Strategy implementation has gained attention in the strategic thinking with enterprises investing heavily on management consultants who can craft executable strategies that will translate into superior performance. Researchers and practitioners alike have realized that impressive strategic plans that have been launched in a flamboyant manner very often do not decipher into brilliant performance. State corporations in Kenya struggle with implementing the strategies set and fall short of attaining the desirable performance, if anything they are net drain on the exchequer where the national government has had to bail them out. This explains why in the modern-day world, public management attention has increasingly focused on organizational capabilities as a key strategy implementation dimension and their effect on organizational performance. Therefore, the purpose of the study was to investigate the contribution of organizational capabilities as key strategy implementation dimension to the organizational performance of commercial state corporations in Kenya. This was a census study comprising of 34 commercial state corporations targeting 295 Senior Management Team (SMT) members. This study employed structural equation modelling to analyse relationships between variables and constructs. The results provided statistical evidence that a positive and significant influence exists between organizational capabilities as key strategy implementation dimension and organizational performance of the commercial state corporations. In addition, the study found out that market turbulence does not have moderating effect on the relationship between organizational capabilities and organizational performance of commercial state corporations in Kenya. The relationship between organizational capabilities and organizational performance was significant at 0.05 level of significance. Therefore, the study concluded that organizational capabilities significantly influence organizational performance of commercial state corporations in Kenya. In practice, this study recommends that commercial state corporations need to pay attention to organizational capabilities as drivers of well-articulated strategic plans thereby translating the intended strategies into desirable high organizational performance

Keywords : State-Owned Enterprises, Organizational Capabilities, Performance and Strategy Implementation.