Strategic Partnerships and Performance of Agricultural Finance Corporation, Kenya
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Date
2024-09
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Kenyatta University
Abstract
Many firms across the world are refocusing their strategies on partnerships due to the realization that they help a great deal in the growth of business amid competition. Agricultural Finance Corporation (AFC) is one of the Kenya’s parastatals in the financial sector that has harnessed on partnerships to improve its business. Nonetheless, the institution is still being faced with challenges hence the aim of this study was to investigate the effect of strategic partnership on the organisational performance of AFC. The specific objectives were; to examine the effect of financial partnerships, business support partnerships, technology related partnerships and partnerships in product development on the organisational performance of AFC. This study was based on the transactional cost theory, innovation diffusion theory, resource-based theory, competence-based theory and Norton and Kaplan theory. The study used descriptive research design and the target populace of 550 employees of Agricultural Finance Corporation. One hundred and sixty six (166) employees of Agricultural Finance Corporation constituted the sample size which was arrived at through stratified random sampling technique. In checking validity, the study used content and construct validity. Content validity was tested by expert opinions method. Construct validity on the other hand was assessed through an examination of the concepts both theoretical and empirical A pilot research was done on 17 respondents to verify the clarity and feasibility of the research instrument. In checking for reliability, Cronbach’s alpha coefficient was used at the threshold of 0.7. Questionnaires were utilised in data collection while analysis was carried through regression analysis. In analyzing the data SPSS version 24 was used. From the results it is apparent that without the application of strategic partnerships at AFC, organisational performance significantly declines (r=-1.906, p<.05). Further, a unit enhancement in financial partnerships brings a significant improvement in organisational performance (r=0.874, p<.05). On business support partnerships, the study found that a unit improvement in appliance of business support partnerships brings a significant improvement in organisational performance (r=0.905, p<.05). The study also found that a unit enhancement of technology partnerships causes a significant and positive improvements in organisational performance (r=0.295, p<.05). Based on the findings a unit enhancement in product development partnerships leads to a significant increase in organisational performance (r=0.530, p<.05). The study recommends that corporation to further enhance its performance; it should consider entering into further partnerships with firms in other sectors. Secondly the study recommends that while engaging in technology partnerships it should consider using more of outsourcing since setting up technology systems can be expensive both in terms of the initial cost and long term costs. The study’s recommendation is that future studies on strategic partnerships should spotlight on other financial sectors particularly the insurance sector where fewer studies have been done.
Description
A Research Project Submitted to the School of Business, Economics and Tourism in Partial Fulfillment of the Requirement for the Award of the Degree of Masters of business Administration (Strategic Management Option) of Kenyatta University, July, 2024
Supervisors:
1.Mary Namusonge