Strategy Implementation Capabilities and Performance of Nairobi Securities Exchange in Kenya

Abstract

Firm’s strategy implementation capabilities such as resource allocation, technological, marketing and management enable an organisation to optimise costs and differentiate its products and services thus resulting in competitive advantage for the organisation. Firms need to focus more on their strategy implementation capabilities to give them and maintain competitive advantage and add economic value in the dynamic market. However, worldwide stock markets had turbulent years recently. In 2020, the Nairobi Securities Exchange (NSE) 20 share index lost 5.14 points all shares traded reduced 1.28 points back to 138.66. The NSE 25 share index had lost 34.20 points to 3248.43 during that period, which could be linked to a weak strategy implementation capabilities within the NSE. Numerous researches have been done over the years to ascertain the impact of strategy implementation capabilities on the performance of the organisations. However, these studies are not exhaustive as they do not conclusively at how strategy implementation capabilities’ variables affect firm performance. The overall objective of the research was to determine the effect of the strategy implementation capabilities on the performance of the NSE. The specific objectives are to determine how resources allocation capabilities affect NSE performance, to assess how technological capabilities affect NSE performance, to ascertain the effect of the marketing capabilities on NSE performance and to find out how management capabilities influence the NSE performance. The theories that underpin this study are the dynamic capabilities theory, the resource-based view theory and the McKinsey 7-s model. The target population was the 62 NSE staff. The unit of observation was the NSE while the unit of analysis were the 62 NSE staff. The analysis used a descriptive survey design and primary data collected through semi-structured questionnaire. Descriptive statistics such as standard deviations, frequency, mode and mean and the inferential statistics were used and the final analysed data presented in tables, charts, graphs. Based on these results, all the null hypotheses of resource allocation capability have no influence on the performance of the NSE, technological capability has no influence on performance to performance the NSE, marketing capability has zero influence on performance of the NSE and management capability has zero influence on NSE performance were rejected, since they had a lower p-value (p<0.05) as the findings were statistically significant. The study concluded that the NSE commits the available resources fully to accomplish its strategic goals as indicated by resource distribution, optimal resource commitment, responsible deployment and mobilization and aligning budget to strategic goals. It was further concluded that the company enhanced technical capabilities through proper management of ICT infrastructure, workflow process, change management, having right systems and cyber security posture and resilience. The study concluded that, the firm had sound marketing capabilities as portrayed by enhanced communication with stakeholders, meeting target market needs, having products that are customer centred and having an effective go to market strategy. The study finally concluded that NSE has enhanced management capabilities among its staff, management and stakeholders through training, coaching, and capacity development programs. The recommendation was that further research be done about variables which affect performance significantly.