How Do the Non-For Profit NFP Organizations Manage Their Procurement Processes?

¶ … picture of how nonprofit organizations balance their procurement processes by applying a phenomenological method to investigate the procurement methods, by categorizing the knowledge of participants. This involved the analysis of survey results in order to pinpoint the fundamental challenges that nonprofits face in conjunction with finding a means of improving the procurement processes. This was an investigation founded on an intensified approach to epistemology. Other models, such as the descriptive and analytical approach were also harnessed to help explain this particular topic. Surveys are of the most pinnacle and fundamental means of gathering enquiries to the information that exists, analyzing them to engage in a critical evaluation of the data. This survey seeks to shed light on the entire task of procurement, which generally refers to the manner in which goods are acquired, via a procuring entity and through the use of public funds. "Public bodies have always been big purchasers, dealing with huge budgets. Public procurement represents 18.42% of the world GDP. In developing countries, public procurement is increasingly recognized as essential in service delivery (Basheka, 2010). It accounts for a high proportion of total expenditure. For example, public procurement accounts for 60% in Kenya (Bhatt 2000), 58% in Angola, 40% in Malawi and 70% of Uganda's public spending (Wittig, 1999). This is very high when compared with a global average of 12-20% (Froystad et al., 2010)" (Kipkorir, 2013).

Thus, as a result of the fact that a tremendous amount of money is connected to government procurement and the fact such money comes from the public, there is a need for accountability and transparency unlike anything else (Kipkorir, 2013). Research like this which uses survey and surveys questions like the ones discussed truly demonstrate the intensive possibility and need for a deeper and more meaningful understanding of the entire procurement process, particularly as it occurs for organizations who work within the UN.

Survey Design: Purity of the Data

In order to pick up a clear radio signal, the noise of the background needs to be minimized; this is also true when it comes to conducting surveys with any level of accuracy. "Four main approaches can be undertaken to control for these other factors. Two of them can be implemented in the initial design of the study (randomization or matching of cases and controls, for example) and the other two during analyses of the data (strati-ed or multivariate analysis)" (Aday & Cornelius, 2011). Thus, there is a certain amount of logic in the realm of stratifying as a means of providing clarity in regards to the variables at stake.

Survey Design: Target Population

"The target population for the survey is the group or groups about which information is desired. This is sometimes referred to as the study universe. It is the group to which one wishes to generalize (or make inferences) from the survey sample. Sample inclusion criteria (such as the civilian noninstitutionalized population of the United States or adults ages eighteen and over) or exclusion criteria (persons living in group quarters or those who speak neither English nor Spanish) are directly re-ective of the target population for the study" (Aday & Cornelius, 2011). In this particular study, the target population involves four particular non-profit organizations. The inclusion criteria for these four non-profit organizations involve having official non-profit status, and being in existence for at least ten years. In this particular study, the non-profits examined will be ones based out of the United Nations. This is directly because of the wide range of work that non-profits associated with the UN are responsible for. They work all over the map, with infrastructure needs in third world countries, with educational needs all around the globe, vaccinations needed, and the needs of children. The good work of these non-profits is often solely dependent on the funding that they can receive. Thus, the survey needs to be designed and targeted so that the results generated are specific enough and compelling enough to offer an accurate snapshot of this population and their needs and challenges. "Different research designs have fundamental and compelling implications for identifying and sampling from the target population. Cross-sectional designs dictate a look at whether the designated time period for identifying the population (such as clinic users) represents the population over time (patients who had visited the facility over the past year sampled from medical records) or at a speci-ed point" (Aday & Cornelius, 2011). In this particular piece of research the target population is showcased in a more lucid and comprehensive manner, since it involves the members of these nonprofits. Group comparisons designs warrant the need of forceful attention to verify that the groups that have this level of comparison are being included in the plan for sampling (Aday & Cornelius, 2011). Certain designs, like longitudinal ones need to plan ahead for certain issues and to determine whether or not the same or different non-profits will be followed over time (Aday & Cornelius, 2011). These are all issues which will directly impact the quality of the research and the accuracy of the data reflected. This particular survey has allotted for a certain amount of follow-up post survey, as the participants will be affected in their procurement processes just simply by talking about them. This type of self-reflection might lead to changes in their methods later on, and a certain degree of follow-up is absolutely necessary to capture these changes.

