influence of strategic capabilities on competitive advantage of sugar companies in western kenya ...

230 Pages·2017·2.58 MB·English

INFLUENCE OF STRATEGIC CAPABILITIES ON
COMPETITIVE ADVANTAGE OF SUGAR COMPANIES
IN WESTERN KENYA

IMBAMBI RICHARD MISIGO

DOCTOR OF PHILOSOPHY
(Business Administration)

JOMO KENYATTA UNIVERSITY OF
AGRICULTURE AND TECHNOLOGY

2017

Influence of Strategic Capabilities on Competitive Advantage of
Sugar Companies in Western Kenya

Imbambi Richard Misigo

A Thesis Submitted in Partial Fulfillment for the Degree of Doctor
of Philosophy in Business Administration (Strategic Management) in
the Jomo Kenyatta University of Agriculture and Technology

2017
DECLARATION
This Thesis is my original work and has not been presented for a degree in any other
University.

Signature -------------------------------- Date -----------------------------
Richard Misigo Imbambi

This Thesis has been submitted for examination with our approval as University
Supervisors.

Signature -------------------------------- Date ----------------------------
Professor Margaret Oloko, PhD.
JKUAT, Kenya.

Signature -------------------------------- Date ---------------------------
Professor Charles M. Rambo, PhD.
U.O.N., Kenya

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DEDICATION
This thesis is dedicated to my late father Hezekiah Imbambi Kabayi, my caring
mother Felika, my loving and supportive spouse Nyaroya and my adorable
children Asachi, Mwanzu, Olinjo, Musoma and Kavai.

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ACKNOWLEDGEMENT
My appreciation and gratitude go to my able supervisors Professor Margaret
Oloko and Professor Charles M. Rambo who tirelessly and timely provided
guidance and support on this Thesis. Their insightful comments, suggestions,
personal commitment, encouragement and support throughout the entire process
of writing this thesis report have been invaluable. Thanks to the staff of Kisumu
campus for their facilitation. Special thanks to my family members for their
understanding, support and prayers.

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TABLE OF CONTENT

DECLARATION .............................................................................................................ii
DEDICATION ............................................................................................................... iii
ACKNOWLEDGEMENT ............................................................................................. iv
TABLE OF CONTENT .................................................................................................. v
LIST OF TABLES ...................................................................................................... viii
LIST OF FIGURES ........................................................................................................ x
LIST OF APPENDICES ............................................................................................... xi
ABBREVIATIONS AND ACRONYMS .....................................................................xii
DEFINITION OF TERMS .......................................................................................... xiv
ABSTRACT .................................................................................................................. xvi
CHAPTER ONE ............................................................................................................. 1
INTRODUCTION ...................................................................................................... 1
1.1 Background to the Study ..................................................................................... 1
1.2 Statement of the Problem .................................................................................. 12
1.3 General Objective of the Study ......................................................................... 14
1.4 Research Hypotheses ......................................................................................... 15
1.5 Justification of the Study ................................................................................... 15
1.6 Scope of the Study ............................................................................................. 16
1.7 Limitation of the Study ...................................................................................... 17
CHAPTER TWO .......................................................................................................... 18
LITERATURE REVIEW ........................................................................................ 18
2.1 Introduction ....................................................................................................... 18
2.2 Theoretical Review ............................................................................................ 18
2.3 Conceptual Framework ...................................................................................... 30
2.4 Empirical Literature Review ............................................................................. 31
2.5 Critique of Existing Literature Relevant to the Study ....................................... 56
2.6 Research Gaps ................................................................................................... 58
2.7 Summary of Literature ....................................................................................... 61
2.8 Summary of Empirical Literature Review......................................................... 62

