IIARD International Institute of Academic Research and Development

IIARD International Journal of Economics and Business Management (IJEBM )

E-ISSN 2489-0065
P-ISSN 2695-186X
VOL. 2 NO. 9 2016

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Effect of Firms Strategic Responses to the Changing Competitive Environment on Performance of Paint Manufacturing Companies in Kenya

Robert Otuya

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Abstract

Strategic responses are known to realign firms to respond to the ever-changing turbulent business environment. This research sought to assess the strategic responses of paint manufacturing companies, in view of the intensity of rivalry of competition. The purpose of the study was to determine the effect of firm’s strategic responses to the changing competitive business environment on performance. The study used a survey design with a purposive sampling of 10 companies with relatively formalized strategic planning systems and employing more than 200 people. A sample size of 119 was obtained from the selected companies. Descriptive statistics used were the percentages while inferential statistics involved the use of multiple regression, correlation analysis, and ANOVA. The regression and correlation analyses showed that all the three responses positively related with performance. However, the differences found among the strategic response effects could not be confirmed statistically. This implied that the firms did not apply pure strategies but used cost strategy as the basis on which other strategic responses are built with varying levels of emphasis. Therefore the study concluded that the companies in the paint manufacture sector studied applied mixed strategies with slight variations in the emphasis accounting for the differences in their performance. Consequently the study made recommendations that the companies need to find ways of increasing effects of niche market leadership and product differentiation as a way of improving performance, to increase research and development activities and human resource practices as these efforts are likely to improve company innovation and therefore performance.

keywords:

Strategic responses, competitive environment, performance, manufacturing firms, Kenya.

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