Moreover, this survey design has allotted for a certain degree of balance between costs and errors and through the harnessing of a realistic appraisal of resources needed in order for the study to move forward. "This appraisal includes both monetary and human resource aspects. Tradeoffs are necessary but involve more than just numbers of subjects. For example, attempting to get large sample sizes but with insufficient follow-up vs. A smaller more targeted representative sample with multiple follow-ups. Seemingly large sample sizes do not necessarily represent a probability sample. When conducting survey research, if follow-ups are not planned and budgeted for, the study should not be initiated" (Draugalis et al., 2008). This is absolutely true: follow-ups give one a more realistic presentation of the survey and can assist in documenting a certain level of changes that have taken place, offering more nuanced results.

Furthermore, this study will focus on using homogenous sampling, as all the participants are fundamentally identical. "A homogeneous sample consists of individuals who belong to the same subculture or group and have similar characteristics. Homogeneous sample units are useful when you wish to observe or interview a particular group, for instance specialists in a ?eld or elite group members. The sample may be homogeneous with respect to a certain variable only, for instance occupation, length of experience, type of experience, age or gender" (Daymon & Holloway, 2011). The homogeneous nature of this sample also almost creates a greater level of ease in the procuring results to the survey, as all participants start at the same baseline level of experience and objectives.

Survey Design: Qualitative Research

Given the nature of the project and the inherent needs and directions of the survey and researcher, a qualitative approach needs to be harnessed. One of the ideal aspects of this type of method is that it allows for the tools for one to study truly complex phenomena within their organic contexts. The correct approach of this method means that it can become a truly indispensible tool for health science researchers in the development of theory, and in the evaluation of programs and for the development of interventions (Baxter & Jack, 2008).

In this case, qualitative research methods are the only type that are suitable for this study. "To study complexity, power relations and the co-construction of meaning in a holistic or critical sense requires a different, more ?exible type of research where the process of discovery is blended with intuition (although this is not without rigour and order as well). It is in this type of research that qualitative methods can perhaps best reach their potential. This is because there is a more natural fit between qualitative research, with its ability to delve into meaning, and the critical or interpretive ways of thinking which are concerned with the social construction of reality" (Daymon & Holloway, 2011). Thus, given the needs of this research and the nature of nonprofit research, there's really a tremendous amount that can't be quantified and which can't be put into a meaningful numerical form. The survey will be drafted in a standard qualitative fashion, to allow the representatives from various nonprofits to be able to answer in the most organic and natural means possible to them. This will ensure for the most relevant data collected.

Drafting the Question Types

As stated earlier, this survey will embrace a more qualitative, broader choice of question; however within this realm of questioning, there are two forms of questions. One type of question asks directly how non-profits procure funding and the other where the type of funding received in inferred from the choice of answer that a respondent selects. Experts debate whether or not there is an advantage or a disadvantage to either approach. The methods by which non-profits engage in procurement is multidimensional. Thus, questionnaires are generally ideal when they ask more specific and focuses questions, rather than ask for global judgment regarding the best ways non-profits have gathered money. Clarity however is key, the most focused each question is, and the easier it is to compare effective procurement with the distinct elements of raising money. "The form of answers offered to the respondent in the questionnaires varies. The simplest form of response is 'yes' or 'no.' The advantages of simplicity of this format are, according to many survey analysts, outweighed…This is a major problem given the overall need to maximize the variability of responses in any survey. Therefore most survey questionnaires now favour more than two alternative responses per question" (Fitzpatrick, 1991).

Techniques like these offer all respondents more opportunities to express their opinions and all the related complexities of their viewpoint regarding this issue. More significantly, this type of question-drafting is able to bolster the apparent reliability of items as the number of responses that are given is increased (Fitzpatrick, 1991). "In practice the gain in precision or reliability of increasing the possible answers beyond seven is minimal, and generally five response categories are used. More advanced questionnaires tend to be developed from more general principles of attitude measurement" (Fitzpatrick, 1991).

