Influence of Strategic Leadership Practices on Organizational Performance

Abstract

The commercial parastatals are allowed by the constitution to charge for various services and goods provided to the public but at a reasonable price so as to fund the government operations. That notwithstanding, the performance of Kenyan commercial-based parastatals has consistently been low to a point that in the financial year 2019/2020, the cumulative operational performance was negative. The general objective of this study was to examine the influence of strategic leadership practices on performance of commercial- based parastatals in Kenya. The specific objectives were to examine the influence of strategic planning, strategic direction, strategic control, and corporate communication on the organizational performance among commercial-based parastatals in Kenya. Further, the strategic leadership theory, contingency theory, and balanced scorecard theory were applicable to this study. Notably, the study used a descriptive research design to collect data on a target population of six (6) commercial based parastatals. The respondents were 45 departmental managers and 151 administrative staff. The study obtained the sample size of 40 departmental managers and 110 administrative staff using simple random method. They were issued with closed and open-ended questionnaires. Additionally, the secondary data collection sheet was used to gather information related to sales, customer numbers, profitability and quality of service. Further, pre-test study was conducted at Kenya Airways where 4 departmental managers and 11 administrative staff. Additionally, descriptive analysis, frequency tables and explanation were used to illustrate the results. Further, inferential statistics were be examined using multiple regression and correlation analysis. The conclusions made on strategic planning were that the basis of the parastatals’ strategic planning was not supported by any bench marking but rather a specific individual’s knowledge and experience. On strategic direction, the management diverted the organization resources to unscheduled things hence ending up mis-using the resources and causing ineffectiveness in the operations. On strategic control, there was lack of support from the government and inadequate funding of the strategies due to poor resource provision by the government. On corporate communications, the deeper details on aspects such as policy formulation processes were hardly known to the staff. The study recommends that on strategic planning, there should be developed processes of strategic planning which are well documented by the management and have a policy. On strategic direction, there should be implementation of tough regulations by the government agencies like EACC of various legal punishments to corrupt staff. On strategic control, the various parastatal managers should lobby for more funds through other legal ways such as fund raising and competitions such as marathons among others within their jurisdiction. On corporate communication, the government through ministry official should develop policies on the extent that the junior civil servants should be allowed in the decision- making process such as policy formulation.