An Evaluation of the Organizational Performance of Local Contractors in Kenya.

Abstract

Organizational performance is the ultimate measure of the success of any local contractor. It involves the analysis of a firm’s performance measured against its goals and objectives. Whilst it is generally agreed that the organizational performance of local contractors is insufficient, such a notion is arbitrary and most of the time based on anecdotal evidence. The purpose of this research was therefore to establish the level of organizational performance of local contractors here in Kenya. A survey research design was adopted. A questionnaire with the evaluation criteria of organizational performance was used to collect data. The sampling frame included all NCA1, NCA2 and NCA3 contractors. In order to avoid bias in the evaluation process, consultants were included in the survey to obtain an external perspective. The level of organizational performance in local contractors was established at three levels. First, 50 measurable indicators were used. The highest performing indicator was found to be the durability of projects executed by local contractors (mean=7.52). The lowest indicator was established to be the net profit margin of contractors (mean=5.34). The second level involved establishing the level of organizational performance based on the 10 dimensions identified from the literature review. This was achieved by calculating the means of the respective indicators. The best performing dimensions of organizational performance were found to be quality of products (mean=7.308) and client satisfaction (mean=6.923). The least performing dimensions were found to be profitability (mean=5.406) and employee satisfaction (mean=5.683). The final level involved establishing the overall organizational performance of local contractors. This was achieved by calculating the mean of the ten dimensions. The organizational performance of local contractors was established to have a percentage score of 63.74%. This was found to be moderately high meaning there was still plenty of room for improvement.