The open-ended nature of the questions of this survey are intended to minimize issues like response bias and the refusal of certain participants in answering questions. "Nonresponse error occurs when a significant number of subjects in the sample do not respond to the survey and when they differ from respondents in a way that influences, or could influence, the results" (Draugalis et al., 2008). These are all things which can result from the survey respondents engaging in a different manner from those who are non-respondents and thus, not representative of the target population (Draugalis et al., 2008). Thus, before even engaging in the survey and the collection of data, the follow-up procedures (such as the timing, method and quantity) need to be followed up on as intensively as possible. In this case, the follow up approach will occur in six months with each non-profit organization, engaging in an informal interview with the representative who completed the survey in the first place to determine any changes, updates or discoveries since the survey had been completed. "While large sample sizes are often deemed desirable, they must be tempered by the consideration that low response rates are more damaging to the credibility of results than a small sample. Most of the time, response bias is very hard to rule out due to lack of sufficient information regarding the no respondents" (Draugalis et al., 2008). This means that it is absolutely critical that researchers sculpt and mold their survey approaches so that they can optimize their response rates in a successful manner. This is also crucial in bolstering credibility to meet and match all acceptable levels of scientific rigor especially in connection to the transparency of the response rate and the overall representativeness of generalizability of the results of the study (Draugalis et al., 2008).

Survey Design: Other Items to be Included

It's quite common in survey research to include what are generally referred to as "background variables" such as social and demographic variable which generally have a specific value in regards to the means of procurement as things like one's level of education, social class, and even marital status may influence people greatly on all degrees of successful fund procurement (Fitzpatrick, 1991). "It is often difficult to clarify whether the relation between such variables and satisfaction is due to differences in expectations and readiness to express negative views or actual differences" (Fitzpatrick, 1991). This highlights the extreme necessity for a reliable means of conducting research and of drafting survey questions so that experts who work in these fields can truly reveal information that has a more illuminating quality.

Survey Design: Developed Survey Questions

The main survey questions developed for these non-profit groups are as follows:

1. What challenges do Non-for Profit organizations like procurement processes face?

2. In what ways Non-for-Profit organizations procurement activities can be improved?

Other questions which will be added to this survey will be as follows:

3. What processes could be added to increase the level of efficiency and effectiveness of public procurements?

4. What processes could be removed to the procurement methods in order to increase the level of efficiency and effectiveness of public procurements?

5. What regulations would you like to see the government adopt in order to improve the procurement policies for non-profits?

6. How can technological development improve procurement policies and what can nonprofits do more aggressively to harness technology for procurement?

7. What developments in technology do you think will more aggressively improve the procurement process?

8. Would you be open to "public procurement partnerships, why or why not?

9. What relationship in the last year has been most beneficial to your procurement endeavors?

10. What risks have been involved in previous performance endeavors? Identify the three most pressing ones.

11. What have you learned or found most revelatory about former performance endeavors?

12. Determine how power has influenced your supply chain in one overall positive way.

13. Determine how power has influenced your supply chain in one negative way.

14. How do personal relationships in business influence your decision-making process?

15. How does a dependency on certain relationships influence your ability to engage in procurement? What are these relationships (list three).

16. Is having a culturally diverse staff advantageous in procurement? What are the most obvious benefits and drawbacks?

17. How is information-sharing important within procurement and what are some of the sensitivities and concerns of this function?

18. How can collaborative supply planning benefit the overall process of procurement and what changes should be made to make this overall process as streamlined as possible?

These questions represent some of the most pressing concerns that orbit around the needs of procurement and function to represent some of the most fundamental factors which can influence successful or unsuccessful procurement. For instance, power and dependence are such nuanced topics and can have truly weighty influence on the entire process; it is worth determining how it functions or fails to function within the procurement journey, by asking sample participants to really scrutinize their answers. "The power and dependence in channels of distribution by noting that channel member dependence and sources of power in marketing channels are conceptually inseparable and dependence is a component or dimension of these power sources rather than a separate phenomenon (Brown et al., 1995). Power plays a significant role in the supply chain, and the different sources of power have differing impact on inter-firm relationships and the performance of the entire supply chain (Maloni and Benton, 2000). Channel members indifferent cultures may have different perceptions of power sources" (Kipkorir, 2012). Numerous academic scholars have placed attention on the importance of power and dependence, there are still investigations as to how power and dependence can impact procurement.

