ABSTRACT
Strategic leadership globally, regionally and locally is increasingly and becoming a crucial issue
that most organizations are facing today. Kenyans need an adequate, efficient, readily available
and affordable public transport. Matatu industry is Kenya’s leading mode of public transport with
over 170 registered Sacco’s. The Sacco’s experiences poor performance including de-registration
due to non-compliance, loss of fleets to other Sacco’s, frequent accidents attributed to careless
driving, poor working condition for employees and poor customer services may be attributed to
leadership of the Saccos. Prior research had focused on factors affecting performance of Matatu
Sacco and has focused on Nairobi County but none has studied the effect of strategic leadership
on performance of Matatu Saccos.Although Several studies in different organizational settings
found that there is a significant positive relationship between leadership styles and organizational
performance positively contributing to organizational performance over and above the
contribution made by other variables. The aim of this study was to determine effective strategic
leadership on the performance of Matatu Sacco in Kisumu County, Kenya. The objective of the
study was to establish the effect of strategic direction, management competencies and
organizational culture on performance of Matatu Sacco in Kisumu County, Kenya. The study
adopted correlation research design to determine the effect of strategic leadership on the
performance of Matatu Sacco in Kisumu County, Kenya. Theories that were adopted to inform the
study include; Behavioral–authoritarian leadership, and transformational leadership Theory. The
study adopted a census approach during data collection where information was collected from 300
employees including Sacco manager, driver’s conductors and other office staff working in 18
registered Matatu Saccos operating in Kisumu County, Kenya was included. Pilot test was done
with a small representative sample of 5 respondents. Primary data was collected using
questionnaires. Stratified Random Sampling technique and primary data collections methods were
used to conduct the study. Validity of the research instruments using explanatory factor analysis
found a high construct validity in all the variable since all exceeded the prescribed threshold of
0.40.Cronbach’s Alpha exceeded the prescribed threshold of 0.7.Correlation analysis method were
used to find out the statistical relationship between variables of the study. Before conducting
regression analysis diagnostic tests which include normality, autocorrelation and sampling
adequacy were conducted. The data was analyzed and presented in the form of tables. The study
revealed the significance values of the three variables of the study. The study found that
management monitored progress towards goal and vision achievement, that their organization had
a vision which was their focus of and that management inspires employees to strive for
organization vision. The strategic direction was the most reliable with an alpha value of (0.854),
followed by organization culture with an alpha value of (0.716) and Management competencies
was the least reliable with an alpha value of (0.728). Overall, the strategic direction –vision had
the greatest effect on performance of Matatu Saccos in Kisumu County, Kenya followed by
organisation culture while management competencies had the least effect on performance of
Matatu Saccos in Kisumu County, Kenya. The study recommends that SACCO members should
elect people with managerial competence to manage their SACCOs.
