Effect Of Competitive Strategies On Performance Of Government Owned Kenyan Sugar Production Companies, Role Of Government Interventions

Abstract

Government owned sugar manufacturing firms play an important role to the economy by contributing to GDP, employment opportunities and raw materials to other industries. The performance has been on declining trend This research aimed to evaluate the influence of government initiatives and the impact of competitive tactics on the performance of government-owned sugar production companies in Kenya. The study aimed to ascertain the impact of various strategies, including innovation, operational, and technological capability, on the performance of government-owned sugar manufacturing companies in Kenya. Additionally, the study sought to determine the moderating effect of government interventions on the relationship between competitive strategies and the performance of these companies. Porter's competitive business typology served as the study's foundation. Other theories were; Resource based view, Dynamic capability and Configuration theories. The study was guided by a descriptive survey research design. The study used positivist paradigm. The target population comprised of 6 Kenyan sugar production companies. Respondents were 359. The sample size consisted of the six-government owned sugar manufacturing firms with 186 top managers and 636 middle level managers totalling to 822. A sample size of 269 was used. The sample size was calculated using Yamane 1980 formula. Questionnaires were used to collect data. Cronbach alpha was calculated using split-half method to test the reliability of the questionnaire. Questionnaires were retained after attaining threshold of 0.70. Validity was tested by expert judgment by providing questionnaires to faculty supervisors and experts who improved on them. Internal consistency was measured using Cronbach’s Alpha computed using Kunder-Richardson formula. Both descriptive; mean, standard deviation, percentage and inferential statistics- pearson product moment correlation and regression analysis were used to present the findings. Pearson product moment of Correlation was used to test the strength of the relationship between the variables. Simple regression was used to test the direct relationship between the variables while multiple regression was used to test indirect relationship between variables. Data was presented using tables. It was revealed that competitive strategies; innovation, operational and technological capability strategies had a positive correlation with performance of government owned Kenyan sugar production companies. ANOVA revealed that, statistically, there is a significant positive relationship between competitive strategies; innovation, significant at (p = 0.000 <0.05) operational at (p = 0.000<0.05 and technological capability strategies at (p= 0.000<0.05) and performance of government owned sugar manufacturing firms. Further, the results of multiple linear regression analysis revealed that innovation strategy was the most effect followed by technological capability and operational strategy respectively significantly affect performance of government-owned Kenyan sugar production companies. The study recommended that; the firms should undertake appropriate and persuasive strategies in order to compete favourably. It was recommended that managers should identify appropriate competitive strategies at their core operations, and that significant funding through grants and loans schemes should be extended to these firms. Future studies should be done on other dimensions of competitive strategies and performance of an organization. Further study should be conducted in all Kenyan sugar production companies.