Publication: Influence of Strategic Management Practices on Performance of National Health Insurance Fund, Kenya
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2024-06
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International Journal of Business Management, Entrepreneurship and Innovation
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Abstract
Strategic management remains crucial for organizations, regardless of their size, as it defines
their success in navigating the external environment while optimizing internal resources. This
study addressed a contextual problem where the National Health Insurance Fund (NHIF) in
Kenya struggles to fully achieve its performance objectives despite implementing strategic
management practices. The research identified a gap in understanding how specific
dimensions of strategic management practices—strategic intent, formulation, implementation,
and control of strategy—affect NHIF's performance. Financial strategies, technology, human
resource planning, and customer service, often mistaken as strategic management practices,
were re-examined under the correct strategic management dimensions. The study employed a
descriptive research design to examine the influence of strategic management practices on
NHIF's performance, targeting a sample size of 135 respondents selected using stratified
random sampling from a population of 206 NHIF employees. Data collection was conducted
using structured questionnaires, and the tools were pre-tested for validity and reliability,
yielding a Cronbach Alpha index of 0.715, indicating satisfactory internal consistency. Data
analysis was performed using descriptive statistics, including mean and standard deviation,
and inferential statistics, specifically multiple linear regression analysis. The regression model
indicated an R-squared value of 0.887, suggesting that 88.7% of the variability in NHIF's
performance could be explained by the independent variables: strategic intent, formulation,
implementation, and control of strategy. The adjusted R-squared value of 0.884 further
confirmed the model's robustness. Findings revealed that strategic management practices
significantly influence NHIF's performance. Specifically, strategic intent, formulation,
implementation, and control were positively associated with improved financial management,
technological adoption, human resource optimization, and enhanced customer service. For
instance, financial strategies, when aligned with strategic planning, demonstrated a significant
positive impact (β = 0.01, p < 0.05). Similarly, the adoption of technology as a strategic tool
also showed a substantial positive effect (β = 0.01, p < 0.05). The study concludes that strategic
management practices exert a substantial and statistically significant influence on NHIF's
performance. This highlights the necessity for NHIF to continually refine its strategic planning
processes, embrace technological advancements, optimize human resource planning, and
prioritize customer service to enhance overall performance and service delivery. The
recommendations emphasize the need for NHIF to develop comprehensive strategic plans,
invest in modern technology, implement effective human resource management practices,
prioritize customer satisfaction, and engage in continuous monitoring and adaptation to
remain responsive to the dynamic healthcare environment
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Keywords
Strategy formulation, Strategy Implementation, Strategic Management Practices, National Health Insurance Fund