Strategic Assets and Performance of Motor Vehicle Assemblers in Nairobi City County, Kenya
Muthoni, Dennis Mungai
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The manufacturing sector accounts for approximately sixteen percent of Gross Domestic Product and fourteen percent of employment globally, but its relative size in an economy varies with the stage of development. In Kenya, a strong manufacturing base for any economy is considered the foundation upon which long-lasting economic frameworks are made. The automotive industry is one of the most competitive industries in the manufacturing sector in Kenya today with significant contribution to the Gross Domestic Product. However, data from the Kenya Motor Industry Association has shown that performance of motor vehicles assemblers is on a decline as indicated by the fall in volume of sales reported annually. This study seeks to investigate the effect of strategic assets on performance of motor vehicle assemblers in Nairobi City County, Kenya. The specific focus of the study is to determine the effect of corporate culture, corporate reputation, human capital and information technology on performance of motor vehicle assemblers in Nairobi City County. The research variables in this study are underpinned on the resource-based view, Schein's structural model of organizational culture and human capital theory. The investigation was guided by descriptive research design. The study targets a population comprising of employees of motor vehicle assemblers and seeks to make field observations on a sample of management employees that was randomly selected using proportionate stratified sampling. The primary data for the investigation was collected using a structured questionnaire whereas secondary that was crucial for validating primary data was obtained through document review. Validity of the questionnaire was assessed and confirmed using opinion from experts and review of relevant literature. A pilot study was carried out using fifteen employees to support the test of reliability of the questionnaire. Descriptive statistics was analyzed using frequencies, percentages, mean, standard deviation and coefficient of variation. Similarly, inferential statistics was analyzed using bivariate correlation and multiple regression analysis in so as to confirm if there is a relationship between the research variables. The results of analysis were presented in form of figures and tables. The found out that corporate culture, corporate reputation, human capital and information technology had a direct linear correlation with performance. The four dimensions of strategic assets were also found to have a statistically significant effect on performance. The board of directors should also ensure that stakeholders’ suggestions are embraced and there is an environment of trust to provide the basis for bundling up of strategic resource for improved performance. Practices that promote fairness, equality, diversity and dignity in the workplace should be strengthened at all level of the firms in order to project a good image in the market place. The manager in charge of information technology should ensure existence of clear mechanism for sharing new information. Practices on customer data and relationship management should also be enhanced to promote deployment, sharing and utilization of firm resources in creation of value.