International Journal of Economics, Commerce and Management

United Kingdom

Vol. V, Issue 1, January 2017

http://ijecm.co.uk/

ISSN 2348 0386

EFFECT OF SAFETY MANAGEMENT SYSTEM ON

PERFORMANCE OF KENYAN AVIATION FIRMS
Capt. Njeru Lukas Maina
Ph.D. Candidate, Department of Management Science, School of Business and Economics, Kenya
[email protected]

Abstract
The purpose of the study was to determine the effect of safety management systems and
performance of the aviation firms in Kenya. This paper is anchored on system theory and
adopted explanatory research design. Questionnaires were used to collect data from
50employees drawn form security departments in aviation firms in Nairobi Kenya. Findings
indicated that safety policy, safety risk management and safety promotion have a significant
effect on firms performance. However, safety assurance has no significant effect on firms
performance due minimal external audits. The study concluded that the existence as well as the
implementation of an effective safety policy improves performance of the firm especially in terms
of increased employees awareness which results in employees confidence and productivity.
The management of the firms should be encouraged to embrace aspects of safety policy and
safety promotion in order to assure firms performance improvement; more benefits of SMS can
be realized through safety assurance by encouraging external audits.
Keywords: Safety Policy, Safety Management Systems, Performance of Aviation Firms, Safety
Assurance, Safety Risk Management, Safety Promotion

INTRODUCTION
Airline businesses operate in an industry that employs a large number of personnel and which
requires huge amounts of infrastructure and aircraft investment. Therefore, the fixed costs of
airline companies are quite high (Morrell, 2007). In addition to these high fixed costs, they have
to operate in an intensely competitive environment where many airline businesses offer similar
services with minimal profit margins. Due to such a highly competitive environment, most

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operating airlines feel pressured to quickly respond to demands in order to survive (Doganis,
2002). Thus, performance management has become a vital issue for airline businesses, and the
need for safety management for future performance (Khim et al., 2010).
Safety in a firm is an integral part of the performance of any job that must not be forced
to compete with the profit motive and must receive constant attention (Benderly, 2013). Safety is
the state in which the risk of harm to persons or of property damage is reduced to, and
maintained at or below, an acceptable level through a continuing process of hazard
identification and risk management (Sutton, 2015). Although air transport is among the safest
means of transport, risk is a constant reality as is true of any human activity and in effect
aviation operations are prone to accidents (McFarlane & Hills, 2013). The global nature of the
aviation industry and the complex and dynamic aviation environment requires that aviation
regulators, air operators, and service providers cooperate to maintain a safe air transport
system (Dannatt, 2006).
In order to keep safety risks at acceptable level, modern safety management practices
are shifting from a purely reactive to a more proactive and predictive (Kjelln, 2012). Effective
safety requires adaptation, resulting into a safety management system (SMS) which focuses
corporate management activity on loss control as part of the normal line management function
(FAA, 2005). The safety management system is process-driven and proactive, and must be
infused into the management system of air operators for desired effect on safety
(Garland, 2011). According to ICAO (2006), SMS is an organized approach organizational
structures, accountabilities, policies and procedures to achieve safe operations and compliance
with the ICAO standards and regulations. SMS represents the next step in the evolution of
safety processes in the aviation industry worldwide, at the organisational level (Velazquez &
Bier, 2015). SMS complements the requirements and regulations in human or technical safety
already implemented during the past decades (Hollinger, 2013). SMS is the formal systemic and
pro-active approach to anticipating and managing safety risk, as well as to initiating and
achieving the necessary transformation of organisational structures, accountabilities, policies,
procedures, standard practices and regulations (Braband, 2011).
SMS is a structured process that requires organizations to apprehend possible safety
issues with the same level of priority that other core business topics are managed, and to
continuously analyze them, in conjunction with state institutions within their State Safety
Program (SSP), as well as with their industry counterparts (Pisarek, 2015). SMS is comprised of
four functional components, including an intangible, but always critical, aspect called safety
culture. SMS concepts, processes, methods and operational management, either cross-domain
or specific to the organizations, emphasize the necessity of enhancing or improving the

