Competitive strategy, organizational competencies coalignment, macro environment and performance of private middle level colleges in Nairobi county, Kenya

Abstract

The purpose of the study was to determine the relationship between competitive strategy and organization competencies co-alignment, macro environment and firm performance of private middle level colleges in Nairobi County –Kenya. The main theoretical frameworks used are organizational theory, contingency theory, and systems theory and business policy. A descriptive cross-sectional survey research design was used. More specifically, census survey was used to include all the registered and fully accredited private middle level colleges in Nairobi County. A questionnaire with both open and closed ended question was used to collect data. Descriptive and inferential statistics, Correlation analysis, multiple regression analysis and pair wise regression analysis were also utilized for data analysis. The results indicate that there was no significant difference between the performance of low cost leaders and that of differentiators.The descriptive statistics and correlations indicated that there exist relationships among the competitive strategies, organisational competencies co-alignment and firm performance though not statistically significant at 5%. Indeed, results indicate that joint effect of competitive strategy and competencies on corporate performances is greater than the sum total of the independent effect of the same variable on performance. Despite overally not statistical significance the study results for the effect of strategy, competences and macro environment on most indicators of performance were positive. It was evident that there is a fairly strong relationship between strategy-competencies co-alignment and corporate performance. However, we observed that the strength of strategy-competencies coalignment and macro environment does not guarantee significant positive change in corporate performance. This has critical managerial implications in terms of assessing the symbiotic advantage or complementariness of adopting particular strategy in tandem with inherent firm competencies. The results of the study support the proposed substantive linkage between the resources based capabilities of a firm and competitive advantage. One obvious implication of the study findings is the need for a firm to understand its competitive environment, and based on that to implement a suitable set of alignment mechanisms. Analyzing strategy /competence/ environment/performance relationship from a multivariate perspective has lead researchers to consider a more dynamic model for the study of strategy rather than a static model. The study therefore contributes in the search for a true dynamic theory of strategic management. This trend has manifested itself in the consideration of strategic management from an evolutionary perspective where a single theory or perspective is not forwarded, but one in which a researcher can draw from a number of operations of bodies of Literature in the quest to fully explain the dynamic operations through a synthesis of materials. It offers a holistic type of approach that more and more scholars are considering as one of the keys to future research in the area of strategy. The co-alignment approach that was used as the theoretical framework for this study presented an exciting intellectual direction of the organizational analysis. The stream of literature on this approach had discontinuities and lack of empirical reaffirmations. The most significant contribution of this study was to restate the importance of co-alignment and to confirm that they provided a superior explanation of organization performance.