STRATEGIC MANAGEMENT PRACTICE OF COOPERATIVE SOCIETIES AS A FORM OF BUSINESS ORGANIZATION
ABSTRACT
This research work intends to explore an appraisal of purchasing function in the public sector in Imo State (Ministry of Agriculture and Natural Resources). I deemed it necessary since this research topic is unique to public sector in Imo state. An environmental practice research was carried out in ministry of agriculture and Natural Resources which was used to generalize the project objective. This research work cannot be said, to be exhaustive due to changing nature of public sector and is not designed to replace other view or subsequent research on these study objectives but has gone a long way in highlighting the ways to the much advocated efficient purchasing practices and techniques which has eluded our society.
CHAPTER ONE
1.0 INTRODUCTION
The success of any organization be it business organization or government parastatal depends largely, on how is being managed and largely, on how it is being managed. And management in itself entails the co-ordination of the various functions of an organization such as purchasing, marketing, finance and so on. These functions in turn owe it as duty to the organization to, operation within a certain specified environment, which may include the policies procedure and ethics that have been laid down for the operation of each function in any organization where they exist. This goes to indication that the policies and procedures employed by organization very but in fact the principles, the techniques and the ethics guiding them are the same.
Purchasing as a professional function has a share is the above analysis. It is professionally guided by well established ethics based on its sensitivity and principles to be acted upon for efficient operation it is how these guiding factors are being employed in the purchasing departments of the public sector organization with particular reference to the ministry of Agriculture and Natural Resources in Imo-State that this research paper is meant to investigate. But before getting into this, there is need to know what is meant by purchasing and why it is important is any organization. From a layman’s point of view purchasing simply means “Buying”. The act of collecting requisition from user department and placing order to the theirs. According to Giwa-Asaju E.O.G “purchasing is the term used in industry, commerce, public corporations and management to denote the act of and the functional responsibility for procuring materials, supplies and services”. He went further to establish that the term involves determing the need, selecting the supplier, arriving at proper price, terms and conditions, issuing the contract or orders and following up orders to ensure prompt delivery.
These definitions go to a greater extend to confirm what Peter Baily and David farmer stated as being the purchasing objectives, definition peculiarity know as the 6rs. And that is to purchase the right quality materials, at the right time of the right price and at the right place. But supplies and services too. From the forgoing, it is clear that purchasing in its broaden sense or definition involves that procurement of materials form the time of need arises until the time the materials is received into the store or where it is needed. It involves requirement decision (make or buy decision) value analysis, organization and management of personnel and functional co-ordination with finance, production marketing, engineering, design and quality control departments.
These methods are never drawn just like that but are derived from well established principle of the purchasing function to encourage an appraisal of purchasing function in the public sector organizations. It is how the public sector organization with particular reference to the ministry of Agriculture and Natural resources Imo-State, drew up their own methods of purchasing that the researcher finds interest in looking into with a view to investigation the suitability of the efficiency of purchasing as they have adopted and also to find out how far they have employed that modern principles of the purchasing functions to encourage efficiency in the profession.
1.1 STATEMENT OF PROBLEM
The basic and critical problem in any research work never appears to be seen on the surface. It is necessary to probe beneath the surface in order to ascertain the nature and extend of the problem in a research work. And this must be stated clearly and correctly too. Many organization and ministries are yet to regard purchasing as a vital area of management, inspite of the large percentage of their expenditures expended by the purchasing function. Although, the need for this has been emphasized, still most mangers and directors of companies and public sector organization are yet to be convinced of the need for a well established purchasing department with full responsibility and authority to purchase materials and services. For most companies that have this department one discovers that there is lack of recognition of the importance of efficient purchasing practices and so on.
The public sector organizations are not kept here and yet they spend much money on procurement of equipment, materials and service. Most procurement activities are not carried out professionally. Hence the researcher interest in investigating how the purchasing functions are being operated in the public sector organization with particular reference to ministry of Agriculture and Natural resource Owerri, Imo-State. And again, the investigation and arrangement and the perfectness and efficiency of the purchasing management and there and natural toward the profitability of the ministry of Agriculture and natural resource Owerri, with these and other numerous problems militating against efficient purchasing in the public sector, this research work is the profession.
