Strategic Management Drivers and Competitiveness of Large Manufacturing Companies in Kenya

Abstract

The manufacturing industry is one of the economic pillars in the vision 2030 with large manufacturing firms contributing more than 53% of the commodities for other forms of production and 10.3% of gross domestic product (GDP). Large manufacturing firms in Kenya grew at a rate of 3.5% in 2015 and 3.2% in 2014 which was slower than economic growth which expanded by 5.6% in 2015. The slower growth points to lack of competitiveness which has been compounded by factors such as technological changes, increased competition as well as changing economic world. Extant empirical studies seeking to link various factors to lack of competitiveness among the large manufacturing firms have failed to focus on strategic drivers. Moreover, studies which have sought to link strategy to competitiveness have found mixed results indicating presence of a moderating factor. The study therefore sought to establish the influence of the strategic management drivers on the competitiveness of large manufacturing firms in Kenya. The specific objectives were: To analyze the influence of information technology on competitiveness of large manufacturing companies in Kenya, to examine how corporate culture influences the competitiveness of large manufacturing companies in Kenya, to establish how human resource influence the competitiveness of large manufacturing companies in Kenya, to evaluate the influence of customer focus on competitiveness of large manufacturing companies in Kenya and to find out the moderating effect of firm size on the relationship between strategic management drivers and competitiveness of large manufacturing companies in Kenya,. Descriptive survey research design was employed in the study and the population will consist of large manufacturing firms in Nairobi, Kenya (454) which was sampled using stratified random sampling to obtain a sample of 384 respondents. Questionnaires were used as the research instruments where the data was collected through drop-and-pick method. The collected data was analysed through both qualitative and quantitative methods where quantitative data was coded and interpreted in form of mean, standard deviations and percentages and presented through frequency tables, pie-charts and bar-graphs. The qualitative data on the other hand was analysed through content analysis where the data were compared and presented based on the research objectives. Inferential statistics were carried out to determine the relationship between independent and dependent variables of the study. The study revealed that the corporate culture was a key strategic management driver influencing the performance of large manufacturing firms in Kenya (β = 0.713; P= 0.0001<0.05). Human resource was also found to significantly influence the performance of large manufacturing firms in Kenya (β = 0.712; P= 0.0001<0.05). The findings further revealed that customer focus and information technology significantly influenced the competitiveness of the manufacturing firms (β = 0.679; 0.641; P= 0.0001<0.05). Additionally, it was revealed that firm size significantly moderated the relationship between strategic management drivers and competitiveness of large manufacturing companies in Kenya. The study concluded that the strategic management drivers (corporate culture, human resources, customer focus and information technology) were integral in influencing the competitiveness of large manufacturing firms in Kenya. It was therefore recommended that there is need for the management of large manufacturing firms in Kenya to embrace these drivers to steer the competitiveness of the manufacturing firms.