Strategy implementation and performance of major tea factories in Kericho County, Kenya

Abstract

Kenya’s overall economic and social development is highly dependent on the growth and development of the agriculture sector. Tea as a leading cash crop has made significant contribution to the economy. Tea exports increased by nearly 30 percent in 2010 reaching 441 tonnes valued at USD 1.3 billion. However the tea industry is faced with myriad challenges that threaten its survival if immediate intervention measures are not put in place. The tea industry is challenged by high cost of labour, farm inputs, energy/fuel, numerous taxes and levies. The application of strategic management in business for various sectors has long been adopted as a response to market demand, variation in clients taste and constant technological change. In as much as strategies could be brilliant, they do not assure effective performance. How the strategies are implemented matters in determining organizational performance. This study aimed at determining the strategy implementation practices adopted by various tea factories in Kericho County as well as how they compare to their performance. The study relied on the resource based view of strategy implementation as well as open systems theory and relevant literature was reviewed. A total of 32 factory managers were targeted for the census survey. Data from the respondents was collected through structured questionnaires. The data was coded and entered into a spreadsheet and analyzed using Microsoft Excel packages and SPSS Software. Data collected was analyzed descriptively using frequencies and percentages. The study found that all tea factories have embraced and apply certain strategy implementation practices but the degree of strategy implementation differs across factories. The study further found that a relationship exists between strategy implementation practices adopted by the tea factories in Kericho County and performance. Most tea factories place more emphasis on financial measures of performance and believe strategy implementation has greater impact on these financial measures. This study established that the tea factories’ primary focus is to grow their sales revenue and increase their production volumes. The study recommends that there is need to apply the strategy implementation practices to a greater extent in order to achieve better organizational performance.