External environmental factors affecting the performance of the export of services sector in Kenya

Abstract

Organizations without exception are environment serving and environment dependent. A business is influenced by the environment in which it operates and the success of any business is dependent on its ability to adapt to its environment. The changes in external environment have a significant impact on the survival and success of the organization. Kenya is in a unique position to export services throughout East Africa and to the rest of the world. The service export sector in Kenya has faced a lot of challenges in the external environment. This study focused on external environmental factors affecting the performance of the export of services sector in Kenya. The objective of the study was to establish the external environmental factors affecting the performance of the services export sector in Kenya. The study adopted a cross sectional design in order to obtain comparative data from a cross section of service exporters registered under various professional bodies in Kenya with particular focus on those registered under Association of Professional Societies of East Africa (APSEA). The population of the study was the 28 professional bodies registered under APSEA. All the professional bodies were included in the study hence a census. The study relied on primary data collected using semi structured questionnaire to standardize the responses. Data collected was analyzed using descriptive analysis. Measures of central tendency like percentage, mean and standard deviation were used. Environmental dimensions of complexity, dynamism and favoritism were used to describe Kenya‟s export of services environment. The study established that, varying degrees of external environmental complexity, dynamism, and favorability exist which tend to be mostly shown in economic factors, competitive rivalry, market factors, technological factors, regulatory factors as well as threat of new entrants. The study further concluded that these factors appeared to have great influence on the organizations performance and strategic decision making. The study recommends that business and professional association should be more active in capacity building and awareness creation of opportunities for export of services. It recommended that the government need to get involved as an enabler through provision of adequate technology, marketing of services in international forum and work on legislative aspects that affects the sector. It also recommends that academic institutions to develop appropriate course to bridge the skills gap in the sector. There were some limitations in the study limited time frame considering those professionals targeted are busy with other work schedules. The sample size from the professional association registered under APSEA may not have represented the view of all service exporters. The study recommends further study on external environmental barriers in the export of service to the East African Community since its Kenya large market for professional service. It also recommends further study on other service sectors outside APSEA members to provide broad guidelines for the entire service sector.