Factors Influencing Competitiveness in the Cement Industry in Kenya: a Case of Savannah Cement Limited

FACTORS INFLUENCING COMPETITIVENESS IN THE CEMENT INDUSTRY IN KENYA: A CASE OF SAVANNAH CEMENT LIMITED

BY DAVID ANTON MANG’EA

UNITED STATES INTERNATIONAL UNIVERSITY - AFRICA

SUMMER 2018

FACTORS INFLUENCING COMPETITIVENESS IN THE CEMENT INDUSTRY IN KENYA: A CASE OF SAVANNAH CEMENT LIMITED

BY DAVID ANTON MANG’EA

A Research Project Submitted to the Chandaria School of Business in Partial Fulfillment of the Requirements for the Degree of Masters in Business Administration (MBA)

UNITED STATES INTERNATIONAL UNIVERSITY - AFRICA

SUMMER 2018

STUDENT’S DECLARATION

I, the undersigned, declare that this is my original work and has not been submitted to any other college, institution or university other than the United States International University in Nairobi for academic credit.

Signed: ______Date: ______David, Anton Mang’ea (652637)

This project has been presented for examination with my approval as the appointed supervisor

Signed: ______Date: ______Prof. Timothy C. Okech, PhD

Signed: ______Date: ______Dean, Chandaria School of Business

All rights reserved. No part of this research project may be produced or transmitted in any form or by any means, electronic, magnetic tape or mechanical including photocopying, recording of any information, storage and retrieval systems without prior written permission from the author.

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ABSTRACT

The purpose of study was to establish the factors affecting competitiveness of Savannah Cement Limited in Kenya. The study was guided by three specific objectives namely to: examine the effect of leadership on competitiveness of Savannah Cement Limited; establish the influence of technology on the competitiveness of Savannah Cement Limited; and find out how product marketing influence competitiveness of Savannah Cement Limited in Kenya.

The research used descriptive survey method. The population of interest was all employees of Savannah Cement Limited in Kenya which was 168 employees at the time of the study. This study adopted the stratified random sampling technique. A sample size of 118 employees was selected. The research used primary data, which was collected using a structured questionnaire comprising of closed ended questions, checklist questions and five point Likert scale. Both descriptive and inferential statistics were used to analyze the data obtained from the research. The data was presented in tables and figures. Statistical Package for Social Sciences (SPSS) was used in analyzing and presenting the data.

The study found out that company leadership had been successful in Savannah Cement Limited strategy implementation. These findings were drawn from the positive correlation between leadership strategic implementation and competitiveness. There was a positive relation between innovation and competitiveness of the company underscoring the importance of innovation for the company to remain competitive in the cement industry. The study, however, found out that the company was not performing well in the area of employee motivation and inspiration and the company leadership did not quickly adapt to change and new realities in the market.

The study found a positive relationship between technology and competitiveness. Technology had the most positive influence on competitiveness compared to the other two variables and therefore a better predictor of competitiveness. It revealed that the company used the newest technology in its production process and had a robust information

communication technology (ICT) tools and systems underscoring the central role played by technology in enhancing the company’s performance and thereby increasing its competitiveness. However, the study further revealed that the company did not have a robust research and development (R&D) function and was not keen on promoting R&D and ICT.

The study found out that the company engaged in positive marketing activities aimed at gaining competitiveness and that its products were better positioned in the market compared to its competitors. The study found out that product marketing based on positive marketing activities, effective advertising activities, change in marketing techniques, investment in market research, better positioning of products, adequate budgeting techniques had a positive relationship with competitiveness. The study, however, revealed that the company had not changed its marketing techniques in the past one year, had not invested in market research and had not put in place and adequate advertising budget.

The study concluded that leadership factors had a weak positive influence on competitiveness of the company. With respect to technology, the study concluded that it was the strongest positive predictor of competitiveness. All technology factors positively and significantly influenced competitiveness. The study further concluded that product marketing also had a positive influence on competitiveness.

The study recommends that the company leadership puts more focus on nurturing, motivating and inspiring its employees as well as adapting to change and new realities in the market place. The study recommends that the company continues to embrace technology that is beneficial to its competitiveness. With respect to product marketing the study recommends that the company invests in market research and review its marketing techniques based on the market research results. The company should also put in place an adequate advertising budget. Through the study it was determined that leadership factors, technology and product marketing together only account for 60.9% of total variation in competitiveness and therefore it would be valuable to explore other factors that could explain competitiveness of company.

ACKNOWLEDGEMENT

This research project would not have been possible without the invaluable support of various people. I have benefited immensely from the wise counsel and continuous support of my supervisor, Prof. Timothy C. Okech.

I am grateful to my classmates at USIU-A, my colleagues at Savannah Cement Limited and all the people I had pleasure working with during this project. They in one way or the other contributed to and inspired the success of this work.

DEDICATION

This research project is dedicated to my family for their encouragement and support and to the Almighty God for His enduring love.

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TABLE OF CONTENTS

STUDENT’S DECLARATION ...... ii

ABSTRACT ...... iv

ACKNOWLEDGEMENT ...... vi

DEDICATION...... vii

TABLE OF CONTENTS ...... viii

LIST OF TABLES ...... xi

LIST OF FIGURES ...... xiii

LIST OF ABBREVIATIONS ...... xiv

CHAPTER ONE ...... 1

1.0 INTRODUCTION...... 1

1.1 Background of the Study ...... 1

1.2 Statement of the Problem ...... 6

1.3 General Objective ...... 7

1.4 Specific Objectives ...... 7

1.5 Significance of the Study ...... 8

1.6 Scope of the Study...... 9

1.7 Definition of Terms ...... 9

1.8 Chapter Summary ...... 10

CHAPTER TWO ...... 11

2.0 LITERATURE REVIEW ...... 11

2.1 Introduction ...... 11

2.2 Leadership and Competitiveness ...... 11

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2.3 Technology and Competitiveness ...... 15

