ABSTRACT

Businesses are experiencing pressures to improve the efficiency and effectiveness of the supply chain, seeking to deliver the best value to the ultimate consumer whilst remaining competitive. The performance of the Flour manufacturing sector in Nairobi has been affected by use of inadequate supply chain management practices and technologies. The existing studies are however characterized by various research gaps, both conceptual and contextual. Some of the studies were based on other countries other than Kenya. Previous studies largely assessed performance using profitability. The current study sought to establish the effect of supply chain management practices on performance of Flour Mills Companies in Nairobi County, Kenya. The specific objectives were assessing the effect of customer relationship management, information sharing and outsourcing on performance of Flour Mills Companies in Nairobi County, Kenya. The study used Resource-Based View Theory, Systems Theory and Diffusion of Innovation Theory. Descriptive research design was used in the study. The target population of the study comprised sixteen flour milling companies in Nairobi, Kenya. Purposive sampling design was adopted in the study where the sample size was forty-eight. The validity and reliability of research instruments were ascertained. Data collection was done using questionnaires which were administered based on a drop and pick later method. Both descriptive and multiple regression analyses were used in the study. The study findings were presented using tables and charts. Ethical considerations were duly adhered to in the course of this study. The study had a response rate of 87%. The correlation test revealed that customer relationship management positively correlated with performance of Flour Milling Companies in Nairobi, Kenya. Also, the correlation test revealed that information sharing positively correlated with performance of Flour Milling Companies in Nairobi, Kenya. Lastly, the correlation test indicated that outsourcing positively correlated with performance of Flour Milling Companies in Nairobi, Kenya. The regression analysis was based on the study objectives and findings indicated that customer relationship management had a significant positive effect on performance of Flour Milling Companies in Nairobi, Kenya. Also, information sharing was reported to have a significant positive effect on performance of Flour Milling Companies in Nairobi, Kenya. Furthermore, outsourcing had a significant positive effect on performance of Flour Milling Companies in Nairobi, Kenya. The study concluded that customer relationship management was key in influencing the performance of Flour Milling Companies in Nairobi, Kenya. Also, the study concluded that information sharing is a key predictor of performance of Flour Milling Companies in Nairobi, Kenya. The study further concluded that outsourcing is significant in predicting the performance of Flour Milling Companies in Nairobi, Kenya. The study recommends that Flour firms should continually enhance their customer relationship management as this brings about customer loyalty and in turn increased firm performance. The study also recommends that management should enhance the information sharing system of the companies. A well informed employee has some sense of belonging within the company and therefore works towards the improvement and sustenance of performance in return. The study further recommends that Flour Milling companies should focus on their key capabilities and outsource other operations and services which they are not fully equipped for.