overall procurement strategy, an alignment of various procurement sofware
solutions along the procurement process and the need for integrated system architectures. They also
noted that companies should realise that a no standardized procurement software solution exists and
that important success factors could also be “nontechnical” in nature.
In 2020 (Gihozo) conducted a research in Rwanda on the “Adoption of e-procurement in Rwandan
public institutions”. The research design in the thesis was an embedded single-case design, since there
was one case study. The research was done on 5 interviewees online on of hem was MINECOFIN
(Ministry of Finance and Eco monic Planning, Kigali, Rwanda). the summary of her findings were the
use of e-procurement had brought significant benefits to MINECOFIN such as price reduction in
tendering, reduction to the source material, improvement of communication and information flow,
improved planning and control, increases transparency and accountability, reduction of corruption,
lower of administrative cost, etc. Despites, all those benefits, there was also some challenges
associated with the adoption of the e-procurement system in MINECOFIN such as culture resistance,
lack of IT skills, poor IT infrastructure, the problem with external linkage systems, and immaturity of
some module such as the contract management module.
In 2007 (Muthigani) conducted a research on, “Electronic procurement implementation”. She stated
that in Kenya organizations such as Nation Media Group have also embraced the use of e-procurement
through their digital platform N-Soko whereby their clients can purchase properties, vehicles, etc. via
the internet (Gitahi, 2011). Her research design constituted on the collection, measurement and
analysis of data. Her study population was made up of the nine organizations that had formed a block
client-base with e-sokoni in 2000 and had used e-sokoni platform to carry out procurement software in
Kenya. The summary of her findings were that there were reasons that impact heavily on
implementation of the procurement software systems, some of the reasons that stood out prominently
included issues of awareness of the new systems, the perception that the new system posed a threat to
the jobs of staff, support from management is indeed very salient in any change process and so it came
out strongly from the findings. Her coclusion was e-procurement implementations have broadened in
reach and deepened in scope for the last 10 years. This change as evident from the findings has
resulted in greater adoption of invoicing and payment activities consistent with the move towards more
fully operational systems and the development of greater e-commerce capabilities. This increase in
reach and scope has also made the challenges associated with software and catalogue integration and
the alignment of organizational culture with procuring online more visible.

2.3.3 Data Analytics and Reporting.

In 2019 Emeral Insights accepted a research paper from (Handfield, Choi and Jeong on the “Emerging
procurement technology data analytics and cognitive analytics) This paper employed a qualitative
approach that relies on three sources of information, executive interviews, a review of current and
emerging technology platforms and a small survey of subject matter experts in the field. This survey
was administered to the Chief Procurement Officers (CPO) or Chief Supply Chain Officers of Fortune
500-type companies that make up the CAPS membership base. CAPS refers to this survey as the CPO
Insight survey. They obtained a set of 25 survey responses out of 110 eligible member firms. The
findings were procurement analytics landscape developed in the research suggest that the authors
would continue to see major shifts in the sourcing and supply chain technology environment in the
next five years. However, there currently existed a low usage of advanced procurement analytics, and
data integrity and quality issues were preventing significant advances in analytics. This study
identified the need for organizations to establish a coherent approach to collection and storage of
trusted organizational data that build on internal sources of spend analysis and contract databases. An
important element for organizations in that evolution is managing change and the need to nourish an
analytic culture.
In a research conducted by (Agburum and Adiele, 2022) on the “Exploration of supplier evaluation
and supply chain performance 0f shipping firms in River State, Nigeria). The research design adopted
for this study is correlation. Correlational research design is a survey method that indicates the
magnitude or strength and nature or direction of linear relationship that that exists between two or
more variables or set of data in a single group of subjects. The study population comprised of the
forty-five (45) Shipping firms operating in Rivers State as enlisted in the Nigerian oil and gas industry
annual report (2019). In line with the findings of this study the researchers concluded that supplier data
evaluation has significant and positive relationship with supply chain performance of shipping firms in
Rivers State, Nigeria. Thus, this implies that supplier data evaluation is a key enabler of growth and
improvement in supply chain performance and the researchers therefore conclude that supplier
evaluation affect supply chain performance of shipping firms in Port Harcourt, Rivers state Nigeria.
Based on the theoretical and empirical findings, the researchers recommend that managers of shipping
firms in Port Harcourt, Rivers state should take advantage of the influential role of supplier evaluation
in their operations as to ensure the enhancement supply chain performance.
A study conducted by (Mugambi, 2017) on the “Effects of cargo tracking system of cross-border trade
between Kenya and Uganda) The study used an exploratory research design, the population of this
study were border officials of Kenya and Uganda. The sample size of the study was 30 border and
headquarter officials. The findings of the research were that cargo tracking as implemented by KRA
had become a dominant way of tracking goods. The common identified factors that affect this system
were the level of technological preparedness of the organization, training of staff and stockholders on
the usage of the system. the study showed that diversion of the cargo to the market has been reduced
due to the tracking system, that clearance of cargo at the border points have been made easier due to
the system.