2.4 Product Marketing and Competitiveness ...... 20

2.5 Chapter Summary ...... 25

CHAPTER THREE ...... 26

3.0 RESEARCH METHODOLOGY ...... 26

3.1 Introduction ...... 26

3.2 Research Design ...... 26

3.3 Population and Sampling Design ...... 27

3.4 Data Collection Methods ...... 29

3.5 Research Procedures ...... 30

3.6 Data Analysis Methods ...... 32

3.7 Chapter Summary ...... 32

CHAPTER FOUR ...... 33

4.0 RESULTS AND FINDINGS ...... 33

4.1 Introduction ...... 33

4.2 Response Rate and Background ...... 33

4.3 Leadership Factors and Competitiveness of Products...... 39

4.4 Technology and Competitiveness ...... 45

4.5 Product Marketing and Competitiveness ...... 51

4.6 Relationships between Leadership Factors, Technology, Product Marketing and Competitiveness ...... 55

4.7 Chapter Summary ...... 58

CHAPTER FIVE ...... 59

5.0 DISCUSSIONS, CONCLUSIONS AND RECOMMENDATIONS ...... 59

5.1 Introduction ...... 59 ix

5.2 Summary ...... 59

5.3 Discussion ...... 61

5.4 Conclusion ...... 66

5.5 Recommendations ...... 67

REFERENCES ...... 68

APPENDICES ...... 79

APPENDIX I: INTRODUCTORY LETTER ...... 79

APPENDIX II: RESEARCH QUESTIONNAIRE ...... 80

LIST OF TABLES

Table 3.1: Population Distribution ...... 27

Table 3.2: Sample Size Distribution ...... 29

Table 3.3: Overall Reliability Statistics ...... 31

Table 3.4: Item Total Statistics ...... 31

Table 4.1: Response Rate ...... 34

Table 4.2: Leadership Factors ...... 40

Table 4.3: Mean and Standard Deviation of Leadership Factors and Competitiveness ...... 41

Table 4.4: Leadership Factors Correlation Analysis...... 43

Table 4.5 Leadership Factors Model Summary ...... 43

Table 4.6 Leadership Factors Anova ...... 44

Table 4.7 Leadership Factors Coefficients ...... 44

Table 4.8 Technology and Competitiveness ...... 46

Table 4.9: Mean and Standard Deviation of Technology and Competitiveness ...... 47

Table 4.10 Technology Correlation ...... 49

Table 4.11 Technology Model Summary ...... 49

Table 4.12 Technology Anova ...... 50

Table 4.13 Coefficients of Technological Factors ...... 50

Table 4.14 Product Marketing and Competitiveness ...... 51

Table 4.15 Mean and Standard Deviation of Product Marketing and Competitiveness ...... 52

Table 4.16 Results of Correlation Analysis for Product Marketing and Competitiveness ..... 53

Table 4.17 Product Marketing Model Summary ...... 54

Table 4.18 Product Marketing Anova ...... 54

Table 4.19 Product Marketing Coefficient ...... 55

Table 4.20 Competitiveness Factors Correlation ...... 56

Table 4.21 Competitiveness Factors Model Summary ...... 56

Table 4.22 Competitiveness Factors Anova table...... 57

Table 4.23 Competitiveness Factors Coefficients ...... 57

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LIST OF FIGURES

Figure 4.1 Ages of Respondents ...... 34

Figure 4.2: Gender of Respondents ...... 35

Figure 4.3 Highest Education Level of Respondents...... 36

Figure 4.4 Experience in Years ...... 37

Figure 4.5 Departments of Work ...... 38

Figure 4.6 Departmental Position of Management ...... 39

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LIST OF ABBREVIATIONS

ARM Athi River Mining CRH Cement Roadstone Holdings GDP Gross Domestic Product ICT Information Communication Technology KEBS Kenya Bureau of Standards OECD Organisation for Economic Cooperation and Development PESTEL Political, Economic, Social, Technological, Environmental, Legal R&D Research and Development RBV Resource Based View SAP Systems Applications Products SCL Savannah Cement Limited

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CHAPTER ONE

1.0 INTRODUCTION

1.1 Background of the Study

The structure of the global cement industry is complex. It consists of cement and clinker movements within local, national, regional and global markets. The structure is very dynamic and affected by environmental factors which include public sector spending on infrastructure projects, demand for housing, macro-economic growth, spending levels, among others. There are relatively few multinational cement companies dominating the global cement market (Mukherjee, 2014). LafargeHolcim based in Switzerland is the world largest cement producer with a total capacity of 345.2 million tonnes per year. The other players in the top ten global cement producers are HeidelbergCement, Cemex, UltraTechCement, Votorantim, InterCement, CRH, Buzzi Unicem, Eurocement and Dangote Cement (Edwards, 2017).

The significant investment in the regional cement industry by some of the biggest global cement producers, LafargeHolcim, Cemex and Dangote, shows the complexity of the cement market. LafargeHolcim is the owner of the biggest cement company in Kenya, Bamburi Cement, besides holding significant shares in East African Portland Cement Co. Ltd. Nigeria based Dangote Cement plans to enter the Kenyan cement market in 2021 (Juma, 2017). The Eastern Africa region macro environment has been fairly stable given the single digit inflation levels, steady currencies and lower interest rates leading to an increase in Gross Domestic Product (GDP) growth as recorded in quarter 1 of 2016 (AIB, 2016). Cement production in the region has been driven by large infrastructure projects, for instance, the Standard Gauge railway in Kenya, booming construction activities in the region, energy infrastructure projects in Uganda, among others.

With the entry of global cement companies in the local market, competition has become aggressive than ever. Global competition has been sharpened by reduced trade barriers, spread of technology and lower costs for communication and transportation (Liargovas & Skandalis, 2012). This is true for the region and even individual countries like Kenya. The fierce competition in the global, regional and local cement market requires individual firms 1

to improve their competitiveness. Cement manufacturing firms in Kenya face increased competition exacerbated by new entrants, threat of imports and increased capacities coupled with high production costs particularly on energy, imported clinker and transport. Furthermore, Kenya's economic context is largely characterized by high inflation, high interest rates and volatility in currency fluctuations (Nyasimi & Gitau, 2016).

Several definitions of competitiveness have been suggested. Oxford dictionary defines competitiveness as the strong desire for a company to be more successful than others. Competitiveness of a firm is the ability of a firm to do better than comparable firms in sales, market share or profitability (Berger & Humphrey, 2007). Potential investors have used the firm’s relative prices or its market share and its profitability to assess its competitiveness before they make rational decisions for investment especially in the stock marks (Notta & Vlachvei, 2011). Competitiveness at macroeconomic level is defined by Michael Porter and World Economic Forum. They define the national competitiveness as a set of factors, policies and institutions that determine the level of the productivity of a country (Marginean, 2006). The focus of competitiveness has not just been a macroeconomic phenomenon but has been significant at regional and local scales (Kitson, Ron, & Tyler, 2006).

