COMPETITIVE STRATEGIES AND PERFORMANCE OF FIRMS IN THE TELECOMMUNICATION INDUSTRY IN KENYA
COMPETITIVE STRATEGIES AND PERFORMANCE OF FIRMS IN THE TELECOMMUNICATION INDUSTRY IN KENYA
Samuel Wamathai Mwaniki - Master of Business Administration (Strategic Management), Jomo Kenyatta University of Agriculture and Technology, Kenya
Dr. Enos Anene (PhD) - Jomo Kenyatta University of Agriculture and Technology, Kenya
ABSTRACT
The telephony sector played a critical role in communication, contributed to the Gross Domestic Product (GDP), created economic opportunities through mobile money agents, facilitated economic activities, and provided mobile money and internet services. The firm performances of the telecommunication companies were thus important in Kenya's context. The study sought to explore the competitive strategies and performance of firms in the telecommunication industry in Kenya. The objectives of the study were as follows: cost leadership strategy, focus strategy, innovation and differentiation strategy on the performance of firms in the telecommunication industry in Kenya. To achieve the set objectives, the study developed research hypotheses and statistically tested them at α = 0.05. The study was hinged on theories such as Porter’s Competitive Business Strategy Typology, Configuration theory, Result-based View Theory, and Miles and Snow typology. It adopted a descriptive research design and used both qualitative and quantitative approaches. The study examined a population of six telecommunication companies in Kenya, employing simple random sampling to select 384 employees in these firms who were directly involved with competitive strategies and the performance of firms in the telecommunication industry in Kenya. The research employed both qualitative and quantitative analytical methods. Qualitatively, the study utilized regression analysis, while quantitative data underwent analysis involving percentages, frequencies, means, and standard deviations, with the assistance of SPSS software. Regression analysis was also applied to establish the relationships between variables. The study's findings revealed that telecommunications companies in Kenya had adopted three key competitive strategies: differentiation strategy, market focus strategy, and cost leadership strategy. Concerning the market focus strategy, the research identified that these companies segmented their products based on customer-desired benefits. In terms of differentiation strategy, there were clear indications that these companies had successfully implemented strategies to differentiate their products and services from those of their competitors. As for the cost leadership strategy, it was apparent that these companies employed cost-effective measures to expand their market share and maintain a competitive edge. In conclusion, the study established a positive and significant relationship between the adopted competitive strategies, namely differentiation strategy, market focus strategy, and cost leadership strategy, and the overall organizational performance of telecommunications companies in Kenya. The study recommended that these companies should continue to invest in cutting-edge technology and the development of unique products to maintain their competitive differentiation. Moreover, they should consider benchmarking their differentiation strategies against those of other firms in the service industry. Additionally, the study advised telecommunications companies in Kenya to sustain their efforts in innovation, product development, and aggressive marketing to enhance and sustain their competitiveness in the market.
