| dc.description.abstract | There is a growing recognition of the importance of organizational structure in aligning the success and
financial performance of any organization. The main purpose of this study was to determine effect of
organizational structure on financial performance of commercial state corporations in Kenya. Specifically
it focused on the effect of organizational size of on the financial performance of commercial state
corporations; effects of structure formalization to financial performance; the extent structure
complexity affect financial performance of commercial state corporations; and the extent structure
centralization affect financial performance of commercial state corporations in Kenya. The findings of
this study were to provide the necessary information to commercial state corporations and enhance its
endeavor to meet both current and long-term demands. The study employed a survey research design
and targeted all the 34 purely commercial state corporations in Kenya. The study used both structured /
closed ended and unstructured / open ended questionnaires to collect data. Both qualitative and
quantitative data was analyzed. Inferential statistics was employed whereby correlation and multiple
linear regressions were used to establish a relation between and among the studied variables. A
Statistical Package for Social Sciences (SPSS) was used to analyze data. From the study findings, the
regression results revealed that there is a positive relationship between dependent variable return on
assets (ROA) and independent variables; Organizational size, structure formalization, structure
centralization and structure complexity. The results indicated that one unit change in organizational size
results in 0.971 units increase in financial performance, one unit increase in structure formalization
results in 0.739 units increase in financial performance, one unit change in the structure centralization
results in 1.271 increase in financial performance and one unit change in structure complexity results in
0.835 units increases in institution’s financial performance. F-tests and t-tests of significance were
carried out at 95% confidence level (α = 0.05). The results indicated F-tests of 0.678 with a significance
value of 0.000, t-tests of; organizational size of 2.021 with a significance value of 0.045, structure
formalization of 1.157 with a significance value of 0.210, structure complexity of 1.194 with a
significance value of 0.234 and structure centralization of 2.617 with a significance value of 0.095. In this
case, all the four variables were important and have strong positive relationships. The conclusion from
the study findings was that organization structure affected the financial performance of commercial
state corporations. It is thus recommended that organizational size, structure formalization, structure
complexity and structure centralization should be considered to be very important when corporation’s
management is developing their organizational structure that will achieve their strategic objectives since
it has effect on financial performance of the corporations. Board members, their size and composition
should also be considered as they are actively involved in shaping commercial state corporations’
strategic directions | en_US |