1.2 OBJECTIVE OF STUDY
The objective of this study is to investigate the operating procedures, documents, record and policies of public sector. A concise overview of a purchasing function cannot be appreciated without a careful study of the following.
1. The contribution of the purchasing function in the public sector.
2. To reveal to government on how inefficient purchasing function can threaten the solvency to the public sector.
1.3 SCOPE OF STUDY
The study was limited to the activities of the public sector Imo-State (Ministry of Agriculture and Natural Resource). Its focus is only on the appraisal of purchasing in the public sector. The researcher will be using the staff or ministry of Agriculture & Natural resource, Imo State public sector to find out the effectiveness and efficiency of the purchasing functional if the public sector recognizes and uses all the procedures necessary for efficiency in the purchasing function. Function can threaten the solvency to the public sector.
1.4 RESEARCH QUESTION
Research question are developed part of the research project, usually research questions relate to the statement of the problems. Research question are such question passed in relation to the perplexing and distributing issues. The following research questions are formulated to enable the researcher carry out a through work.
1. Is purchasing department recognized in the public sector?
2. How efficient and effective is the purchasing function in the public sector?
3. What is the relationship between purchasing function and the department?
4. Is purchasing highly placed in your organization?
5. Is purchasing a routine, clerical and cost saving function in your organization?
1.5 HYPOTHESIS FORMULATION
The null and working hypothesis has been set by the researcher to verify the accuracy of the date collected during the course of the research work. In carrying out this, the researcher will use hypothesis to find out whether the purchasing function in the public sector is effective. An hypothesis may therefore be defined as a declaration statement of relation between two or more variable used for better understanding on the problem of the study. In recognition of this objective of this project, it is hypothesized thus
1 Ho: The function of purchasing is not important in the success of public sector.
Hi: The function of purchasing is important in the success of public sector.
2 Ho: There is no relationship between purchasing department and the other departments in ministry of agriculture and natural resources.
Hi: There is relationship between purchasing department and other department in ministry of agriculture and natural resources.
1.6 SIGNIFICANCE OF STUDY
The finding of this research project will provide and eradicate the problem encountered by public sectors when procuring their materials. This research will help us the future purchaser to examine the buying structure in our organization and the processed involved and where these problems are incurred and a way out of it. It will help us to procure raw materials of our organization little or no problems. Finally, it will serve as a lunch pad for future researchers in this area of knowledge who will benefit immensely from the finding of this work. It will also be of greater benefits to ministry of agriculture and natural resources Imo state in procuring of materials and other organization with the country with similar procurement problems associated with purchasing function.
1.7 LIMITATION OF THE STUDY
In carrying out this research, the research, the seal and enthusiasm of the following
1. Finance: The present married economic situation in the country greatly affected the financial resources of the researcher.
2. Time: The institute academic system did not allow for any particular period or an uninterrupted length of time to carry out the research period were allocated as to every other course is the institute, thus time became an uncontrollable factor.
3. Non-response: Some members of the population were very unwilling to respond to the questionnaire because of either the fear that they lack the authority and the intricacies of the law or that they will reveal their firm’s secrets.
Finally, due to financial, time constraint and non responses, the researcher was unable to examine all the variable involved in appraisal of purchasing function in all the public sector organization hence limiting her study to only ministry of Agriculture and natural Resource Imo-State.
1.8 DEFINITION OF TERMS AND ABBREVIATIONS
The following words are defined to clarify their uses in the research.
L.P.O – local purchase order that is issued to a supplier before supplies are made.
5RS the right quality, right time, right quantity, right source right price.
Profitability – ability to contribute to profit
Profession – As used the study, refers to an occupational group which can only be enter by those who have qualified by a training which includes higher education and also a special test admonished by member of that group.
G.R.N – As used the research, is in connection with stores, it means good received notes it is used in the stores work for recording receipts thus forming a conformation of the work of purchase /buyers.
Performance – Activities of purchasing in government ministries.
Purchase requisition – An internal document by which a functional department such as stores, send to the purchasing department details of materials to meet their needs, replenish stock or obtain material for specific jobs etc.
Procurement - This term show that act of purchase of items either locally or overseas. By purchasing department.
