The Effect of Strategy Implementation on Competitive Advantage for SME’S in Nairobi Central Business District

Abstract

The purpose of this study was to establish the effect of strategy implementation on competitive advantage in Small and Medium Enterprise’s in Nairobi Central Business District. The study assessed effects of strategy implementation skills on competitive advantage; examined how organizational structure affects competitive advantage; and evaluated the effects of organizational culture on competitive advantage. The study also examined the concepts of each research objectives on competitive advantage. The research methodology used in this the research was the descriptive research method. It was focused on owners of Small and Medium Enterprise’s operating in the Nairobi Central Business District. The population of this study was 85 Small and Medium Enterprises in Nairobi Central Business District. From the population a sample size was drawn based on simple random sampling method. Data collection was carried out via questionnaires made up of structured as well as open ended questions and informal interviews to ensure the primary data collected was accurate. The data collected was analyzed through the descriptive statistics while using Microsoft Excel and Statistical Package for Social Science (SPSS) as the analysis tools. The data analysis involved descriptive statistics, i.e. Means; Percentages; Standard Deviations, and inferential statistics i.e. Regression analysis. The data was presented using tables and figures. The study established that there was a positive relationship between strategy implementation and competitive advantage. There was a significant strong relationship among the three elements of the study. The study also established that organizational culture plays a vital role in strategy implementation; the source of competitive advantage is rooted in strategy implementation skills and organizational structure. Further it was established that firm resources and capabilities, are crucial factors in strategy implementation hence have an impact on the competitive advantage of the Small and Medium Enterprises. The study concluded that strategy implementation is one of the most important processes in Small and Medium Enterprise’s to gain competitive advantage. It facilitates the achievement of the strategic and organizational objectives and sustains the competitive advantage for the Small and Medium Enterprises. It can be assented that successful strategy implementation efforts in Small and Medium Enterprise’s depends on strategy implementation skills which include leadership skills, communication skills and human resource skills. The study agreed that the type of organization structure adopted by Small and Medium Enterprise affects competitive advantage. It can be stated that for effective strategy implementation Small and Medium Enterprise require flexible organizational structure. Finally, the study revealed that the type of organizational culture which includes resistance to change culture, change receptive culture and innovative organizational culture affects the strategy implementation process. The critical factor identified under organizational culture was the level of involvement of employees and their attitudes toward work to enhance competitive advantage. The study recommends that owners of Small and Medium Enterprise’s should ensure there is successful strategy implementation. Small and Medium Enterprise’s owners should have the right strategy implementation skills, adopt a flexible organization structure and embrace a change receptive culture that is innovative. The study further recommends that managers and owners of the Small and Medium Enterprise’s to make their strategy work, through action or implement throughout the organization.