From a regional perspective, competitiveness has simply been defined as the success to which regions compete with one another in some way, for instance, export market share or ability to attract capital or human resource (Kitson, Ron, & Tyler, 2006). Michael Porter noted that competitiveness is a function of forceful innovation, progressiveness and an ability to change and improve (Porter, 1992). Porter looked at competitiveness from a productivity perspective. Krugman shared a similar view that competitiveness is just another way of saying productivity (Krugman, 1994). According to Krugman, trying to define competitiveness of a nation is more problematic than defining competitiveness of a company since competitiveness of a company is just its bottom line.

We have various models to analyze industry competitiveness. Porter (2008) analyzed competitiveness from an industry perspective as well. He is credited with the Five Forces of competitive analysis. According to him the industry forces are existing competitor rivalry, bargaining power of suppliers, bargaining power of consumers, threat of substitutes and

threat of new entrants. In addition, Porter developed the Diamond Model of industry competitiveness (1990). Porter (1990) considered competitiveness as a function of four major determinants namely, factor conditions; home demand conditions; related and supporting industries and firm strategy, structure, and rivalry.

As can been seen above, competitiveness is a multi-dimensional concept analyzing the macroeconomic level, industry level and firm level. This study will focus on the firm level of the term competitiveness. We can say a competitive firm as one which can produce services or products of superior quality and lower costs than its local and global competitors (Das & Das, 2011). Competitiveness is synonymous with a company's long-run profit performance and its ability to pay its employees and provide superior returns to its shareholders (Buckley, Christopher, & Prescott, 1988). In this context, we measure a firm’s competitiveness by its financial performance. When profitable opportunities exist, firms increase their production and sales. Thus, the existence of a good financial performance suggests a firm or industry with increasing competitiveness just as a bad financial performance suggests a firm or industry with falling competitiveness. The various financial performance measures often employed for measuring the competitiveness of companies include return on sales (ROS) which shows how much a firm earns in relation to its sales, return on assets (ROA) which shows a firm’s ability to make use of its assets and return on equity (ROE) which shows the return that investors take for their investments (Liargovas & Skandalis, 2012). Therefore, competitiveness is very important for the firm’s long run profit performance and its ability to repay its costs as well as providing better returns to the shareholders (Muiru, 2009). This study will assess the factors affecting SCL’s competitiveness in the cement industry in Kenya.

As turbulence becomes the order of day in today’s business world, competitiveness has even gained more relevance for a firm’s success and survival (Akben-Selcuk, 2016). There are several factors that affect a firm’s competitiveness. These factors could either be macro, industry or internal. Internal factors are the forces or conditions within the boundary of the firm. These factors affect the firm’s ability to be responsive and compete in the external environment. Some of the different internal factors that have been found to influence the firms responsiveness to the external environment include financial ability, human resources, 3

leadership, marketing, innovation, management commitment and firm structures (Forbes & Jermier, 2002; Delmas & Toffel, 2005).

The operations of the different internal factors compel the use of certain preferred strategies within the firm to respond to problems (Schein, 2010). When the firm solves a certain problem, it does so using the available skills, knowledge and resources (Howard-Grenville, Nash, & Cog, 2008), so it is these resources and knowledge available to the firm that represent the outcome of internal negotiation (Carlile, 2002; Howard-Grenville, 2005). The internal factors revolve around the resources and capabilities of the firm (İhsan, 2012). A resource-based view of the firm has been used to analyze the capabilities and resources of the organization to enhance its return and competitiveness (Amit & Schoemaker, 1993; Oliver, 1997).

The firms industry is where the firm is rivaled by companies who produce and supply similar goods and services (Ülgen, 2007). Porter (1990) defined industry as a group of firms that are making products or supplying services that are close substitutes for each other. Industry factors that impact the firm include buyer and suppliers bargaining power, intensity of competition and the industry and product market structure (Oliver, 1997). These are the factors sought to be analyzed in Porters Five Forces Model (Porter, 2008). Other relevant factors in the industry are rate of market growth in an industry, degree of product or service differentiation, switching costs be they supplier or customer, entry and exit barriers. How a company mitigate against the adverse effects of the industry forces determine its survival in that particular industry.

With technology and globalization the world has become borderless affecting four main factors of business namely, communications; capital; corporations; and consumers (Ohmae, 2005). The barriers to communication have been significantly reduced while capital and corporation can move almost freely to any part of the world in response to available market. Consumers are no longer confined within narrow geographical locations but are spread across the world. This has changed and broadened the external business environment making international competition even more critical (İhsan, 2012). To survive, a company must consider the macro environment in its strategies. Macro factors include political factors,

economic factors, social factors, technological factors, environmental factors and legal factors which are commonly known by the acronym PESTEL (Wambugu, 2012). To remain competitive a firm should adopt a strategic approach to the management of macro environmental events and occurrences. These factors are beyond the control of the firm but affect its operations (İhsan, 2012).

Both cement production and consumption in Kenya has been on the rise in recent years. The Kenya National Bureau of Statistics (2017) reported that total cement produced in Kenya went up from 6,352.9 thousand tonnes in 2015 to 6,707.2 thousand tonnes in 2016 while cement consumption went up from 5,708.8 thousand tonnes in 2015 to 6,302.0 thousand tonnes in 2016. Cement oversupply in Kenya has resulted in price stagnation (Dyer & Blair, 2007).

As of January 2018, there were eight cement producing companies in Kenya namely; Bamburi Cement Limited, Mombasa Cement Limited, Savannah Cement Limited, ARM Cement (Athi River Mining Ltd), East African Portland Cement Co. Ltd, National Cement Company Ltd, Rai Cement Limited and Karsan Ramji & Sons Ltd (Ndovu Cement) (AIB, 2016).

