The effect of performance contracting on productivity of public sector organizations. a case of Postal Corporation of Kenya
The aim of this research was to assess the effect of performance contracting on public sector organizations productivity taking Postal Corporation of Kenya as a case study. The study relied on both primary data completed by the case method and secondary data scanned from literature review and previous studies. The study applied stratified random sampling technique where the respondents were given time to complete the questionnaires. Data was analyzed using descriptive and inferential statistics such as mean, standard deviation, correlation and multiple regression analysis. The higher the absolute value of Beta the more important the variable in the predicting the productivity in public sector organization. In assessing the effects of performance contracting on productivity of public sector organizations the predictors were Employee perception with (Beta 0.10), Speed of Service delivery with (Beta 0.09), Customer satisfaction with (Beta 0.06) and finally Achievement of targets with (Beta 0.03). The results revealed that general managers, heads of department, managers and assistant managers from the selected state corporation believe that Employee perception has the first priority, followed by Speed of Service delivery, Customer satisfaction and Achievement of targets respectively, toward productivity in public sector organizations through performance contracting initiative. The study observed that public corporations should be able to sustain themselves in order to remain viable and survive. This requires inculcating and exercising entrepreneurial knowledge, skills and attitudes in the day-today operations of the organization and performance target annually. Performance contracting training is important to inculcating requisite skills towards development. This means that there is a need for training and educational institutions to review curricula to make it relevant to a developmental state.