Effect of Strategic Outsourcing Approaches on The Performance of Manufacturing Companies Listed at The Nairobi Security Exchange, Kenya

Abstract

Purpose: This study sought to establish the effect of strategic outsourcing approaches on the performance of manufacturing.Methodology: A descriptive survey design was adopted, informed by the relatively small population of the listed manufacturing and allied companies, which doubled as the target population of the study. A structured and closed- ended questionnaire was used to collect primary data, administered by drop and pick a method. Total of (72) strategic managers drawn from the nine manufacturing firms were involved in the study. Data collected was quantitatively scrutinized based on research objectives and presented in form of tables and charts for interpretation. The data was then be analyzed through descriptive and inferential statistics supported by the statistical package for social sciences (SPSS), version 22. Regression analysis was done to ascertain the effect of strategic outsourcing approaches on performance. The response rate of the study was 92%.Results and conclusion: The findings of the study showed that strategic professional outsourcing, strategic manufacturing outsourcing, strategic business process outsourcing and strategic project outsourcing have a positive relationship with performance of performance of the manufacturing companies listed at the Nairobi Security Exchange. The results of the regression analysis revealed there is a significant positive relationship between the dependent variable and the independent variable. The independent variables reported R-value of .805 indicating that there is a perfect relationship between a dependent variable and independent variables. R square value of 0.647 means that 64.7% of the corresponding variation in performance of manufacturing companies listed at the Nairobi Security Exchange can be explained or predicted by (strategic professional outsourcing, strategic manufacturing outsourcing, strategic business process outsourcing and strategic project outsourcing) which indicated that the model fitted the study data. The results of the regression analysis revealed that there was a significant positive relationship between the dependent variable and independent variable at (β = 0.647), p=0.000 <0.05).Unique contribution to theory, practice and policy: Finally, the study commends that manufacturing companies listed at the Nairobi Security Exchange embrace the various strategic outsourcing approaches as a way to improve their performance. Equally, the study recommends similar studies be carried out in other industries across the country and in abroad to ascertain if the same results can be obtained and generalized.

The Impact Of Outsourcing on Hotel Efficiency and Performance

“…Effectiveness is of course needed by businesses in order to run business processes optimally. However, a business can be hampered in achieving its goals due to conditions that occur within the business itself (Kisilu & Gatari, 2021).…”