Influence of contextual and cognitive factors on the relationship between performance contracting system and organizational performance in government ministries in Kenya

Abstract

This study sought to establish the relationship between performance in Government Ministries in Kenya and the implementation of performance contracting (PC) system. The study investigated the influence of contextual and cognitive factors on the relationship between PC system and organizational performance in Government Ministries. This study was grounded on Results Theory because the PC system in Kenya is a results oriented performance measurement system. The research designs that guided this study were descriptive survey design and correlational research design. The research approach in this study was mixed methods research approach and pragmatism paradigm. Quantitative data was collected through a self-administered structured questionnaire while qualitative data was collected through an interview guide after the research instruments were pilot tested for validity through content related method and reliability through test-retest criterion. A sample size of 310 respondents was selected by use of Sekaran’s (2003) sampling size criterion from a population of 103,010 employees in Government Ministries through multi-stage sampling technique. The statistical tools of analysis that were used for descriptive data were the arithmetic mean and the standard deviation while the statistical tools of analysis that were used for inferential statistics were Pearson’s Product Moment Correlation (r) and Stepwise Regression (R2). F-tests were used to test the hypotheses in the study. Tests of statistical assumptions were carried out before data analysis to avoid invalidation of statistical analysis. Out of the ten hypotheses tested in the study, five were accepted while five were rejected. With r = 0.232, F (3,177) = 3.358 at p = 0.02 > 0.05, H1 was accepted and concluded that PC systems significantly influence organizational performance. With r = 0.003, F (1,181) = 0.001 at p = 0.969 > 0.05, H1a was rejected and it was concluded that PC targets do not significantly influence organizational performance. With r = 0.193, F (1,181) = 6.9 at p = 0.009 > 0.05, H1b was accepted and it was concluded that PC tools significantly influence organizational performance. With r = 0.058, F (1,179) = 0.612 at p = 0.435 > 0.05, H1c was rejected and it was concluded that PC implementer participation does not significantly influence organizational performance. With R2 = 0.094, F (1,179) = 18.470 at p < 0.05, H2 was accepted and it was concluded that the strength of the relationship between PC system and organizational performance depends on contextual factors. With R2 = 0.057, F (2,177) = 5.315 at p = 0.006 < 0.05, H2a was rejected and it was concluded that the strength of the relationship between PC system and organizational performance does not depend on organizational structure. With R2 = 0.118, F (2,177) = 11.864 at p < 0.005, H2b was accepted and it was concluded that the strength of the relationship between PC system and organizational performance depends on organizational culture. With R2 = 0.033, F (1,179) = 6.074 at p = 0.015 < 0.05, H3 was rejected and it was concluded that the strength of the relationship between PC system and organizational performance does not depend on cognitive factors. With R2 = 0.033, F (1,179) = 6.074 at p = 0.015 < 0.05 H3a was rejected and it was concluded that the strength of the relationship between PC system and organizational performance does not depend on implementer attitude. With R2 = 0.140, F (2,177) = 9.588 at p < 0.05, H3b was accepted and it was concluded that the strength of the relationship between PC system and organizational performance depends on implementer Monitoring and Evaluation (M&E) skills. It was recommended that performance measurement systems in Government Ministries should be synchronized through an integrated M&E system. In addition, the PC system should be contextualized per Government Ministry and anchored through parliamentary legislation to safeguard related gains from future political manipulation. It was also recommended that the simplicity, validity and reliability of PC tools should be enhanced and PC implementers equipped with M&E skills. Since this study delimited itself to the PC system, further research can be carried to investigate the influence of NIMES, EPROMIS and Vision 2030 on organizational performance in Government Ministries in Kenya.