Strategic Planning And Performance Contracting In Kenyan Owned Commercial State Corporations

Abstract

The happenings in the environment are key to success of an organization because every organization exists to serve the environment. Any change in the environment calls for a strategic response for both survival and growth. Strategic plans are designed to improve the performance of public agencies. Performance contracts are mainly defined by performance indicators which are derived from the agency’s objectives and mission as per the strategic plan. The study’s objective was to establish the association between strategic planning and performance contracting of the Kenyan owned commercial state corporations operating in Kenya. Several theories underpinning this study emerged expounding on strategic planning and performance contracting. The theories used in this study were contingency theory, goal setting theory and the new public management theory which elaborated in depth the literature review of the study. Descriptive cross sectional research design was used to address this research problem. The sampling frame was 32 Kenyan owned commercial state corporations. The study sampled respondents in each commercial state corporation, giving a total of 32 respondents. Primary data was used in this study. Structured questionnaires were used for the collection of primary data. The targeted respondents in this study were senior level managers and supervisors of the Kenyan owned commercial state corporations. This is because they are involved in the organizations’ management and have a broad understanding of its affairs. The data generated by questionnaires was checked, edited and coded. The coded data was then inputted into Statistical Package for Social Sciences (SPSS) and analyzed using descriptive and inferential statistics. Descriptive analysis included frequencies and percentages while the inferential statistics included correlations and regression analysis. Based on the results, the study concluded that strategic planning has a positive influence of performance contracting of Kenyan owned commercial state corporations. The implication of this study was to establish the relationship between strategic planning and performance contracting in Kenyan owned commercial state corporations. From the findings there was also increased emphasis on accountability, collaboration with stakeholders and openness in revealing progress toward attainment of goals. This implied that better strategic planning translates to better performance contracting. The study provided key guidelines to key policy makers in the commercial state corporations and the government, scholars and strategic managers.