Balanced Scorecard Perspectives and Organizational Performance: A Case of Kenyatta National Hospital in Nairobi City County

Abstract

The balanced scorecard is a framework that organizations follow in aligning the organization strategy, communicate organization’s mission, prioritize projects, services and products as well as monitoring the advancement towards attaining the strategic objectives or targets. The overall organizational performance of Kenyatta National Hospital is still not up to standard despite the fact that it is anticipated to established high health-care standards offered to the public so that private and public hospitals can follow. Reports have revealed that cancer, heart and kidney patients receive delayed treatment. In addition, the hospital is said to lack sufficient numbers of functional specialized medical equipment as well as inadequate financial support, industrial unrests, patients overcrowding, claims of medical negligence and poor service delivery. Therefore, this has caused a major concern to the government and other stakeholders. Based on these challenges, Kenyatta National Hospital introduced a five-year strategic plan 2013 to 2018 centred on the Balanced Scorecard approach. It was within this context that the study sought to establish the influence of balanced scorecard perspectives on organizational performance of Kenyatta national hospital in Nairobi City County, Kenya. The study was guided by the following specific objectives; to find out whether focus on customer perspective, financial perspective, internal business processes perspective, learning and growth perspective influence the performance of Kenyatta national hospital in Nairobi City County, Kenya. The study was also guided by Stakeholder theory, Resource based view theory and institutional theory. The study adopted a descriptive research design with quantitative techniques. The target population for the study were 80 management staff of Kenyatta national hospital in Nairobi City County. The sample size for the study was calculated to be 67. The study used stratified random sampling procedure and simple random sampling to select a sample that represented the target population. Data was collected using a pre-tested structured questionnaire to capture participants insight on balanced scorecard perspectives and the overall organizational performance. Their responses on several items were scored and the scores were used in bivariate analysis and Multiple regression analysis. Descriptive statistics like measures of central tendency were used for continuous data while frequencies were used for categorical data. The data analysis was done using SPSS version 23. The study obtained a Cronbach’s Alpha coefficient of 0.9 which was considered reliable. These results show that financial perspective and customer perspectives focus were statistically significant predictor of organizational performance at (p<0.05) while internal business process and learning and growth were not statistically significant when regressed together. An R squared of 0.593 which implied that focusing on all of the balanced scorecard perspectives contributed up to 59.3% of organizational performance. The study concludes that focus on balanced scorecard perspectives have a positive influence on organizational performance. However, there are variations on the magnitude of influence among the perspective. Therefore, the balanced scorecard can be used as a strategic management tool in public facilities and not only as a measurement tool. The study recommends that Kenyatta National Hospital in Nairobi City County should continue using the balanced scorecard and other public hospitals or institutions should also adopt it. The continuous usage and new adoption of the balanced scorecard would ensure better organizational performance