This is a case study of Savannah Cement Limited (“SCL”), a state of the art, Eco friendly cement grinding plant with a capacity of 1.5 million tonnes a year. It is located in Athi-River, 30 kilometers from Nairobi City in Kenya. SCL, which was commissioned in July 2012, is locally owned. It has a fifteen percent (15%) market share in the Kenya cement industry. SCL is currently a grinding plant – basically grinding imported clinker (main raw material), gypsum and pozzolana to produce two products namely Cement type 1 or CEM 1 42.5 and Cement type IV or CEM IV 32.5R. CEM I 42.5 (cement class traditionally referred to as Ordinary Portland Cement) is high strength cement, with a twenty eight day compressive strength of 42.5 million Pascals, (MPA) hence its name CEM I 42.5. This kind of cement is used in areas requiring high strength like in building of bridges, high rise buildings, and building slabs. The CEM IV 32.5R is a medium strength cement that has a 28 day compressive strength of 32.5MPA. This is general purpose cement used in brick laying, plastering and any other general purpose (Savannah-Cement, 2016)

The grinding plant is a combination of roller press and V-separator before the mill technology - the first of its kind in the region – making the plant the most energy-efficient in the region. A One Thousand Two Hundred tonnes per day pozzolana drier is also in place to ensure moisture free mill feed. The packing plant is equipped with three modern eight spout rotor packers with a combined loading capacity of at least than six thousand tons per day. A bulk loading facility is also installed for loading bulk cement on to road tankers.

Savannah Cement Limited’s market share has remained at around 15% in the last 3 years despite its objective to acquire at least 25% market within its 5 year of operation. This has warranted a review into factors determining its competitiveness in the Kenya cement industry.

1.2 Statement of the Problem

With the growth of cement production and consumption, competition is more intensified, eating into the industry’s margins. The industry’s net profit margin averaged 10 per cent in 2015 down from 15 percent in 2011. Cement prices have fallen from an average of $140 per ton in 2011 to an average of $100 in 2015 (AIB, 2016). While SCL’s sales have increased year on year in the last three years, its profit has decreased year on year within the same period. This suggests depressed margins driven by reduced cement selling price and possibly increased production costs. For SCL to enhance its profitability and earn an acceptable return to shareholders and other stakeholders it needs to assess its competitiveness in the industry. Shareholders and lenders expect a firm to preserve and enhance the wealth they have entrusted to it (Hitt, Ireland, & Hoskisson, 2016).

While substantial studies have been done on competitiveness at the regional level there is little published work on competitiveness at the firm level globally (Muiru, 2009). Nyasimi and Gitau (2016) studied effects of strategic responses on competitiveness and sustainability in cement manufacturing firms in Kenya and found that there is high level of competition between the cement manufacturing companies and hence the firms need to put in place strategies to counter the competition in order to gain competitive advantage. Liargovas and Skandalis (2012) examined the financial and non-financial determinants of firm competitiveness by studying 102 Greek firms. Their focus was to review the impact of key 6

determinants of a firm’s competitiveness. They found out that leverage, export activity, location, size and the index for management competence significantly affected firm competitiveness. Moturi (2017) evaluated the effect of internal factors on the financial performance of firms in the cement manufacturing industry in Kenya. The study found out that that internal factors and financial performance ratios were the driving force for cement manufacturing companies in relation to their financial health. Nyawira (2010) examined the responses by cement companies to the strategic challenges posed by competition in the cement industry in Kenya. The study found out that the main strategic response that was common between both the multinational cement companies and the indigenous cement companies was expansion of production capacity. Mbongwe, Nyagol, Amunkete, Humavindu, Khumalo, Nguruse, & Chokwe (2014) assessed the cement market dynamics including barriers to entry, regulatory arrangements, and the outcomes observed in terms of price and supply across Botswana, Kenya, Namibia, South Africa, Tanzania and Zambia. The study found the cement industry across the countries examined to be a tight oligopoly with a small number of producers controlling operations across countries.

From the literature reviewed, not much has been done in terms of competitiveness studies at the firm level in the cement industry and thus informed policies cannot be formulated. For Kenya to be competitive as a country, the individual firms need to be competitive. This study therefore bridged this gap of knowledge by analyzing factors affecting competitiveness of SCL in Kenya.

1.3 General Objective

The main objective of this study was to establish factors affecting competitiveness of Savannah Cement Limited in Kenya.

1.4 Specific Objectives

The specific objectives of the study were:

1.4.1 To examine how leadership factors affect competitiveness of Savannah Cement Limited in Kenya.

1.4.2 To establish the influence of technology on the competitiveness of Savannah Cement Limited in Kenya

1.4.3 To find out how product marketing influence competitiveness of Savannah Cement Limited in Kenya.

1.5 Significance of the Study

This study is expected to be useful to a number of key stakeholders. These consist of not only the management of Savannah Cement Ltd but other similar management in the cement industry, researchers and academicians, and government policy makers. The following sub- sections illustrate how the various stakeholders are likely to gain from the study.

1.5.1 Savannah Cement Limited Management

The findings of this study will be beneficial to SCL management. They will understand the areas they need to focus to improve SCL competitiveness. With the help of this study findings, they will be able to formulate strategies in terms of leadership, technology and product marketing relevant for enhancing competitiveness.

1.5.2 Government Policy Makers

The findings of this study will also be valuable to policy makers in government institutions on matters concerning competition in the cement industry in Kenya and how to regulate the industry. Policy makers will develop an understanding of the areas they need to monitor and regulate to fuel fair competition in the cement industry to protect both the consumers and the cement firms.

1.5.3 Researchers and Academicians

The findings of this study will be important to academicians and researchers of factors affecting competitiveness of a firm in the cement industry in Kenya. Findings of this study

will form useful reference materials to future researchers besides other areas where they can carry out research on.

1.6 Scope of the Study

The study was confined to SCL and the factors affecting its competitiveness in Kenya. This was arrived at based on the assumption that, SCL being one of the major players in Kenya cement industry, the factors could easily be related to the other cement players. The study focused on SCL employees, the manufacturing plant and offices in Athi River, Machakos County. A sample size of 118 employees was selected based on Yamane (1973) statistical formula and data was collected and analyzed. The study was carried in between the month of March 2018 to June 2018. The study evaluated leadership factors, technology and product marketing in SCL. The influence of these three factors on competitiveness of the organization was evaluated.

