Effect of Employee Engagement on Performance of Small and Medium Size Enterprises in Mombasa County, Kenya

In today’s global environment one of the major challenges is having engaged workforce in an organization. The workforce is one of the organization’s greatest assets. Employee engagement is the process of keeping employees engaged in the organization. It is one of the key fundamentals of making an organization competitive. The main objective of this study was to investigate the effect of employee engagement on performance of small and medium organizations in Mombasa County, Kenya. A positivist paradigm using descriptive research design was used. Stratified random sampling technique was used to interview respondents. The study sampled a total of 105 small and medium enterprises operators. A questionnaire with Likert-type interval scale anchored on a 5-point scale was used to collect data. Hypotheses were tested using Pearson’s product moment and multiple regression. Findings of the study indicated that most of the small and medium enterprises (SMEs) have not embraced the concept of employee engagement. Nonetheless they have awareness of the practices that employees desired which would give them competitive edge. It is of necessity that the SMEs operators be trained on best practices and also benchmark within their industry subsectors so as to be able to initiate and embrace employee engagement. At start-ups and early stages of business growth, there is minimal investment in human resources which results in haphazard recruitment of family members who are sometimes are neither qualified nor trained and not engaged.  Consequently, the staff underperforms, a lot of infighting and conflicts in families and relatives, leading to strained family relationships and high labour turnover which in turn affects performance. The study recommended a deliberate action be taken by the management to embrace employee engagement concept for their organizations to be competitive. Implications of the study are that adopting employee engagement empowers employees which results in increased performance in organizations. The study also contributes to the literature that seeks to develop theory emphasizing the importance of embracing employee engagement notion as an important human resource concept.