An analysis of the effects of competitive intelligence practices on the performance of pharmaceutical companies in Nairobi
Abstract
The relevance of monitoring, understanding and responding to competitors has long been
recognized as a significant aspect of marketing activity. Yet analysis of the competitive
environment seems often to be subordinated as greater emphasis is placed on understanding
consumers. Clearly important though customers are, they should not dominate marketing
strategy and planning. Competition in the Kenyan Pharmaceutical Industry continually work
to drive down the rate of return on capital invested. The pharmaceutical companies have thus
resulted in making use of various competitive intelligence aspects to ensure profitability. The
study generally sought to analyze the effects of competitive intelligence practices on the
performance of pharmaceutical companies in Nairobi. Specifically, the study sought to
establish the effect of product intelligence strategies, new markets intelligence, technology
intelligence, strategic alliance intelligence and on the performance of pharmaceutical
companies in Nairobi. The study adopted a descriptive survey design. The method is chosen
since it is more precise and accurate since it involves description of events in a carefully
planned way and also portrays the characteristics of a population fully. The study targeted
managers of pharmaceutical distribution companies in Nairobi. For the smaller firms, the
target respondents were the owners/managers or the superintending pharmacists or their
designate. In larger corporations, the managers at the time being in charge of distribution,
their equivalents or their designate was targeted. From the population sampling frame the
required number of subjects/ respondents was selected through stratified proportionate
random sampling technique based on whether they bare wholesalers, manufacturer or
retailers. Primary data was obtained through use of questionnaires. Quantitative data
collected using a questionnaire was analyzed by the use of descriptive statistics while the
qualitative data was analyzed using content analysis. In addition, the researcher conducted a
multiple regression analysis so as to determine the relationship between the company's
profitability and the four competitive intelligence practices. This research helped the
companies to remain competitive and profitable amidst the current stiff competition
witnessed in the pharmaceutical sector. The study found that the company employed new
market intelligence as a competitive intelligence. Product intelligence influenced the
performance of the company to a great extent. The company initiated activities to obtain
information on technology advancement in the industry to a very great extent. Mergers in the
industry and strategic alliance enhanced the performance of the company to a very great
extent. The study concludes that the company employed new market intelligence as a
competitive intelligence. Product intelligence influenced the performance ofthe company to a
great extent. The company initiated activities to obtain information on process automation in
the firm, interconnected technology in the company, integrated systems in the industry and
new software in the industry. Joint venture in the industry and acquisitions in the industry
enhanced the performance of the company. The study recommends pharmaceutical
companies to employ new market intelligence. The study recommends the managers in
pharmaceutical companies to adopt product diversification intelligence. The company should
initiate activities to obtain information on technology advancement in the industry. They need
to form mergers so as to enhance the performance of the company.