A Survey of Business Growth Strategies Applied by Medical Insurance Organizations in Kenya

Abstract

Growth means change and proactive change is essential in a dynamic business environment. The growth of a business firm is similar to that of a human being who passes through the stages of infancy, childhood, adulthood and maturity. Growth Strategy refers to a strategic plan formulated and implemented for expanding firm’s business. Businesses therefore engage in growth and expansion strategies that will enable them to respond to the environmental challenges in order to gain competitive advantage over their competitors, increase market share and indeed for continued survival in the market. Firms adopt various strategies based on the goals and objectives. The different strategies have different costs and related benefits that influence adoption. The medical insurance firms are not an exception to this regard. The increasing significance of growth strategies in these firms therefore is of paramount importance to the development of sustainable competitive advantage. The overall objective of the study was to establish the business growth strategies applied by medical insurance organizations in Kenya. This study was guided and informed by various theoretical and literature reviews. This was a crosssectional survey research. The study used primary data which was collected using a semistructured questionnaire. Descriptive statistics data analysis methods were employed to analyze the quantitative data obtained. The study had a response rate of 81.5%. The findings revealed that business growth strategies that are adopted by medical insurance firms in Kenya include diversification, product development and market development. These firms incorporate new features into existing products and introduce new products as forms of product development strategies. For market penetration they persistently advertise their medical insurance products and introduce new medical facilities. The adoption of business growth strategies in medical insurance firms in Kenya is influenced by availability of business opportunity, the firms’ financial capacity, customer demands and competition. Price reduction, opening new medical insurance offices in other countries and diversification through medical tourism and conferencing seem not to be business growth strategies adopted by the medical insurance firms in Kenya. In light of the findings, the study recommends that these firms should focus more on market research and development so as to have a strong base for innovation and sustainable growth. These companies should also emphasis on diversification strategies.