Quality Management Practices and Operational Performance of Insurance Companies in Kenya

To establish how operational performance of insurance companies was affected by quality \nmanagement was the main objective of this study. Specifically, the study sought to establish the \nquality management practices adopted by insurance companies in Kenya; the quality management \nchallenges faced by insurance companies in Kenya and the relationship between quality \nmanagement practices adopted and the operational performance of insurance companies in Kenya. \nAnalyzing of the data with the aid of SPSS was done using descriptive statistics and inferential \nstatistics. The study concludes that insurance companies have implemented quality management \npractices (top management support, strategic planning, process management, supplier \nmanagement, and customer focus and employee involvement) to a great extent. The most \nimplemented practices were customer focus, top management support, supplier management and \nemployee involvement where they were all implemented to a great extent. The study also \nconcludes there exists a strong link (R-value = 0.602) between quality management practices and \noperational performance of insurance firms with quality management practices being able to \nexplain 36.2% of the total variance in the operational performance of insurance firms. All the \nquality management practices (top management support, strategic planning, supplier management, \nprocess management, and customer focus and employee involvement) were found to have a \npositive effect on the operational performance of insurance firms. The study further concluded that \ninsurance companies face challenges when implementing quality management practices to a \nmoderate extent. The challenges faced often by the insurance firms are resistance to change by the \nstaff; lack of adequate experience in implementation and inadequate implementation personnel \nwhile the less often faced challenges were inadequate leadership and direction from managers; \nlack of understanding of the strategy by implementers and absence of the appropriate structures. \nThe study makes the following recommendations. The management of the insurance firms should \ninvolve the employees in identifying the best practices to adopt in order to reduce resistance to \nchange by staff. The insurance firms should also hire qualified staff that has the requisite expertise \nand experience in implementing quality management practices. Most respondents were reluctant \nin filling the questionnaires. They feared that the information sought through the questionnaires \nwould be used against them. The scope of “this study was limited to the effect of quality \nmanagement practices on the operational performance of insurance companies. This implies that \nthe findings cannot be adequately applied to non-insurance firms. In future, a similar study should \nbe done considering non-insurance firms such as commercial banks in order to establish how \nimplementation of quality management practices affects their operational performance.