2.4 Critique of Literature.

(Larason and Kulchitsky's, 2000) found in their study that electronic communication, was timely and
accurate. However, they noted that face-to-face and telephone communication were strongly preferred,
suggesting a potential resistance or preference for traditional communication methods over electronic
ones. (Richard Chinomona 2015) emphasized the importance of collaborative communication as a
value-adding aspect in supply chain management. He also acknowledged the importance of
communication for relationship longevity but highlights the need to explore external market factors
influencing relationship maintenance for SMMEs in South Africa. (Abbas 2016) highlights the
extensive use of mobile phone technology for various logistics functions, indicating its recognition and
positive influence. The study mentions challenges such as system reliability, lack of proper training
and inadequate human resource development, these challenges highlight barriers to the widespread and
effective adoption of mobile phone technology in logistics.

Puschmann and Alt (2005) identify success factors for the introduction of procurement sofware
systems, emphasizing the need for an overall procurement strategy, alignment of various procurement
software solutions, and integrated system architectures. The study notes the absence of a standardized
procurement software solution, suggesting potential challenges and complexities in the adoption of e-
procurement systems. Gihozo (2020) states that the adoption of procurement software systems in
Rwandan public institutions led to significant benefits, including improved communication,
transparency, accountability, and lower administrative costs. Challenges associated with procurement
software adoption in Rwandan public institutions include cultural resistance, lack of IT skills, poor IT
infrastructure, problems with external linkage systems, and module immaturity. Muthigani (2007)
indicates that e-procurement implementations have broadened in reach and deepened in scope over the
last 10 years, resulting in greater adoption of invoicing and payment activities. The challenges
associated with software integration and the alignment of organizational culture with procuring online
are highlighted.
Handfield, Choi, and Jeong (2019) point out the emerging landscape of procurement analytics,
emphasizing the need for organizations to establish a coherent approach to data collection and storage.
The research also identifies a low usage of advanced procurement analytics, with data integrity and
quality issues hindering significant advances. Agburum and Adiele (2022) suggests a significant and
positive relationship between supplier data evaluation and supply chain performance for shipping firms
in Rivers State, Nigeria. However, she states that there was a shortage of skilled professionals with
expertise in data analytics and reporting that hindered organizations from fully leveraging their data.
Mugambi (2017) highlights the positive effects of the cargo tracking system on cross-border trade
between Kenya and Uganda, reducing cargo diversion and easing the clearance process at border
points. He also states that the common factors affecting the cargo tracking system include the
technological preparedness of organizations, training of staff and stakeholders, indicating potential
challenges in these areas that need to be addressed for effective system implementation.

2.5Summary of the literature.

The literature provides insights into the impact of ICT adoption on clearing and forwarding companies
in the logistics and supply chain industry. It emphasizes the role of technologies like e-ordering, ERP
systems, and data analytics in improving operational effectiveness and supply chain performance.
Clearing and forwarding companies play a pivotal role in the movement of goods, impacting economic
growth. The literature review deals with The Technology Acceptance Model (TAM) suggests that the
intention to use technology is influenced by perceived ease of use and perceived usefulness.(Davis,
1989)
The conceptual framework illustrates independent variables related to electronic communication,
procurement software adoption, and data analytics, with corresponding dependent variables. It outlines
how various ICT components are interconnected and can influence the operational effectiveness of
companies. the chapter talks about how electronic supplier communication includes e-ordering, real-
time communication, and electronic invoicing. It also explains that e-ordering can enhance
procurement efficiency, reduce errors, and lead to quicker response times. Real-time communication
facilitates collaboration, quicker issue resolution, and adaptability to changing conditions, and how
Electronic invoicing reduces manual processing, speeds up payment processing, and enhances
accuracy.
This chapter explains how Procurement software adoption encompasses custom software solutions,
Enterprise Resource Planning (ERP) systems, and Warehouse Management Systems (WMS). Custom
software solutions are tailored to the specific needs of clearing and forwarding companies,
streamlining various processes. ERP systems facilitate the integration of business processes, resource
allocation, and process management. WMS optimizes warehouse operations, improving cargo tracking
and overall productivity. the chapter talks about Data analytics that involves data mining, inventory
analysis, and assessing cost savings and cargo tracking opportunities. Data mining helps in assessing
supplier performance and identifying trends. Inventory analysis optimizes stock levels, reducing costs
associated with excess inventory. Cost savings and cargo tracking are essential for evaluating the
benefits of ICT adoption.
2.6 Research gaps
2.5 Previous studies reveal that ICT adoption in the operational effectiveness of different companies in
Kenya is influenced by various factors. However, not much study has been done in Kenya’s
context of clearing and forwarding adoption of ICT. Due to the fact that various countries and
firms have different unique characteristics and specific conditions of technological innovation and
diffusion, this study is meant to fill in the gap. There have been challenges such as system
reliability, lack of proper training, and inadequate human resource development pose barriers to the
widespread and effective adoption of procurement software systems in logistics. There has been a
preference for traditional methods as opposed to electronic communication. (Larason and
Kulchitsky's, 2000) noted that face-to-face and telephone communication were strongly preferred
thus insinuating a potential resistance or preference for traditional communication methods over
electronic ones in supply chain interactions.
There have been challenges in procurement software system adoption, the absence of a standardized
procurement software solution suggests potential challenges and complexities in the adoption of
procurement systems. Handfield, Choi, and Jeong (2019) highlight the emerging landscape of
procurement analytics but note low usage of advanced analytics, with data integrity and quality issues
hindering significant advances. Meaning that there are specific barriers and challenges that limit the
broader implementation of advanced procurement analytics.
 CHAPTER THREE

