The effect of performance contracting on service delivery of kenya parastatals: a case of the Coffee Board of Kenya

Abstract

Within the Kenyan public service, for a long time the government operations were mainly on provision of services with much emphasis being put into delivering the same according to the laid down rules and regulations. Performance management and measurements were not being emphasized upon, albeit a well-known fact that one cannot manage what has not been measured, and that which is measured gets done. Emphasis was not made on set targets or standards, and outputs or tangible outcomes were not the main concern. However by 1991, the Government of Kenya realized that much was not being achieved and it was necessary to introduce measures that would lead to performance, production and cost containment, thus ushering in the introduction of the public service reform programs(PSRP), reform of statutory organizations, management of the current budget, other public sector reforms and general reform areas. In the backdrop of all these dynamics, the Coffee Board of Kenya, a state corporation in charge of the Coffee sector is not an exception. The purpose of this study was to investigate the effect of performance contracting on the service delivery of Parastatals in Kenya in a case of coffee board of Kenya. This study adopted a descriptive survey research design. The target population was the value chain players in the coffee sector from the farm to the market with the grower representation drawn from the central region where about 70% of Kenya coffee is grown. Although a sample size of 10% of the target population is sufficiently representative, the researcher worked with a sample size of20% of the target population, thus arriving at a sample size of 77 respondents. Data from this study were collected by means of questionnaires with both open and closed ended questions. These were administered through drop and later pick method. Data collected was analyzed by use of descriptive statistics such as the Mean, Frequencies and Percentages. Data collected was presented by means of charts, graphs and tables. Among the key findings of the study was the great improvement that has taken place on the delivery of services by the Board to its customers who are the various value chain players in the industry. On the Inspections carried out, it was established that indeed the Board has increased the number of inspections for compliance and the players are happy with that. There has also been an improvement on the awareness creation programs that the Board has been planning as forums for enlightening the industry stakeholders about new developments in the industry and especially their rights and obligations. An increase in new license applications has been observed and improved compliance with license renewals with more business friendly guidelines and polices being formulated leading to a shorter licensing lead-time. There has been greater innovation in the industry and a general improvement in service delivery by the Board. The study recommended that the company improve on its law enforcement role for greater compliance. It was also recommended that inter and intraindustry communication be enhanced so that each player understands the role of the other and how other parallel industries work. The Board should also work to improve innovation(s)especially in line with Vision 2030. Research should be carried out on production and marketing to enable the organization re-engineer itself to cope with Emerging challenges. Further research should be carried on other similar organizations in the agricultural sector for comparison and benchmarking as well as establishing the effectiveness of the performance contracting approach on service delivery and customer satisfaction.