Practices adopted for the implementation of performance contracts in Kenyan state corporation

Abstract

The main objective of this study was to establish the practices adopted for the implementation of Performance Contracts in Kenyan state corporations as well as to determine the challenges they face in implementing Performance Contracts. The research design that was used was cross sectional and descriptive survey. The target population of this study consisted of 187 operational State Corporations in Kenya. The sample size was arrived at using sample size calculator to select a sample of 57 corporations which is 30% of a population of 187 State Corporations in Kenya. The findings indicated that all the Corporations sampled were under Performance Contracting. The findings also indicated that performance had improved in State Corporations with implementation of Performance Contracts however it was noted that most Corporations do not meet their set targets. The study concluded that majority of the state corporations had the chief executive officer giving the general direction and strategies on Performance Contracting implementation and line managers developing and implementing strategies whereas most corporations do not first carry out research on best practices before implementation. The study also concluded that the most common implementation challenges were lack of training and capacity building of employees regarding performance contracting, ambiguity in the process and resistance by personnel to participate in the process hence these challenges had hindered the successful implementation of performance contracts in Kenyan State Corporations. The study recommends that the management of State Corporations should review the strategies adopted in implementing the performance contracts and ensure that proper continuous training is conducted to the employees on performance contracting. The study also recommends constant follow up, monitoring and evaluation of the performance contracting so as to address challenges as they arise and to ensure that employees understand the need and importance of performance contracts. The study will contribute to the existing knowledge on Performance Contracting and will contribute to policy making by Government in developing public service reform initiatives in order to improve service delivery in the Public Sector