3.0 Introduction
This chapter highlights the methods and procedures that were used in carrying out the study. It
includes the survey research design, population, the sampling frame and techniques, data collection
methods (instruments and procedures), and data analysis and presentation methods.
3.1 Research Design
According to Orodho (2003) a research design is a method of collecting information by interviewing
or administering a questionnaire to a sample of individuals. Some examples of research designs are
Quantitative research design, Qualitative research design, Experimental design, Descriptive design and
Explanatory design. (Jain, 2023) My study will adopt a qualitative design method. It is suitable for this
study because it is a research method, that is used to describe the existing phenomena as accurately as
possible. Atmowardoyo (2018)

3.2 Population of the Study

According to Ogula (2005), a population refers to any group of institutions, people or objects that have
common characteristics. The types of populations in a study are accessible population, target
population and study population. (Psychiaty, 2010). The appropriate type of population for my
research will be the target population, it will include clearing and forwarding companies in Kenya.
This type of population is suitable for my research because it deals with an entire group of people or
objects to which a researcher wishes to generalize the study findings.

3.3Target Population
(Alvi, 2016) described a target population as all the members who meet the criteria specified for a
research investigation. A target population needs to be exclusive enough to avoid having participants
who do not represent the study needs which will misrepresent the population of interest (Cast eel &
Bridier,2021). The target population of this study is will be 20 licensed and registered customs clearing
agents from different companies in Nairobi. The target population is suitable for this study because
they are most relevant to the study.

3.4Sampling Frame
According to the (Oxford Dictionary, 2023) a subject frame or sampling frame is a list of the items or
people forming a population from which a sample is taken. Some examples of subject frames related to
my research are Government Licensing Records, Business Directories, Yellow Pages and Freight
Networks. The type of sampling frame I will use is freight networks, Kenya International Freight and
Warehousing Association (KIFWA).This type of sampling frame is suitable for this study because
Kifwa has over 1,200 agents operates from the Ports, Container Freight stations, Inland Container
Depots and all border points and airports.(Mghenyi, 2023)
3.5 Sampling Technique and Sample Size.

Sampling technique is the process of studying the population by gathering information and analyzing
that data(BYJUs). (BYJUs, 2023) states that some examples of sampling techniques are probability
sampling, non-probability sampling. The study will use simple random sampling technique in selecting
firms to be studied, this is a group of the probability sampling technique. This type of sampling
technique is suitable for this study as it is simple and easy to use making the research process simpler
and faster. Orotho (2003)

A sample size is a research term used for defining the number of individuals included in a research
study to represent a population. (Kibucha, 2021). according to Kombo (1992), a sample size is a sub-
set of a given unit. The importance of a sample size in research is because it is impossible to study an
entire population hence the need of a smaller unit from a group in a population. The sample size for the
study constitutes of 60 clearing and forwarding agents from the KIFWA website.
3.6 Data Collection Instrument.
(O.Mosweu &T.Mosweu, 2020) define data collection instrument as the tools used by researchers to
actually collect data in the research process. They also state that the common data collection
instruments in research include interviews, questionnaires, documentary analysis and observation. The
data will be collected using research questionnaire. According to Nkapa (1999) a questionnaire is a
carefully designed instrument for collecting data in accordance with the specification of the research
questions. They are suitable for this study because questionnaires are commonly used to obtain
important information about the population (Mugenda and Mugenda, 1999)

