Department of Business management

MODERATING EFFECT OF DIGITAL FINANCE SERVICE ON THE RELATIONSHIP BETWEEN FINANCIAL MANAGEMENT PRACTICES AND FINANCIAL PERFORMANCE OF SELECTED SMEs IN ELDORET CITY, KENYA.

Wed, 01 Jan 2025 00:00:00 GMT

MODERATING EFFECT OF DIGITAL FINANCE SERVICE ON THE RELATIONSHIP BETWEEN FINANCIAL MANAGEMENT PRACTICES AND FINANCIAL PERFORMANCE OF SELECTED SMEs IN ELDORET CITY, KENYA. JEPLETING, GLADYS Financial performance refers to the measure of how well a company is using its assets to generate revenue, profit, firm credibility, and value for shareholders and its ability to pay off debts. Challenges affecting SMEs financial performance include poor financial management, lack of technological skills and enough resources. As a result, it was necessary to investigate the moderating effect of digital finance service on the relationship between financial management practices and financial performance of selected SMES in Eldoret city, Kenya. The specific objectives of the study were to examine the effect of cash flow management, budget planning, investment decision and digital financial services on financial performance of selected SMEs. In addition, the study sought to examine the moderating effect of digital financial services on the relationship between; cash flow management, budget planning, investment decision and financial performance of selected SMEs. The research was guided by the priority- based budgeting theory, modern portfolio theory and resource-based theory. The study utilized explanatory research design. Target population was 1236. Simple random sampling techniques was utilized to collect data from 302 selected SMEs using self- administered questionnaires. Cronbach alpha was applied to test reliability while factor analysis was applied to test construct validity. Hierarchical regression analysis was employed to examine direct and moderating effects, with firm age and firm size controlled as covariates. The findings indicate that firm age has a statistically significant positive effect on financial performance (β=0.282, p=0.022), whereas firm size does not (β=0.070, p=0.149) affirming the need to control these variables. The study revealed that cash flow management (β=0.237, p=0.000), budget planning (β=0.364, p=0.000), and investment decision (β=0.366, p=0.000) positively influence financial performance, collectively accounting for 71% of the variance (R2=0.742, ∆R2=0.713, p≤0.05). The study further examined the direct effect of digital finance services on financial performance, with results showing a positive and significant influence (β=0.137, p=0.007), contributing an additional 1% variance (∆R2=0.007) to the model. However, digital finance services did not moderate the relationship between cash flow management and financial performance (β=0.002, p=0.852), indicating no significant interaction (∆R2=0.000). Conversely, digital finance services significantly moderated the relationship between budget planning and financial performance (β=-0.049, p=0.000, ∆R2=0.016), and between investment decision and financial performance (β=0.035, p=0.042, ∆R2=0.003), resulting in a combined explained variance of 80% in financial performance (R2=0.798). The study provides valuable insights for SME managers, policymakers, and financial institutions, emphasizing the importance of targeted digital finance tools to optimize financial management practices and support SME growth. SMEs owners or managers should assess and adopt digital finance solutions that align with their financial management practices.

INFLUENCE OF E-LOGISTICS ON SUPPLY CHAIN PERFORMANCE OF MANUFACTURING FIRMS, IN UASIN GISHU COUNTY, KENYA. MODERATED BY ELECTRONIC RESOURCE PLANNING

