The relationship between performance contracting and organization performance in national hospital insurance fund
The main purpose of the study was to establish the relationship between performance contracting and performance of National Hospital Insurance Fund. Specifically the study sought to answer the following research question: what is the relationship between financial performance, quality service, innovation/ creativity, efficiency improvement and performance at the National Health Insurance Fund, Kenya? The study used a descriptive design in collecting data from the respondents because it ensures complete description of the situation, making sure that there is minimum bias in the collection and interpretation of data. The target population was drawn from National Insurance Fund and consisted eleven (11) directors, fifteen (15) top management staff and thirty four (34) middle management staff. Due to the fact that the population of the study was small, census of the total target population of sixty (60) respondents was taken and used as a study sample. The primary data for the study was collected using the questionnaires. Quantitative data was analyzed using descriptive and regression statistics with the aid of Statistical Package for Social Sciences (SPSS 21.0).The results of the study was presented using tables. The study established that financial performance, quality service, innovation and efficiency influence organization performance as indicated by increased membership contribution and managers capacity to mobilize members‟ contribution while keeping the variable costs down. The organization regularly sets quality service performance requirements, implements and enhance efficient internal processes which lead to excellent service performance. Organization has fostered and encouraged creativity and innovative practices internally within the organization and allowing management and employees to determine how to best accomplish the work hence ensuring organization competiveness. Efficiency improvement has increased service quality levels, direct financial income, costs containment in the organization and enhanced work accountabilities. The study recommends the need for the organization to: set and implement performance measures which are clear to management and employees indicating precisely what is being measured and how the measures are calculated; employees‟ participation in the development and implementation of in-house performance contracts and enhance their motivation through elaborate motivation schemes; enhance innovation/ creativity through job enlargement and enrichment process, increased employees motivation and training and for management to develop and implement effective management practices, enhance management key competencies and participatory approach to decision making.