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organisation safety culture - the just culture, through a transformation of leadership,

management and employees attitudes (Crutchfield & Roughton, 2014).
One of the greatest challenges facing international civil aviation organization is ensuring
that all member states implement the set standards in a timely manner for uniform application,
in order to enhance global aviation safety (Chen, 2010).Despite the Kenyan government
recommending self-regulation of safety management systems (SMS) for Aviation industry with
the hope of improving the situation, the successful implementation is questionable.
Problem Formulation
The performance of the African aviation industry is still lagging behind those of the rest of the
world (African Development Bank AfDB, 2012). Air transportation in most Africa is almost nine
times more dangerous as compared to the global industry's average level(African Development
Bank AfDB, 2012).In addition, safety performance of the aviation industry in Kenya is
questionable which has resulted to safety deficiencies and maybe low performance of some of
the aviation firms in Kenya. Thus, this requires a robust safety management system that is
integrated into the overall strategic business objectives of an organization within an expanded
industrial business context that can anticipate changes in an operative environment while
balancing safety with economic goals (Di Gravio, Patriarca, Mancini &Costantino, 2016).
However, most studies in safety management have been conducted primarily on
implementation of SMS without a great deal of how SMS affect performance of aviation firms
(Snook, 2002; Gehman, 2003; Johnson, 2004). Moreover, Studies that have been done locally
include Njeru (2016) who examined the determinants of aviation training performance, case of
Kenya aviation training institutes, Mokaya and Nyaga (2009) assessed the factors that affect the
successful implementation of safety management systems (SMS) in the Aviation industry in
Kenya while Mokaya, Chocho and Kosgey (2009) sought to assess the performance of the
aviation regulatory system in Kenya with specific reference to the Kenya Civil Aviation Authority,
no study in Kenya has been carried out to the researchers knowledge, to assess the
relationship between safety policy, risk management, safety assurance and safety promotion
and performance of the aviation firms in Kenya. It is against this background that this study
sought to highlight pertinent issues influencing the relationship between safety management
systems and performance of the aviation firms in Kenya. The study hypotheses that:
H01:

Safety policy has no significant effect on performance of the aviation firms

H02:

Safety risk management has no significant effect on performance of the aviation firms

H03:

Safety assurance has no significant effect on performance of the aviation firms

H04:

Safety promotion has no significant effect on performance of the aviation firms

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THEORETICAL FRAMEWORKS
This paper is anchored on system theory by Ludwig von Bertalanffy. Systems theory has been
proposed as a way to understand accident causation (Rasmussen, 1997; Nancy, 2004).
Systems theory dates from the thirties and forties and was a response to the limitations of
classic analysis techniques in coping with the increasingly complex systems being built
(Checkland, 1981). The systems approach focuses on systems taken as a whole, not on the
parts taken separately. It assumes that some properties of systems can only be treated
adequately in their entirety, taking into account all facets and relating the social to the technical
aspects (Ramo, 1973). These system properties derive from the relationships between the parts
of systems: how the parts interact and fit together (Leveson, 2004). Thus, the systems approach
concentrates on the analysis and design of the whole as distinct from the components or the
parts. In systems theory, open systems are viewed as interrelated components that are kept in a
state of dynamic equilibrium by feedback loops of information and control. Systems are not
treated as a static design, but as a dynamic process that is continually adapting to achieve its
ends and to react to changes in itself and its environment. For safety, the original design must
not only enforce appropriate constraints on behavior to ensure safe operation (the enforcement
of the safety constraints), but it must continue to operate safely as changes and adaptations
occur over time.

LITERATURE REVIEW
Safety Policy
The policy statement describes in detail the operation of the entire organization and includes the
roles, responsibilities and relationships between all individuals involved in the organization. It
specifically includes the involvement of top management which is a key component to the
success of SMS (Tzempelikos, 2015). Furthermore, the policy statement defines the procedural
framework, which describes the responsibilities of all departments, including the training,
processes measurement and the change in the system, if there should be one
(Tzempelikos&Gounaris, 2015).
The organizational structure is the next element of the Safety Policy pillar which allows
for the company to clearly see the responsibilities of fellow employees. The organizational
structure is a part of SMS because it is needed in order for employees to follow the proper
procedures for the organization (O'Toole, 2012). The procedure element of the Safety Policy
pillar describes the way hazards are identified and mitigated. Should an accident or incident
occur, this section discusses the proper protocol during that time (Pawowska, 2015). The
procedure element further defines who to contact, the order in which people are contacted, and

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are readily available to any person. Beach (2000), also revealed that management's
commitment to safety is a major factor affecting the success of safety programmes in industries
and this parameter is capable of discriminating between high and low accident rate
organisations.