1.7 Definition of Terms

The common occurring terms in this study are defined below

1.7.1 Cement

Cement is defined as a hydraulic binder, i.e., a finely ground inorganic material which when mixed with water forms a paste which set and hardens by means of hydration reactions and processes and which after hardening retains its strength and stability even under water (Hüschelrath, Müller, & Veith, 2013).

1.7.2 Clinker

Clinker is a dark grey nodular material produced by high-temperature reaction of a lime- bearing material with one containing silica, alumina and ferrous materials. It is the main raw material in cement production. (Charn-Hoon, Hyun-Seo, Chung-Bong & Ji-Whan, 2004)

1.7.3 Competitiveness

Competitiveness is the ability to design, produce and market products or services superior to those offered by competitors, considering price and non-price factors (Momaya, Shee, & Ajitabh, 2001).

1.8 Chapter Summary

This chapter begins with a background of the global cement market, delves into the regional market, the local industry then focuses on SCL specifically. The statement of the problem identifies the knowledge gap which necessitates the study. The objectives of this study, both the general and specific, are clearly identified to guide the study. Significance of the study and scope are clearly defined for purposes of clarity. In chapter two, the relevant literature was reviewed with respect to the subject under study based on the research objectives. Chapter three presented the research method used to carry out the research focusing on the research design, population and sampling design, data collection methods, research procedures, data analysis methods and presentation. Chapter four presented the results and findings of the study and ultimately chapter five presented the summary, discussion of the results, conclusions and recommendations of the study in that order.

CHAPTER TWO

2.0 LITERATURE REVIEW

2.1 Introduction

This chapter discusses the relevant literature with respect to the subject under study with a particular focus on the specific objectives of the research. The study draws materials from various sources which are related to the subject under study.

2.2 Leadership and Competitiveness

Leadership factors have been widely studied. Limsila and Ogunlana (2008) argued that the word leadership has varied meanings depending on the scholar defining it. It has been defined in terms of the personality, position, responsibility, influence process, an instrument to achieve a goal, behaviours, result from interaction and given some other meanings by various scholars. The common theme in all the definitions is directing people towards an objective. So it can be inferred to be the process of influencing followers lend their efforts towards achieving an objective. Their study focused on three types of leadership styles, namely; laissez‐ faire style, transactional leadership; and transformational leadership. Laissez‐ faire style is the avoidant leader who may not care about the subordinates and is non-productive. Transactional leaders focus mainly on the physical and the security needs of subordinates, basically based on bargaining exchange or reward systems. Transformational style on the other hand encourages subordinates to put in extra effort and to go beyond their call of duty. They are motivated to perform beyond expectation. They continued to argue that transformational leaders achieve the highest level of performance from followers given that they are able to motivate them and increase their skills for creativity, innovativeness and success.

Transactional and transformational styles of leadership are distinct. Gitonga (2016) differentiated between transactional and transformational leadership. Whereas transactional leaders achieve their leadership through discrete exchange transformational leaders achieve their leadership through motivating and inspiring their follows to achieve exceptional 11

outcomes. Menguc, Auh, & Shih (2013) defines transformational leadership as a process where leaders and followers participate in a mutual process of uplifting one another to higher levels of motivation and morality. He argues that transactional leadership is less effective compared to transformational leadership. Menguc et al. (2013) continue to argue that improvements in transformational-leadership-based competencies should enhance competitiveness.

Transformation leadership is more acclaimed than transactional leadership. Kaur (2012) studied the difference between transformational and transactional leadership. The context of the study was selected public and private sector banks in Chandigarh. He argued that a positive perception of employees towards leadership behaviour (transformational and transactional) puts in more effort in their duties when they get inspiration to shine their performance and ensure both financial and non-financial rewards as required in return by their leaders. He argued that leaders appraise, give feedback and coach their employees when productivity is below expectation and reward them upon achievement of targets. According to him, there are many mechanisms of motivating employees by their leaders which includes being a role model, challenging them to take responsibility and ownership for their work and understanding them. This kind of leadership, which is transformational in nature, he posits, will identify and nurture talent. It has been argued that transformational leaders support their followers to learn and develop as individuals by inspiring and encouraging them with a handy range of behavioral and decision-making skills. Box and Miller (2011) studied the benefits and effectiveness of transformational leadership in terms of leadership and the training of leaders.

2.2.1 Innovation and Competitiveness

Leadership factors occupy a central role in the firms degree of innovation and creativity. Lochomoruk (2014) argued that in today’s turbulent environment, creativity and innovation was fundamental to achieve organizational success. She argued that it is the role of leaders to tap creativity in organizations by establishing conducive environment for incubation and delivery of creativity and innovation. Such innovation and creativity will enhance the firms competitiveness. As Kaur (2012) argued, leaders are the promoters that establish and 12

manage the firms internal environment, culture and strategies that fuel sustained innovation, creativity and organizational success.

For a firm to survive in the cut-throat global competition and environmental turbulence it calls for an innovative approach so as to drive the organizations forward. This innovative approach will turn innovative concepts into reality. Employees have a general tendency to resist change in the face of turbulence and this can be managed through effective leadership intervention which will secure a firms survival. She argued that a leader needs to clearly communicate the organziational vision and strategic goals. Clearly formulated organizational goals need innovative leadership to achieve maximum organizational success. It is the duty of leadership to smell unexpected changes in the business environment and create innovative strategies to cope with them (Lochomoruk, 2014).

Leadership and innovation are organizational processes enshrined in organizational decision streams. It identified five forces of leadership and innovation which provide a model of decision processes. The five forces of effective leadership are organizational skills and capabilities, capacity to learn, capacity to listen, capacity to motivate, and capacity for organizational innovation. He further argues that low innovation organizations are caused by management. Top management sets the tone at the top, create the right decision making climate and employee motivation. They lead by example as their mannerisms establish the overall behaviour of the firm. Top management weaknesses, for instance, arrogance and imperious style, permeate into the entire firm and inhibit learning and innovation (McMillan, 2010).

Sustained competitiveness is dependent on continuous product, service and process innovation. They suggested that innovation and transformational leadership are related. Their study found that transformational leadership was need in moments of a firms change since it produces better outcomes for the firm as well as innovative processes and products. They concluded by proposing that leaders who motivate their staff to identify with their team, and create a positive team climate, not only maintain sustained innovation and creativity but

possibly motivate staff to exploit opportunities created by changes in the business environment (Paulsen, Callan, Ayoko, and Saunders, 2013).

