Real-time strategic issue management practices by large scale tea producers in Kenya

Abstract

This study was on real-time strategic Issue management practices by large scale tea producers in Kenya. It had two objectives namely; to determine the nature of real-time strategic issues that have affected the large tea firms in Kenya over the previous ten years and to establish the real-strategic issue management practices among these firms. The first objective was determined in three dimensions, that is, turbulence of environmental factors, importance of these factors and the direction and magnitude of impact of environmental events and developments. The second objective was pursued through investigating such environmental surveillance and monitoring, forecasting, issue processing, issue analysis etc. The study was deemed fit because today, business environments are full of surprises and firms need to be alert all the times in order to take advantage of opportunities that come their way and also shield themselves from strategic shocks. The study was a census conducted using cross-sectional survey. The population consisted of all tea producers in Kenya which are members of EAITA. The total population had fifteen members and out of these, seven responded giving response rate of approximately 47%. Data was collected using self-administered mail questionnaires which were responded to by the person in charge of real-time strategic issue management systems in each firm. The data was analyzed using descriptive statistics and content analysis. Measures of central tendency, dispersion and frequencies were computed. Findings showed that the environment in which these firms operate is changing but not at a rate that can be classified as surpriseful and unpredictable. However, politics and currency exchange rates showed the highest rate of change among the environmental factors studied. These two exhibited changes that can be described as discontinuous but predictable. The most important environmental factors to these firms are production costs, state of the economy, behaviour of buyers, tea auction prices and the strength of the local currency. Environmental factors that had the highest positive impact on these firms are mechanization of tea picking, ISO-Certification and liberalization of tea sub-sector. The biggest draw backs came from the rise in fertilizer costs, the current global fmancial crunch, exchange rate fluctuation, the recent oil crisis, environmental degradation and generally high cost of doing business. On the second objective, the study showed that these firms practice realtime strategic issue management practices though there are individual differences on how they carry out the actual activities. The majority of the firms surveyed however lacked formalized real-time SIMS. Only two firms had formalized SIMS or department with one having a loosely organized system.