Operations Management Practices and Performance of County Pension Fund Financial Services in Kenya

Abstract

The performance of a company depends on many internal factors which are within the realm of the organization especially operational management practices. Customers have been demanding for greater services and with the emergence of cut-throat competition, organizations must come up with mechanisms and interventions that will improve efficiency and effectiveness of organizational operations. County pension fund has experienced various challenges which in turn have affected its operations. There is acute non-remittance of the monthly contributions by the sponsors, delayed payments of insurances, weak enforcement of pension laws, low coverage by the scheme, high demands from customers, and existing regulatory framework in the country which has not been effective as there have been delays in resource allocation. Negative attitude to save for retirement by citizens, stiff competition amongst pension providers, lack of access to financial services and fewer jobs in the informal sector have greatly affected the growth of pension funds. Study objectives were: to examine the practices of operations management utilized by the County Pension Fund Financial Services in Kenya; to examine the effects of operations management practices on performance of County Pension Fund Financial Services in Kenya; and to determine the challenges faced in the adoption of operations management practices by the County Pension Fund Financial Services in Kenya. Resource based view theory as well as dynamic capability theory are the two theories that guided the study. The descriptive research design was applied in this research. The population targeted encompassed all the 47 counties in Kenya. Heads of human resource departments and CPF county representatives in all the Counties were respondents. Questionnaires were utilized in collecting data. Quantitative data was used while both descriptive and inferential statistics were applied. Conclusions of the study were founded on the study findings. The study concluded that operations management practices used by the County Pension Fund in maintaining and increasing performance were inventory management, quality management, job design as well as innovation strategies. The study further concluded that operations management practices have significant effects on performance of County Pension Fund. The study further concludes that CPF financial services is experiencing challenges in the adoption of operations management practices. The key challenges were identified to be insufficient resources in addition to inadequate personnel. The study recommendation is made on determination of the effect of operations management practices on the performance of pension funds in Kenya. This will allow for a wider scope on the pension industry. A further study is recommended on the influence of operational decisions on the operational performance of pension funds in Kenya. A further suggestion is recommended on research on operational management practices and operational efficiency in other sectors other than pension sector.