Likewise, information sharing can obviously improve the ways in which funds are procured and in which companies do business, something can that can have an intensive impact on supply chain operations not to mention procurement in the bigger and smaller picture (Kipkorir, 2012). When information such as inventory levels, forecasted data, sales trends and a minimized cycle time, means that orders are fulfilled faster, with a higher level of accuracy. Information sharing is something that can flourish inside and outside of all domains of corporate operational activities. "Starting from the development chain process where information sharing can happen in the product design stages and product life cycle management activities with both internal and external partners. In the customer chain processes information sharing can help in formulating customer experience strategies, increase customer service effectiveness and operations (Dewett and Jones, 2001)" (Kipkorir, 2013). It's also worthwhile acknowledging the psychological barriers that do exist around information sharing that can cause disadvantages; however, many of these disadvantages can be assuaged by creating effective business policies, agreements and business plans that enterprises can aptly harness for their own benefit. Such things can help in mitigating the fear of information sharing and bolster efficiency creating new opportunities for all involved eventually (Kipkorir, 2013).

These surveys were given to four different non-profit organizations which were strongly associated with the UN. Appropriate representatives at each organization were asked to complete the surveys as comprehensively as possible; the first two questions they were all told they absolutely could not skip. The following questions they were told to answer as fully as they could and to the absolute best of their ability.

Survey Design: Findings

For question one, survey participant one and two cited issues with understanding the procurement application process. Survey participants three and four cited problems with being able to follow all requirements. For question two, survey participant one asked for a simpler and more stream-lined process; survey participant two asked for better illustrations of the entire procurement process; survey participant three asked for a mentor to be assigned for the entire procurement process. And survey participant four asked for a glossary of terms to help illuminate the entire procurement process. For survey question number three, survey participants one and three asked for fewer processes within the procurement journey in order to make the whole thing more efficient and effective. Survey participants two and four asked for truncated versions of the procurement process in order to bolster efficiency. All of the participants echoed these sentiments when it came to question number four: apparently any of the steps could be removed from the procurement process and the participants would be delighted and find it all together more effective.

For question number five, survey participant one and four cited that they would like to see the government embrace fewer regulations for obtaining procurement status. Survey participants three and two cited that they would like to see the government engage in greater prevention of corruption of all processes during the procurement process and eliminate special treatment that certain organizations receive over others.

For question six, all of the survey participants agreed that technological development can better the procurement policies: nearly all of the participants suggested the use of an app or another tool to make procurement smoother and more technologically easy for the process. Regarding question seven, survey participants one and two thought that having mobile phone applications would force the entire process to be tremendously stream-lined. Survey participants three and four thought that making the entire application process transformed into a Skype interview would be the best move ahead. Regarding question eight, all survey participants explained that they would be open to public procurement partnerships, if of course they were truly designed to help and facilitate the process. For question nine, survey participant one said that their relationship with their law firm was the most beneficial to them; survey participant two said that it was their relationship with another non-profit that could act as a mentor which was extremely beneficial to them. Survey participant three explained that the most important relationship was one they had with other environmental groups, such as ones connected to the government. Survey participant four explained that their government liaison was the most beneficial and important relationship to them.

All survey participants skipped question eleven. Regarding question twelve, survey participant one explained that power influenced the supply chain through motivation; survey participant two explained that power caused encouragement, survey participant three said that power gave financial incentive and survey participant four responded that power influenced employee loyalty. For question thirteen, all four survey participants found that power had the capacity to dominate which could impact the supply chain in a negative way. Question fourteen also elicited similar responses from all four survey participants who cited inspiration and mentorship as one way that personal relationships impacted the decision-making process. For question fifteen, survey participant one and three found that their relationships with their suppliers most impacted their ability to engage in procurement; survey participants two and four cited their relationships with other non-profits. None of the survey participants were able to cite three relationships.

Regarding question sixteen, all four survey participants found that it was in fact advantageous to have a culturally diverse staff. They all cited aspects like life experience, diverse cultural backdrops and broadened perspectives as the benefits of diversity. No one listed any drawbacks.