3.7 Data Collection Procedures.

Data collection procedure is a systematic approach used to collect data for research, analysis, or
decision-making purposes. (Getachew,2023) I will obtain all the necessary documents, including a
questionnaire. Audience with the local authorities in the region will also be sought to clarify the
purpose of the study. (Willson, Iravo, 2015). I will distribute the questionnaires to sampled individuals
who are the clearing and forwarding agents. The use of questionnaires is expected to ease the process
of data collection. During the distribution of the instruments, I will explain the purpose of the research.
The questionnaires will be an objective method since there will be no bias resulting from the personal
characteristics (as in an interview) (Owens, 2002).
3.8 Data Analysis
Data analysis is a process for obtaining raw data, and subsequently converting it into information
useful for decision-making by users. (Wikipedia, 2023) Some types of data analysis are
Descriptive, diagnostic, predictive, and prescriptive (Stevens, 2023). This research will use descriptive
data analysis. The goal of descriptive analysis is to describe or summarize a set of data (Neo,2023).
This type of analysis is suitable for this research as looks at what has happened in the past and has an
aim to solely provide an easily digestible snapshot. (Stevens, 2023)
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APPENDICES

Appendix 1 RESEARCH QUESTIONNAIRE

PART A: Dear respondent, I am conducting a research study on the effects of ICT adoption on the
operational effectiveness of forwarding and clearing companies in Kenya. The questionnaire items are
about the study and you are kindly requested to participate in responding to the questions below. The
information given will be treated as confidential and the results of the study will be used for academic
research purposes only.
PART B: Demographic Data.
1.Name of the respondent (optional) ……………………………………….………
Name of your organization (optional)……………………………….……………………….
Gender: Male [ ] Female [ ]
2.What is your age bracket? (Tick as applicable).
Under 20 years [ ]
21 – 30 years [ ]
31 – 40 years [ ]
41- 50 years [ ]
Over 50 years [ ]
3. Length of continuous service with the company?
Less than two years [ ]
2-5 years [ ]
6- 10 years [ ]
Over 10 years [ ]
4. For how long has your company been in existence?
Under 5 years [ ]
6-10 years [ ]
11-15 years [ ]
Over 16 years [ ]
Part C: Electronic Supplier Communication.
5. Has your company adopted Electronic Supplier Communication? Yes[ ] No[ ]
Please rate the extent to which your organization utilizes electronic communication with suppliers for
the following aspects.
5= To a very strong extent 4= To a strong extent 3= To moderate extent 2= To a minimal extent 1=
Not at all

Utilization of Electronic Communication 1 2 3 4 5

1. To what have traditional methods of communication been preferred to
modern ones?
2. To what extent has real-time electronic communication facilitated quick
 decision-making with suppliers?

3. To what extent does your organization place orders with suppliers using
electronic platforms?
4. To what extent does your organization use electronic systems for
generating and processing invoices?
5 To what extent does your organization engage in real-time
communication (zoom calls, instant Messaging) with suppliers through
electronic means?

Part D: Procurement Software Systems

6. Does your organization use Warehouse management systems? Yes [ ] No[ ]
7. Does you organization use custom procurement software e.g Vendor Management Systems? Yes [ ]
No[ ]
Please rate the extent to which your organization utilizes procurement software systems for the
following aspects.
5= To a very strong extent 4= To a strong extent 3= To moderate extent 2= To a minimal extent 1=
Not at all

Adoption of procurement software systems

1. To what extent does your organization use Warehouse Management
Systems (WMS) as part of your procurement processes?

2. To what extent has there been absence of standardized systems in your

organization?
3. To what extent are the systems you use reliable?

4. How have integrated procurement processes within your ERP system

positively impacted your organization's overall efficiency?

5. How well do the custom procurement solutions align with the unique
needs and workflows of your organization?

Part E: Data analytics and reporting.

Please rate the extent to which your organization utilizes data analytics and reporting for the following
aspects.
5= To a very strong extent 4= To a strong extent 3= To moderate extent 2= To a minimal extent 1=
Not at all
 Data analytics and reporting 1 2 3 4 5
1. To what extent does your organization utilize data mining techniques to
evaluate and assess the performance of suppliers?
2. To what extent does your organization use data analytics to identify
opportunities for cost savings and operational efficiencies?

3. How extensively is data analytics applied for real-time cargo tracking

and monitoring throughout the supply chain?

4. How would you rate the extent of effectiveness of data mining in

improving the evaluation and selection of suppliers?
5. To what extent has the use of data analytics for inventory data analysis
positively impacted your organization's operational efficiency?

Part F. Operational effectiveness of clearing and forwarding companies.

