Thesis II - Daniyal Khan 25176 final

EFFECT OF E-PROCUREMENT, TIME MANAGEMENT AND COST MANAGEMENT ON INBOUND LOGISTICS : AN

INTERACTIVE APPROACH

MBA(SCM)M. Daniyal Khan - 25176Supervisor: Shahnawaz Ali

INTRODUCTION

Supervisor: Shahnawaz AliMBA(SCM)M. Daniyal Khan - 25176

OVERVIEW• This study is based on the three main components of inbound logistics which played vital roles in the development of

every business are time management cost management and e-procurement.

• Swift change of technology compels every organization to get the advantage of it for the profitability of the company.

• E-procurement change the way of procuring materials from the supplier which reduced the time and cost of the

supply chain department and different software’s help the companies to maintain inventory in the stock to the certain

requirement, also encourage companies to develop good relation with many suppliers at a time.

PROBLEM STATEMENT• Inbound logistics maximizes the profitability of the company. The research proposes the effect of time, cost and e-

procurement on inbound logistics, these three main variables have a significant effect in converting ineffective and

inefficient inbound logistics into a reliable and efficient logistics of a company.

BACKGROUND, OBJECTIVES AND SIGNIFICANCE

• BACKGROUND

Inbound logistics basically deals with the purchasing and management the movement of materials, from the end of

the supplier to the manufacturing plant or assembly. Many of the manufacturers are trying to reduce their inventory

cost by controlling the movement of the inventory. Manufacturers have implemented many methods to hold their

inventory optimally. Just in time method is one of the widely used methods in the inbound logistics of the companies.

Some companies establish their suppliers near to their manufacturing plant to make their inbound logistics more

efficient. ( Svensson.G,2001)

• OBJECTIVE

H0: E-Procurement, time management and cost management has a significance effect on inbound logistics.

H1: Effective and efficient use of e-procurement, time management and cost management can maximize the

profitability of a company.

• SIGNIFICANCE

This research paper highlights the procurement of materials electronically which directly reduce the cost and time of

the supply chain department of the companies.

OUTLINE OF THE STUDYThis paper consists of five main sections. First section tells us the overview, hypothesis and problem statement. Second

section includes literature review. In third section we have discussed research method. Collection of data has been done

in fourth section. Last section comprises of conclusion with discussion and future research.

• Problem identification

• Reviewing the literature

• Research objective

• Formulation of Hypotheses

• Designing a questionnaire

• Determining samples

• Data collection

• Data analysis and interpretation

• Conclusion

• Presentation

LITERATURE REVIEW


LITERATURE REVIEW• Vonderembse et al. (2000) discussed the relationship between time management and e-procurement based on survey.

In real all the variables have a close relationship between them and it also evaluates that till what limits they have the

matching issue. E-procurement is done in companies to reduce time and to make the procedure efficient of bringing

goods and raw material in.

• David and Zhou (2003) elaborated that time has a huge impact on the company’s profitability and not easy to

measure it manually so it’s better to make this efficient then the time can be reduced of transaction and economic

conditions of organization would increase.

• Mark (2009) shared that Supply chain is a vast field which allows companies to check and balance all the process of

procuring material from the suppliers end to the manufacturers / producers till the distributors and customers. Every

single organization has the ability to make its supply chain process convenient and efficient and it is the only division

to reduce the cost hence increases the profitability of the company.

THEORETICAL FRAMEWORK

• The literature analysis allows us to preserve that E-procurement, time management and cost management has a great

effect on inbound logistics. Efficiency of logistics in supply chain depends on these variables however several other

variables also effect the logistics management which is not included in the research to make it concise.

• The research model used in this research paper includes different aspects of e-procurement, cost and time which is

based on the size of the quantity whether it is in bulk or small, cost depends basically on its size and the nature of the

product, this research also consider the efficiency of procuring material from the suppliers which can be enhanced by

using electronic procurement with its suppliers. This research mainly focused on FMCG industry where different

types of material required by the firms, can be edible oil, soap, pulses etc. Different products require different types

of materials for their products even packaging materials are different or characterized according to the product it

possess inside it.

RESEARCH METHOD


RESEARCH METHOD• METHOD OF DATA COLLECTION

A survey was conducted by reaching out to employees and SCM personnel of various organizations belonging to

different industries and they were requested to fill a questionnaire.

• SAMPLING TECHNIQUE

The unrestricted non-probability based sampling was used in order to ensure that respondents were easily available to

the researcher.

• SAMPLE SIZE

The sample size used was 202, which comprised of employees and SCM personnel belonging to different industries

such as energy and power, media agency, textile, education, electronics and other service industries.

• INSTRUMENT OF DATA COLLECTION

In order to determine the Effect of E-procurement, time management and cost management on inbound logistics,

close ended structured questionnaire were used.

RESEARCH METHOD• VALIDITY AND RELIABILITY TEST

The above table shows the value of Cronbach’s alpha which is greater than 0.7. The result shows the value of

Cronbach’s alpha is 0.742, proves the instrument is Reliable.

• RESEARCH MODEL DEVELOPED

The main or basic purpose of this model is measure the effect of e-procurement, time management and cost

management on inbound logistics which impact the company’s cost of production and increase profitability.

RESEARCH METHOD• STATISTICAL TECHNIQUE

The data acquired by respondents was analyzed by using Factor Analysis and Multiple Regression Technique. The

reason for applying for this test was that the researcher needs to identify a hidden dimension and to reduce the large

amount of data

RESULTS


RESULTS• The value of KMO is 0.531 which is greater than 0.05 and the sig value of Bartlett’s test is.000 which is significant and null hypothesis is rejected so

our model for factor analysis is appropriate.

• The Cumulative % is 61.726% which is greater than 60% which shows that the factor analysis is appropriate.

• In the model summary the Dependent variable has been change by 39% due to independent variables

• According to coefficients table the significance value of E-Procurement is .104 and the value of Time Management is .135 which is greater than 0.05,

Hence researcher rejected the null hypotheses and accepted alternate hypotheses which indicates that Effective and efficient use of e-procurement

and time management can maximize the profitability of a company where as the significance value of Cost Management is .022 which is less than

0.05, the researcher rejects the Null Hypotheses and indicates the significance relationship between Cost Management and inbound logistics

HYPOTHESES ASSESSMENT SUMMARY

• Null hypothesis is rejected

• Alternate hypothesis is accepted

CONCLUSION


CONCLUSION• Research has been conducted on Effect of E-procurement, time management and cost management on inbound

logistics. Findings of this research indicate that Cost Management plays a vital part to a certain extant with inbound

logistic and it does not ensure the profitability.

• However it has been identified that E-procurement and Time Management maximize the profitability of the

company. It has also been found that in the dynamics of Pakistan, employees have started giving significance

importance to cost management over E-procurement and time management. The reason, which has been identify is

the selection decision, egoistic attitude of the employees and prevailing culture of seniority.

Policy Implication

This paper can be useful for fresh graduates who are about to enter into corporate world and for SCM personnel.

Current job seekers can take an idea that what efforts or endeavours they should make in order to be a part of the

corporate world.

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Thesis II - Daniyal Khan 25176 final