Effect of Strategic Innovation Management Practices on Performance of Internet Service Providers in Nairobi, Kenya

Abstract

Modern day organizations are facing various challenges attributed to rapid increase in new products, processes, technologies as well as changing customer preferences. Organizations have employed innovation as a response strategy to these changes in order to discover and exploit new opportunities. This is because effective discovery and management of new innovations leads to superior performance by introducing distinct services and products and aid the streamlining of administrative and managerial processes. Adopting strategic innovation management practices is crucial for survival in the highly competitive market environment. Strategic innovation management helps the company to respond to customer needs efficiently through effective market intelligence hence recording superior performance. This study aimed to assess the impact of strategic innovation management practices on performance of Internet Service Providers Nairobi County, Kenya. The study employed a census approach hence all the 63 Tier 3 ISPs in Nairobi County were considered for the study. A response of 73% translating to 46 firms was achieved. The descriptive statistics findings revealed that top management support, resource allocation and organizational culture effectively supported the management of strategic innovations in the firms. The model’s R-squared (R²) value of 0.359 indicates that 35.9% % of the variance in organizational performance is explained by the independent variables, demonstrating substantial explanatory power. The statistical significance of the regression model of 0.000 which is less than 0.05 implying that strategic innovation management practices was a statistically significant predictor of organizational performance. The coefficients values of the predictor variables for top management support, resource allocation and organizational culture were (β=0.241, p=0.005 (p < 0.05); (β=0.234, p=0.014 (p < 0.05); (β=0.574, p=0.000 (p < 0.05) implying that each predictor variable triggered a positive impact on performance. Internet service providers should therefore allocate adequate resources to support research and development efforts, incubate new innovations and training of staff to ensure that the correct systems are used and that the staff are properly equipped to advance strategic innovations in the highly competitive market space. Benchmarking with successful strategic innovation management practices was also highly recommended.The Kenyan government may also support innovation endeavors through development of relevant infrastructure such as incubation hubs and digital infrastructure to increase the rate of internet connectivity across the country.