Article Published In Vol.7 (May-June 2019)

Effect of Setting of Performance Contract Objectives on Organizational Performance in the State Owned Sugar Companies

Author : Mr. Andrew Opiyo Mwalim, Dr. Robert K.W. Egessa and Mr. Kwendo Evans

Poor performance in the Kenya public sector consistently hindered the realization of sustainable economic growth and development since the country attained her independence in 1963 (Mbithi, 1996). Among the noted factors that contribute to poor performance included: excessive regulations and control, frequent political interference, poor management, outright mismanagement of resources and lack of a guiding vision (Government of Kenya, 2005). Lack of clear focus as to what is expected from employees and poor or no methods of measuring performance has been the greatest challenge (Muthaura, 2007). The new Government elected in 2003 decided to manage public service through performance contracting system to address the situation. In Kenya, Performance contracting concept can be traced back in 1990 through Cabinet Memorandum No. CAB (90) 35 when performance contracting paradigm was conceived and designed with an aim of having a real impact in changing the way things were being done, creating a new behavior patterns and adoption of positive attitude work ethics in the entire public service delivery (Kobia and Mohammed, 2006). The system was expected to return faith on government services to the citizens and other international stakeholders (Muthaura, 2007). The paradigm was later outlined in the Economic Recovery Strategy for Wealth and Employment Creation (ERS) 2003-2007.

Keywords: Performance contracting, objective setting, organizational performance