Safety Risk Management

The third pillar in SMS is Safety Risk Management (SRM). The SRM pillar describes operation
processes across all departments and agency boundaries, identifies key performance indicators
and regularly measures them, methodically assesses risk, and exercises controls to mitigate
that risk. The concept of risk management is about understanding the operational systems
(Hwang, 2011). The SRM pillar analyzes systems, identifies risks, and conducts a risk analysis
and hazard assessments. It further involves risk acceptance, causal analysis, controlling those
risks and system operation (Lachlan & Spence, 2010).
The first element of the Safety Risk Management Pillar is hazard identification. This pillar
allows for one to really dig deep and take a hard look at the hazards that the firm faces (Ericson,
2011). Often times it is hard for people to do this without being biased. The firm should have
an external source perform an audit on the firm. The next step after all hazards are identified is
to conduct a risk assessment. In an SMS, all identified hazards are documented and analyzed
to determine what action is required to eliminate or reduce the safety risk assessment
associated with the hazard, (Beguera, 2006). The final element of the third pillar in SRM is risk
mitigation and tracking. When a hazard is identified and mitigated, that hazard should be
thoroughly analyzed to ensure that the reason it was mitigated was in fact the cause of the
hazard. This process is completed through a system that allows one to neutralize any risk that
allows for a safe operation (Abu el Ata &Schmandt, 2016).
Safety Assurance
Safety Assurance is the fourth pillar of Safety Management Systems and is defined as process
management

functions

that

systematically

provide

confidence

that

organizational

products/services meet or exceed safety requirements (Federal Aviation Administration, 2012).

Fundamentally, it gives the organization assurance that what they are doing to identify, mitigate
and track hazards are actually working. Safety Assurance consists of three elements: internal
audits, external audits and corrective action (Stolzer, Halford&Goglia, 2011).
The first element of the Safety Assurance pillar is internal audits. It is important to note
that not only should internal audits be conducted but external audits should be conducted as
well (Transportation Research Board, 2012). The safety auditor should conduct both formal and

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informal audits across all departments. These audits should be conducted on a regular basis
and should include both scheduled, and non-scheduled audits (National Archives and Records
Administration, 2012). Internal Audits allow for the firm to use their own employees to complete
an audit. This cannot only has positive effects, but negative as well. One of the positive,
includes being familiar with the policies and procedures of the Firms, which then allows the
person to quickly identify the hazards (Stolzer, Halford&Goglia, 2011). A negative effect is that
the person could be biased and overlook issues to avoid causing trouble, or simply be used
to seeing the hazard and not identify it as a discrete cause. Therefore, external audits should be
completed, which is the second element in the Safety Assurance pillar.
External Audits mimic those of Internal Audits but have one difference; these audits must
be completed by an external independent agency. This allows for the unbiased approach to
identifying risks, but is also at the expense of the firm (Gingerich, 2010). Firms do not like to use
this option because independent agencies often see other issues that the firm previously did not
recognize. The third and final element of the Safety Assurance pillar is Corrective Action, which
is the consequences bearing element. This pillars ensures they incur the proper penalties
be enforced. The Corrective Action element is further used ensure that hazards are actually
being addressed (LaFreniere, 2013).
Safety Promotion
Safety Promotion, as defined by the FAA (2007) is a combination of safety culture, training, and
data sharing activities that supports the implementation and operation of an SMS in an
organization. Safety Promotion consists of culture, training and communication. SMS should
not only be the priority of management, but all employees (Transportation Research Board,
2007). Therefore, it is top managements responsibility to not only release a policy statement
advising the organization of their commitment to safety but they must also be proactively
engaging themselves as well (Spencer, Adams &Yapa, 2013). It is imperative for top
management to remain and exhibit a positive attitude about SMS. They must not only be on
board in the beginning, but also remain committed because they are the fundamental and
necessary requirement of building a positive safety culture.
The Safety Promotion pillar is about fostering that safety culture, which has proven to be
one of the most difficult and challenging aspects of the entire SMS process (Stolzeret al, 2008).
Safety culture is the first element under the safety promotion pillar. Having management
involved gives the employees assurance that they need and seek (Stolzeret al, 2008). This is
where communication is vital, which is another part of the safety promotion pillar. Training is the
second element of Safety Promotion which allows for the organization to properly demonstrate

