Competitive Strategies and Performance of Escalator and Elevator Firms in Kenya

Abstract

This study examined the relationship between competitive strategies and performance of escalator and elevator firms in Kenya with a moderating effect of firm size. Competitive strategies included cost leadership, differentiation, and focus strategies. The study was hinged on Porter's generic competitive strategies, innovators’ dilemma theory, theory of price, Knowledge-Based Theory and Resource-Based View Theory. A correlation research design was used. 38 firms registered with Energy and Petroleum Regulatory Authority (EPRA) formed unit of analysis while 76 senior managers drawn from the firms using purposive sampling technique formed unit of observation. Primary data was collected using questionnaires and analysed using SSPS version 24. Data was presented using percentages, mean and standard deviation, and displayed using tables, pie charts, and figures. Correlation and multiple linear regression analysis were used to assess the relationship between variables. A positive and significant link between firms’ performance and cost leadership strategy (r=.683, p=.000), differentiation strategy (r=.411, p=.000) and focus strategy (r=.381, p=.000) was observed. On the other hand, an insignificant and negative correlation between the size of the firms and their performance was established. Differentiation, cost leadership and focus strategies accounted for 50.5% change in firms’ performance. With a moderating variable, firm size, a positive shift from 50.5% to 53.8% was realized and differentiation strategy took preeminence over cost leadership strategy. The study recommends emphasis on production efficiency, outsourcing and economies of scale for enhanced performance. As firms increase in size, having unique products, smart pricing, leveraging on proprietary technologies, and enhancing brand equity becomes key. Awareness of disruptive technologies like use of robotics, remote monitoring using internet of things (I.o.T) and other emerging technologies which might shape future competition landscape is key.