Effects of Outsourcing Support Services on Organizational Performance: The case of Iringa Urban Water Supply and Sanitation Authority (IRUWASA), Tanzania

Abstract

The purpose of the study was to assess the effects of outsourcing services on organisation performance at Iringa Urban Water Supply and Sanitation Authority (IRUWASA). Specifically, the study was guided by the following objectives: to assess the effect of outsourcing cleaning services on organisational performance, to investigate the effect of outsourced garbage collection services on organisational performance and to assess the effect of outsourced stationery outsourcing services on organisational performance at IRUWASA. The study adopted a cross-sectional research design, where data were collected at one point in time. The targeted population of this study were all employees (48) from IRUWASA. Descriptive statistics and regression analysis were used to analyse data. Major findings from the study showed that cleaning, garbage collection and stationery outsourced services positively impacted IRUWASA performance. The results also revealed that outsourcing resulted in cost savings in all three aspects of cleaning, garbage collection and stationery outsourcing of about Tsh. 12,309,000 (56.89%); 19,520,000 (55%) and 12,309,000 (36.73%) respectively. Results from correlation and multiple linear regression showed the adjusted R2 equals 0.640, implying that the model explains about 64% variations in organisation performance, while all the independent variables were found statistically and positively significant, influencing the dependent variable. The study concludes that outsourcing services improve organisational performance. The study recommends that the government and other institutions discern the potential benefits of outsourcing services in terms of cost-effectiveness, resource allocation, and the optimisation of core functions