Logistics Management Practices and Organizational Performance of Dairy Firms in Kenya

Abstract

This study soughtto establish the effect of logistic management practices on organizational performance. The specific objectives of the study wereto; establish logistics management practices in Dairy firms in Kenya and examine the effect of logistics management practices on organizational performance of Dairy firms in Kenya.The study adopted a descriptive survey design. Study was carried out in Dairy firms in Kenya. According to the Kenya Dairy Board (KDB), there are 34 dairy firms in Kenya. The study therefore targeted all the 34 dairy firms. Since the population is small (34) census was used to collect information from the entire population. Questionnaire and data sheet were used in data collection. The researcher conducted pilot study to ascertain validity and reliability of research instruments. Descriptive statistics as well as regression analysis with the aid of SPSS were used to analyze the collected data. The study findings indicated that there was a significant relationship between information flow and organizational performance (p=0.000); there was a significant relationship between transport management and organizational performance (p=0.000); there was a significant relationship between warehousing management and organizational performance (p=0.000) and that there was a significant relationship between inventory management and organizational performance (p=0.000). The study concludes that IT helps in sharing information on transfer or exchange of information indicating the level and position of inventory, sales data, and information on the forecasting information, information about the status of orders, production schedules and delivery capacity, and firm performance measures. Transport management have a positive significant effect on organizational performance of dairy firms and that inventory management practices within the operations of the firm is positively significant on their performance. Logistics management plays an important role of adding competitive advantage to a firm in customer support and business excellence. The study recommended investment on information systems useful to managers in dairy operations to bring about quality products and reduce the cost of transformation of goods. Managers in dairy firms should incorporate transport management in their operations processes such as procurement of raw materials and distribution of products to increase overall cost efficiency, enhanced market share, and reduced lead time thereby impacting positively on their performance and the inclusion of inventory management in the strategic plans of the dairy firms in Kenya.