Strategic Business Networking as a Source of Competitive Advantage in the Motor Vehicle Industry in Kenya

Abstract

The competitive business environment has forced organizations to overhaul their thinking and re-assess the external and internal environment. Organizations need to acquire new skills to develop a strategic vision for the future course of their business. This brings the need for business networking among firms so as to allow a company to concentrate on its distinctive competencies, while gathering efficiencies from other firms. This study establishes how strategic business networking is a source of competitive advantage in the Motor Vehicle Industry in Kenya. The study adopted a cross sectional survey design. The entire population of the 17 players in the motor vehicle industry participated in the research. A structured three part questionnaire was used to collect data. The data was analyzed by the use of descriptive statistics so as to summarize and relate variables which were attained from the administered questionnaires. The data was classified, tabulated and summarized using descriptive measures, percentages and frequency distribution tables while tables and graphs were used for presentation of findings. Regression and correlation analysis was also done to establish on various relationships of variables. The study established that strategic business networking is formed for a variety of reasons, which include increase of markets, better resource utilization, synergy and competitive advantage, improve organizational learning, flexibility development, financial risks sharing and firm‘s innovation process contribution. The ways in which the companies achieve competitive advantage through the adoption of strategic business networking was indicated as added value, company's product and service diversity, firm creation and sustainable fruitful collaborations, superior quality of services, firm unique corporate culture, use of strategic networking that enables the company to access complementary resources and skills that reside in other companies, unique resources, speed of offering the service and the firm managing its strategic networks more effectively than competitors. Strategic business networking tend to maintain and improve competitive advantage by making strategic decisions, which are primarily focused on development of new products, services, and processes.