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SMS. After promoting a positive safety culture, the next step is to properly train all employees
on the policies of the organization, the procedures on how to respond to certain situations and
to discuss their roles and responsibilities and how it relates to SMS (Daalmans, 2013). It is
important to note that training not only occurs as part of implementation training, but it also
involves recurrent training.
In addition to written communication, it is important for employees to witness evidence of
the commitment of top management to safety, (Transportation Research Board, 2012). The
communication process allows for identifying what went wrong, how issues can be fixed, and
what lesson each member of the team can take away to ensure that the lessons learned will not
recur. Communication must be open and employees must feel like they are contributing to the
operation because information has no value unless employees learn from it (Krasman, 2015).
The Safety Promotion pillar is the foundation of SMS because each element affects the
other profoundly; without having a solid foundation SMS will not be successful (Kppler et al.,
2014). Often companies already have their policies, procedures, and organizational structure,
so all they need to do is revamp and put these in one location, creating a safety manual. But
actually properly training and communicating with all employees can be difficult. If this pillar is
not at its best, then the success of SMS at that organization is jeopardized. An organization
must have the best possible safety manual, training, and communication.

RESEARCH METHOD
The study adopted Explanatory research design. A census survey was utilized to select the
target respondents for the study. Questionnaires were used to collect data from 50employees
drawn form security departments in aviation firms in Nairobi Kenya. Reliability assessment of
internal consistency of the items was determined using Cronbach alpha coefficient. According to
(Sekeran, 2003; Ventura et al.,2013; Waithaka et al.,2014; Cooper & Schindler, 2001), the
general reliability coefficients around 0.9, was considered excellent, values around 0.8 as very
good and values around 0.7 as adequate (Nunnally,1978).Quantitative data was analyzed using
descriptive statistical method; the statistical tools such as mean, mode and standard deviation
were used. Inferential statistic such as Pearson correlation coefficients r and multiple regression
models were used. Multiple regression analysis was employed to test the hypotheses.
= + 1 1 + 2 2 + 3 3 + 4 4 +
Where, was the intercept
1 4 are regressions coefficients
Y= firm Performance.x1 =Safety promotion,x2 =Safety risk,x3 =Safety assurance, x4 =Safety policy

= Error Term

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ANALYSIS AND FINDINGS

Descriptive statistics and Factor analysis results
This section of the analysis focused descriptive statistics of the study item and factor loadings
together with reliability results.

Table 1: Firm Performance

Statements

Mean

Std. Deviation

Loadings

Cronbach

Growth in sales in relation to your expectations

4.02

0.553

0.728

0.899

Growth in sales in relation to your competitors

4.18

0.661

0.899

Growth in profits in relation to your expectations

4.04

0.570

0.877

Competitors

4.02

0.622

0.851

Increase in number of employees

4.12

0.718

0.661

4.18

0.691

0.904

your Competitors

4.30

0.789

0.735

Growth in capital from operations

4.22

0.679

0.948

Improvement in efficiency

3.94

0.550

0.691

High level of new customers

4.16

0.650

0.908

Growth in

profit level in relation to your

Increased market size in new markets in relation to

your
Increased market size in new markets in relation to

KMO and Bartlett's Test

Kaiser-Meyer-Olkin Measure of Sampling Adequacy.

0.573
744.7
12.00

Bartlett's Test of Sphericity, Approx. Chi-Square

df

45

Sig.

