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Strategic positioning and is it a useful construct in improving performance of microfinance institutions in Kenya

Author

Listed:
  • Jackline Kapukha

    (Kenyatta university)

  • Muathe Stephen Makau

    (Kenyatta university)

Abstract

This paper aims to examine the effect of strategic leadership, resource allocation, information technology, customer focus, and differentiation on the performance of microfinance institutions in Nairobi City County. The study was founded on a resource-based view, dynamic capability and life-cycle theories. A target of 300 employees was targeted from which a sample of 172 research participants was recruited. The sample was selected through a combination of both stratified and sampling techniques. Questionnaires were used for primary data collection. Analysis used both descriptive and multiple regression analyses. The findings of the study indicated the urgency for microfinance organizations to adopt growth strategies that encompass innovative digital advancements, the introduction of novel products, innovation-focused strategies, and the digitization of services. The findings further highlighted the pivotal roles played by strategic positioning, strategic leadership, information technology integration, and differentiation in significantly shaping microfinance institutions’ performance. The findings also indicated that a unit enhancement of strategic positioning indicator had a significant enhancement on their individual performance. However, the effect of customer focus and resource allocation did not exhibit the same level of significance. The study recommended the reinforcement of strategic positioning, optimized resource allocation, embracing technological integration, and an unwavering focus on customer needs. The study recommended the exploration of diverse leadership styles, resource allocation strategies, and the undertaking of comparative analyses to draw insights into the effects of these factors on microfinance institutions Key Words:Strategic Positioning, Strategic leadership, Resource allocation, Strategic leadership, Customer Focus.

Suggested Citation

  • Jackline Kapukha & Muathe Stephen Makau, 2023. "Strategic positioning and is it a useful construct in improving performance of microfinance institutions in Kenya," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 12(7), pages 136-152, October.
    • Handle: RePEc:rbs:ijbrss:v:12:y:2023:i:7:p:136-152
    DOI: 10.20525/ijrbs.v12i7.2909
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    References listed on IDEAS

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    1. Edwin Mawira Kubai & Prof. Patrick Ngugi Karanja Ph.D. & Dr. Allan Kihara Ph.D., 2021. "Influence of Differentiation Strategy on Performance of the Insurance Companies in Kenya," Journal of Business and Strategic Management, CARI Journals Limited, vol. 6(4), pages 21-31.
    2. Zenou, Yves & Islam, Asad & Ushchev, Philip & Zhang, Xin, 2018. "The Value of Information in Technology Adoption: Theory and Evidence from Bangladesh," CEPR Discussion Papers 13419, C.E.P.R. Discussion Papers.
    3. Ferreira, Jorge & Coelho, Arnaldo & Moutinho, Luiz, 2020. "Dynamic capabilities, creativity and innovation capability and their impact on competitive advantage and firm performance: The moderating role of entrepreneurial orientation," Technovation, Elsevier, vol. 92.
    4. Chaudhuri, Atanu & Subramanian, Nachiappan & Dora, Manoj, 2022. "Circular economy and digital capabilities of SMEs for providing value to customers: Combined resource-based view and ambidexterity perspective," Journal of Business Research, Elsevier, vol. 142(C), pages 32-44.
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