Relationship between outsourcing and operational efficiency of pension schemes of companies listed at the Nairobi stock exchange
Abstract
The study sets out on a survey to establish the relationship between outsourcing and
operational efficiency in pension scheme administration. Numerous studies have been
carried out on understanding the key factors driving outsourcing decisions but there is
limited study on the impact of the outsourcing. Further, the retirement benefits
authority (RBA) which among its mandate is to regulate and license pension scheme
administrators does not have a policy guideline to guide Trustees on the outsourcing
decision. Survey was conducted through a structured questionnaire. Drop and pick
method was used. SPSS and Microsoft Excel were used for data analysis. The study
established that majority of firms outsourced their staff pension scheme
administration. Outsourcing enhanced operational efficiency. Most respondents
perceive operational efficiency in the twin lens of quality of service to members and
investment performance. It is recommended that RBA formulates a policy guide on
the outsourcing decision and monitoring of the service provider.
Publisher
University of Nairobi