Effect of Strategic Material Sourcing on Operational Performance of Manufacturing Firms: A Case of East African Breweries Ltd, Kenya

The objective of the study was to determine the effect of strategic Material Sourcing on operational performance of manufacturing firms, a case of East African Breweries Limited in Nairobi, Kenya. The study adopted descriptive research design to generate findings and made conclusions Strategic Material Sourcing and operational performance. Stratified sampling technique was adopted besides using closed ended questions to obtain data. Data was analyzed using SPSS version 21 where findings were presented in both descriptive and inferential analysis format. Descriptive analysis was presented using mean and standard deviation while inferential analysis utilized Karl Pearson correlation co-efficient to establish the relationships that exist between the independent and dependent variables. The study findings showed that strategic material sourcing entails developing sourcing strategy and that it involved improving and re-evaluating the purchasing activities at EABL. Findings also indicated that effective supplier relationship management helps in reducing monitoring costs and that it helped in conflict resolution and better communication between the company and the supplier thereby promoting operational performance. Recommendations were made based on the findings of the study including; that communication to be shared among supply chain partners should be commonly agreed upon majorly to enhance trust and understanding between the buyer and the supplier. Further, the study recommended that alternative strategies should be formulated to facilitate attempts by companies to promote their buyer supplier relationships with regard to enhanced operational performance.