Core Competencies and Performance of Firms in the Service Industry: A Case of Micro Cap Holdings
Loading...
Date
2021
Authors
Moga, Sarah Kaly-Esah
Journal Title
Journal ISSN
Volume Title
Publisher
Kenyatta University
Abstract
Kenyan service industry contributes to employment of millions of people and the income earning for government, hence the need for it to perform highly. Major reforms have been done in the sector like use of ICT, service charters but the main issue to its poor performance is financial challenges that hamper its support of the Big4 agenda. Micro Cap Holdings as part of the service industry has suffered poor performance until it split to three factions in a bid to inject in resources from investors and incorporate financial intermediation. This study investigated if adoption of core competencies would improve the performance of service industry and the case of Micro Cap Holdings. The specific objectives included the effect of marketing competence, impact of human resource competence, impact of research and development competence and financial resource competence on performance of Micro Cap Holdings. The Resource Based Theory, the Balance Score Card Model and the Core Competency Model were used in the study. The study used descriptive research design and targeted all the 645 employees at Micro Cap Holding and the sampled 63 respondents which 10% of the targeted population. The participants were randomly selected hence employment of the simple random sampling technique. The primary data was collected using semi-structured questionnaire and the study applied descriptive and multiple regression analysis during the data analysis. The results from correlation analysis reveal that all the independent variables had a strong positive and significant effect to performance since all r- values were between 0.5 and 0.9. Findings showed that marketing competence had r of 0.736; HR competence r was at 0.631, R&D competence r value was at 0.709 and financial resource competence r- 0.812. The adjusted coefficient of determination was analyzed and its findings showed that 72.7% variations in the dependent study variables can be traced to the independent variables but 27.3% residual effect of the performance could be explained by other factors outside the scope of the current study. The study concluded that marketing competence positively affected the performance of Micro Cap Holding; with the respondents agreeing that that the customer had a high reputation of the firm based on the marketing activities and also the sales team members were skilled and dynamic. On human resource competence, it had a positive and significant impact on the performance of Micro Cap Holding, identified through the effective recruitment program leading to obtaining skilled and qualified employees and improving their commitment levels from the career development programs. The study further concluded that research and development competence influenced the performance of Micro Cap Holding which was exposed through having a taskforce to guide research activities and conducting market analysis and economic value analysis. The study also concluded that financial resource competence led to improved performance of Micro Cap Holding. Sufficient financial resources helped the company to do marketing, conduct research and pay salaries and allowances to its employees. The implication of this study is such that core competencies significantly influenced the performance of Micro Cap Holdings; as such the study makes recommendation for management team to adopt core competencies in its operation so as to increase the firm performance. The study recommends that other service industry players seeking to improve their performance to incorporate core competencies in their operations
Description
A Research Project Submitted to the School of Business in Partial Fulfillment of the Requirement for the Award of the Degree of Master of Business Administration (Strategic Management) of Kenyatta University, June, 2021
Keywords
Core Competencies, Performance, Firms, Service Industry, A Case of Micro Cap Holdings