An Evaluation on the effect of Ethical Practices on Procurement Efficiency: A Case Study of Mika Hotel

Abstract

In today’s competitive business environment, procurement has evolved from a routine administrative function into a strategic driver of organizational performance, efficiency, and sustainability. Ethical practices within procurement are increasingly recognized as vital for promoting transparency, reducing risks, fostering trust, and enhancing long-term business relationships. This study, titled “An Evaluation on the Effect of Ethical Practices on Procurement Efficiency: A Case Study of Mika Hotel,” examined the extent to which ethical conduct influences procurement outcomes. A mixed-methods research design was employed, utilizing structured questionnaires and interviews to collect data from a sample of 52 respondents. Quantitative data were analysed using descriptive statistics in SPSS version 20, while qualitative responses were examined through thematic analysis. Guided by Agency Theory, the findings revealed that ethical practices are largely perceived to be integrated into procurement processes at Mika Hotel, with 63.4% of respondents agreeing or strongly agreeing. However, 57.7% indicated that ethical practices do not necessarily reduce procurement delays, suggesting that challenges such as bureaucratic procedures, limited resources, and operational inefficiencies may overshadow ethical benefits. Similarly, 57.6% disagreed that ethical practices help control procurement costs, while opinions on quality improvement were slightly more favourable, with a slim majority acknowledging a positive effect. Overall, 54.9% of respondents agreed that ethical practices enhance procurement efficiency, indicating a generally positive, though not unanimous, perception. The study concludes that while ethical practices contribute meaningfully to procurement efficiency, their effectiveness is influenced by consistency in enforcement and alignment with organizational systems. It recommends stronger application of ethical guidelines, enhanced monitoring, and improved transparency across all procurement activities. Future research should explore the challenges hindering ethical procurement in the hospitality sector. Keywords: Ethical Procurement, Procurement Efficiency, Transparency, Supplier Relationships, Agency Theory, Hospitality Industry, Mika Hotel.