Factors influencing the implementation of balance scorecard in insurance companies in Kenya

Abstract

The Balanced Scorecard (BSC) complements financial measures of past performance with measures of the drivers of future performance. While many companies already have performance measurement systems that incorporate financial and non-financial measures, they are often only used for control and feedback of short-term operations at a corporate level. This study sought to determine the factors influencing the implementation of balance scorecard in insurance companies in Kenya. Specifically, the study looked at the following objectives; to establish the effect of team involvement on BSC implementation in insurance firms, to determine the effect of resource allocation on BSC implementation in insurance firms, to establish the effect of leadership involvement on BSC implementation in insurance firms. To investigate the intervening effect of culture on the relationship between the factors and implementation of BSC. This study employed a descriptive research design. The study focused on the CIC General Insurance Limited and Britam General Insurance Limited companies which were selected purposively due to their registered improving growth over years. The study employed the use of a structured questionnaire in data collection. The study used both quantitative and qualitative techniques in analyzing the data. Descriptive analysis was employed; which include computation of medians and relative frequencies. Inferential statistics by way of ordinal logistic regression was performed to assess the relationship between the variables. Results indicate that only organization culture bore a positive relationship with strategy implementation although this relationship was not statistically valid. The main implication of the study, therefore, was that there is a need for further research on the peculiarities of operation within insurance companies in Kenya given that extant literature indicates a positive relationship between the factors resource allocation, leadership involvement, team involvement and the dependent variable strategy implementation.