the role of procurement contract management in the effectiveness of project management for the ...

93 Pages·2016·0.42 MB·English

by  Mohammed Khalfan Amour

THE ROLE OF PROCUREMENT CONTRACT MANAGEMENT
IN THE EFFECTIVENESS OF PROJECT MANAGEMENT FOR
THE TELECOMMUNICATION COMPANIES:
A CASE OF tiGO TANZANIA
THE ROLE OF PROCUREMENT CONTRACT MANAGEMENT
IN THE EFFECTIVENESS OF PROJECT MANAGEMENT FOR
THE TELECOMMUNICATION COMPANIES:
A CASE OF tiGO TANZANIA
By
Mohammed Khalfan Amour
A Thesis Submitted in Partial Fulfillment of the Requirements for the Award of
the Degree of Master of Science in Procurement and Supply Chain Management
(MSc-PSCM) to Mzumbe University.
2014
CERTIFICATION
We, the undersigned, certifies that we have read and hereby recommend for
acceptance by the Mzumbe University, a thesis entitled; The Role of Procurement
Contract Management in the Effectiveness of Project Management for the
Telecommunication Companies: The Case of tiGO Tanzania, in partial
fulfillment of the requirements for award of the degree of Master of Science in
Procurement and Supply Chain Management (MSc-PSCM) of Mzumbe University
_______________
Major Supervisor
________________
Internal Examiner
Accepted for the Board of ……………………
____________________________________________________________
DEAN/DIRECTOR, FACULTY/DIRECTORATE/SCHOOL/BOARD
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DECLARATION
AND
COPYRIGHT
I, Mohammed Khalfan Amour, declare that this research is my own original work
and that has not been presented and will not be presented to any other institution for
any award.
Signature____________________
Date________________________
© 2014
This thesis is a copyright material protected under the Berne Convention, the
Copyright Act 1999 and other international and national enactment, in that behalf, on
intellectual property. It may not be reproduced by any means in full or in part, except
for short extracts in fair dealings, for research or private study, critical scholarly
review or discourse with an acknowledgment, without the written permission of
Mzumbe University, on behalf of the author.
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ACKOWLEDGEMENTS
First and foremost, I would like to thanks ALLAH (Subhanahuu Wa’Taalah) MOST
GRACIOUS, MOST MERCIFULS, LORD OF WORLDS, and MASTER OF THE
DAY OF JUDGMENT for keeping me ALIVE, HEALTHY and give me energy and
patience to search for education outside my homeland. I thank God the Almighty for
his love, enablement, and provision. Were it not for Allah, I would be completely
lost and therefore I always praise and thank.
Secondly, I would like to acknowledge my utmost gratitude and great enthusiasm to
mysupervisor, Dr Martin Madale for being a dedicated mentor. He was always ready
to provide me with his valuable and constructive suggestions that enabled this project
to run smoothly, for guiding me through every step of the thesis and providing me
direction and insight on numerous occasions during the course of this work.
May I take this opportunity to thank my friends, work mates and others for
supporting me in my effort to complete this thesis especially our Group leader Mama
Cecilia
Last but not least, I am forever indebted to all my family members for their constant
moral support and prayers throughout the entire duration of my studies and
completion of this dissertation. Their words of encouragement, LOVE,
INSPIRATION, and SACRIFICE to me never failed to keep me going even through
the hardest of times and it is here that I am expressing my sincerest gratitude to them.
You are all loved. NAWAPENDA SANA SANA SANA SANA!!!!!!
MAY ALLAH BLESS ME AND YOU ALL
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DEDICATIONS
In loving memory of my precious MOTHER,
Who, since her passing away on 11th November
2006, has been constantly with me.
Although you are out of my sight, you will
NEVER be erased from my mind.
I will always treasure and pray for you.
اﺮﯿﻐﺻ ﻲﻧﺎﯿﺑر ﺎﻤﻛ ﺎﻤﮭﻤﺣراو يﺪﻟاﻮﻟو ﻲﻟ ﺮﻔﻏا ﻢﮭﻠﻟا
Yaaa ALLAHplease forgive my PARENTS
And
Shower them with your mercy
MAY ALLAH BLESS YOU FOREVER-ameen.
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LIST OF ABBREVIATIONS
2G - Second Generation Mobile Technology
3G - Third Generation Mobile Technology
ACTS - African Centre for TechnologyStudies
BSS - Base Station Subsystem
CAPEX - Capital Expenditure
CAR - Capital Approval Request
CIPS - Chattered Institute of Purchasing and Supply
DRC - Democratic Republic of Congo
FSA - Frame Supply/Services Agreement
GPRS - General Packet Radio Services
GSM - Global Systems for Mobile
IACCM - International Association for Contract and Commercial
ICC - International Chamber of Commerce
IN - Intelligent Network
IP - Internet Protocol
ITA - Institute of Tax Administration
JIT - Just-In-Time
KPI - Key Performance Indicator
LLC - Limited Liability Company
Management
MIC - Millicom International Cellular (“MILLICOM”)
MSA - Master Service Agreement
NSS - Network Switching Subsystem
OPEX - Operational Expenditure
PMI - Project Management Institute
PO - Purchase Order
SLA - Service Level Agreement
SSA - Support Services Agreement
TQM - Total Quality Management
TRA - Tanzania Revenue Authority
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UAE - United Arab Emirates
UK - United Kingdom
UMTS - Universal Mobile Telecommunications Systems
UPS - Uninterrupted Power Supply
USA - United States of America
USPS - United State Postal Services
VAS - Value Added Services
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ABSTRACT
In today’s competitive and hectic global economy, to stay ahead of the pack companies
have to embrace effective project management in order to consistently deliver business
results. As most of projects are complex and multi-disciplinary, to keep them on track
and constantly monitor the results, effective oversight of contracts is critically important.
On the other hand poor management of contractsensue range of risks; from being forced
to close the projects due to breaking of the law to struggling on with supplier disputes.
There is no doubt, that effective contract management is paramount for it guarantees
organization in realizing its business value by successful delivering projects on time and
within budget.
The aim of this study is to assess the role of procurement contract management in the
effectiveness of project management at MIC-Tanzania. Research was executed by means
