Intensive Growth Strategy and Performance of Cement Manufacturing Firms Listed in Nairobi Securities Exchange Kenya
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Date
2024-11
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Kenyatta University
Abstract
The cement manufacturing sector plays a crucial role in job creation, social and development agenda and GDP of the country. However, the sector suffers challenges including high energy costs, production inefficiencies and high competition leading to poor performance in terms of low production and consumption trends. To resolve the performance challenge, this study was forced on employing intensive growth strategies. The main study objective was assessing effect of intensive growth strategy on performances of NSE listed cement manufacturing firms. The specific objectives entailed market penetration and development, product development and diversification employed to improve performance outcomes. The study was grounded on the Ansoff’s matrix model, and supported by the dynamic capability theories and balanced scorecard model. It deployed descriptive research designs while targeting 216 employees working in the three listed companies. Stratified and simple random samplings were utilised in grouping respondents as per company and position and in selecting the respondents to take part in the research. The Yamane formula was employed to get the sample size of 139 respondents who filled the structured questionnaire as the research tool. The questionnaires were tested for validity and reliability using 13 employees from the non-listed cement companies and Cronbach Alpha was employed at a standard of 0.7. The researcher collected primary data from the respondents and produce qualitative and quantitative data. Analysis included entering the data into SPSS where descriptive statistics was done to obtain mean, standard deviation, frequencies and percentages. In addition, inferential statistics was analysed using multiple regressions and correlation analyses to show association amongst the variables. Content analysis was also done for the qualitative data and findings were presented charts, tables and prose form. The results from the analysis were used to confirm if there is any relationship between the intensive growth strategies and performance of the firm. The study revealed that market penetration (β=0.713; p=0.00), market development (β=0.869; p=0.000), product development (β=0.681; p=0.000) and product diversification (β=0.919; p=0.000) leads to a positive and significant effects on performance of listed cement manufacturing firms in Kenya. The study concluded that market penetration, market development, product development and product diversification have significantly affected the performance of listed cement manufacturing company. The study recommended that management of NSE listed cement manufacturing firms need to implement strategic pricing strategies to facilitate market penetration. The study further recommends that management of NSE listed cement manufacturing companies needs to develop and implement comprehensive customer education programs to raise awareness about the firm's products and services. The study recommends that NSE listed cement manufacturing companies need to consider bundling similar cement products together to create value-added packages for customers.
Description
A Research Project Submitted to the School of Business, Economics and Tourism in Partial Fulfilment for the Requirement of the Award of Master’s Degree of Business Administration (Strategic Management Option) Kenyatta University, November 2024.
Supervisor
Godfrey Kinyua