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Effects of Strategic Outsourcing of Non-Core Business Units on Business Performance: A Case of Glaxosmithkline Limited in Kenya

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dc.contributor.author Rono, Abraham
dc.date.accessioned 2020-07-30T13:19:15Z
dc.date.available 2020-07-30T13:19:15Z
dc.date.issued 2020
dc.identifier.uri http://erepo.usiu.ac.ke/11732/5955
dc.description This Research Project Report Has Been Submitted To Chandaria School of Business in Partial Fulfilment of the Requirement for Masters’ Degree in Business Administration (MBA) en_US
dc.description.abstract The purpose of this study was to determine the effects of strategic outsourcing on non-core business units on business performance at GlaxoSmithKline Kenya. The following research questions were used to conduct this study; what is the effect of outsourcing human resource activities on business performance, what is the effect of outsourcing logistics on business performance and what is the relationship between outsourcing of non-core business units and business performance. This study made use of descriptive survey design on a population of 55 managers at GlaxoSmithKline Kenya. A structured questionnaire was deployed for primary data collection. A census was used in studying the entire population as the sample size for this particular study. Data analysis was made up of both descriptive statistics and correlation and regression analysis. Data was analyzed using Statistical Package for Social Sciences (SPSS) software version 24. Data was presented using tables and figures. The first research question sought to determine the effect of outsourcing human resource activities on business performance. The findings of this study revealed that there exists a significant relationship between human resource outsourcing and business performance, r (0.369); p-value < 0.01. This relationship is statistically significant. The second research question sought to determine the effect of logistics outsourcing on business performance at GlaxoSmithKline. The findings indicated a statistical significant relationship between logistics outsourcing and business performance r (0.484); p-value < 0.01. The relationship is statistically significant. The third research question sought to determine the relationship that exists between outsourcing and business performance. The findings revealed a strong and significant relationship was found to exist between outsourcing of non-core business units and business performance, r (0.767); p-value < 0.01. The relationship is statistically significant. This study concludes that outsourcing of human resource activities enhances business performance of an organization. This study also concludes that the urgency of accurately responding to the changes in the market on daily basis and the difficulties associated with predicting the direction of such kind of changes requires organizations to continuously focus on their core competencies and capabilities that will help them in addressing the changes taking place in the business environment effectively making outsourcing of human resource activities a paramount. This study concluded that logistics outsourcing enhances operational efficiency in the organization. Logistics outsourcing is one of the crucial sources of increasing the company’s business performance since it makes the company more nimble and permits it to the increased concentration on its core activities while leaving the non-core business units to the outside providers. This study concluded that there exists a significant relationship between outsourcing of non-core business units and business performance. Outsourcing of non-core business units can lead to improved performance such as shorter cycle time, high quality products, profitability and increased productivity within the firm as it allows the firm to focus on what they do best. This study recommended that GlaxoSmithKline should outsource entirely all activities concerning human resource to a third part company as opposed to only recruiting and payroll outsourcing. All activities concerning human resource ranging from recruiting, induction, compensation, training and development should all be outsourced. This will help the organization to focus more on its core activities to effectively meet the dynamic demands and competition pressures from other pharmaceutical firms. This study recommended that GlaxoSmithKline should reduce its overall costs through outsourcing logistics to a third party logistics providers that offer a better service that is in line with the company’s logistics needs. The company should also emphasize on improved customer focus by putting necessary measures that will enable them compete effectively in the market. Since, this study has established a significant relationship between outsourcing of non-core business units and business performance. Therefore, GlaxoSmithKline should put up various measures that will address a declining rate of innovation while at the same time enhancing motivation loss of employees in line with the outsourced services. GlaxoSmithKline should also identify qualified as well as reliable suppliers for them to clearly decide what activities should be outsourced and what should not en_US
dc.language.iso en en_US
dc.publisher United States International University- Africa en_US
dc.subject Kenya en_US
dc.subject Glaxosmithkline Limited en_US
dc.subject Business Performance: en_US
dc.subject Non-Core Business Units en_US
dc.subject Strategic Outsourcing en_US
dc.title Effects of Strategic Outsourcing of Non-Core Business Units on Business Performance: A Case of Glaxosmithkline Limited in Kenya en_US
dc.type Thesis en_US


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