Strategic Management Practices and Performance of Domestic Airlines in Kenya
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Date
2025-05
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Kenyatta University
Abstract
The study sought to assess the effect of strategic management practices on organizational performance of domestic airlines in Kenya. This comes at a time when the domestic airlines in Kenya has been facing tremendous challenges orchestrated by dynamics in the operating environment. The domestic airlines have seen a surge in customer-shun rate due to low customer satisfaction. Moreover, most of the players in domestic airlines have faced a steady decline in sales revenues and the overall market share. This raises the question on what could be the remedy to upscale organizational performance of domestic airlines. Empirical evidence shows that strategic management practices are fundamental in enhancing organizational performance, although there is scant evidence on this in Kenya’s domestic airlines. The study therefore sought to examine the effect of strategic management practices on organizational performance of domestic airlines in Kenya. Specifically, the study sought to assess the effect of environmental scanning, strategy formulation, strategy implementation, and strategy evaluation on performance of the domestic airlines in Kenya. Theory of organizations, resource-based theory, dynamic capability theory, and balanced score-card theory formed the basis of the study. Focusing on 43 domestic Kenyan airline carriers, the study used a descriptive research design. There were a total of 129 people polled, including 43 Managing Directors, 43 Marketing Managers, and 43 CTOs. Due to the practicality of the sample size, the study used a census that includes all 129 employees. To gather primary data, the study used a standardized questionnaire on a 5-point Likert scale. Thirteen individuals were the subject of a pilot study in the domestic airlines. Both the concept and content validity were ensured via consultations with supervisor. A minimum admissible value of 0.7 was used to evaluate the data's reliability using the Cronbach Alpha test. Statistical Packages for the Social Sciences (SPSS) was used to conduct descriptive and inferential analyses on quantitative data. Figures as well as tables were employed in displaying attained results. The findings of the study revealed that environmental scanning significantly influenced performance of domestic airlines in Kenya. The results further revealed that strategy formulation played an essential and significant role in performance of domestic airlines in Kenya. It was further revealed that strategy implementation as another key aspect of strategic management significantly contributed to performance of domestic airlines in Kenya. Further, the results revealed that strategy evaluation was a significant strategic management practice that influenced performance of the domestic airlines in Kenya. The study concluded that the most of the surveyed airlines did not effectively integrate the core strategic management practices, and this affected their performance. It is therefore recommended that there is need for senior management team in domestic airlines to effectively embrace strategic management practices through effective assessment of their environment, formulating strategies informed by environmental conditions, and implementing the strategies for enhanced performance.
Description
A Research Project Submitted to the School of Business, Economics and Tourism in Partial Fulfillment of the Requirements for the Award of Degree of Master of Business Administration-Strategic Management Option of Kenyatta University, May 2025.
Supervisor
Sarah Kamau