A Survey of Factors Influencing Strategic Responses by State Corporations to Changes in the Environment

Abstract

The purpose of this study was to find out factors that influence strategic responses by State Corporations in Kenya to changes in their environment. The need for the study arose out of the urge to understand why given the same scenario, different state corporations will react differently yet, to a great extent, state corporations operate under the same environment, and are governed by the same rules and regulations. Studies had been done on responses of organizations to environmental changes. These studies however, did not go further to establish factors that account for the differences in strategic responses to changes in the environment. This was the point of departure for the present study.

A sample size of 40 state corporations was selected. A structured questionnaire was used to collect primary data. 31 state corporations responded appropriately, giving a response rate of 77.5 %. The findings of the study revealed that a number of factors are perceived as affecting strategic responses by State Corporations to changes in their environment. On average, factors that highly influence strategic responses are organization’s mission, Organizational structure and control processes, and availability of resources, consecutively. Those that least influence strategic responses are internal politics, influence of the CEO and competitors’ actions and reactions.

Majority of state corporations were almost unanimous on the extent to which organizational structure and control processes, organizational culture, and consideration of the level of risk influence their strategic responses. On the other hand, there was a very high level of dispersion on the extent to which competitors’ actions and reactions and influence of the CEO, affected strategic responses.

The factors that were rated as being very significant in influencing strategic responses by state corporations to changes in the environment are organizational structure and control processes, and availability of resources. Reference to past strategy and degree of the firm’s external dependence were rated as insignificant factors. All the other factors were rated as significant in influencing strategic responses by state corporations to changes in the environment.