Abstract:
The purpose of this study was to investigate the effects of discriminatory public procurement practices on
organizational performance in the Kenyan public sector. This study sought to evaluate the effect of reservation practices
on the performance of State Corporations in Kenya. The study was guided by the following objectives; to determine the
effect of preferencing practices on the performance of State Corporations in Kenya; ascertain the effect of indirect
practices on the performance of State Corporations in Kenya and; assess the effect of supply side practices on the
performance of State Corporations in Kenya. This study adopted both qualitative and quantitative research design. The
population of interest for this study was State Corporations in Kenya. Data collection was undertaken by surveying all
State Corporations in Kenya. The study interviewed 139 procurement managers from the corporations, out of which 100
responded. Both primary and secondary data was used for the study. Data analysis methods employed included
quantitative and qualitative procedures. In addition, a multiple linear regression model of effects of discriminatory public
procurement practices versus organizational performance was applied to examine the relationship between the variables.
The model treated organizational performance as the dependent variable while the independent variables were
discriminatory public procurement practices including; reservations, preferences, indirect practices and supply side
practices. The study concluded that reservations, preferences and indirect practices, positively influenced the
performance of State Corporations in Kenya. As part of recommendation, Kenya needs to undertake a sectoral analysis in
order to determine which scheme to use for each of the different sectors, while at the same time applying additional
measures to ensure the improvement of the developmental impacts of public procurement for the national economy. Such
measures include making sub-contracting to Kenyan firms obligatory, downsizing contracts to volumes that local
businesses can manage, addressing providers’ concerns over bidding costs by reducing bureaucratic barriers, and
providing better feedback to local providers and bidders.
