Effect of contract management practices on organizational performance of Rwanda development board (2017-2022)

Abstract

The general objective of this research project was to assess the effect of contract management on organizational performance. The following were specific objectives of the study: to analyze the effect of contract planning on performance of Rwanda Development Board, find out the effect of contract negotiation on performance of Rwanda Development Board, assess the effect of contract implementation on performance of Rwanda Development Board and assess the effect of contract monitoring on performance of Rwanda Development Board. To achieve these objectives, literature was reviewed on the subject matter, and then data was collected from 156 employees of RDB and they were chosen by using census sampling technique. Questionnaire, observation, interview guide and documentation were used as tools of data collection. Data was analyzed by using both quantitative data and qualitative data by presenting the findings of respondents through the mean and standard deviation. Findings indicated that there is positive link between contract management and organizational performance whereas it was found that the effect of all contract management on organizational performance will be 1.462 percent; a unit increase in the use of contract planning would lead to an increase in RDB's performance by 19.2%; a one percent increase in the use of contract implementation would lead to an increase in RDB's performance by 3.8%; a one percent increase in the use of contract monitoring would lead to an increase in RDB's performance by 11.5%; and lastly, a one percent increase in the use of contract monitoring would lead to a 35% increase in RDB’s performance. Overall, contract monitoring had the greatest effect on RDB’s performance, followed by contract implementation, while contract planning took third place, and lastly, contract negotiation. At a 5% level of significance and a 95% level of confidence, contract planning varies at a 0.010 level of significance; contract negotiation had a 0.048 level of significance; contract implementation had a 0.031 level of significance; and contract monitoring had a 0.029 level of significance. All the variables were significant (p<0.05). The study also concludes that the main objective of contract management is to ensure that the borrower's contractors, suppliers, or consultants meet agreed project specifications and completion dates.