Manufacturing strategy in small and medium scale enterprises in Kenya

Abstract

In every organization, continued excellent operational performance calls for a strategic fit to exist i.e a link between its competitive strategy objective and its operations objective. This is achieved through the use competitive objectives as a translation device between strategic and operation objectives and by creating a balance between the market/customer requirement and what the organization is in the position to offer. However defining these strategies is not an easy remedy in handling the constant change in the business entities today. Firms are faced with the extensive process of separating what the firm has in terms of capabilities it can compete on and the development and implementation of these capabilities into processes that work on the available resources. The study focusing on small and medium manufacturing enterprises in Kenya, sought to establish the capabilities the firm has at its disposal to explore on its resources, the perspective/ approach the firm chose to use to satisfy/meet its customer’s requirement and lastly how it used these capabilities to gain advantage over its competitors. A descriptive survey conducted revealed that the most common four capabilities available to the firms were cost, quality, flexibility and delivery. Most firms chose to use the resource-based perspective of strategy i.e. they chose to map/align their operation resources and processes to the requirements of the market. Unlike having the market requirements exploit the operation resources capabilities as is in the case of market based perspective. The study also found that most firms could only focus on one capability at time thus the trade off model was found to be the dominant model of manufacturing capabilities among the firms. This study recommends that for small and medium scale enterprises (SMEs) in Kenya to be competitive, they need to re-evaluate their capabilities. Benchmarking should be used to borrow best practices on the best strategies to cut cost and improve on other capabilities. Moreover more funds should be sourced in order to pursue a few or all strategies at the same time.