Working capital management and organizational performance of steel manufacturing companies in Uganda: A case of MM Integrated Steel Mills Limited
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The purpose of the study was to establish the relationship between working capital management and organizational performance at MM Integrated Steel Mills. The study was driven by the fact that, working capital management (WCM) is core determinant of company’s performance and is widely accepted and documented by both scholars and policy maker. The study was guided by the three specific research objectives which were; to examine the effectiveness of working capital management at MM Integrated Steel Mills, to assess the extent of organizational performance at MM Integrated Steel Mills and to establish the relationship between working capital management and organizational performance of MM Integrated Steel Mills. The study used a cross-sectional descriptive research design which was non-experimental and unit of analysis were suppliers, corporate Customers, operations staff at MM Integrated Steel Mills. Primary data was collected using self-administered questionnaire anchored on Likert scaled range and was analyzed using SPSS to generate descriptive and correlation. Results revealed that steady increase in company profits, steady increase on investment return, profitability has been increasing steadily, and company has survived against its competitors over the years, customer interests are recognized and fulfilled and noticeable decline in the number of customer complaints determines organization performance. In addition, finding from the correlation analysis established that inventory management has a high positive relationship and cash management has average positive relationship to company performance at 1% level of significance. Credit management has a weak positive relationship at 5% level of significance. However, all working capital measures had a positive statistically significant relation at 5% and 1% level of significance towards organizational performance of MM Integrated Steel Mills. The study recommends that manufacturing companies should endeavor to re-enforce working capital management attributes (cash, inventory and credit management) mechanism through strengthen internal financial controls in order to provide quality products and achievement of set objectives.