Risk Management and Operational Performance of Logistics Companies in Uganda. A Case Study of Spedag Interfreight Uganda Limited

ABSTRACT The purpose of this study is to investigate the relationship between risk management and operational performance of logistics companies in Uganda. A case study of Spedag interfreight Uganda Limited. Also to identify the risks faced by l9gistics companies and to determine the impact of operational risk on performance. A sample of 70 respondents was selected from the total population and the questionnaire was distributed in order to collect data to be analyzed using Statistical Package for Social Sciences (SPSS) and regression analysis was carried out in order to establish the relationship between the variables and the finding revealed that there was a significant relationship between the variables of the current research. Regression analysis showed that risk management significantly predicted 69% of operational performance of logistics companies. Based on the findings the researcher concluded that Risk management has a positive effect on operational performance of logistics companies in Uganda. This effect was significant at 5% level, 1~ 0.640, p 0.00 1. Logistics companies were recommended to enrich and embraces risk management practices in order to attain better performance in terms of profitability, dependability, flexibility and costs redubtion.

TABLE OF CONTENTS

DECLARATION

APPROVAL

DEDICATION

ACKNOWLEDGEMENT iv

TABLE OF CONTENTS

LIST OF TABLES

LIST OF ABBREVIATIONS AND ACRONYMS ix

ABSTRACT

CHAPTER ONE 1

INTRODUCTION

1.0. Introduction

1.1 Background

1.2 Problem Statement 4

1.3 Purpose of the Study 4

1.4 Specific Objectives 4

1.6.1 Geographical Scope 5

1 .6.2 Subject Scope 5

1.6.3 Time Scope 5

1.7. Significance of the Study 5

1.8 Conception Framework 6

CHAPTER TWO 7

LITERATURE REVIEW 7

2.0 Introduction 7

2.1 Definition of key terms 7

2.1.1 Risk 7

Risk management 7

2.1 .2 Operational performance 8

2.2 Risks faced by logistics companies 12

2.2.1 The risk management process 15

Risk Identification and Analysis 1 5

Risk Assessment 16

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Risk Ivlonitoring .16

Controlling Risks .16

2.2.2 f.4ethods in Iiisk~7

Enterprise 1~islc I~4anageinent analysis ._...I7

2.3 Effbcts of operational risk on perforthance oflogistics companies .18

2.4 Relationship between risk management and operational perfonnance 19

2.5 Related Literature 20

2.6 Summary of literature review’ 21

~ 23

pyfE1fI~JoDoLoGy .23

3.0 Introduction 23

3.1 Research t)esign 23

3.2. Study Pdpulation 23

3.2.1 Sample Size .23

3.2.2 Target population 24

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3.2.3 Sampling procedure 25

3.3 Data Sources 25

3.3.1 Primary ata 25

3.3.2 Secondary data 26.

3.4 Data collection instruments 26

3.4.1 Interview guide 26

3.4.2 Questionnaires 27

~.5 Quality data control 27

3.5.1 ~‘alidity 27

3.6.2 Relia1~ility 27

3.6 Qata Processing 28

3.7 1)ata analysis 28

3.8 Ethical consideration 28

3.9. Limitations ofthe study 29

vi

CHAPTER FOUR .30

DATA ANALYSIS AND PRESENTATION 30

4.0. Introduction 30

4.1. Sample characteristics of the respondents 30

.4.1.1. Gender of the respondents 30

4. 1.2. Age bracket of the respondents 31

4.1.3. Marital status of the respondents 31

4.1 .4. Number of years worked in the company 32

4.1.5, Highest level of education attained 32

4.2. Descriptive statistics 33

4.2.1. Different types of Risks faced by Spedag interfreight Uganda limited 33

4.2.2. Relationship between risk management and operational performance of Spedag

interfreight Uganda limited 34

4.2.3. The effect of operational risk on performance of Spedag interfreight Limited 35

4.3. Regressions Analysis 35

4.3.1. Model summary 36

4.3.2. Regression Coefficients 36

CHAPTER FIVE 38

SUMMARY, CONCLUSION AND RECOMMENDATIONS 38.

5.0. Introduction 38

5.1. Summary of the Findings 38

5.1.1. Different types of Risks faced by Spedag Interfreight Uganda Limited 38

5.1.2. Effect of operational risk on performance of Spedag Interfreight Uganda limited 38

5.1.3. Relationship between Risk Management and Operational Performance of Spedag

Interfreight Uganda limited 39

5.2. Conclusion 40

5.3. Recommendations 40

5.4. Areas of Further Research 41

APPENDICES 45

Appendix 1: Questionnaire 45