Outsourcing Human Resource Practices on Performance of Total Oil Company in Kenya
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The emergence of globalization has made outsourcing to become one of the widely embraced organizational practices for delivering outstanding services to customers in both corporate and private entities. However, in spite of the increasing trend in outsourcing arrangements, there are inadequate literature underpinnings on how outsourcing human resource practices affect performance of Total Oil companies in Kenya. The main objective of this study was to investigate the effect of outsourcing human resource practices on performance of Total Oil Company in Nairobi Kenya. Specifically, the study sought to examine the effect of outsourcing training practices, recruitment practices, payroll services and human resource management information systems on organizational performance of Total Oil Companies in Nairobi County Kenya. The study was guided by resource-based view theory, resource dependency theory and Core competency theory. The study adopted a descriptive research design where it targeted all employees totaling to 112 in functional departments of Total Oil Company at the headquarters in Nairobi County. The departments were finance and administration, human resource, supply chain, product development and technical support respectively. The study was a census and purposive and stratified sampling technique were used in selecting the respondents. Primary and secondary data were collected. The study’s primary data was obtained using semi-structured questionnaires. Secondary data was collected from the available human resources publications at Total Oil Company and Energy and Regulatory Authority. The researcher did a pilot study to ensure reliability and validity of the instrument. Quantitative data was generated from the closed ended questions while qualitative data was obtained from the open-ended questions. Inferential and descriptive statistics were used to analyse quantitative data with the help of Statistical Package for Social Sciences (SPSS version 22). Descriptive statistics included frequency distribution, mean, standard deviation and percentages. The results were presented in tables. It was evident that outsourcing training practices increases the level of service delivery, reduces costs of training and increases organizational performance. The results on outsourcing recruitment services showed that opportunities were there for employees to identify job openings, timely system on recruitment was provided and there was seamless cooperation with recruitment agencies to save time and costs. The results indicated that outsourcing payroll services was fairly done. These were supported by low variation in responses that depicting that there is automated payment process by collecting data on employee time and attendance, generation of periodic payroll and tax reports, fairness in doing deductions and taxes in the employees’ payment and that they conduct periodic employee tax reports. Majority of the respondents agreed that outsourcing HRMIS enhances communication, timely delivery of services and that the company is able to safeguard data confidentially. Based on the regression results the study concluded that there was a significant positive relationship between outsourcing training practices, outsourcing recruitment and selection practices, outsourcing HRMIS practices, outsourcing payroll services and organizational performance.