Strategic Alliances Between Kenya Revenue Authority and Telecommunications Companies in Kenya

Abstract

Through the formation of strategic alliances, organizations can enhance their competitive positioning by sharing key businesses’ costs, skills, risks, and ideas. Several organizations have thus realized that the formation of strategic alliance not only improve performance but also increases productivity, access to customers, increased sales, and promotes competitive advantage. Therefore, it is crucial for strategic alliances to be formed to realize their intended business objectives. It is against this backdrop that the current study assessed the influence of strategic alliances between KRA, Safaricom, and Airtel Kenya. The study was premised on Resource Based View theory, Network theory, and Transaction Cost Economics theory. Regarding methodology, the research employs a quantitative research design. The target population was all the Kenya Revenue Authority (KRA) managers based at Times Tower-Nairobi 194 managers. The sample size was 131 respondents for KRA while all the Airtel and Safaricom managers totalling to 17 and 23 at Mombasa road and Westland head offices, respectively were chosen. Data collection tool was self-administered questionnaire. The processing of data was done via Statistical Packages for Social Sciences (SPSS) version 25.0. Data was analysed using descriptive statistics. Data was presented in table, percent, frequencies, and figure format. The study found that technological, marketing and product alliances used had benefited all firms. Regarding technological alliances, it concluded that, the use of technology to roll out services and products benefit all the partners. On marketing alliance, the study concluded that, marketing alliance with other partners increased advertisement of services and products, increased access to products/services, and increased operations’ efficiency. Concerning product alliance, the study concludes that, formation of product alliance led to increased public awareness, increased public knowledge, and increase uptake of products/services. Regarding strategic alliance (dependent variable), the study concluded that, the three businesses were driven into alliances because of cost sharing, risk sharing, sharing of skills, technology sharing, and expansion of customer base. KRA, Airtel, and Safaricom should continuously conduct employee’ training programs to help in the full execution of strategic alliances. The study suggests that to improve market share, boost revenue, productivity, sales, awareness, and access to goods and services, all partners ought to take customer relationship management and growth seriously. This can be done by carrying out awareness campaign using social media apps, celebrities, and promotional organizations in the country. Further, the report suggests removing pointless rivalry between Safaricom and Airtel-Kenya to reduce operating costs, boost economies of scale, and increase market share. This can be done by having a uniform transaction costs on LIPA NA MPESA or PAY USING AIRTEL MONEY services.