2.2.2 Strategy Implementation and Competitiveness

Several scholars have studied organisation leadership and implementation of strategy. Katuse, Kiriri, and Kyalo (2016) studied the influence of organizational leadership and strategy implementation. They argued that firms in all sectors are working hard to survive in the face competition, surprising changes, globalization changes in technology among others. Many companies spend a lot of time planning and formulating strategies but very poor at implementation. Organizational leadership is critical to strategy implementation. Cater & Pucko (2010) studies 172 Slovenian companies and reported that ineffective leadership was the primary obstruction to strategy implementation. They further argued that adapting the organizational structure so as to implement strategy positively influence performance of the organization. Rajasekar (2014) suggested that for strategy implementation to succeed both employees and all department need to be passionate about the process and that having the people drive the agenda will have a positive impact on the strategy implementation.

Leadership is crucial both in managing through others people and assisting in the activities required to ensure that firms manage with change in the every turbulent business environment. Strategic leadership actions include defining the strategic direction of the firm, developing controls, management of the firms resources, defining and managing culture and ethical practices (Katuse, Kiriri, & Kyalo, 2016). These activities are key in implementation of strategy and leaders who practice them will pride in effective strategy implementation and enhance organizational performance (Gumusluoglu & Ilsev, 2009).

One of the most critical responsibilities of leadership is to motivate employees in a firm. Motivation is fundamental for improved employee performance. The leadership must be a vibrant force in motivating employees involved in implementation of strategy. They must comprehend the process of employee motivation which includes understanding the employees needs which are diverse and the effort the employees employ to meet such needs. Understanding the employees needs will influence the kind of motivation for that particular 14

employee. Human needs are continues, so is motivation. There must be a deliverable leadership process of identifying emerging employee needs and creating mechanisms to satisfy them either through monetary or non-monetary ways. Leader must design innovative employee motivation strategies to enhance employee performance (Katuse, Kiriri, & Kyalo, 2016).

Organizational leadership involves directing the firm to manage constant change, which requires top leadership to embrace change by re-assessing strategic intent, building their firms and influencing the firms culture to align with the challenges and opportunities coming along with change. In addition top leadership is availed with the required skills to enable them cope with continuous change which calls for visionary and operational leadership. They continue to argue that the leaders education, principles and perseverance are the critical building blocks for organizations in today’s business world which are keenly watched by all stakeholders. Firms are more effective and successful if leaders lead and show their followers what they are supposed to do by example (Pearce & Robinson, 2013).

Leadership carries a significant sway in the success of strategy implementation. In their study, Katuse, Kiriri and Kyalo (2016), concluded that a firms top leadership play critical roles in strategy implementation, for instance, coming up with strategic plans, giving direction and support and ensuring they are properly implemented. The leaders ensure that a proper monitoring and evaluation system is embedded within the strategic plans for constant feedback on strategy implementation. A firms leadership coordinates the entire process from strategic planning through implementation up to evaluation and monitoring. Their study found out that poor leadership is a disaster to strategy implementation. The reverse is true.

2.3 Technology and Competitiveness

Technology has attracted numerous definitions. White and Bruton (2011) define technology simply as “the practical implementation of learning and knowledge by individuals and organizations to aid human endeavor. Technology is the knowledge, products, processes, tools, and systems used in the creation of goods or in the provision of services” (p. 15). They argue that technology enhances a firms communication and pushes it to lower costs and 15

increases outsourcing. Technology is billed as a major driving force for organizational success (Antoniou & Ansoff, 2007). Sarvan, Durmuş, Köksal, Başer, Dirlik, Atalay & Almaz, (2011) argued that the real power of organizations with respect to competitiveness depends on their ability to create knowledge and access to information. We shall therefore focus on those two areas, namely; Research and Development (knowledge creation) and access to information (information communication technology) and link them to competitiveness.

2.3.1 Research and Development and Competitiveness

Research and development (R&D) plays an important role to a firms competitiveness. According to Hagedoorn (2002) R&D refers to the programs and activities devoted to devoted to growing scientific or technical knowledge and then applying that knowledge to the development of new and improved processes and products. OECD (1993) defines R&D as comprising of creative work done on a systematic basis so as to increase the stock of knowledge, particularly knowledge of man, culture and society, including the utilization of this stock of knowledge to develop new applications. Accordingly, R&D brings to fore and fuels a firms innovative capability.

The criticality of R&D in optimizing utilization of the firms resources and capabilities has been studied. Tsoukatos, Psimarni-Voulgaris, Lemonakis, and Vassakis (2017) argued under the resource-based view (RBV) of the firm, an organizations primary goal is profit maximization through augmenting and taking advantage of its resources and capabilities (Tsang, 2000). How a firm can create value through knowledge creation and information access will go a big way in determining its competitiveness. They suggested that innovation encompasses changes in management and organizational responsibilities, creating new customers and markets and products and services, especially creative ventures of knowledge and information. Innovation is essential in order for firms to enhance their ability to absorb new technology and knowledge developed either at a firm or industry level. Vassakis, Voulgaris, Xekardakis, & Lemonakis (2015) argued that innovation and knowledge are considered essential factors for a firms survival and success. Both tangible and intangible R&D expenditures and investments in innovation positively affect the competitiveness of a 16

firm. Reguia (2014) described innovation as the discovery of an idea that will steer the business to competitiveness if well implemented.

A firm with highly educated and knowledgeable employees is likely to have a higher absorptive ability that is accessing, creation and implementation of new knowledge thus enhancing the firms competitiveness in its market place. According to Faria and Barbosa (2013) an organizations investment in innovation and technology enhances its knowledge capability while absorbing externally derived knowledge (Faria & Barbosa, 2013). Additionally, new innovations and technology are industry specific determined by the degree of an organizations capacity to absorb technological enhancements and innovation (Bobillo, Rodriguez & Tejerina, 2006).

