INFLUENCE OF FUNDING DIVERSIFICATION ON THE PERFORMANCE OF PUBLIC UNIVERSITIES IN KENYA

Abstract

Funding diversification enhances the performance of public universities in Kenya by improving financial stability and overall institutional impact. Despite this critical role in education, research, and economic growth, public universities face challenges such as high employee turnover, low graduation rates, and declining teaching staff numbers. This research determined the influence of funding diversification strategies on university performance using resource dependence theory, contingency theory, innovation diffusion theory, and stakeholder theory. An explanatory research approach targeted 13,258 academic and administrative staff in 34 public universities, with purposive sampling selecting 136 key finance, ICT, academic, and research heads. Data was collected from both primary (semi-structured questionnaires) and secondary sources (university reports on graduation rates and publications). Analysis was conducted using SPSS version 25, applying both descriptive and inferential statistics. Results revealed that funding diversification positively influences university performance. The study recommends increased research grants, expanded consultancy services, and improved alumni development to enhance financial stability. Additionally, universities should prioritize online programs, energy resource efficiency, and optimal resource utilization to improve performance. Ethical research guidelines were strictly followed, ensuring informed consent, anonymity, and compliance with NACOSTI permits.