Response strategies adopted by small oil marketing companies in Kenya to environmental challenges

Abstract

The objective of the study was to establish the response strategies adopted by Small Oil marketing companies in Kenya to environmental challenges. The study was a crosssectional survey design. The cross-sectional design was preferred to other designs since it is the most commonly used form of survey design when data is to be collected at one point in time across many firm. The target population in this study was the oil marketing firms in Kenya. According to Energy Regulation Commission‟s website, there were 36 Small oil marketing firms in Kenya as at 30th June 2014. These firms were therefore the population of the study. Since the number was not so large, all the 36 firms were included in the sample. This was therefore a census survey. This study used primary data. The data was collected using structured questionnaire on the basis of the objectives of study. After collection of data, it was analyzed using SPSS. Descriptive analysis method was used to analyze the collected data. The statistics used was percentages, mean and standard deviations. The results were presented in form of charts and tables where appropriate for ease of interpretation. Results indicated that response strategies considered in the event of environmental challenges were; focus market, cost leadership strategic alliances and corporate social responsibility. Acquisition and mergers lobbying the government were least pursued response strategies to environmental challenges. The strategies which were used to a large extent were focus and cost leadership. The study finds that response strategies with a high impact to environmental challenges were; corporate social responsibility and cost leadership. The results revealed that the strategic combinations that best suit the small oil marketing companies were; differentiation and low cost leadership, and differentiation and market focus while the strategic combinations that least suit the small oil marketing companies were corporate social responsibility and lobbying the government and corporate diversification and acquisitions and mergers. In line with the above findings the study concluded that response strategies play a very crucial role in environmental challenges and more specifically, it was concluded that among the response strategies that affected strategy implementation were focus market, cost leadership, strategic alliances and corporate social responsibility. Based on the above findings the study recommends that in order to tackle the environmental challenges facing the small oil marketing companies then the following strategies should be pursued by the players in the sector. For policy purposes, the study recommend that, organizations should conduct environmental scanning to be aware of different challenges in the environment and that an organization should apply corporate strategies, business strategies and functional strategies in response to environmental challenges. The study further suggests that since this study focused on only small oil marketing companies which represented a small percentage of the oil industry, further studies should be conducted on other organizations in the industry to establish the correlation. The study also suggests that further studies should focus on other industries such sugar and construction industries.