Organizations have to compete along parallel avenues, for instance, developing and implementing new services and products, designing proper marketing strategies, development of uncharted markets (Singh, Garg, and Deshmukh, 2010). Then it can be argued that it is how a firm maximizes the resources and capabilities at its disposal to design new knowledge and innovation that will make it compete and survive in the turbulent environment. Love, Roper, & Du (2009) argued that innovation and creativity is key to a firms entry, survival and growth in the market. Consumer tastes and preferences and their needs and wants are evolving by the minute augmented by heightened globalization and technological advancement. The changing needs and wants are progressively manipulating the principles of competitive paradigms (Tsoukatos et al., 2017) and calling for a more responsive and technologically advanced firm in order to survive. Faria & Barbosa (2013) suggested that innovative organizations increase their competitive advantage through establishing a temporary monopoly power and generating profits from exploiting advantages born out of their reputation, superior learning capabilities and economies of scale.

R&D is central to a firms innovativeness. Filippetti (2011) in his examination of the role of design and R&D as a source of innovation, found out that besides design, R&D was a source of a firms innovation. Koellinger (2008) using a conceptual framework examined the correlation of innovation, technology and firm performance and found a positive correlation 17

between innovation and turnover and employment growth. Tsoukatos et al. (2017) noted that R&D activity is a major internal source of knowledge and major determinant of an organizations competitiveness. To understand the different strategy types and effect on a firms performance it is key to distinguish between product and process innovation (Bogliacino & Pianta, 2010).

Product innovation provides competitiveness through new and improved products while process innovation provides competitiveness through efficient manufacturing and production systems and procedures. Muthoni (2017) argued that product innovation is critical for a firms competitiveness in the market space through creation of a more powerful product than the exisiting one. Kanagal (2015) noted that product innovation is required for a firm to deal with competitive pressures, short product life-cyles, consumer tastes and preferences, customer needs and wants, changing demand patterns and advancement in technology. According to Stawicki (2010) product innovation is a tool firms use to deal with competition and introduce new products to the market, expand market share and obviate the need to compete on price alone. Product improvements can be used to develop new interests to counter declining interest in already existing products (Meyer & Thu Tran, 2006).

Process innovation favourably modifies the firms production process to create new manufacturing techniques, administration procedures for the betterment of the entire production and management process (Muthoni, 2017). Through process innovation a firm increases efficiency and cuts down on costs while improving the product features. O’Sullivan & Dooley (2009) noted that process innovation targets a firms operational activities which create the firms competitiveness through product quality improvement and efficiency in product distribution in the market. Since process innovation has the effect of lowering a the product cost the firm can gain competitiveness through offering the product to the market at an efficient price to the benefit of both the firm and the customer (Muthoni, 2017).

2.3.2 Information Communication Technology and Competitiveness

Information Communication Technology (ICT) has been defined by several scholars. Rouse (2013) defined ICT as an umbrella word that includes any communication application or tool, including television, radio, cellular phones, computer and network software and hardware, satellite systems and the several applications and services related to them, for instance, video conferencing and distance learning. Okauru, (2010) defined ICT as the digital utilization and processing utilization of data and information using electronic computers. Tan, Chong, Eze, & Lin (2009) defined ICT as use of Information and Communication Technology devices including computer network, hardware and software required for internet connection. Akinfolarin & Rufai (2017) noted that despite the various scholarly definitions of ICT it can be defined as the use of modern technological equipment to enhance effective communication or ensure effective information flow in an organization.

The effect of ICT on profitability of a firm has been studied. In their study, Mithas, Tafti, Bardhan, and Goh (2012), found out that ICT had a positive impact on a firms profitability through enabled revenue growth. They proposed three reasons to explain why overall ICT investments were like to positively affect a firms profits. First, with a firms continuous investment in ICT the firm can maintain a more proactive digital posture and benefits from the learning thus becoming better at managing ICT. Second, such continuous investment and experience in ICT benefits the firm with respect to improving the firms capacity to leverage from information and strengthen organizational capabilities such as improved customer satisfaction and reduced marketing spend. Their third explanation was that due to possibly exhausted production cost reduction as a result of process automation, revenue growth driven by ICT through differentiation may be more promising for the firm. They posited that IT investments enhance revenue growth through new marketing and distribution channels, new value propositions and better management of the customer life cycle.

In today’s era of technological advancement and economic globalization acquiring ICT to support business operations is a fundamental increasing the firms competitiveness. Firms must be capable of adopting and adapting new technologies. They need to stay ahead of

change and constantly upgrade themselves by learning, re-learning and upgrading their skills in ICT knowledge to improve on product quality and market share (Hashim, 2007).

The impact of ICT on an organizations performance is establishment of more effective processes leading to development of higher quality products (Vinas, Bessant, Perez, & Gonzal, 2001). Gordon and Tarafdar (2010) argued that firms promoting R&D invested heavily on ICT since these systems decrease coordination costs and enhance firms capacity to conduct R&D activities more efficiently. Therefore, according to Tsoukatos et al., (2017) the efficient execution of Total Quality Management (TQM) can significantly increase competitiveness. In the same stance, inadequate investment in ICT can act as a significant barrier to a firms competitiveness since such a firm does not invest in the development of expensive Enterprise Resource Planning (ERP) systems (such as SAP) to seamlessly manage the firms operations.

2.4 Product Marketing and Competitiveness

The impact of product marketing on competitiveness is another area that has received wide research. Armstrong and Kotler (2015) observed that marketing is meeting customer needs. They argued that marketing has evolved beyond the traditional advertising and selling activities. They introduced this 12 edition of the book by noting that marketing starts with comprehending customer needs and wants, making a decision as to which target markets the firm can serve best, and establishing a convincing value proposition by which the firm can attract, maintain, and grow targeted consumers.

It involves building a deep consumer relationship and securing the firms brand as part of the consumers conversation. With advanced technology and digitization, in addition to the traditional marketing approaches marketers can access an incredible set of new customers relationship-building tools be they smartphones, social media, tablets among other tools – for real time engagement with consumers regardless of the place and time. They proposed that if marketers make use of these important marketing tools and techniques then they will reap enormous rewards with respect to market share, profits, and customer equity. They defined

marketing as the process whereby firms create value for consumers and build strong consumer relationships so as to capture value from consumers in return.

