The challenges facing the implementation of outsourcing strategy at the Kenyatta National Hospital

Abstract

In recent years, outsourcing as a business strategy has brought dramatic change of fortunes in many organizations. Smart organizations focus on core competencies that provide high value, maximize return on internal resources, treat many services as strategic enablers and also have an internal customer/supplier orientation. They approach outsourcing in a strategic manner to bring predictability and reliability in the delivery of services as well as giving them a competitive advantage.KNH has experienced several challenges since the early 1980s in its endeavors to provide quality health care. These have included overcrowding, quality of care, poor attitudes, under-establishment in human resource and deterioration of medical equipment. This has been attributed to management weaknesses, both in structure and staffing, absence of good controls and system, and the slow bureaucratic decision process. In 2005, the K.N.H Board, in response to government policy guidelines, undertook a thorough situational analysis of all strategic sub-systems of the hospital. These included organizational structure, human resource and financial management, supplies and procurement procedures, institutional image, quality assurance and clinical governance, physical facilities and equipment and hospital policies and management practices. Essentially, from the national outlook Public and Private Organizations are shifting from providing non-core services to outsourcing them. A case in point is that there has been widespread outsourcing of cleaning services amongst government agencies to firms who are specialist in that field. Outsourcing as business management practice has many applications and facets. A variety of service delivery techniques can be used to maximize efficiency and for service quality. Outsourcing is the most commonly used type of privatization. To remain competitive and improve services, public institutions K.N.H included as well as business and other Public utilities have increasingly employed a variety of popular management approaches including outsourcing. Through outsourcing institutions are forced to be more responsive to the needs of their clients and outsourcing can generate efficiencies that can enhance the institutions goals. This study was therefore to determine the services that can be outsourced at KNH and the challenges of introducing or implementing outsourcing as a strategy in the hospital. To achieve the stated objectives a case study research method was used where primary data was collected .A structured questionnaire was administered to twenty senior managers in the hospital including the CEO and his deputies. On the areas where outsourcing strategy should be implemented the study established that security services should be the priority area with 100% response. This may be explained by the verse knowledge of the respondent who understands the emerging trend within the smart organizations of need to cut operations cost and as well concentrate on the core business of the Institution. This was followed closely by cleaning and canteen& catering each with 70%, then maintenance 40%, laundry 35%, transport 20% and parking at 20%. All the managers were in agreement that improved service delivery will be promoted within the hospital if outsourcing strategy is implemented. Similarly, 95% of the respondents agree that focus on core business and improved hospital performance will be promoted once outsourcing strategy is implemented. Improved service quality was cited by all respondents as one of the advantages of outsourcing. Despite all the managers being in agreement that outsourcing is of benefit to the hospital, the researcher had noted that the strategy has not been implemented in the hospital. Resistance to change ranked highest among the challenges facing implementation of outsourcing with 55% of the respondent being in agreement. Other challenges included lack of resources, conflict of interest, lack of management support and political interference among other reasons.