Extent Of Performance Management System Alignment To Organizational Strategy At Kenya Electricity Generating Company PLC

Abstract

KenGen embarked on a transformational journey which has seen the organization adopt a new strategy, structure and processes. The aim of the transformation journey was to highlight and enhance a performance culture that promotes sustainability into the future. The strategy was dubbed G2G. To improve and deliver to its vision, mission and strategy, the company has leveraged on a culture that enhances organization performance. The G2G strategy was to be implemented in three 5 year phases. Horizon I, II and III. KenGen is currently implementing the revamped plan Horizon II phase of the strategy (2016-2025). The study seek to examine extent of performance management system alignment to organization strategy at KenGen. The study aimed at finding out how employees’ targets are set and tracked, if the targets are aligned to overall corporate strategy, and are organizational strategy and goals precisely understood from top management to the shop floor, among other factors. This research used a case study and therefore the researcher used interview guide to collect the data. KenGen was taken as benchmark of power utilities in the country. Informants who have considerable knowledge of the organizational strategy and PMS were selected. The study revealed that the organizational strategy has been cascaded widely. However, more awareness needs to be done to all employees focusing on organizational goals and the strategic aspirations of increasing generation, capacity while creating value for shareholders. Similarly measures need to be introduced to speed-up generation of electricity from renewable sources. The study found out that PM is indeed the bedrock of an organization performance as it has been the driving force behind the company’s delivery of G2G transformational strategy. With regard to organizational culture, the study revealed that there is a positive culture within the company and employees have inculcated a fairly good demeanor. A review of the performance management system established the process is aimed at enhancement of performance of employees and subsequently delivery of organizational strategy. A comprehensive review of the training and reward policy revealed that bonuses, promotions, employee recognition schemes increase motivation and performance of employees to drive performance of the organization. In conclusion, the study revealed that performance management system alignment is a prerequisite to effective execution of organizational strategy. It is recommended that KenGen adopts a simplified and objective performance management system tool that effectively measure the employees’ behavior and drives overall business performance. It is further recommended that the company should have incentive framework that is consultant and sustainable.