Moderating effect of implementation factors on the relationship between performance contracting and service delivery of employees at huduma centres in western Kenya

Abstract

The Kenyan Government has pressures from its citizens to improve on service delivery and be responsive to citizen’s needs. Attempts such as privatization, voluntary early retirement and restructuring did not improve on service delivery. Performance contracting was introduced as an option and is now being used together with Huduma Centres. The centres serve 30,000 customers daily against a target of 60,000 customers and on revenue, the centres collect Kshs 12 billion annually against a target of Kshs 30 billion according to a Government report of 2018. Focus of previous studies in resolving this around performance contracting have majorly been case studies and not surveys. Further from reviewed literature, performance contracting influence service delivery, performance and accountability. However other studies reveal that it does not result in increased customer care activities, effectiveness and efficiency and reduction in the number of customer complaints. These are mixed findings from case studies, an indicator of a moderation effect yet to be tested. Additionally, reviewed studies show that resource factors and personal factors influence service delivery but their moderating influence has not been checked. However, there is hardly evidence for empirical testing of the factors individually or jointly as having a moderation effect on the relationship between performance contracting and service delivery. The purpose of this research was to determine the moderating effect of implementation factors on the relationship between performance contracting and on service delivery in Huduma Centres Western Kenya. Specific objectives were, to determine the relationship between performance contracting and service delivery, to establish the moderating effect of resource factors on the relationship between performance contracting and service delivery in the Huduma Centres of Kenya, to establish the moderating effect of personal factors on the relationship between performance contracting and service delivery in the Huduma Centres of Kenya .The study was anchored by Vroom’s Expectancy Theory and Goal Setting Theory and utilized correlational survey research design. The target population was 276 workers at the 5 Huduma Centres in Western Region in a census survey. Pilot results (N=10) revealed 41-item instrument overall mean reliability α=0.819. Construct validity was backed by the literature and confirmed by expert review. Results revealed proportion of variance in the Service delivery explained by the Performance Contracting is 32.4 % or R2=0.324. specifically, performance contracting (β = 0.562, p = 0.000) had positive significant effect on service delivery among Huduma Centres. Resource factors (∆R2=0.158; p=0.000) positively and significantly moderated the relationship significantly implying the interactive effect of resource factors improved service delivery levels by 15.8 % while personal factors (∆R2=0.0338; p=0.000) positively and significantly moderated the relationship meaning the interactive effect of personal factors improved service delivery levels by 3.38%. The study concluded that performance contracting practices are significant predictors of service delivery levels; resource factors and personal factors has a positive moderating effect on the relationship between performance contracting and service delivery. Recommendations were that firms should continue enhancing performance contracting practices, provides for resource and personal factors as these efforts enhance service delivery in Huduma Centres in Kenya. The study’s significance is informing the literature and government policy by isolating resource factors and personal factors as key variables for improving public sector service delivery.