A study of performance contracting as a tool for strategy implementation in catering and tourism development levy trust, Kenya
Once an organization develops its strategy, it is important that the strategy is effectively implemented to achieve the desired results. Strategy implementation is the process of transforming strategic intentions into actions, then actions into acceptable results. Different organizations use different approaches and tools to operationalized and implement their strategies. This study laid focus on determining an analyzing the use of performance contracting as a tool for strategic plan implementation in Catering and Tourism Development Levy Trustees (CTDLT). Among studies that have been done on strategy implementation, none has focused on strategy implementation within the context of performance contracting. The study revealed that CTDLT practices formal strategic planning giving rise to a strategic plan on the basis of which performance contracts are negotiated and signed at various levels in the organization. It was established that performance contracting has been used as an effective tool for strategic plan implementation at CTDLT. Among other things performance contracting has served as an engine in driving CTDLT’s goals and enhanced clear understanding of the nature of effort required to attain the required levels of performance through effective translation of strategies into action, and action into desired results. It has also enhanced the understanding of the obligations for each of the signatories and therefore acts as a basis of attributing responsibility for success or failure in a fairly transparent and just manner. Further still, performance contracting has enhanced the alignment of CTDLT’s strategy with various internal organizational elements like the structure, culture, resources and capabilities. However, it was revealed that implementation of performance contracting has not been 100% effective because of some challenges. These challenges relate to the unpredictability of the environment in which implementation is taking place, the content of the performance contract in terms of targets and measurement criteria, timeliness in its implementation, resistance to its adoption and the changes required for its effective implementation, and its inclusiveness and/or coverage.