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CHAPTER THREE ...................................................................................................... 68
RESEARCH METHODOLOGY ............................................................................ 68
3.1 Introduction ........................................................................................................ 68
3.2 Research Paradigm ............................................................................................ 68
3.3 Target Population ............................................................................................... 70
3.4 Sample Size and Sampling Procedures .............................................................. 71
3.5 Research Instrument .......................................................................................... 72
3.6 Data Collection Procedure ................................................................................. 73
3.7 Pilot Testing ....................................................................................................... 74
3.8 Data Analysis Techniques ................................................................................. 76
3.9 Measurement of Variables .................................................................................. 82
3.9.1 Operationalization of the Variables ................................................................... 84
CHAPTER FOUR ......................................................................................................... 86
DATA ANALYSIS AND DISCUSSION ..................................................................... 86
4.1 Introduction ........................................................................................................ 86
4.2 Response Rate .................................................................................................... 86
4.3 Reliability and Validity Tests of Research Instrument ...................................... 87
4.4 Bio Data ............................................................................................................. 89
4.5 Human Resource Capability and Competitive Advantage of Sugar
Companies ......................................................................................................... 94
4.6 Technology Capability and Competitive Advantage of Sugar Companies ..... 109
4.7 Material Capability and Competitive Advantage of Sugar Companies ........... 122
4.8 Financial Capability and Competitive Advantage of Sugar Companies ......... 139
4.9 Strategic Capabilities and Competitive Advantage ......................................... 157
4.10 Strategic Capabilities, Government Regulatory Policy and Competitive
Advantage ........................................................................................................ 159
CHAPTER FIVE ......................................................................................................... 169
SUMMARY OF FINDINGS, CONCLUSIONS AND RECOMMENDATIONS.. 169
5.1 Introduction ...................................................................................................... 169
5.2 Summary of Findings ...................................................................................... 169
5.3 Conclusions ...................................................................................................... 177
5.4 Recommendations ............................................................................................ 178
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5.5 Areas for Further Research .............................................................................. 179
REFERENCES ............................................................................................................ 180
APPENDICES ............................................................................................................. 199

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LIST OF TABLES
Table 3.1: Breakdown of Senior and Middle Level Managers ........................................ 70
Table 3.2: Total Number of Samples of Managers per Company.................................... 71
Table 4.1: Response Rate ................................................................................................. 87
Table 4.2: Reliability Tests Results .................................................................................. 88
Table 4.3: Profiles of Companies as at 2014 .................................................................... 90
Table 4.4: Bio Data of the Respondents ........................................................................... 91
Table 4.5: Training and Development .............................................................................. 96
Table 4.6: Company Leadership ...................................................................................... 98
Table 4.7: Labour Turnover ............................................................................................. 99
Table 4.8: Cadre of Staff most Trained by the Organization ......................................... 100
Table 4.9: Common Training Upgrade Course carried out by the Organization ........... 101
Table 4.10: Cadre of Staff who mostly resign from the Organization ........................... 101
Table 4.11: Employees Resignations Records from 2011 to 2015 ................................ 102
Table 4.12: Logit of Human Resource Capability and Competitive Advantage ............ 105
Table 4.13: Correlation of Human Resource Capability and Competitive Advantage .. 106
Table 4.14: New Technology Adoption ......................................................................... 110
Table 4.15: Technology Innovation ............................................................................... 112
Table 4.16: Factory Maintenance ................................................................................... 113
Table 4.17: Five Years’ Comparative Data of Factory Capacity Utilization (%) .......... 115
Table 4.18: Five Years’ Comparative Data of Stoppage due to Factory Breakdowns .. 116
Table 4.19: Five Years’ Comparative Data of Factory Time Efficiency (%) ................ 116
Table 4.20: Five Years’ Comparative Data of Reduced Overall Recovery (%) ............ 117
Table 4.21: Logit Regression of Technology Capability and Competitive Advantage . 118
Table 4.22: Correlation of Technology Capability and Competitive Advantage ........... 120
Table 4.23: Sugarcane Husbandry.................................................................................. 123
Table 4.24: Sugarcane Harvesting.................................................................................. 125
Table 4.25: Sugarcane Transport .................................................................................... 126
Table 4.26: Five Years’ Data on Factory Stoppage due to no Sugarcane (MT) ............ 127
Table 4.27: Five Years’ Comparative Data of Area under Sugarcane (Hectares) ......... 128
Table 4.28: Five Years’ Comparative Data of Sugarcane Yield per Hectare (MT) ....... 129
Table 4.29: Five Years’ Projections of Sugarcane Availability for Crushing (MT) ...... 131
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