Customer Value Proposition Innovation Strategy and Performance of Manufacturing Firms Listed on Nairobi Securities (NSE) in Kenya
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Date
2025
Journal Title
Journal ISSN
Volume Title
Publisher
Journal of Strategic Management
Abstract
Despite manufacturing firms being vital to national economic infrastructure through
employment and revenue generation, most manufacturing firms in Kenya have recently
experienced declining performance marked by low profit margins and stagnating market share
due to increased competition from imports. Thus, this study investigated the effect of customer
value proposition innovation strategy on performance of manufacturing firms listed on the
Nairobi Securities Exchange in Kenya. The study was anchored on Porter's value chain model.
A positivist research paradigm and an explanatory research design were adopted. The target
population consisted of 95 functional heads of departments drawn from 19 listed manufacturing
firms through a census approach. The data collection instrument was a semi-structured
questionnaire with closed and open-ended questions. A pilot study was conducted to test the
reliability of the research instrument, achieving Cronbach alpha indices of 0.964 for customer
value proposition innovation strategy and 0.892 for firm performance, both well above the
recommended threshold of 0.7. These reliability coefficients indicated strong internal
consistency of the measurement scales, and the instrument was also subjected to face,
construct, and content validity testing. The response rate was 88%. Quantitative data were
analyzed using descriptive and inferential statistics. The study found that customer value
proposition innovation strategy significantly and positively affected firm performance
(β=0.659, t=7.510, p=0.000), explaining 40% of the variance in performance. The study
conclude that managers of manufacturing firms should prioritize customer value proposition
innovation strategy to improve performance. Manufacturing firms should invest in advanced
CRM technologies, establish dedicated account managers for key customers, and implement
effective communication channels to enhance customer satisfaction and loyalty. Continuous
feedback collection and refinement of value propositions should remain at the forefront of
customer-centric strategies to ensure alignment with evolving preferences.
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Citation
Maina, J. R., Muchemi, A., & Maina, S. (2025). Customer Value Proposition Innovation Strategy and Performance of Manufacturing Firms Listed on Nairobi Securities Exchange (NSE) in Kenya. Journal of Strategic Management, 9(2), 12-27.