Access to safe sanitation and water services for all is a human right that is anticipated under the UN Sustainable Development Goals (SDGs). Despite extensive government interventions to improve the water and sanitation sector efficiency, a very large portion of the population still lacks adequate access to these services. This study aimed to evaluate the dynamic environmental scanning approaches and economic efficiency of water service providers (WSPs) in Kenya. Specifically, it explored the effect of dynamic environmental scanning on economic efficiency of WSPs. It was anchored on Lewin’s Change Management theory and Systems theory. A descriptive research design was employed, focusing on a census of all the 88 regulated WSPs in Kenya. Collection of data was carried out using closed ended questionnaires, supplemented with secondary data. It focused on data for five financial years from 2019/20 to 2023/24. It obtained a response rate of 89.9%. Descriptive statistics was used to give an outline of the dataset. Hypothesis testing was conducted through inferential statistics to generate conclusions that addressed the objective of the study. Microsoft Excel, python libraries and SPSS version 29 were used in the creation of insightful diagrams, charts, graphs and tables. The findings provided valuable insights for WSPs management, regulatory bodies and policymakers in enhancing water and sanitation services. By addressing this objective, the study strived to facilitate positive change management and advancement in the sanitation and water sector, ultimately benefiting communities within Kenya.