For question seventeen, all survey participants reported that information sharing was a professional obligation. However, it was only participants two and four who cited the need for privacy and protecting the confidentiality of information that was a priority. The final question brought on a diversity of responses: survey participant one explained that collaborative supply planning could prevent mistakes and omissions, survey participant two explained that this could broaden the perspective of what was needed, survey participant three said that it could create a larger supply base, and participant four said that it could help relieve the intense burden from one person, thus eliminating mistakes.

75% percent of the respondents listed communication as one of the main challenges of the procurement process, all of the respondents listed that they were aware that they were responsible for these challenges. The bulk of the responses (75%) listed technology as something that they could more heavily work into their daily needs and obligations for better fulfilling procurement strategies. For instance, half of the non-profits who were involved in the survey mentioned that they felt the smart phone applications should be developed to help them zero-in on the things they needed to achieve and to also improve inter-organization communication. Technology was a term which kept coming up consistently as an arena where improvement could be experienced. This was indeed noteworthy, in the consistency in which technology kept appearing and being mentioned.

All of the respondents explained that that they wished they could engage in alliances and partnerships, another finding which is truly provocative. It's also incredibly thought-provoking as so few of them actually did engage in such alliances and partnerships when they had the opportunity. Many of the participants wouldn't comment on early supplier involvement as a means of reducing procurement costs, and there seemed to be some overall discord regarding how this impacted the overall success and efficiency. Similar levels of discord occurred with regard to information sharing, with half the respondents asserting the importance of information sharing and the other half denying all importance of this process. Occasional surveys were handed back with respondents making commentary about how enough information sharing occurs over the media, but for the most part, respondents seemed open to the needs and importance of this phenomenon, they just need guidance.

Some of the answers given by respondents regarding the role of entity-supplier partnerships were revelatory of earlier research projects. "Procuring entity-supplier partnerships findings indicated that 76.4% of the respondents were assured of such partnerships arguing that it would lead to the realization of the five rights of purchasing. 23.6% disagreed that Procuring Entity Supplier partnerships had nothing to do with the achievement of five rights of purchasing and lastly 45% of the respondents…held that Procuring Entity -- Supplier Partnership was very important to strategic procurement performance whereas 33% responded that the exercise was important" (Kipkorir, 2013). This finding demonstrates a rather revelatory trend which can occur when it comes to the nuanced relationship with entity-supplier partnerships: there can be a tremendous amount of uncertainty as to how they work, what they achieve and what their overall use is, that they often become devalued. If anything, these results, as mirrored with this research project, allude to a need to help overcome some of the vagaries of this relationship.

Notably, all the survey results spoke to the need of the government to adopt more regulations to improve the procurement process for non-profits. This was demonstrated unanimously. When it came to technology, all the groups in the sample spoke to the need of technological improvements along with their aggressive implementation. While all groups said they would be open to public procurement partnerships in the form of a "Yes" answer, half of the non-profits offered reasons which contradicted their earlier reason. For instance, one non-profit selected a "Yes" answer but his reasons essentially explained why he thought partnerships were waste of time. This was a clear example of someone who needed definitive follow-up post survey.

The four non-profits cited a range of business relationships as being most beneficial to their procurement of endeavors. They were: outside consulting agencies, the U.S. government, one legal firm, and one Internet start-up which focuses on the creative use of social networking for businesses. Only three of the four non-profits answered the question on risk. The three risks listed were: lack of accuracy, lack of stability, and imprecision for one non-profit. Another non-profit listed: aggressive expansion, dubious alliances, and imaginative marketing as another risk. The final non-profit which answered this question listed: intensive reasoning, spheres of influence and grassroots marketing as their most aggravated risks. These answers were problematic as they generally lacked the further elaboration needed for them to make clear, cohesive sense. These answers mark arenas which will require follow-up and further discussion.

All of the non-profits answered the question about former performance endeavors and how they could be improved. Two of the non-profits who answered this question said that asking for help from expert consultants was one of the main things that was learned about this process. Another non-profit echoed this response by saying that reaching out to experts who knew more was something that was learned as a necessity of the overall process. The answers regarding power and the influence on supply chain were all over the map. One non-profit asserted that it meant that they had to engage in needless, bureaucratic rules and follow time-consuming regimes in order to help people. This was indeed noteworthy as apparently all the non-profits had a difficulty listing a positive way in which power relationships impacted supply chain in a beneficial manner. Virtually every non-profit skipped the question which asked about the dependency on certain relationships. Remarkably, all of the participants were able to speak very eloquently about how a culturally diverse staff was able to impact their procurement needs. In fact, none of the participants listed any drawbacks in this regard. All of the non-profits spoke about their desire to help minority and women-owned business flourish and to create an even better commitment to service and effectiveness.

