Strategic Management Practices and Performance of Hotels in Nairobi County

Abstract

Strategic management practices play a key role in organizational performance. The hotels within Nairobi County have adopted different strategic management practices in their attempt to remain afloat. These have been related to strategic focus, differentiation strategy and cost leadership. However, the hotels’ performance has recently been on a downward trend. This study sought to determine the effect of strategic management practices on performance of hotels in Nairobi County, Kenya. This research was based on stewardship theory and institutional theory. It adopted a cross-sectional survey research design on 354 hotels4.operating in Nairobi County. This study adopted Yamane formula to calculate the sample of 78 hotels sampled using simple random sampling method. The top manager in every hotel was given the structured questionnaire through a drop-pick-and-wait methodology. This study adopted descriptive and regression statistics for analysis. The findings showed that the hotels had poor performance. The study also found that the hotels had vision statements, mission statements, company values, goals and objectives with majority working towards their vision. The strategic management practices had a positive effect on organization performance. This was displayed in the positive and significant regression coefficient. The findings further showed that strategic focus, differentiation and cost leadership had a positive effect on organization performance. From the findings, the study concluded that strategic management practices have a positive effect on organization performance of hotels within Nairobi County. Further, strategic focus, differentiation and cost leadership have a positive effect on organization performance of hotels within Nairobi County. The study recommends that hotels within Nairobi County improve their strategic management practices for improved performance. The study recommends similar research based on other factors influencing performance of hotels; other strategic management practices; other organizations and hotels in other counties other than Nairobi.