Strategic Fit Components And Influence On Organization Performance; Case Of Retirement Benefits Authority In Kenya Pensions Sector

Abstract

Globally, Kenya included as per 1999 statistics a mere fifteen per cent of the population had access to retirement income support. A situation worsened by government’s reluctance to fund social security obligations and by poor societal relations where the elderly are abandoned. In Kenya, the pension sector related policies have been in favour of formal sector employment; minority with 15% while overlooking the informal sector with 70% of labour force. This situation has caused stagnation of pension cover at 15% of the labour force. This low coverage of pension schemes is in sharp contrast to their being over 1,350 work-related and individual scheme sector players. This study set out to determine the strategic fit components of retirement benefits authority and influence on performance in Kenya pension sector. The study sought to determine influence of political, economic, socio-cultural and technological factors on performance of retirement benefits authority. This study was aimed at assessing how strategically aligned the Retirement Benefits Authority being the Kenya pension sector regulator, supervisor, promoter and a sector player is in spearheading mobilization of pension savings to be used to fund capital-intensive projects enhancing realization of Kenya Vision 2030 while at the same time improving quality of life for all Kenyans. Theories applied in the study were; Open systems theory, Resource Based View theory, Michael Porter Five forces theory, McKinsey 7’S Model and Goal theory. The study was a census and it adopted descriptive survey research design to establish relationship between independent and dependent variables. The respondents were; the Chief Executive Officer, departmental heads of supervision, research & strategy, risk & compliance and four operational level staff of the three departments chosen using stratified sampling. Structured questionnaires devised by the researcher were used in data analysis. Collected data was analysed via descriptive analysis such as mean, standard deviation facilitated by statistical package for social sciences (SPSS) version 20.0. A correlation test using Pearson correlation coefficient was done to test nature of relationship between independent and dependent variables. All correlations tests gave a result of (< +1) indicating a positive correlation between the independent and dependent variables. From the study findings the researcher concluded that political factors (r=0.855), economic factors (r=0.818), socio-cultural factors (r=0.776) and technological factors (r=0.655) influence an organization performance in descending order. The researcher concluded that strategic fit components namely; political, economic, socio-cultural and technology factors are interrelated and they influence an organization performance in varying levels. Therefore, the study recommends that organizations should continuously work towards attaining strategic fit to political, economic, socio-cultural and technological factors in their operating environments because they influence an organization performance.