0.000

Rotation Method: Varimax with Kaiser Normalization.

As evidenced in Table 1, all the means were above 3.5 indicating all respondents agreed on the
elements of performance. Hence, there was high performance. The highest indicator of firm
performance was in relation to the growth in sales in relation to your expectations and increased
market size in new markets in relation to the firm (mean = 4.18 respectively) while the lowest
was improvement in efficiency (mean = 3.94). A Cronbach alpha which is a measure of internal
consistency reliability was computed for each scale of the instrument separately and the value
of 0.899 was found to be favorable. The Kaiser-Meyer-Olkin (KMO) measure of sampling

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adequacy and the Bartletts test of Sphericity were computed. KMO measure was 0.573. KMO
measure of 0 indicates that the sum of partial correlations is large relative to the sum of
correlations. Values greater than 0.5 are deemed acceptable and hence the value of 0.573 is
acceptable. The Bartletts test of Sphericity showed a chi-square value of 2.000 which was
significant, p-value = 0.000 (df = 45). The significant test value indicated that the correlation
matrix is not an identity matrix which implies that there are some relationships between
variables and factor analysis was appropriate in this case.
Table 2 presented the results regarding the factor loadings as well as the consistency of
the data and the test for sampling adequacy and Sphericity regarding safety policy.

Table 2: Safety Policy

Statements

Mean

Std. Deviation

Loading Cronbach

High ability to develop new products

3.66

0.626

0.865

The firm has an Emergency Response Plan

3.94

0.682

0.856

The firms safety management policy is transparent

3.58

0.499

0.876

The firm management is committed to the safety program

3.50

0.580

0.899

The firm management policy is easily understood

3.62

0.635

0.656

The firms safety policy is approved by authorities

3.50

0.580

0.891

The safety objectives are well spelt out

4.06

0.767

0.860

The firm has a clear SMS implementation plan

3.60

0.535

0.673

The firm has a supportive organization structure

4.06

0.793

0.802

0.744

KMO and Bartlett's Test

Kaiser-Meyer-Olkin Measure of Sampling Adequacy.

0.589

Bartlett's Test of Sphericity, Approx. Chi-Square

543.637

df

36

Sig.

0.000

Rotation Method: Varimax with Kaiser Normalization.

The findings in Table 2 revealed that all the means were 3.5 and above with the lowest mean
shown to be related to the firm management is committed to the safety program and the firms
safety policy is approved by authorities and the highest mean regarding safety objectives being
well spelt out and the firm having a supportive organization structure (mean = 4.06). A
Cronbach alpha value of 0.744 was found to be favorable and can be concluded that data
gathered were reliable and have obtained the acceptable level of internal consistency.
The Kaiser-Meyer-Olkin (KMO) measure of sampling adequacy and the Bartletts test of
Sphericity were computed. The KMO measure of sampling adequacy was 0.589 and was found

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to be acceptable while the Bartletts test of Sphericity showed a chi-square value of 543.637
which was significant, p-value = 0.000 (df = 36). All the factor loading values were greater than
0.800 except for firm management policy is easily understood item and the firm has a clear SMS
implementation plan item.
Table 3 presented the results regarding the factor loadings as well as the consistency of
the data and the test for sampling adequacy and Sphericity regarding safety risk assessment.

Table 3: Safety Risk Assessment

Statements

Mean

Std. Deviation

Loadings

Cronbach

The firm has a highly qualified risk assessment process

3.40

0.495

0.727

0.748

The firm has a hazard identification process

4.02

0.553

0.893

The firm has risk control measures

3.46

0.503

0.702

The firm carries out a thorough risk analysis

3.84

0.650

0.837

The firm has a comprehensive Correction Action Plan

3.72

0.497

0.684

The firm maintains a Hazard Log

3.94

0.712

0.901

The firm encourages accident/incident reporting

3.92

0.665

0.936

Event investigation is adequate

3.96

0.832

0.720

The firm has a confidential reporting system

3.86

0.700

0.751

The firm has an on-going hazard identification program

3.98

0.553

0.874

KMO and Bartlett's Test

Kaiser-Meyer-Olkin Measure of Sampling Adequacy.

