The Impact of Outsourcing in Hospitals

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IMPACT OF OUTSOURCING ON ORGANIZATIONAL PERFORMANCE
A CASE STUDY OF MATER HOSPITAL, NAIROBI.

BY

KIPTOO MARITIM BERNARD

REG. NO: BBM/2609/11

RESEARCH PROPOSAL SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE AWARD OF THE DEGREE OF BACHELOR OF BUSINESS MANAGEMENT OF THE SCHOOL OF BUSINESS MANAGEMENT AND ECONOMICS

MOI UNIVERSITY

DECEMBER, 2011

DECLARATION

I declare that this is my original work and to the best of my knowledge, has not been submitted to any other institution or University for the purpose of examination.

Signature …………………………………..Date……………………………_ KIPTOO MARITIM BERNARD (BBM/2609/11)

The project proposal has been submitted for examination with approval as University supervisor.

Signature …………………………………..Date……………………………_ WELDON NGENO
LECTURER
MOI UNIVERSITY

DEDICATION

This work is dedicated to all organizations which perceive outsourcing as one of their strategies that will lead to improvement in the organizational performance. I hope this research will inspire the Government, planners, Outsourcers and implementers of outsourcing to facilitate the dream of Kenya becoming an outsourcing hub by the year 2030

ABSTRACT

The aim of this paper is to assess the effects of outsourcing on performance of organizations. Outsourcing is a strategic use of outside resources to perform activities that are usually handled by internal staff and resources. By using a well – managed outsourcing agreement, can gain in markets that would otherwise have been uneconomical. This study was designed to explore the impact outsourcing has on organizational performance. The results show that organizations benefits from outsourcing strategies if they identify their outsourcers wisely.

The target population for the study was 60 employees. The questions tried to find out the extent to which outsourcing led to financial performance improvement, the impact did outsourcing revenue cycle functions have on the hospital employees, extent has outsourcing improved patient service and satisfaction and extent has outsourcing benefited the wider community.

The instruments for data collection were questionnaires and interview schedule. The questionnaire was administered to the employees. This was a useful tool that enabled the researcher to receive responses on same questions from many respondents. Descriptive statistics was used to summarize data into frequencies and percentages. The data findings revealed that outsourcing has an impact on the performance of organizations.

Table of Contents

1.1 Back ground to the problem1

1.2 Mater hospital2

1.3 Statement of the problem3
1.4 Research Questions4
1.5 Significance of the Study5

1.6 Scope6

2.1 Introduction2

2.2 Determinants of outsourcing3
2.3 Types of outsourcing4

2.3.1 Total Outsourcing5

2.3.2 Multiple suppliers outsourcing6
2.3.3 Joint venture/strategic alliance outsourcing2

2.3.4 In sourcing3
2.3 Theories of outsourcing4

2.3.1 Transaction cost theory5

2.3.2 The Agency Theory6
2.3.3 Resource-based theory1

2.3.4 Resource-dependent theory2

2.3.5 Game theory3
3.1 Introduction4

3.1 Research Design5

3.2 Target Population6

3.3 Description of the Sample and Sampling Procedures1

3.4 Description of Data Collection Procedures2

3.4.1 Questionnaire3

3.5 Description of Data Analysis Procedures4

4.1. Introduction5

4.2 Presentation of finding6
4.2.1 Respondents’ Background Information1

4.2.2. Opinion of employees on the decision to outsource2

4.2.3 The extent to which outsourcing has lead to improved financial performance3 4.2.4 The impact outsourcing revenue cycle functions had on the hospital employees4

4.2.5 Employees comment on the reaction of the staff union on the outsourcing decision5

4.2.6 The extent to...
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