The Effects Of Outsourcing On The Cost And Performance Of Non-Core Organizational Functions: A Case Study Of Cleaning Services At The University Of Nairobi

Abstract

This study sought to find out the effects of outsourcing on the performance of non-core organizational functions. An empirical study was conducted at the University of Nairobi with an aim of establishing whether outsourcing has significant impact on the performance of the outsourced services. It was based on the Transaction Cost Economics theory and adopted a longitudinal research design. The study used primary data which was collected using the survey method. A Structured questionnaire was administered to 30 respondents selected purposively. In addition, the study also used secondary sources of data including summarized official reports from the University of Nairobi. Data analysis was done using a combination of Microsoft Excel program and the R program for statistical computing or Simply R. The study found a strong positive correlation between outsourcing and the performance of the outsourced services namely. That is, outsourcing has improved the performance of cleaning at the University of Nairobi in terms of cost and quality. That is, the adoption of outsourcing has significantly improved the levels of cleanliness of the offices, lecture halls as well as the lawns and walkways at the university’s main campus. Further, the study established that cleaning cost has reduced after outsourcing. These findings therefore strongly support the study hypothesis