Wed, 01 Jan 2025 00:00:00 GMT

INFLUENCE OF E-LOGISTICS ON SUPPLY CHAIN PERFORMANCE OF MANUFACTURING FIRMS, IN UASIN GISHU COUNTY, KENYA. MODERATED BY ELECTRONIC RESOURCE PLANNING CHEPKEMOI, CLARA Supply chain performance is crucial for businesses to increase efficiency, reduce expenses, and meet changing client needs in a competitive environment. However, manufacturing firms in Kenya face challenges such as competition, high production costs, and untimely product availability. This study aimed to examine the moderating influence of Enterprise Resource Planning (ERP) on the relationship between e- logistics and supply chain performance of manufacturing firms in Uasin Gishu County, Kenya. Specific objectives were to assess the influence of electronic order processing, transportation management, automated warehousing, inventory management, and enterprise resource planning systems on supply chain performance. The study further assessed the moderating influence of enterprise resource planning on the relationship between electronic order processing, transportation management, automated warehousing, inventory management systems, and supply chain performance of these firms. The study was guided by Resource-Based, Innovation, and Transaction Cost Theories. Explanatory research design and a census approach were adopted in collecting data using a closed-ended questionnaire from 270 Heads of 9 Departments closely linked to the study variables in 30 manufacturing firms. Cronbach’s alpha and factor analysis were used to assess reliability and construct validity. Data analysis was performed using descriptive and inferential statistics, with a hierarchical regression model used to test all the study hypotheses. Results indicate that firm age (β=0.190, p = 0.021) significantly influences supply chain performance while firm size (β=0.101, p=0.223) does not. These control variables explain 4.8% of the variance in supply chain performance, as shown by an R2 of 0.048. Findings further revealed that electronic order processing system (β1=0.316, p=0.001), transportation management system (β2=0.167, p=0.011), automated warehousing systems (β3=0.217, p=0.008), and inventory management system (β4=0.232, p=0.001) significantly influence supply chain performance. These variables explain 56.6% of the variance in supply chain performance (R2 = 0.566 inclusive of the controls) and 51.8% (∆R2 = 518 exclusive of the controls). Results further indicate that ERP (β=0.094, p=0.010), influences supply chain performance. It explains 1.2% of the variation in supply chain performance (∆R2 =0.12). Furthermore, ERP was found to moderate the relationship between electronic order processing system (β=0.100, p=0.000), transportation management system (β=0.054, p=0.012), inventory management system (β=-0.120, p=0.002), and does not moderate the link between automated warehousing system and supply chain performance (β=-0.013, p=0.701). The entire Hierarchical model accounts for 64.5% (R2 = 0.645) of the variance in supply chain performance, much more than the direct effect model, which explains 56.6% (R2 = 0.566). The study concludes that electronic order processing, transport management, automated warehousing, inventory management systems, and ERP influence supply chain performance. ERP moderates the link between electronic order processing, transport management, inventory management systems, and supply chain performance, but does not moderate automated warehousing systems and supply chain performance. This study contributes to knowledge by examining the interaction of ERP and study variables. Future scholars will benefit from the study's findings as they conduct new research in e-logistics and supply chains in various industries. The policymakers and management may use the results to develop policies and strategies for investing in e-logistics and ERP, as these enhance efficiency in supply chain performance.

MODERATING EFFECT OF SELF-CONTROL ON THE RELATIONSHIP BETWEEN FINANCIAL LITERACY AND RETIREMENT PLANNING AMONG COMMERCIAL BANK EMPLOYEES IN ELDORET CITY, KENYA

Wed, 01 Jan 2025 00:00:00 GMT

MODERATING EFFECT OF SELF-CONTROL ON THE RELATIONSHIP BETWEEN FINANCIAL LITERACY AND RETIREMENT PLANNING AMONG COMMERCIAL BANK EMPLOYEES IN ELDORET CITY, KENYA CHESEREK, GLADYS Retirement planning, defined as a goal-oriented behavior where individuals devote effort to prepare for their retirement life, can effectively reduce retirement worry, keep stress under wraps, and enhance retirement preparedness and confidence. However, there is little literature about retirement planning among employees working in Kenyan Commercial banks. To fill this gap, this study aimed to establish the moderating effect of self-control on the relationship between financial literacy and retirement planning among commercial bank employees in Kenya. The study was guided by the following specific objectives: to assess the effect of financial knowledge, financial behavior, financial attitude, and self-control on retirement planning among commercial bank employees in Eldoret City, Kenya. In addition, the study examined the moderating effect of self-control on the relationship between financial knowledge, financial behavior, financial attitude, and retirement planning. This study was guided by goal- setting theory, social cognitive theory, and behavioral life cycle theory. The study adopted an explanatory research design, with data being collected from a target population of 1058 employees of 32 commercial banks in Eldoret town. A sample size of 290 respondents was obtained using Yamane’s formula. The study used systematic sampling techniques to select employees as respondents. Data was collected using a structured, closed-ended questionnaire. The researcher ensured the reliability of the research instrument through a pilot study and further confirmed it with Cronbach's alpha, which was above the score of 0.7. Construct validity was assessed using factor analysis, while content validity was assessed by having supervisors and experts in the field review the test items to make sure they were relevant and representative of the content that was being measured. Descriptive and inferential statistical analyses were conducted using SPSS (Statistical Package for the Social Sciences) version 25, with study hypotheses tested through a hierarchical regression model. It was found that Financial Knowledge had a significant positive impact on retirement planning (β = 0.402, p < 0.05), confirming that employees with better financial knowledge are more likely to plan effectively for retirement. Financial Behavior also showed a positive and significant influence on retirement planning (β = 0.182, p < 0.05), indicating that prudent financial actions enhance retirement preparedness. Financial Attitude similarly exhibited a significant positive effect on retirement planning (β = 0.267, p < 0.05). Self- control not only directly impacted retirement planning (β = 0.174, p < 0.05) but also moderated the relationship between financial knowledge (β = 0.120, p < 0.05), financial behavior (β = 0.099, p < 0.05), financial attitude (β = -0.047, p < 0.05), and retirement planning. The study concludes that self-control moderates the relationship between financial knowledge, financial behavior, financial attitude, and retirement planning among commercial bank employees in Eldoret City, Kenya. The results of this study can be used by practitioners and policymakers in developing strategies and formulating policies for retirement systems in the workplace. The findings contribute knowledge to the literature and theory related to financial literacy, self-control, and retirement planning.

