Outsourcing and Supply Chain Performance of Property Management Firms in Nairobi

Abstract

The study was aimed at establishing the impact of outsourcing on supply chain performance in property management firms in Nairobi, Kenya. There were three specific objectives that the study intended to achieve: to identify the activities to which property management firms in Nairobi outsource, to determine the extent to which these activities are outsourced and to determine the challenges that result from outsourcing activities among property management firm in Nairobi. Relevant data was collected from the eight property management firms registered with Kenya property Developers Association (KPDA). Five questionnaires were distributed to each of the eight companies totaling to forty questionnaires. Thirty three questionnaires were completed and verified to be appropriate for the study. The collected data was coded and keyed for analysis using Statistical Package for Social Sciences (SPSS) to which descriptive statistics such as means and standard deviations were used to analyze the data. Multiple regression and correlation analysis were also used to test the relationship between outsourcing and supply chain performance. The findings indicated that property management firms outsource most of activities from external sources which includes security services, IT services, cleaning and gardening services, accounting services, repairs and maintenance services among others. The findings also revealed that outsourcing of these activities influence to a great extent the performance of property management supply chains. This was reflected by reported performance indicators such as improved reliability, enhanced responsiveness, increased operational efficiency, improved asset management and improved agility of the firms’ supply chains. The study revealed some of the challenges that property management companies encounters as a result of outsourcing in efforts to improve their supply chain performance including threats of losing company confidential information, vulnerability to competition threat of suppliers, threat of losing business control, loss of opportunity to innovate, threats of losing organizational culture and threats of uncontrolled cost increase