0.792

Bartlett's Test of Sphericity, Approx. Chi-Square

486.732
df

45

Sig.

0.000

Rotation Method: Varimax with Kaiser Normalization.

The findings in Table 3 showed that all the means were above 3.5 except for the firm has risk
control measures (mean = 3.46) and the firm has a highly qualified risk assessment process
(mean = 3.40) items. The highest mean was found for the firm has a hazard identification
process item. In addition, a Cronbach alpha value of 0.748 was found to be favorable and thus it
can be concluded that data gathered were reliable and have obtained the acceptable level of
internal consistency.
The findings also showed results relating to the Kaiser-Meyer-Olkin (KMO) measure of
sampling adequacy and the Bartletts test of Sphericity. From the findings, a KMO measure of
sampling adequacy was 0.792 and was found to be acceptable while the Bartletts test of
Sphericity showed a chi-square value of 486.732 which was significant, p-value = 0.000 (df =

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45). The highest factor loadings were for the firm encourages accident/ incident reporting and
the firm maintains a hazard log items.
Table 4 presented the results regarding the factor loadings as well as the consistency of
the data and the test for sampling adequacy and Sphericity regarding safety assurance.

Table 4: Safety assurance

Statements

Mean

Std. Deviation

Loadings

Cronbach

The firm is committed to implement corrective action

3.52

0.505

0.786

0.911

The firms safety performance is reliable

3.86

0.670

0.857

The firm complies with standards and recommended practices

3.46

0.542

0.890

The firms SMS management is functional

3.82

0.691

0.707

The firm conducts internal safety audits

3.80

0.639

0.937

The safety audits are documented

3.98

0.795

0.908

Safety review is communicated to the top management

3.82

0.629

0.915

External audit is carried out

3.96

0.781

0.862

Change management assures safety

3.70

0.789

0.657

The firm seeks continuous safety improvement

3.94

0.793

0.893

KMO and Bartlett's Test

Kaiser-Meyer-Olkin Measure of Sampling Adequacy.

0.755

Bartlett's Test of Sphericity, Approx. Chi-Square

756.453
df

45

Sig.

0.000

The findings in Table 4 revealed that all the means were above 3.5 except for the firm complies
with standards and recommended practices (mean = 3.46) item. The highest mean was found
for the safety audits are documented (mean = 3.98), the external audit is carried out (mean =
3.96) and the firm seeks continuous safety improvement (mean = 3.94) items. In addition,
Cronbach alpha values of 0.911 was found to be favorable and showed that the data gathered
were reliable and have obtained the acceptable level of internal consistency.
The findings also showed results relating to the Kaiser-Meyer-Olkin (KMO) measure of
sampling adequacy and the Bartletts test of Sphericity. From the findings, a KMO measure of
sampling adequacy was 0.755 and was found to be acceptable while the Bartletts test of
Sphericity showed a chi-square value of 756.453 which was significant, p-value = 0.000 (df =
45). The highest factor loadings were for the firm conducts internal safety audits and the safety
review is communicated to the top management items.

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Finally, Table 5 presented the results regarding the factor loadings as well as the consistency of
the data and the test for sampling adequacy and Sphericity regarding safety promotion.

Table 5: Safety promotion

Statements

Mean

Std. Deviation

Loadings

Cronbach

The firm provide safety training to it employees

3.76

0.744

0.821

0.801

The firm advocates for a positive safety culture

4.04

0.947

0.878

The firm offers safety training measures to its customer

3.78

0.648

0.792

The firm assures safety communication to all employees

3.96

0.781

0.876

The firm promotes a positive safety culture

3.98

0.769

0.896

The firm distributes safety lessons learnt

4.00

0.571

0.830

New employees are trained sufficiently prior to work

3.74

0.527

0.676

Employees are given adequate training in SMS policy

3.92

0.829

0.859

The firm encourages employees to attend safety seminars

3.76

0.687

0.774

The firm keeps staff training records

4.14

0.639

0.921

Safety Promotion

3.91

0.599

KMO and Bartlett's Test

Kaiser-Meyer-Olkin Measure of Sampling Adequacy.