Please rate the extent to which your organization demonstrates operational effectiveness in the
following areas.
5= To a very strong extent 4= To a strong extent 3= To moderate extent 2= To a minimal extent
1= Not at all

The Operational effectiveness of clearing and forwarding companies. 1 2 3 4 5

1. To what extent does your organization adhere to compliance and
regulatory requirements in the clearing and forwarding processes?

2. To what extent does your organization effectively implement cargo

tracking and tracing systems to monitor shipments?

3. To what extent is your organization committed to ensuring high levels

of customer satisfaction in its clearing and forwarding services?

4. How would you rate the effectiveness of the measures in place to ensure
compliance and regulatory performance?
5. How extensively does your organization utilize cargo tracking systems
to enhance operational efficiency and visibility?
6. To what extent has a focus on customer satisfaction positively impacted
your organization's overall operational effectiveness?

Appendix 2. Time Lines

SEPT OCT NOV DEC JAN FEB MARCH

 Proposal Writing

Data Collection

Data Analysis

Report Writing

Appendix 3 Budget.
Proposal Writing 4,400ksh

Data Collection 2,000ksh

Data Analysis 1,500ksh

Report Writing 2,500ksh

Total 10,400 ksh

Appendix 4 List of Firms.

Kind Logistics Limited
Mitchell Cotts Kenya
Freight in Time Ltd
 CHAPTER FOUR: FINDINGS AND DISCUSSIONS
4.1 Introduction
The chapter presents the results of the study. The discussion of the study results is also provided in the
chapter.
4.2 Response Rate
The response rate for the study was presented in Figure 4.1.

Response Rate
6; 10%

54; 90%

Returned Unreturned

Figure 4.1

A total of 60 questionnaires were administered. However, those that were filled completely and
returned were 54 translating to a response rate of 90%. This was a good response rate that was
favorable for the study.

4.3.1 Descriptive analysis for Electronic Supplier Communication

The descriptive results for Electronic Supplier Communication were presented in Table 4.1.
Table 4.1: Descriptive statistics for Electronic Supplier Communication
N Mean Std.
Deviation
Our firm has been using electronic orders to examine the effects of 54 4.63 0.663
electronic supplier communication in clearing and
forwarding companies
Our firm has been using real-time communication to examine 54 4.48 0.629
the effects of electronic supplier communication in clearing and
forwarding companies
Our firm has been using electronic invoices to examine the effects of 54 4.35 0.601
electronic supplier communication in clearing and
forwarding companies
Valid N (list wise) 54

From the results presented in table 4.2 the statement our firm has been using electronic orders to
examine the effects of electronic supplier communication in clearing and forwarding companies had
mean of 4.63 and a standard deviation of 0.663. The statement that our firm has been using real-time
communication to examine the effects of electronic supplier communication in clearing and
forwarding companies had a mean of 4.48 and a standard deviation of 0.629. Additionally the
statement that our firm has been using real-time communication to examine the effects of electronic
supplier communication in clearing and forwarding companies had a mean of 4.35 and a standard
deviation of 0.601.
This indicated that most of the respondents agreed to statement our firm has been using electronic
orders to examine the effects of electronic supplier communication in clearing and forwarding
companies. The findings agree with those of Kim (2002) who found that electronic orders had a major
role in examining the effects electronic supplier communication in clearing and forwarding companies.
However these findings contradicted with those of Passi (2014) who found that real-time
communication had a key role in examining the effects of electronic supplier communication in
clearing and forwarding companies. It was concluded that electronic orders had a major role in
examining the effects electronic supplier communication in clearing and forwarding companies.

4.3.2 Descriptive analysis for Procurement Software Adoption

The descriptive results for Procurement Software Adoption were as in Table 4.2
Table 4.2 Descriptive analysis for Procurement Software Adoption
N Mean Std.
Deviation
Our firm has been using procurement software solutions to 54 4.39 0.609
examine the effects of procurement software adoption in
clearing and forwarding companies
Our firm has been using enterprise resource planning to 54 4.30 0.585
examine the effects of procurement software adoption in
clearing and forwarding companies
Our firm has been using warehouse management systems to 54 4.20 0.570
examine the effects of procurement software adoption in
clearing and forwarding companies
Valid N (list wise) 54

The results showed that the statement our firm has been using procurement software solutions to
examine the effects of procurement software adoption in clearing and forwarding companies had a
mean of 4.39 and a standard deviation of 0.609. Furthermore the statement our firm has been using
enterprise resource planning to examine the effects of procurement software adoption in clearing and
forwarding companies had a mean of 4.30 and a standard deviation of 0.585. Additionally statement,
our firm has been using warehouse management systems to examine the effects of procurement
software adoption in clearing and forwarding companies had a mean of 4.20 and a standard deviation
of 0.570.
The results revealed that most of the respondents had been using procurement software solutions to
examine the effects of procurement software adoption in clearing and forwarding companies. The
findings agreed with the findings of Logistaas (2023) who revealed that using procurement software
solutions to examine the effects of procurement software adoption in clearing and forwarding
companies had a significant impact. However these findings contradicted with those Lorason (2000) of
who found that warehouse management systems played a major role in examining the effects of
procurement software adoption in clearing and forwarding companies. The findings concluded that
procurement software adoption had a positive impact on the performance of clearing and forwarding
companies.

