Challenges faced by small and medium enterprises in strategy implementation in Nairobi city county

Abstract

There is vast knowledge on strategic plans and strategy planning as put forward by various scholars and researchers. Other researchers have studied on the strategic planning practices of various organizations. While these research studies emphasize the importance of strategic plans, they do not give details of some of the challenges of strategy implementation. This study therefore sought to fill the existing research gap by carrying out a survey on the challenges faced by Small and Medium enterprises in strategy implementation in Nairobi City County. A survey of small and medium enterprises within Central Business District (CBD) of Nairobi city was undertaken. Data were obtained from 30 respondent firms. Data were collected through questionnaires. Results were analysed through descriptive statistics, cross tabulations, Pearson Correlation and analysis of variance. It was established that inadequate finances, government regulation, competition and organization structure pose the greatest challenge to strategy implementation. In contrast, organizational culture, lack of management support and lack of clear communication strategy affected strategy implementation process to a small extent. Age of the enterprise can be both an asset and a liability in the strategy implementation process. As an asset, organizational age can enhance a firm‟s ability to attract financial resources. As a liability, age can promote status quo preference and entrench structural rigidities which in turn impede strategy implementation process. It was also established that nature of enterprise ownership is associated with a firm‟s ability to access financial resources. The study established that external environment factors largely affected strategy implementation process than internally based factors. Based on findings of the study, it was concluded that successful implementation of strategy require addressing access to funds, gathering market intelligence and monitoring the regulatory environment. It was recommended that future studies need to adopt longitudinal research design to investigate challenges to strategy implementation. In addition, there is need for widening the geographic scope of the study to include the entire Nairobi City County and beyond. It was further recommended that managers should redesign organization structure whenever a new strategy is prepared; and to gather and share market intelligence with organizational members.