Influence of Strategic Human Resource Management Practices on Performance of State Corporations in Kenya

Abstract

The overall objective of this study was to establish the influence of strategic human resource management (SHRM) practices on the performance of State Corporations in Kenya and the moderating influence of strategic planning. The specific objectives were to establish the influence of employees’ recruitment and selection process on performance of State Corporations in Kenya, determine the influence of employees’ career development and ascertain the influence of employees’ performance review on performance of State Corporations in Kenya. The study further identified the influence of employees’ reward on performance of State Corporations in Kenya and the moderating influence of strategic planning on SHRM practices and performance of State Corporations in Kenya. The study was anchored on contingency, resource based view and motivation to work theories. It was also informed by performance prism and balanced score card models. This was a cross sectional descriptive study that was guided by positivism orientation. The study population was 200 State Corporations that signed performance contract and were evaluated during the financial year 2014/15. A sample of 132 State corporations was drawn using simple random sampling method. One questionnaire was administered in each institution. A total of 102 State Corporations completed the questionnaires. Data analysis was done using descriptive statistics, correlation and regression analysis. Presentation was done using tables and figures. The findings were that SHRM practices influences performance of State Corporations. The study established that introduction of strategic planning as a moderator variable increases the influence of SHRM practices on corporate performance. The study concludes that, State Corporations that exhibited improvements in SHRM practices and had developed strategic plan and were implementing the plan experienced better performance results compared with those that were not doing the same. The study recommends that State Corporations should conduct recruitment and selection professionally, emphasize career development, employees’ performance review and rewards. In addition, all State Corporations should have a valid strategic plan and ensure implementation. Relevant policies to back up the SHRM practices and strategic planning should also be developed and implemented. A similar study is recommended to cover the private sector, Ministries, County Government and the not for profit organizations. The study also recommends further study on the role of policies as a basis of competitive advantage. The study has contributed to theory, policy and practice by identifying the role of strategic human resource management practices on performance of State Corporations and the moderation influence of strategic planning. It has provided practitioners managing State Corporations and other corporate bodies with evidence for performance improvement. It has also provided guidance on future review of performance contracting guidelines to ensure it is evidence based.