4.3.3 Descriptive analysis for Data Analytics and reporting

Table 4.3 showed the descriptive analysis results for Data Analytics and reporting
Table 4.3: Descriptive analysis for Data Analytics and reporting
N Me an Std.
Deviation
Our firm has been using data mining for supplier evaluation to 54 4.21 0.572
examine the effects of data analytics and reporting in
clearing and forwarding companies
Our firm has been using inventory data analysis to examine the 54 4.07 0.545
effects of data analytics and reporting in clearing and
forwarding companies
Our firm has been using cost savings and cargo tracking to 54 3.93 0.520
examine the effects of data analytics and reporting in
clearing and forwarding companies
Valid N (list wise) 54

The results revealed that the mean and standard deviation for the statement our firm has been using
data mining for supplier evaluation to examine the effects of data analytics and reporting in clearing
and forwarding companies was 4.21 and 0.572 respectively. The results also revealed that mean and
the standard deviation for the statement our firm has been using inventory data analysis to examine the
effects of data analytics and reporting in clearing and forwarding companies were 4.07 and 0.545
respectively. Finally the statement our firm has been using cost savings and cargo tracking to examine
the effects of data analytics and reporting in clearing and forwarding companies had a mean of 3.93
and standard deviation of 0.520.
These results implied that most of the respondents agreed to the statement our firm has been using data
mining for supplier evaluation to examine the effects of data analytics and reporting in clearing and
forwarding companies. The findings agreed with those of Dillman (1978) who found using data
mining for supplier evaluation to examine the effects of data analytics and reporting in clearing and
forwarding companies was crucial. However, these findings contradicted with those Richard (2015) of
who found cost savings and cargo tracking played a major part in examining the effects of data
analytics and reporting in clearing and forwarding companies. The findings concluded that data
analytics and reporting had a positive impact on the performance of clearing and forwarding
companies.

4.3.4 Descriptive analysis for performance of forwarding and clearing companies

The descriptive results for the performance of manufacturing firms were presented in Table 4.4.
Table 4.4 Descriptive analysis for performance of forwarding and clearing companies
N Mean Std.
Deviation
Our firm has been witnessing increased compliance and 54 4.35 0.601
regulatory performance
Our firm has been witnessing improved cargo tracking and tracing 54 4.20 0.570
Our firm has been witnessing an increase in customer satisfaction 54 4.07 0.545
Valid N (list wise) 54

Table 4.5 results showed that the mean for the statement our firm has been witnessing increased
compliance and regulatory performance was 4.35 and the standard deviation was 0.601. It was also
revealed that the statement our firm has been witnessing improved cargo tracking and tracing had a
mean of 4.20 and a standard deviation of 0.570. Finally the results revealed that the statement our firm
has been witnessing an increase in customer satisfaction had a mean of 4.07 and a standard deviation
of 0.545.
The results revealed that most of the respondents agreed firm had been witnessing increased
compliance and regulatory performance, improved cargo tracking and customer satisfaction. The
findings were similar to those by Abbas (2016) who found that increased compliance and regulatory
performance, improved cargo tracking and customer satisfaction positively led to improved
performance of forwarding and clearing companies. However the findings contradicted with those of
Alt (2005) who argued that focusing solely on compliance and regulatory can lead to neglecting
quality control, which can result in defective products and ultimately harm customer satisfaction and
brand reputation. Findings concluded that increased compliance and regulatory performance, improved
cargo tracking and customer satisfaction could positively lead to improved performance of forwarding
and clearing companies.
4.4.5 Descriptive analysis for effects of ICT adoption on the operational effectiveness of
forwarding and clearing companies
Descriptive analysis for effects of ICT adoption on the operational effectiveness of forwarding and
clearing companies were presented as in Table 4.5.
Table 4.5 Descriptive analysis for effects of ICT adoption on the operational effectiveness of
forwarding and clearing companies
N Mean Std. Deviation
Electronic supplier Electronic orders 54 4.63 0.663
communication Real time communication 54 4.48 0.629
Electronic invoices 54 4.35 0.601
Procurement software Custom procurement software solutions 54 4.39 0.609
adoption Enterprise resource planning 54 4.30 0.585
Warehouse management systems 54 4.20 0.570
Data Analytics Data mining 54 4.21 0.572
and reporting Inventory data analysis 54 4.07 0.545
Cost savings and cargo tracking 54 3.93 0.520
Performance Compliance and regulatory 54 4.35 0.601
Cargo tracking and tracing 54 4.20 0.570
Customer satisfaction 54 4.07 0.545
Valid N 54

