The Impact Of Outsourcing On Organisational Performance: A Case Study Of Nile Breweries.

TABLE OF CONTENTS IMPACT OF OUTSOURCING ON ORGANISATIONAL PERFORMANCE: A CASE STUDY OF NILE BREWERIES ................................................................................................................................. i DECLARATION ..................................................................................................................................... ii APPROVAL ........................................................................................................................................... iii DEDICATION .............. : ........................................................................................................................ iv ACKNOWLEDGEMENT ....................................................................................................................... v CHAPTER ONE .................................................................................................................................... 1 INTRODUCTION ................................................................................................................................... 1 1.0 Introduction .................................................................................................................................. 1 1. 1 Back ground of the study .......................................................................................................... 1 1.2 Problem Statement. ........................................................................................................................ 4 1.3 Objective of the study .................................................................................................................... 4 1.4 Specific objectives ......................................................................................................................... 4 1 1 5 .Research questions ........................................................................................................................ 4 1.6 Scope of the study ........................................................................................................................ 5 1.6.1 Time scope ........ .-......................................................................................................................... 5 1.6.2 Geographical scope ..................................................................................................................... 5 1.6.3 Subject scope .............................................................................................................................. 5 1.7 Significance of the study ................................................................................................................ 5 1.8 Conceptual diagram .......................................................................... 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CHAPTER TWO .................................................................................................................................... 7 LITERATURE REVIEW ........................................................................................................................ 7 2.0 Introduction .................................................................................................................................. 7 2'. 1 Importance of outsourcing to the organizations ............................................................................... 8 I 2.2 Challenges encountered in outsourcing by organizations .............................................................. 15 2.3 Solutions to the challenges encountered in outsourcing ................................................................. 18 2.4 Relationship between outsourcing and organizational performance ............................................... 23 CHAPTER THREE ............................................................................................................................... 27 RESEARCH METHODOLOGY ........................................................................................................... 27 vi 3.0 Introduction ............................................................................................................................... 27 3.1 Research design ........................................................................................................................... 27 3.2 study population ........................................................................................................................... 27 3.3 Data collection ............................................................................................................................ 27 3.4 Sample Size ................................................................................................................................. 28 3.5 Sampling method ......................................................................................................................... 28 3.6 Data Collection Methods .............................................................................................................. 28 316.1.Questinaire ................................................................................................................................ 28 3.6.2 Interviews ................................................................................................................................. 28 3.6.3 Observations ..... , ....................................................................................................................... 28 3.6.4 Secondary Data Collection Methods ........................................................................................ 28 3.8 Reliability and validity ofresearch instruments ........................................................................... 29 3.9 Procedure of data collection ..................................................................................................... 29 3.10 Data quality control .................................................................................................................... 29 3.11 Data analysis and presentation .................................................................................................... 29 3.12 Limitations to the study .............................................................................................................. 29 CHAPTER FOUR ............................................................................................................................... 31 DATA PRESENTATION, ANALYSIS AND INTERPRETATION ..................................................... 31 4'.0 Introduction ..................................................................................... 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Bookmark not defined. 4.1 Demographic characteristics ......................................................................................................... 31 4.2 impmtance of outsourcing in Nile Breweries ................................................................................ 34 4.3 Challenges encountered in outsourcing by Nile breweries ........................................................... 38 4.4 Solutions to the challenges encountered in outsourcing schemes by Nile breweries ....................... 42 4.5 Impact of outsourcing on the performance of organisation ........................................................... 44 CHAPER FIVE ..................................................................................................................................... 47 DISCUSSION, SUMMARY, CONCLUSION, RECOMMENDATIONS AND SUGGESTIONS .......... 47 5.0 Introduction ................................................................................................................................. 47 5.1 Discussion of Findings ................................................................................................................. 47 5.1.2. Challenges encountered in outsourcing .................................................................................... 48 5.1.3 Solutions to the challenges encountered in outsourcing ........................................................... 48 5 .1 .4 Relationship between outsourcing and organisational performance ............................................ 48 vii 5 .2 Summary ..................................................................................................................................... 49 I 5.3 conclusion .................................................................................................................................... 50 5.4. Recommendations ....................................................................................................................... 50 5.5 Areas of further study ................................................................................................................... 51 REFERENCES .................................................................................................................................. 52 APPENDICES: APPENDIX I RESEARCH INSTRUMENT ............................................................. 55 Research Budget. ................................................................................................................................... 60 APPENDIX II TIME FRAME ......................................................................................... 61 I I viii I

CHAPTER ONE INTRODUCTION

1.0 Introduction. Thi,s chapter looks at the background of the study, statement of the problem, purpose of the study, specific objectives, research questions, scope of the study, significance of the study, and the conceptual frame w.ork. 1.1 Back ground of the study Since the Industrial Revolution, companies have grappled with how they can exploit their competitive advantage to increase their markets and their profits. The model for most of the 20th century was a large integrated company that can "own, manage, and directly control" its assets. In the 1950s and I 960s, the rallying cry was diversification to broaden corporate bases and take advantage of economies of scale. By diversifying, companies expected to protect profits, even though expansion required multiple layers of management. Subsequently, organizations I attempting to compete globally in the 1970s and 1980s were handicapped by a lack of agility that resulted from bloated management structures. To increase their flexibility and creativity, many large companies developed a new strategy of focusing on their core business, which required identifying critical processes and deciding which could be outsourced.