Strategic Capabilities and Performance of Selected Manufacturing Small and Medium Enterprises in Nairobi City County, Kenya
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Date
2024-06
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Publisher
Kenyatta University
Abstract
One key element in the growth of the economy is the manufacturing sector because it
creates jobs, generates foreign exchange, and increases trade and business, so its
accomplishment is also important. To ensure stability, it is necessary to enhance the
profitability, efficiency, operational efficiency and adaptability of manufacturing
enterprises. Major manufacturers in Kenya have suffered from recession and
decreasing income over the previous five years as a result of the unstable business
climate. It is projected that in East Africa, large industrial enterprises have lost
seventy percent of their market share, mainly due to high operating costs. Therefore,
the current investigation explored the effect of strategic capabilities on the
performance of selected small and medium in size manufacturing companies in
Kenya's Nairobi County. Specifically, the investigation examined innovation,
operational, material, and financial capabilities effect on the Nairobi County’s small
and medium in size manufacturing companies performance in Kenya. The
investigation was predicated on the innovation capacity maturity model, the resourcebased vision and the dynamic efficiency theories. A descriptive and explanatory study
design was used. The target audience is selected manufacturing companies in the
Nairobi city area. Utilizing a semi-structured questionnaire, primary data was
gathered. A target population of two thousand one hundred and seventy-one (2,171)
managers of key departments in twelve (12) manufacturing sub-sectors was utilized.
Three hundred and thirty-eight (338) managers were drawn from the population to
make up the sample size following the stratified sampling procedure. To ensure that
errors from the questionnaire are identified and addressed, a pilot study involving
thirty-seven (37) respondents that is, 11% of the sample size was undertaken. This
was to make certain that the instrument was valid and reliable. More so, Construct and
content validity tests were used to evaluate the validity, and Cronbach's alpha value,
which has a 0.7 correlation coefficient, was utilized to evaluate reliability. The
quantitative data was examined using descriptive statistics, which were then displayed
in tables and figures. Furthermore, the research employed inferential statistics,
specifically multiple regression assessment examined the independent factors effect
on the explained factor. All ethical standards were duly observed. Findings displayed
that innovative capabilities negatively predicted SME performance in an insignificant
manner; operations capabilities positively predicted SME performance in an
insignificant way; the outcome posited positively yet significant of material
capabilities effect on SME performance; and financial capabilities significantly
positive affect SME performance. Based on this outcome, the survey suggests that the
managers instead of focusing solely on innovation, SMEs should prioritize ...
Description
A Project Submitted to the School of Business, Economics and Tourism in Partial Fulfilment of the Requirements for the Award of Master of Business Administration (Strategic Management) of Kenyatta University. June, 2024
Supervisor
Felistus Hilda Makhamara