The data analysis results showed that forwarding and clearing companies prioritized electronic supplier
communication. Electronic orders had a mean of 4.63 and a standard deviation of 0.663. Real time
communication had a mean of 4.48 and a standard deviation of 0.629. Electronic invoices had a mean
of 4.35 and a standard deviation of 0.601. Procurement software adoption focused on custom
procurement software solutions which had a mean of 4.39 and a standard deviation of 0.609.
Enterprise resource planning had a mean of 4.30 and a standard deviation of 0.585. Warehouse
management systems had a mean of 4.20 and a standard deviation of 0.570. Data analytics and
reporting results showed that the mean and standard deviation for data mining was 4.21 and 0.572
respectively. The results also revealed that mean and the standard deviation for inventory data analysis
were 4.07 and 0.545 respectively. Cost savings and cargo tracking had a mean of 3.93 and standard
deviation of 0.520.
The performance results showed that the mean for compliance and regulatory was 4.35 and the
standard deviation was 0.601. It was also revealed that cargo tracking and tracing had a mean of 4.20
and a standard deviation of 0.570. Finally the results revealed that customer satisfaction had a mean of
4.07 and a standard deviation of 0.545. Generally, the findings agreed with those of Lorason (2000)
who found that procurement software adoption had a positive impact on the performance of clearing
and forwarding companies. However, these findings contradicted with those Dillman (1978) of who
found that data analytics and reporting had a major and positive impact on the performance of clearing
and forwarding companies.
Therefore this study concludes that adoption of Information and Communication Technology (ICT)
has demonstrably enhanced the operational effectiveness of forwarding and clearing companies. This
is evident through improved data management, streamlined communication, and enhanced visibility
throughout the supply chain. ICT facilitates real-time tracking of cargo, efficient document processing,
and seamless collaboration with various stakeholders, leading to faster clearance times, reduced errors,
and ultimately, increased customer satisfaction. By leveraging ICT solutions, forwarding and clearing
companies can optimize their operations, gain a competitive edge, and navigate the complexities of the
global logistics landscape more effectively.
 CHAPTER FIVE: SUMMARY, CONCLUSION AND RECOMMENDATIONS
5.1 Introduction
This chapter consists of the summary of the study findings the conclusions and the recommendations.
This was done in line with the study objectives. The areas for further research are also stated.
5.2 Summary of Findings
The findings revealed that electronic communication methods, particularly electronic orders, are
widely used. Additionally, procurement software solutions were found to be the most prevalent
software employed. Furthermore, data mining for supplier evaluation was identified as a common
practice, while inventory data analysis and cargo tracking for this purpose were found to be less
widespread. Finally, the study suggests positive changes associated with the use of these technologies,
with the most significant improvements observed in compliance and regulatory performance, followed
by cargo tracking and tracing, and lastly, customer satisfaction. These findings align with existing
research on the importance of these practices in the success of forwarding and clearing companies.
5.2.1 Summary of findings on Electronic Supplier Communication
The descriptive analysis revealed suggest that a majority of the respondents agreed with the statement
that the firm uses electronic orders to examine these effects. There was slightly less agreement with the
statements regarding the use of real-time communication. Overall, the findings indicate that electronic
communication methods are prevalent within the firm for examining the effects of supplier
communication.
5.2.2 Summary of findings on Procurement Software Adoption
The descriptive analysis results suggested that procurement software solutions were the most
commonly used method followed by enterprise resource planning and warehouse management
systems. This aligned with the research which identified procurement software solutions as having a
significant impact in this context.
5.2.3 Summary of findings on Data Analytics and reporting
The results of the descriptive analysis further revealed that respondents largely agreed with the
statement that their firms use data mining for supplier evaluation, suggesting this practice is prevalent.
This aligned with previous research by which highlighted the importance of data mining for supplier
evaluation in this sector. Interestingly, the use of inventory data analysis and cargo tracking for
examining data analytics' effects received slightly lower agreement, suggesting they might be less
widespread compared to data mining for supplier evaluation.
5.2.4 Summary of findings on performance of forwarding and clearing companies
The study found that respondents generally agreed with statements indicating the firm was
experiencing positive changes, with the highest agreement for increased compliance and regulatory
performance, followed by improved cargo tracking and tracing and lastly, increased customer
satisfaction. These findings align with prior research by suggesting that improvements in these areas
contribute to the overall success of forwarding and clearing companies.
5.3 Conclusions
5.3.1 Electronic Supplier Communication
The study concludes that electronic supplier communication has a positive and significant effect on the
performance of forwarding and clearing companies. The study concludes that increasing the use of
electronic supplier communications will lead to improvement of forwarding and clearing companies.
5.3.2 Procurement Software Adoption
The study concludes that procurement software adoption has a positive and significant effect on the
performance of forwarding and clearing companies. The study concludes that increasing the use of
procurement software adoption will lead to improvement of forwarding and clearing companies.
5.3.3 Data Analytics and reporting
The study concludes that forwarding and clearing companies should strongly consider increasing their
use of data analytics and reporting. This is because the research demonstrates a clear and positive
correlation between data-driven practices and improved company performance.
5.3.4 Performance of forwarding and clearing companies
The study concludes that the respondents perceive the firm to be undergoing positive changes, with the
most significant improvements seen in compliance and regulatory performance, followed by cargo
tracking and tracing, and finally, customer satisfaction. This aligns with existing research suggesting
that these areas are crucial for the overall success of forwarding and clearing companies. I
5.4 Recommendations
5.4.1 Electronic Supplier Communication
This study strongly recommends that forwarding and clearing companies actively leverage and invest
in electronic communication channels with their suppliers. This is because the research demonstrates a
clear and positive correlation between the increased use of electronic communication and the improved
performance of these companies.
5.4.2 Procurement Software Adoption
The study recommends that that forwarding and clearing companies can significantly improve their
performance by adopting and actively utilizing procurement software. The research demonstrates a
positive and direct correlation between the use of such software and overall company performance,
highlighting its potential to enhance efficiency and effectiveness in the procurement process.
5.4.3 Data Analytics and reporting
The study recommends a shift towards crafting comprehensive material handling policies that
prioritize not just operational efficiency, but also employee well-being, safety, and data privacy. This
means expanding the scope by going beyond traditional efficiency metrics and incorporate aspects like
ergonomic design, fatigue management, and mental health support in policy development.
5.4.4 Performance of forwarding and clearing companies
The study recommends that that the firms should prioritize and continue its efforts in the areas that
received the highest positive responses: compliance and regulatory performance, cargo tracking and
tracing, and customer satisfaction. These areas not only demonstrate positive internal improvements
but also align with existing research indicating their significance to the overall success of forwarding
and clearing companies.
 5.5 Areas for Further Study
The study recommends that future researchers should investigate the impact of specific ICT solutions
on different aspects of operational effectiveness. While existing research suggests a positive overall
effect, a deeper understanding of how specific ICT solutions impact different aspects of operational
effectiveness is needed. This can help companies make informed decisions about which solutions to
prioritize for their specific needs.

