INFLUENCE OF COMPETITIVE STRATEGIES ON PERFORMANCE OF COMMERCIAL AIRLINES IN KENYA: A SURVEY OF THE AIRLINE INDUSTRY IN KENYA
Hassan Ali Farah - Masters Degree in Strategic Management, Kenya Methodist University, Kenya
Jane Munga - Kenya Methodist University, Kenya
James Mbebe - Kenya Methodist University, Kenya
ABSTRACT
Competitive threats from multinational players across the globe are increasingly making domestic players such as KQ more conscious of their vulnerable state and incentivizing them to proactively engage in an effort to ensure their sustainability in these turbulent times. However, despite implementing these strategies, the operators in Kenya have continued to record dismal performance in the recent years epitomized by globalization, liberalization and consolidation of the African markets. The profitability of the airlines in Kenya has been dismal over the years unlike their counterparts in the region such as Ethiopian airlines. Further, the Kenyan sky is dominated by the European and Middle East carriers. The study aimed at determining the influence of competitive strategies on performance of commercial airlines in Kenya with reference to Airline Industry in Kenya. The specific objectives of this study were to:- establish how cost leadership strategy, product innovation strategy, market focus strategy and product differentiation strategy influences the performance of commercial airlines in Kenya. This study was based on the following theories theory of strategic balancing, porter's generic model, contingency theory and mathematical theory of games. A descriptive research design was used this study. A sample population of 194 managers was arrived at by calculating the target population of 393 managers at Airline Industry with a 95% confidence level and an error of 0.05 using the below formula taken from Kothari (2004). The researcher used a semi structured questionnaire as the primary data collection tool. The questionnaire was administered using email and a drop and pick later method to the sampled respondents. Data processing and analysis were included data preparation, editing, coding, classification and analysis. This involved a sequence of operations to check and code forms, transfer the tabulation on computer files, check for errors and make an exploratory analysis. The quantitative data in this research was analyzed by descriptive statistics using statistical package for social sciences (SPPS) version 24. Inferential statistics such as regression analysis was used to gauge the relationship between the dependent and independent variables. Data was presented in tables, charts and graphs. The study shows that cost leadership affects performance in Airline Industry in Kenya to a much extent, that product innovation strategy affect performance their Airline to a much extent, that market focus affect performance in Airline Industry to a much extent and that product differentiation affect performance in Airline Industry to a much extent. The study concluded that cost leadership strategy influences the performance of commercial airlines in Kenya positively, that product innovation strategy influences performance of commercial airlines in Kenya positively, that market focus strategy influences performance of commercial airlines in Kenya significantly and that product differentiation strategy influences the performance of commercial airlines in Kenya significantly. The study recommends that managers be on the look for any possible factor that has an implication on the operations of the business and respond appropriately and that the management of the company needs to have the required knowledge, expertise and skills before they can agree and embark upon an implementation program.