Effects of Budget Planning on Financial Performance of Selected SMEs in Eldoret Town, Kenya Moderated by Digital Finance Services

Mon, 01 Jan 2024 00:00:00 GMT

Effects of Budget Planning on Financial Performance of Selected SMEs in Eldoret Town, Kenya Moderated by Digital Finance Services Jepleting, Gladys,; Tarus, John; Shitote, Zachariah The study intention was to investigate effects of budget planning on financial performance of selected SMEs in Eldoret town, Kenya, moderated by digital financial services. Specific objectives of the study were to examine the influence of budget planning on financial performance and effect of digital financial services on financial performance. The study was designed to assess the moderating role of digital financial services on the relationship between budget planning and financial performance of selected SMEs. The research was guided by the Priority-Based Budgeting Theory and Resource Based Theory. The study utilized explanatory research design and descriptive research design. Simple random sampling techniques in collecting data from 302 selected SMEs using structured questionnaires. Cronbach alpha was applied to test reliability while Factor analysis was applied to test validity. Using SPSS version 23 hierarchical regression model was employed in data analysis and testing of the hypotheses. The results reveal that digital finance services had significantly positive relationship between budget planning and financial performance.

Influence of Green Product Selection Practice on Organizational Performance of Manufacturing Firms in Nairobi County

Wed, 01 Jan 2025 00:00:00 GMT

Influence of Green Product Selection Practice on Organizational Performance of Manufacturing Firms in Nairobi County Mutai, Diana; Keitany, Pauline; Bartocho, Evaline Manufacturing firms in Nairobi County would operate with a strong organizational performance achieving high productivity, efficiency, profitability, and quality standards through green product selection practices. A strong organizational culture supports these practices, fostering employee engagement, innovation, and environmental sustainability. However, the sector faces challenges such as limited technical efficiency, declining GDP contribution, and reduced market share. Despite contributing 17.30% of total tax revenue, the sector's technical efficiency is lower. Therefore, the main objective of this study was to establish the influence of green product selection practice on organizational performance of manufacturing firms in Nairobi County. This study was guided by Ecological Modernization theory. This study utilized an explanatory research design. The study targeted 554 procurement managers of all manufacturing companies in Nairobi County. The researcher obtained sample size of 232 respondents using Yamane formulae. The study used stratified random sampling technique to select respondents from manufacturing companies. These research study used structured questionnaires to collect data. Pre-testing of research instruments was achieved through pilot study in manufacturing companies in Nakuru County which have similar characteristics as manufacturing companies in Nairobi County. This assisted in testing for reliability and validity of the research instruments. Collected data was analysed using both descriptive and inferential statistics with the aid of Statistical Package for Social Science (SPSS) version 25. Descriptive statistics included frequency, means, minimum, maximum and standard deviation. Inferential statistics included correlation and regressions models. The study findings revealed that green product selection practice (β1=0.165, p=0.002) had a positive and significant effect on organizational performance of manufacturing firms in Nairobi County. The study concluded that integrating green product selection, enhances manufacturing firms’ performance, cost-effectiveness, and market competitiveness while advancing their environmental and social responsibilities. The study recommends that firms develop a strong sustainability-focused culture, integrate green product, engage with environmental policies and certifications to maximize sustainability performance.