0.730

Bartlett's Test of Sphericity, Approx. Chi-Square

703.235
df

45

Sig.

0.000

The results in Table 5 revealed that all the means were above 3.5 for all the items with the
highest mean for the firm keeps staff training records (mean = 4.14) item. In addition, Cronbach
alpha value of 0.801 was found to be favorable and showed that the data gathered were reliable
and has obtained the acceptable level of internal consistency.
The findings also showed results relating to the Kaiser-Meyer-Olkin (KMO) measure of
sampling adequacy and the Bartletts test of Sphericity. From the findings, a KMO measure of
sampling adequacy was 0.730 and was found to be acceptable while the Bartletts test of
Sphericity showed a chi-square value of 703.235 which was significant, p-value = 0.000 (df =
45). The highest factor loadings were for the firm keeps staff training records item.
Table 6 illustrates the findings of the regression model and the model summary of
multiple regression model.

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Table 6: Regression model results

Unstandardized

Standardized

Coefficients

Coefficients

Std. Error

(Constant)

-0.284

0.249

Safety Policy

0.533

0.073

Safety risk
management

0.328

Safety assurance
Safety promotion

Beta

Collinearity
Correlation

Sig.

-1.144

0.259

0.529

7.336

0.085

0.305

0.020

0.084

0.279

0.081

Statistics

Zero-order

Tolerance

VIF

0.000

0.709

0.513

1.950

3.878

0.000

0.716

0.431

2.319

0.023

0.241

0.811

0.518

0.293

3.409

0.327

3.445

0.001

0.582

0.297

3.370

summary statistics
R

0.938a

R Square

0.880

Adjusted R Square

0.869

Durbin-Watson

1.771

82.345

Sig.

0.000b

a Dependent Variable: firm performance

The results showed that all the four predictors (safety policy, safety risk management, safety
assurance and safety promotion) explained 88.0% variation of firm performance. This showed
that considering the four independent variables, there is a probability of predicting form
performance by 88.0% (R squared =0.880, adjusted R-square = 0.869).
Multiple regression analysis was conducted so as to determine the relationship between
firm performance and the four independent variables. The findings of the multiple regression
analysis were presented in relation to the stated hypothesis. The tolerance levels do not exceed
the rule of thumb of 1.0 as well as the VIF which do not exceed the rule of thumb value of 10.
This means the hypothesis of the absence of multicollinearity is not rejected.
The regression equation was;
Firm performance = 0.529Safety Policy + 0.305 Safety Risk Managemtn + 0.327Safety Promotion
H01: Safety policy has no significant effect on performance of the aviation firms
The first hypothesis stated that safety policy has no significant effect on performance of the
aviation firms. Findings in Table 6 showed that safety policy had an estimated coefficient (0.529,
standardized coefficient), p-value = 0.000 which indicated that it was significant and carried the

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largest significant effect with a correlation of 0.709. This implied that the null hypothesis was
rejected and it was concluded that safety policy has a significant effect on firm performance.
This suggested that there was up to 0.529 unit increase in firm performance for each unit
increase in safety policy. The effect of safety policy was more than 7 times the effect attributed
to the error, this was indicated by the t-test value = 7.336.The findings are in line with OToole
(2012) and Pawlowska (2015) who highlight importance of various aspects of safety policy
especially their effect on the employees and how this would influence the performance of the
organization and in general, safety policy, with its various aspects has a positive influence on
the performance of the firm.

H02: Safety risk management has no significant effect on performance of the aviation firms
The second hypothesis stated that safety risk management has no significant effect on
performance of the aviation firms. The findings in Table 6 showed that safety risk management
had an estimated coefficient (0.305, standardized coefficient), p-value = 0.000 which indicated
that it was significant with a correlation of 0.716. This implied that the null hypothesis was
rejected and it was concluded that safety risk management has a significant effect on firm
performance. This suggested that there was up to 0.305 unit increase in firm performance for
each unit increase in safety risk management. The effect of safety risk management was more
than 3 times the effect attributed to the error, this was indicated by the t-test value = 3.878.
Based on these findings, Hwang (2011) point out that the concept of risk management is about
understanding the operational systems. Furthermore, the positive effect of safety risk
management is highlighted by Beguera (2006) who notes that it allows for the elimination or
reduction of the risk while Abu el Ata &Schmandt (2016) note that such a system where there is
proper attention given to safety risk management, allows one to neutralize any risk that allows
for a safe operation.

