A Framework for setting up effective procurement units in the MMDA, Ghana.

Procurement in the public sector has garnered sufficient attention in public sector due to its magnitude on a country’s economic expenditure and this has led to attempts by stakeholders to drive efforts at making it effective. In Ghana, public procurement has been improved with the formulation of procurement laws and regulations which were recently reformed. The reform produced the Public Procurement Amendment which stipulated the formation of procurement units within the public entity to cater for the organizations procurement operations. The formation of procurement units is a good management strategy but the absence of guideline for setting up procurement units for it to be effective may cause the procurement unit to fail in its operations. The research study sought to answer the question of what factors are needed in setting up procurement units. This leads to the development of aim of the study thus developing a guideline for setting up effective procurement units in the MMDA in Ghana. To attain this aim three objectives were formulated and a mixed methodology approach was adopted in two stages. A review of germane literature was initially conducted to identify the factors required for procurement units to be effective. The first stage involved interviewing experts in public procurement which were purposively selected concerning information gathered from literature and were consequently used to guide the questionnaire for the survey at the second stage. The questionnaire were distributed to MMDAs in Ghana which were subsequently analysed using the confirmatory factor analysis, exploratory factor analysis, mean index score and one sample t-test. The first objective sought to identify the factors for setting up effective procurement units. The confirmatory factor analysis and the mean index score was used to identify the dynamics of the procurement structure with high levels of specialization, configuration and hybrid (de)centralization and this indicated that the procurement unit size should be large to accommodate its operations. Exploratory factor analysis using principal component analysis was used to identify the key requirements needed for setting up effective procurement units thus resource and operations management requirement, top management requirement, organizational structure alignment requirement and procurement law and regulations requirement. The second objective sought to identify the factors that influence the performance of the procurement units. The one sample t-test was used to produce eleven factors that influence the procurement units in public organizations. Subsequently the success factors needed for the procurement units to be successful and effective in the public entity were also identified using one sample t-test. To attain the third objective, a framework was developed using the findings from the study to provide a clearer view of these factors and their influence on the procurement units. Further studies is suggested in the areas of assessing the impact of these requirements on the performance of these procurement units.

Source: KNUST