STRATEGY INSTITUTIONALISATION AND PERFORMANCE OF STATE OWNED CORPORATIONS IN THE ELECTRICITY SUB - SECTOR IN KENYA KIRUI CALEB CHERUIYOT, BED (MOI), MBA (KU) D86/CTY/PT/28906/2013 A Thesis submitted to the School of Business in Partial Fulfillment of the Requirement for the Award of the Degree of Doctor of Philosophy in Business (Strategic Management) , Kenyatta University November, 2016 ii DECLARATION This thesis is my original work and has not been presented for a degree in any other university. No part of this thesis should be reproduced without authority of the author or/and Kenyatta University. Signature………………………………………………..Date……………………… Kirui Caleb Cheruiyot Department of Business Administration We confirm that the work reported in this thesis was carried out by the candidate under our guidance as the appointed University supervisors. Signature………………………………………………..Date……………………… Dr. Stephen M.A Muathe (PhD) Department of Business Administration, School of Business, Kenyatta University Signature………………………………………………..Date……………… Dr. Mary Ragui (PhD) Department of Business Administration School of Business Kenyatta University iii DEDICATION This thesis is dedicated to my father Stephen Rono Kipkirui and my late mother Pastor Linner Rono. You have been my source of inspiration and strength in my entire academic life. iv ACKNOWLEDGEMENT I give honour and thanks to the Almighty God for giving me good health, strength, perseverance and the enthusiasm during the period of study. I also wish to give Special thanks to my supervisors; Dr. Stephen M. A Muathe (PhD) and Dr. Mary Ragui (PhD) who have been of great assistance to me at all stages of conceptualizing this study, I will always remember their guidance, encouragement, patience and insightful suggestions at each and every stage. I acknowledge the support by the Management and staff of the State Owned Corporations for providing me with the much needed information for the study. I would also like to thank my employer for funding this research through the grant I received through the Dean, School of Business. I also acknowledge the support of the staff in the School of Business for being accessible whenever I sought clarification regarding this thesis. I acknowledge the support I received from Dr. Jane Wanjira, Dr. Rosemary James, Dr. James Kilika, Dr. Hannah Bula, Dr. Eddie Simiyu, Dr. Samuel Maina, Dr. Elishiba Murigi, Dr. Peter Wambua and Dr. David Kiiru. I also thank my colleagues in the Ph.D. programme namely Ms. Perris Chege, Mr. Nahashon Langat, Mr. Joshua Tumuti, Ms. Lydia Gachengo and Mr. Josphat Kyalo who were keeping track on my progress and encouraging me. I most sincerely thank my wife Sophie and our children Calvin, Cheryl, and Chrystal for the sacrifices they made when I had to be away during this process. I also thank my sisters Beatrice, Caro and Joyce and my brother Manu for the encouragement and support they accorded me. I am also truly indebted to my friends for their moral and unwavering support during the course of this study. May the Lord God bless you most abundantly! v TABLE OF CONTENTS Declaration ......................................................................................................................... ii Dedication .......................................................................................................................... iii Acknowledgement ............................................................................................................. iv Table of Contents ............................................................................................................... v List of Tables ..................................................................................................................... ix List of Figures .................................................................................................................... x Operational Definition of Terms ..................................................................................... xi Abbreviations and Acronyms ........................................................................................ xiv Abstract ........................................................................................................................... xvi CHAPTER ONE: INTRODUCTION .............................................................................. 1 1.1 Background to the Study ........................................................................................... 1 1.1.1 Organisational Performance ............................................................................... 3 1.1.2 Strategy Institutionalisation ................................................................................ 5 1.1.3 Kenya’s Electricity Sub-sector ........................................................................... 8 1.2 Statement of the Problem ........................................................................................ 12 1.3 Objectives of the Study ........................................................................................... 14 1.3.1 General Objective ............................................................................................. 14 1.3.2 Specific Objectives ........................................................................................... 14 1.4 Research Hypotheses ............................................................................................... 15 1.5 Significance of the study ......................................................................................... 15 1.6 Scope of the Study ................................................................................................... 17 1.7 Limitations of the Study .......................................................................................... 17 1.8 Organization of the Thesis ....................................................................................... 18 CHAPTER TWO: LITERATURE REVIEW ............................................................. 19 2.1 Introduction ............................................................................................................. 19 2.2 Theoretical Review .................................................................................................. 19 2.2.1 The Stakeholder Theory ................................................................................... 19 vi 2.2.2 The Balanced Scorecard Theory ...................................................................... 21 2.2.3 McKinsey Seven S’s Model ............................................................................. 22 2.2.4 Institutional and Organisation Assessment Model (IOA) ................................ 24 2.3 Empirical Literature Review ................................................................................... 26 2.3.1 Systems and Organizational Performance ........................................................ 26 2.3.2 Leadership and Organizational Performance ................................................... 28 2.3.3 Organisational Structure and Organisational Performance .............................. 29 2.3.4 Influence of Staff - skills on Organizational Performance ............................... 30 2.3.5 The moderating role of Corporate Culture on the relationship between Strategy Institutionalisation and Performance .................................................. 32 2.4 Summary of Literature and Research Gaps ............................................................. 35 2.5 Conceptual Framework ........................................................................................... 41 CHAPTER THREE: RESEARCH METHODOLOGY .............................................. 43 3.1 Introduction ............................................................................................................. 43 3.2 Research Philosophy ............................................................................................... 43 3.3 Research Design ...................................................................................................... 44 3.4 Empirical Model ...................................................................................................... 45 3.5 Operationalisation and Measurement of Variables ................................................. 49 3.6 Target Population .................................................................................................... 50 3.7 Sample Size and Sampling Design .......................................................................... 51 3.8 Data Source and Collection Instruments ............................................................... 54 3.9 Validity and Reliability ........................................................................................... 54 3.10 Data Collection Procedure ..................................................................................... 56 3.11 Data analysis Methods ........................................................................................... 57 3.11.1 Quantitative Data Analysis ............................................................................. 57 3.11.2 Qualitative analysis ........................................................................................ 63 3.12 Ethical Issues ......................................................................................................... 63 vii CHAPTER FOUR: RESEARCH FINDINGS AND DISCUSSION ........................... 65 4.1 Introduction ............................................................................................................