The Moderating Influence of Enterprise Resource Planning on the Relationship between Electronic Order Processing Systems and Supply Chain Performance of Manufacturing Firms in Uasin Gishu County, Kenya

Mon, 01 Jan 2024 00:00:00 GMT

The Moderating Influence of Enterprise Resource Planning on the Relationship between Electronic Order Processing Systems and Supply Chain Performance of Manufacturing Firms in Uasin Gishu County, Kenya Chepkemoi, Clara; Keitany, Pauline; Shitote, Zachariah Kenyan manufacturing firms face challenges in supply chain performance, including fierce competition, high production costs, and delayed product availability, requiring improved efficiency and cost-cutting strategies. The aim of this study was to investigate the moderating effect of enterprise resource planning on the relationship between electronic order processing system and supply chain performance among manufacturing firms in Uasin Gishu County, Kenya. The study utilized resource-based theory, explanatory research design, a census approach, and a closed ended questionnaire to collect data from 270 heads of 9 departments in 30 manufacturing firms in Uasin Gishu County. A hierarchical regression model was used to test all the study hypotheses. Results of the control variables indicate that firm age (β=.190, P = .021) significantly influences supply chain performance while firm size (β=.101, P=.223) does not. These control variables explain 4.8% of the variance in supply chain performance (R2 of .048). Furthermore, the electronic order processing system (β=.837, P=.000) and enterprise resource planning (β=0.117, P=.003) significantly influence supply chain performance. Finally, enterprise resource planning moderated the link between electronic order processing system and supply chain performance (β=.132, P =.000). This moderation model indicates an improved R2 of .579 and a change in R2 of .083 implying that all the variables in the study account for 57.9% and 8.3% of the variance in supply chain performance. This study contributes to knowledge by examining the interaction of enterprise resource planning and the study variables. The study suggests that manufacturing firms should adopt electronic order processing systems and ERP to enhance supply chain efficiency. In addition, policymakers and managers should develop policies and strategies that encourage investments in these technologies, as they have been found to influence supply chain performance and competitive advantage.

EFFECT OF RECRUITMENT PRACTICES ON EMPLOYEES’ PERFORMANCE IN PUBLIC UNIVERSITIES IN NYANZA REGION, KENYA

Mon, 01 Jan 2024 00:00:00 GMT

EFFECT OF RECRUITMENT PRACTICES ON EMPLOYEES’ PERFORMANCE IN PUBLIC UNIVERSITIES IN NYANZA REGION, KENYA Anditi, Philip Duncan; Ngari, Christine; Bartocho, Evaline Employee performance is integral to organizational success, yet public universities in Kenya have faced challenges in achieving satisfactory performance despite implementing human resource management (HRM) practices. This study aimed to investigate the effect of recruitment practices on employee performance in public universities in Nyanza region, Kenya. The target population comprised of 3,129 individuals, and the sample size of 355 teaching and non-teaching staff were determined using the Yamane formula, employing random sampling techniques for data collection. A structured questionnaire was utilized as the primary data collection tool in a quantitative research design. Cronbach's alpha was calculated for each scale in the questionnaire. Data analysis was conducted using both descriptive statistics and inferential statistics with the aid of SPSS version 23. To ensure reliability, the results were as follows: recruitment practices have a significant positive effect on employee performance ((β = 0.165, p<0.05). The study concluded that recruitment practices have a significant positive effect on employee performance. The study recommended that hiring decisions in universities should always be made on the basis of a person’s potential to do a job. The study recommended that hiring decisions in universities should be made on the basis of a person’s potential to do a job. The recruitment process should continue to be done in a transparent manner and the recruitment processes in the universities should keep on being improved to enhance employee satisfaction. The employee selection process should always be done in an ethical manner and in a manner that is fai

Critical Incident Stress Management and Job Satisfaction among National Police Service Officers

Mon, 01 Jan 2024 00:00:00 GMT

Critical Incident Stress Management and Job Satisfaction among National Police Service Officers Chesang, Lilian; Ngari, Christine; Bartocho, Evaline The purpose of the study was to examine the moderating effect of employee wellbeing on the relationship between critical incident stress management and job satisfaction among the same officers. The study was guided by Two Factor Theory of Motivation. An explanatory research design was employed to explain the cause-effect relationship between the variables. Stratified and purposive sampling techniques were used to collect data from a sample size of 328 respondents derived from Yamane’s formula, with a target population being 1297 police officers using a structured, closed ended questionnaire. A pilot study was conducted in national police service in Nandi County to ascertain validity and reliability of the research instruments. Data collected were analysed using descriptive statistics and inferential statistics. Descriptive statistics were frequencies, percentages, mean and standard deviation. Inferential analysis was carried out through correlation to ascertain the relationships between variables and regression analysis to test the hypotheses. The study findings revealed that critical incident stress management (β1=0.185, p=0.000) had a positive and significant effect on job satisfaction among national police service officers in Uasin Gishu County, Kenya. In addition, results indicated that employee wellbeing moderates the relationship between critical incident stress management (β5= -0.067, p=0.000, R2=.511, ΔR2=.016) and job satisfaction among the national police service officers. The study recommended that the National Police Service (NPS) should enhance mental health services to improve officers' job satisfaction.

