Effect of Environmental Sensing on Organizational Performance of Non-Commercial State Agencies in Kenya

This study is grounded in the Strategic Agility Framework and examined the effect of environmental sensing on organizational performance in non-commercial state agencies in Kenya, as well as the moderating role of the institutional framework. Drawing on Organizational Information Processing Theory, Institutional Theory, and Public Value Theory, the study investigated how policy shift tracking, stakeholder feedback systems, and real-time crisis sensing influence service delivery effectiveness, operational and cost efficiency, and public value creation. The study adopted a pragmatism philosophy and a mixed methods explanatory design with a predominantly quantitative approach, undertaking a census of 131 non-commercial state agencies. The respondents comprised Chief Executive Officers, Directors, Heads of Departments, and senior managers responsible for strategic planning, operations, and organizational performance. Data were collected through semi-structured questionnaires and secondary sources, while a pilot study involving 14 agencies established instrument validity and reliability. Common Method Variance was assessed using Harman’s single-factor test, which confirmed that common method bias was not a significant concern. The findings revealed that environmental sensing significantly improves organizational performance, with policy shift tracking emerging as the strongest sensing capability, while stakeholder feedback systems and real-time crisis sensing remained only moderately developed due to fragmented information systems and limited digital integration. The study further established that the institutional framework significantly strengthens the relationship between environmental sensing and organizational performance, with supportive governance structures, policy alignment, and accountability mechanisms enhancing performance outcomes. The study concludes that environmental sensing is a critical driver of organizational performance in non-commercial state agencies, but its effectiveness depends on enabling institutional conditions that facilitate information utilization, coordination, and responsiveness. The study recommends strengthening digital sensing systems, improving feedback-to-action mechanisms, enhancing inter-agency coordination, and undertaking institutional reforms that promote flexibility and evidence-based decision-making in the public sector.