Mixed responses were given in regards to information sharing within procurement. Two of the non-profits skipped this question in its entirety and the two which answered listed sensitivities which ranged from a need for privacy to an aggravated view of publicity to a more centered and dysfunctional need for attention. On the other hand, all non-profits looked at collaborative supply planning and how this could aggressively benefit procurement. All of the non-profits questioned were able to determine the needs and changes made to make the overall process as cohesive as possible for all involved. Reasons and factors listed cited the strength involved in collaboration and how weaknesses could often be eliminated.

Discussion and Results

Based on a rigorous analysis of the data, it appears as though a main difficulty for non-profit organizations like these is dealing with steps of the procurement process that they simply don't understand: often these organizations feel like they have no one to guide them. The biggest challenges for non-profit organizations in the procurement process generally seem to be handling and implementing many of the nuanced steps involved, and essentially keeping the "balls in the air." One of the challenges that many of the non-profits have found is that various aspects of the procurement process will or will not be supported by technology. E-procurement can be helpful to certain organizations that are ready to embrace the advantages that it offers, though at the same time, using e-procurement can offer yet another set of challenges. Just like in other studies, the findings demonstrated here point to e-procurement as being a sign of the future, "as more ?rms come forward with their pioneering implementation experiences and as more and more ?rms take internet-enabled supply chain management initiatives more seriously. Meanwhile, in a ?eld study of an industrial supplier and its customer, Mukhopadhyay and Kekre (2002) found that a supplier could derive strategic bene-ts when the hub customer ?rm initiates the e-procurement system and the supplier trading partner, in turn, enhances the system's capabilities. It was also found that supplier trading partners with advanced technological capabilities can signi-cantly increase the bene-ts of an order processing system both to themselves and their customers" (Angeles & Nath, 2007). Since non-profits don't have customers, they don't receive quite all of these benefits of e-procurement.

However, they do receive the benefits for the people each non-profit is trying to help. Even so, the organizational redesign that e-procurement demands of so many of these non-profit enterprises can be formidable. It can prevent the non-profits who have adopted e-procurement from continuing with it to a fuller and more intensive place where it can operate with aggravated effectiveness. "A number of recent studies have also looked into dif-culties faced by ?rms in launching e-procurement. In a recent survey of 102 international active e-marketplaces and procurement service providers, Huber et al. (2004) found the following perceived barriers to electronic procurement: a "wait-and-see" attitude among ?rms in selecting, e-marketplaces and procurement service providers; concerns over security and con-dentiality of the data needed to be exchanged in electronic environments; reluctance to share data with trading partners; the "non-feasibility of custom-made products" for pooling initiatives; lack of standardization; and uncertainty over trust and commitment among trading partners" (Angeles & Nath, 2007).

These are precisely the textbook signs that these non-profit organizations were facing with both the procurement and the e-procurement process. There were heightened needs for security and a more lucid sense of protocol. Nearly all four of the organizations simply weren't clear on the exact timeline that they were supposed to follow; this was due in part, to a lack of standardization. An inherent challenge with the procurement process that none of the non-profit organizations were able to articulate, but which became apparent over time was the fact that because so much uncertainty ruled both the standard procurement and e-procurement process, this undermined the ability of colleagues to be able to work together. Thus, where alliances should have formed, they did not. It cannot be underestimated how much this damaged or set back these organizations from evolving to their full potential.

Another aspect that many non-profit organizations alluded to but which were unable to articulate fully was the fact that improving procurement regulations for a lot of the stuff that they wanted to do would actually help in combating corruption, in at least two significant ways. More specific procurement regulations can offer more concrete, direct benefits (Gordon, 2013). "A legal requirement for competition for public procurement contracts should reduce the frequency of sole-source awards, thus potentially bringing the benefits of competition as well as reducing the trade in public contracts as rewards to friends and relatives of government officials" (Gordon, 2013).