Appendices.
Appendix 1:
Section1: Electronic Supplier Communication
Construct Strongly Agree Neutral Disagree Strongly
Agree Disagree
Our firm has been using electronic
orders to examine the effects of
electronic supplier communication in
clearing and forwarding companies
Our firm has been using real-time
communication to examine the effects of
electronic supplier communication in
clearing and forwarding companies
Our firm has been using electronic
invoices to examine the effects of
electronic supplier communication in
clearing and forwarding companies
 SECTION 2: Procurement Software Adoption

Please rank the following statements and use a tick mark where applicable in the 5 points of a Likert
scale.

Construct Strongly Agree Neutral Strongly Disagree

Agree Disagree

Our firm has been using procurement

software solutions to examine the
effects of procurement software
adoption in clearing and forwarding
companies

Our firm has been using enterprise

resource planning to examine the
effects of procurement software
adoption in clearing and forwarding
companies
Our firm has been using warehouse
management systems to examine the
effects of procurement software
adoption in clearing and forwarding
companies
 SECTION 3: Data Analytics and reporting

Please rank the following statements and use a tick mark where applicable in the 5 points of a
Likert Scale.

Construct Strongly Agree Neutral Disagree Strongly

Agree Disagree

Our firm has been using data mining

for supplier evaluation to examine the
effects of data analytics and reporting
in clearing and forwarding companies
Our firm has been using inventory data
analysis to examine the effects of data
analytics and reporting in clearing and
forwarding companies
Our firm has been using cost savings
and cargo tracking to examine the
effects of data analytics and reporting
in clearing and forwarding companies
 SECTION 4: Performance of forwarding and clearing companies

Construct Strongly Agree Neutral Disagree Strongly

Agree Disagree

Our firm has been witnessing increased

compliance and regulatory
performance

Our firm has been witnessing

improved cargo tracking and tracing

Our firm has been witnessing an

increase in customer satisfaction

Appendix 2: List of Firms

Kind Logistics Limited

Mitchell Cotts Kenya
Freight in Time