of questionnaires and interviews where employees from Supply Chain department and
otherproject stakeholderswere invited toshare their experiences of the same.
Literatures acknowledge the importance of contract management for effective contract
management by citing important terms and conditions for good contracts as well as the
essential features of valid contract. They also spell out the basis for supplier selection,
remedies for breach of project contracts, service level agreements, contract as a project
risks managementtool as well as supplier relationship matrix.
This research has discovered that there is very high dependency of effective project
management on suppliers’ compliance with terms and conditions, suppliers’ technical
capability and close monitoring of suppliers during project implementation. Therefore,
contract management is essential for effective project management.
The researcher recommends MIC-Tanzania to recruit more experienced and qualified
staff for its contract management function, to have e-contract management solution in
order to have visibility of its active contracts at every stage of the project lifecycle, to
have strong technical supplier evaluation and to secure and enforce penalty clauses for
suppliers’ breach of project contracts. This is because the more MIC-Tanzania improves
its ability to manage its project contracts at practically every stage of project life-cycle,
the more it can transform contracting into a project management competency.
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TABLE OF CONTENTS
Pages
CERTIFICATION......................................................................................................i
DECLARATION........................................................................................................ii
AND.............................................................................................................................ii
COPYRIGHT.............................................................................................................ii
ACKOWLEDGEMENTS.........................................................................................iii
DEDICATIONS........................................................................................................iv
LIST OF ABBREVIATIONS...................................................................................v
ABSTRACT..............................................................................................................vii
TABLE OF CONTENTS........................................................................................viii
LIST OF TABLES...................................................................................................xii
Pages..........................................................................................................................xii
LIST OF FIGURES................................................................................................xiii
CHAPTER ONE ........................................................................................................1
INTRODUCTION AND BACKGROUND TO THE STUDY...............................1
1.1 Introduction...............................................................................................1
1.2 Background Information...........................................................................1
1.3 Statement of the Problem..........................................................................2
1.4 Research Objectives..................................................................................3
1.4.1 General Research Objective......................................................................4
1.4.2 Specific Research Objectives....................................................................4
1.5 Research Questions...................................................................................4
1.5.1 General Research Question.......................................................................4
1.5.2 Specific Research Questions.....................................................................4
1.6 Significance of the Study..........................................................................5
1.7 Scope of the Study.....................................................................................5
1.8 Limitations of the Study............................................................................6
1.9 Delimitations of the Study.........................................................................6
1.10 Organization of the Report........................................................................6
CHAPTER TWO.......................................................................................................8
LITERATURE REVIEW..........................................................................................8
2.1 Introduction...............................................................................................8
2.2 Theoretical Literature Review...................................................................8
2.2.1 Definitions of key Terms...........................................................................8
2.2.1.1 Contract.....................................................................................................8
2.2.1.2 Contract Management...............................................................................8
2.2.1.3 Effectiveness.............................................................................................9
2.2.1.4 Procurement..............................................................................................9
2.2.1.5 Project 9
2.2.1.6 Project Contracts.....................................................................................10
2.2.1.7 Project Delivery.......................................................................................10
2.2.1.8 Promise and Promisor.............................................................................10
2.2.1.9 Service Level Agreement..........................................................................10
2.2.2 Theoretical Perspective...........................................................................10
2.2.2.1 Contract Compliance Theory..................................................................11
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