Relationship Between Environmental Cost Disclosure and Financial Performance of Manufacturing and Construction Firms Listed in Nairobi Securities Exchange; The Moderating Effect of Firm Size

Mon, 01 Jan 2024 00:00:00 GMT

Relationship Between Environmental Cost Disclosure and Financial Performance of Manufacturing and Construction Firms Listed in Nairobi Securities Exchange; The Moderating Effect of Firm Size Malakwen, J. Ruth; Tarus, John Environmental issues have become increasingly prominent, driving the need for companies to operate transparently and responsibly. This study investigated the moderating effect of firm size on the relationship between environmental cost disclosures and financial performance among manufacturing and construction firms listed on the Nairobi Securities Exchange in Kenya. The study was guided by the stakeholder’s theory. Using a combination of explanatory and longitudinal research designs, the study analyzed data from audited annual reports of manufacturing and construction firms from 2014 to 2021. Data was coded into STATA version 17 and analyzed using both descriptive and inferential statistics. Results indicated that financial performance positively and significantly correlated with environmental costs (r=0.460, p < 0.01), firm size (r=0.416, p < 0.01). Also, environmental costs disclosure positively and significantly correlated with firm size (r=0.213, p < 0.05). The study further established that environmental cost disclosure (β =0.1273701, ρ-value <0.05) had a positive and significant effect on the financial performance of manufacturing and construction companies listed in Nairobi securities exchange. Further, the study found that firm size moderated the relationship between environmental cost disclosure (β= 0.0041, ρ<0.05) and financial performance of manufacturing and construction companies listed in Nairobi securities exchange. This result suggests that the impact of environmental cost disclosure on financial performance is indeed influenced by firm size. Managers should prioritize the transparent reporting of environmental costs, as these disclosures have been shown to positively impact financial outcomes. Hence, firms can demonstrate their commitment to sustainability and responsible business practices, which in turn can attract investors and stakeholder trust.

EFFECTIVENESS OF CREDIT POLICY ON MANAGEMENT OF NON-PERFORMING LOANS IN KENYAN COMMERCIAL BANKS

Sun, 01 Jan 2023 00:00:00 GMT

EFFECTIVENESS OF CREDIT POLICY ON MANAGEMENT OF NON-PERFORMING LOANS IN KENYAN COMMERCIAL BANKS ATIENO, EUNICE MACREAN The financial growth and stability of commercial banks majorly depend on regular loan repayments by their borrowers. In the recent past, commercial banks have been facing challenging matters originating from steady increases in Non-Performing Loans due to borrowers defaulting in making their loan repayments as scheduled. The purpose of this study was to determine the effectiveness of credit policy on management of NonPerforming Loans in Kenyan Commercial Banks. The specific objectives were to determine the effect of credit terms, credit appraisal and collection policy on management of non-performing loans in Kenyan Commercial Banks. The study literature was supported by information from the Theory of Information Asymmetry and Credit Scorecard Theory. The study adopted an explanatory type of research design on a sample size of 222 credit officers working in the 41 commercial banks within Nairobi city. Cronbach alpha and factor analysis were applied to test the reliability and validity of the research instruments respectively. Data collection was done using self-administered questionnaires. A multiple regression model using SPSS (version 23) was used to analyze the obtained data and test the hypotheses. The findings revealed that credit terms (ꞵ= .570, p < .000), credit appraisal (ꞵ = .302, p < 0.000), and collection policy (ꞵ = .201, p < .000) all had a positive and significant effect on management of Non-Performing Loans. Based on the new findings, the management of commercial banks and policy makers should develop effective strategies, policies and techniques that would make borrowing affordable to attract creditworthy borrowers to the banks. The study brings new knowledge that credit terms have the greatest predictive power on management of Non-Performing Loans compared to credit appraisal and collections policy. Whereas the study used quantitative data, future studies may consider using mixed approaches as they may uncover other issues affecting the management of Non-Performing Loans in commercial banks.