At the height of the Covid-19 pandemic, no government agency came into publicity than the public body mandated to supply drugs and medical equipment to health institutions in the country.
The organisation lost billions of public funds from undue COVID-19 supplies which caused the dismissal of the entire board, under the chairmanship of Kembi Gitura and the management team led by then-CEO Jonah Manjari.
The Kenya Medical Supplies Authority (Kemsa) was again involved in a botched Sh3.7 billion mosquito nets supply tender funded by the Global Fund. The misappropriation issue was so severe that, at the time of this interview, the KEMSA warehouse still hosted massive stocks of non-essential items, such as personal protective equipment (PPE), that would easily last the country ten years.
On the other hand, essential commodities such as crucial medicine are deficient.
A myriad of maladies had brought Kemsa a sizable reputational challenge. Ironically, the healthcare institution prescribed to save the healthcare industry in the spirit of Universal Healthcare just kept disappointing citizens.
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In light of this, it was not surprising to Andrew Mulwa that everyone who watched him build his career from a clinic to the county levels, and then the Ministry of Health thought it was a wrong decision for him to take up the KEMSA CEO appointment.
If history is the best teacher, Dr Mulwa's associates had every reason to be wary, as two immediate former KEMSA CEOs had been fired due to allegations of malpractice.
It has been more than a year and the country has not been told of a fresh scandal from the then infamous house. What has been the secret to the new image? Nancy Nzau spoke to the new Kemsa boss.
What has been the problem with KEMSA?
Let's revisit the COVID-19 scandal when all the symptoms of what was wrong with KEMSA were fully displayed. The major and outstanding thing was the organisational disharmony, especially on the human capital component. A lot of staff were working from home, which caused a human resource crisis. How does a driver or picker work from home? Besides that, employees of the organisation, and a caretaker team from the ministry and other agencies of government had also been brought to work at KEMSA. That really brought all the issues, including procurement and all the issues that KEMSA had in terms of planning, prioritisation and others.
Suppliers were unhappy because they were not being paid. Most of the money that KEMSA had, had been committed to the COVID-19 supplies, and therefore, the essential supplies could not be made available. We also now add the process issues, the policies, the systems.
What were your first steps to streamline the body after you took over?
We have been addressing the process issues, the policies, the systems. The organisation acquired an ERP (enterprise resource planning), business management software meant to run and automate entire business operations, including finance, human resources, manufacturing, supply chain, services, procurement, and more.
The existing in-house 12-year-old ERP was not robust enough and had several systems. We had a logistic management information system that does not speak to the KEMSA ERP, and therefore, a disjointed system, which brings a lot of problems.
Who is to blame for all the misses KEMSA has had in the past? Firing people surely cannot be enough.
Everyone in the ecosystem, especially top management, contributed to KEMSA's downfall.
When I talk about governance, the public procurement law and the legal framework for this country assigns roles and responsibilities to various individuals. As a CEO, I am the accounting officer. The board has a governance role too. They approve budgets and procurement plans and have an oversight role. The political class, whether parliament, senate, or leadership, also has a role. The Ministry of Health has a role in the governance of this organisation because it appoints the board, oversees what we do, and make policies for us to work on.
Is there political interference in what Kemsa does?
Saying political interference is the sole cause of the problem, I will look at it and say no, because everyone in the ecosystem has a role. As the accounting officer, I know what the law says I should do in a procurement process. What is the procurement manager's role? What do the tender processing committees, the tender opening, and the tender evaluation committee do? All that is defined by law.
There have been incidents where even suppliers try to manipulate the system to fit in in a certain way. I have seen it, not once, not twice, these attempts come, and we have to stop them and say no.
What has changed so far?
The digitisation journey that we have undertaken with the new ERPs that we have acquired, and working with the Ministry of Health that is digitising the whole health ecosystem, we are going to increase transparency so that procurement bids are submitted online.
No one can come and say they submitted their bid late or there was a change of document because all those documents can be tracked; when the documents were actually submitted, when the tender was closed, who are the people who opened, and whether they are open online.
We are at the tail end of rolling a system-wide ERP for the organisation that we look at HR, procurement, finance, warehousing, logistics management, and even distribution of commodities so that end-to-end KEMSA is fully automated.
We did some staff rationalisation when we came in and looked at optimum numbers because the cap of 341 members of staff was given in 2013. Many things have changed in our business model, and therefore, 341 may not be enough to do the work that we are doing. So, we thought the number should be between 500 and 600, we are currently with 560 staff after we did a rationalisation, and ran out of contracts for over 400 people.
We have also launched the Kisumu Regional Distribution Centre which serves nine counties in the western part of the country.
Once we optimise that, we have another one coming up in Mombasa. What would take seven days from Nairobi to Kisumu is now taking two days or even a day. So, we are working on that digitisation. We are working on decentralisation to address the issue.