H03: Safety assurance has no significant effect on performance of the aviation firms
The third hypothesis stated that safety assurance has no significant effect on performance of
the aviation firms. The findings in Table 6 showed that safety risk management had an
estimated coefficient (0.023, standardized coefficient), p-value = 0.811 which indicated that it
was not significant with a correlation of 0.518. This implied that the null hypothesis was not
rejected and it was concluded that safety assurance has no significant effect on firm
performance. This suggested that although there was up to 0.023 unit increase in firm
performance for each unit increase in safety assurance, this effect was not significant. The
effect of safety risk management was more less 0.5 as indicated by the t-test value = 0.241.

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Safety assurance is implemented through audits and the Transportation Research Board (2012)
notes that not only should internal audits be conducted but external audits should be conducted
as well. The findings have shown that safety assurance has no significant effect on firm
performance which ideally indicates that there are aspects of audits that are overlooked such as
external audits and Gingerich (2010) notes that external audits allow for the unbiased approach
to identifying risks, but is also at the expense of the firm and as such firms do not like to use this
option because independent agencies often see other issues that the firm previously did not
recognize and thus avoid this pillar. Thus, effect of safety assurance is not significant.

H04: Safety promotion has no significant effect on performance of the aviation firms
The fourth hypothesis stated that safety promotion has no significant effect on performance of
the aviation firms. The findings in Table 6 showed that safety risk management had an
estimated coefficient (0.327, standardized coefficient), p-value = 0.001which indicated that it
was significant with a correlation of 0.582. This implied that the null hypothesis was rejected and
it was concluded that safety promotion has a significant effect on firm performance. This
suggested that there was up to 0.327 unit increase in firm performance for each unit increase in
safety promotion. The effect of safety risk management was more less 3 times the effect
attributed to the error as indicated by the t-test value = 3.445. In line with these findings,
Kppler et al, (2014)noted that without a solid foundation SMS will not be successful. As such,
an organization must have the best possible safety manual, training, and communication.
CONCLUSION
From the findings, the safety policy carries the most significant and positive effect on firm
performance with an effect size exceeding 7 units compared to the residuals. This indicated that
the existence as well as the implementation of an effective safety policy increases the
performance of the firm especially in terms of the increased awareness of the employees of the
policy which results in the employees being more confident at work and eventually increasing
their level of performance.
Furthermore, the findings have revealed that safety risk management has a significant
and positive effect on firms performance and was the third most influential variable. This aspect
allows for the elimination or even reduction of the risk since any risk is neutralized allowing the
workforce to work in a safe environment which results in increased levels of performance which
positively affects the overall firms performance.
The findings have also revealed that the pillars of safety assurance are not utilized fully
by the firms with absence of external auditing as a result of the related costs, hence safety

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assurance was found to have no significant effect on firms performance. Finally, safety
promotion through the availability of safety manuals, training of the workforce and effective
communication of the same to the workforce has the second most significant influence on firms
performance; the absence of safety promotion means that the firm will not be successful.
The study limited to only four dimensions of Safety Management System (safety policy,
safety risk management, safety assurance and safety promotion). Thus, future study should
explore more dimensions of Safety Management System. The study had small sample size of
50 employees from security departments in aviation firms in Nairobi Kenya
RECOMMENDATIONS
Investing on having a better foundation for safety risk management and safety promotion by
utilizing various elements of these pillars would have an increased effect on firm performance.
Furthermore, the management of the firms should be encouraged to embrace aspects of safety
assurance such as external auditing in cost effective ways in order to ensure that the positive
effects are tapped and utilized in improving the performance of the firm. Furthermore, the
involvement of the workforce in the structuring and implementation of the safety policy as well
as the pillars of safety risk management, safety assurance and safety promotion is critical
towards the realization of the positives on the success of the firm.

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