Effect of Strategic Supplier Relationship Management on Internal Operational Performance of Manufacturing Firms: A Case of East African Breweries Limited, Kenya

Abstract

It is the aim of every organization to achieve sustainability and operational excellence. For these reasons, organizations adopt various strategies. To achieve operational excellence, every functional area of the organization must be have roles to play. Supply chain operations are in particular key in enhancing operational performance. The aim of this study was to determine the effect Strategic Supplier Relationship Management on Internal Operational Performance of Manufacturing Firms. The study focused on business-supplier communication and business-supplier joint decision making. The study was grounded on three objectives; to establish the effect of buyer supplier communication on operational performance of manufacturing firms, to evaluate the influence of buyer supplier joint decisions on operational performance of manufacturing firms and to investigate the overall effect of strategic supplier relationship management on internal operational performance of manufacturing firms. This was a correlational study and both descriptive and inferential analyses were conducted. The individual parameters were analyzed using descriptive statistics (frequencies, mean, standard deviation and variance) while regression analyses was conducted to test the effect of strategic supplier relationship management on internal operational performance. The study revealed that business-supplier communication and business-supplier joint decision making both individually and jointly have positive effect on internal operational performance. This study therefore recommends that management of manufacturing firms and other organizations adopt and implement strategic supplier relationship management as one of the management strategies. In addition, the study suggests that further studies are conducted to relate other aspects of strategic supplier relationship and organizational performance such as financial, environmental and social performance.