Analysing strategies for successful Implementation of the Supply Chain Management Policy Framework : A case study of the Nelson Mandela Bay Municipality (NMBM) in South Africa

Abstract

After South Africa’s first democratic elections in 1994, the need to revisit the socio-economic and political order of South Africa was identified. The new government was confronted by significant public sector challenges, including the need to transform local government. The government was also forced to introduce new legislations and policies in line with the Constitution. National Treasury has the mandate to promote government’s fiscal policy framework. National Treasury introduced the Municipal Finance Management Act No. 56 of 2003 (MFMA) with the aim of modernising budget, accounting and financial management practices by placing local government finances on a sustainable footing, in order to maximise the capacity of municipalities to deliver services to communities (Modernising Financial Governance: Implementing the Municipal Finance Management Act, 2003). Chapter 11 of the MFMA provides for processes and procedures to be adopted by municipalities when dealing with procurement activities; so as to address the limitations associated with procurement legislation, such as the Constitution of the Republic of South Africa, No. 66 of 1993. The purpose of the study is to analyse the strategy followed by the Nelson Mandela Bay Municipality (NMBM) in the implementation of the SMPF, and to evaluate its impact of the implementation on service delivery. This analysis will be conducted to investigate and identify factors that may negatively affect the implementation of the SCMPF in the Nelson Mandela Bay Municipality. The study revealed how far the NMBM has progressed in implementing the SCMPF and provided recommendations for improvement, where necessary. The study assessed how the NMBM ensured effectiveness, efficiency and transparency when dealing with supply chain matters. The research also revealed the degree to which Supply Chain Management strategies followed in the Municipality influence service delivery and socio-economic factors. This study employed a mixed methods approach. Out of 80 questionnaires and 10 interviews requests, 68 completed questionnaires were returned and 8 interviews were conducted to gather the views of the respondents. 6 The responses were analysed, and the results revealed that SCM strategies employed by the NMBM had a negative impact on service delivery and SCM objectives. Various factors were identified as the cause of the challenges affecting the level of service delivery in the implementation of the SCMPF. It is concluded that lack of communication, governance, lack of reliability and skills and capacity issues are major problems affecting service delivery within the NMBM. It is recommended that the NMBM should embark on a benchmarking exercise in order to measure itself against the best performing municipalities in South Africa and strive to implement an integrated SCM system, as outlined in the SCMPF.