To the extent that a firm can differentiate and position itself as providing superior consumer value, it generates competitiveness. Further, Armstrong & Kotler (2015) posit that the four Ps of marketing mix (being the Product, Price, Promotion and Place) comprises of tactical marketing tools combined into an integrated marketing package that actually delivers the intended value to target consumers. Their book is heavy on the concept of value. To cultivate profitable relationships with target consumers, a firm must comprehend consumer needs and deliver more value than competition.

Marketing can be seen from different perspectives. Ouma (2012) argued that it should be seen from the environment or conditions from which it is operating since this affects the kind of marketing mix to be employed. She posits that marketing involves understanding customers’ needs and wants and providing it to them at a profit. She underscores the customer orientation and commercial process of marketing. It therefore entails identifying consumers, understanding their needs and satisfying those needs profitably. She further defines marketing as a series of interconnected activities involving a series of services starting with production to consumption of products. According to her, marketing is a both a managerial and social process because there must be interaction between the buyer and the seller and it involves certain management functions. She summarizes by observing that marketing systems are dynamic and involve constant improvement and change.

Globalization has made the world borderless and heightened competition since local firms can feel the weight of global competition at home (Ohmae, 2005). Consequently, organizations need to re-strategize to counter these globalization forces (Kariuki, 2015). This means organizations managers should focus on the globe as a unified market and not on countries as individual markets (Tsiotsou & Goldsmith, 2012). The changing global environment coupled with improved technology significantly affects how firms develop their marketing strategies (Bertoli & Resciniti, 2012).

2.4.1 Advertising and Competitiveness

Advertising helps a firm communicate with its target customers. Armstrong and Kotler (2015) noted that advertisement can be traced back to the very beginning of recorded history. They argued that a firm must make four key decisions when coming up with an advertising program, namely; put down the advertising objectives, come up with the advertising budget, establishing the advertising strategy, and assessing advertising campaigns. Hansen & Christensen (2003) defined advertising as any method of non-personal message and promotion of goods, services and ideas. It is any form of communication that delivers message to target consumers about a firms products and services.

The role of advertising in ensuring a firms competitiveness is critical. Manickam (2014) observed that the role of advertising is expanded in today’s competitive business world, as firms allocate huge sums of money to build brands, identify, target, reach, and influence target customers to consume their services or products. It has the role of awareness creation, provision of required information to the target customers and improving the product knowledge leading to purchase by the customer. Advertisement has been described as a marketing strategy tool utilized by firms to positively influence a customer’s buying decision towards the firms brand (Tan & Rashad, 2014).

There are different tools of advertising. Manickam (2014) further argued that firms employ different advertising tools to communicate and it is critical to carefully identify the impact and role of the advertising tools for effectiveness in reaching the target customers. The firm may employ a mix of traditional marketing tools and the modern marketing tools. Traditional media include printed media advertisements, broadcast on radio and television, outdoor billboards, brochures among others. The major traditional media include face-to-face or personal selling, direct-mail marketing, catalog marketing, telemarketing, direct-response television (DRTV) marketing, and kiosk marketing (Armstrong & Kotler, 2015). Driven by the predominance of technology social media advertisement is now taking center stage. According to Golden (2011) social media marketing utilized pull techniques to interest consumers based on the attraction of consumer due to good content hence it allows them to

engage. Traditional marketing pushes the firms products to the potential consumers through the traditional media tools. According to Scott (2010) social media has also opened a remarkable opportunity for firms to directly reach target customers with targeted messages that are much less costly than traditional marketing media.

Advertising is becoming more complicated than ever. Owing to digitization customers are well informed and more empowered. Rather than depending on marketer supplied information, they can utilize the Internet, social media, and other technologies to discover the information on their own. The can easily connect with other consumers online on a real time basis and exchange product information (Armstrong & Kotler, 2015). Although traditional advertising media remain useful, their importance is waning. The changing dynamic in the advertising world invite innovative advertising strategies as social media like Facebook, Instagram, WhatsApp and others have taken the market by storm. Firms need to creatively integrate the various advertising to optimally enhance the firm brand image. Growth in the firms brand improves the firms competitiveness as it translates to additional sales and market share.

2.4.2 Differentiation and Positioning and Competitiveness

Differentiation calls for a firm to be unique in its industry in its offering to the consumers. Armstrong and Kotler (2015) observed that beyond deciding on the target market the firm must first decide its value proposition—that is how it will build differentiated value for niche consumers and what positions it aims to occupy in those segments. A product position is the way a product or service is defined by customers on key characteristics — the place the product or service occupies in the customers minds relative to those of competitors. They further argued that to develop profitable relationships with target consumers, a firm must understand consumer needs and deliver better customer value than competition. To the extent that a firm can differentiate and position itself as offering superior customer value, it gains competitiveness.

The foremost literature on differentiation is provided by Porter (1985) where he notes that differentiation involves the creation of a product or services that is perceived throughout its 23

industry as unique. Differentiation is one of Porter’s generic strategies alongside cost leadership and focus. Based on the product uniqueness, the firm may charge a premium on the service or product. Examples here are unique designs, unique features, customer service, brand image, technology among others (Tanwar, 2013). According to Porter (1985), differentiation is a viable strategy for making above average returns in trading since with increasing brand loyalty, price sensitivity decreases. Customer loyalty can also act as barrier to entry for new organization who must develop their distinctive uniqueness to compete successfully. According to Porter (1992), a differentiation strategy doesn’t mean that a firm ignores costs but rather costs are not the main strategic target. There a firm that can attain and sustain differentiation becomes highly competitive if its price premium surpasses the marginal cost suffered in achieving uniqueness. This is underscored by Robinson (2015) who observes that a successful differentiation strategy permits a firm to provide a product of perceived greater value to consumers at a “differentiation cost” lower than the “value premium” to consumers.

Firms must more than ever analyze their brand position in the market. Elzinga and Rodgers (2008) argued that as product varieties become more crowded and marketing budgets get more suppressed firms must rethink the strategy to brand positioning. They posit that creating a compelling and differentiated brand positioning can bring form that difference between blasé market performance and blockbuster. Their definition of positioning includes deep understanding of customer needs, a well-defined target market and a unique point of differentiation. According to them these key elements are reflected in a concise depiction that shows the benefits delivered by the brand to provide emotional connection and persuasion to the consumer to make a purchase decision swayed by the power of the brand. They clarify their argument by noting that a good brand positioning stipulates a clear target market, defines the product and its purpose, and avails a distinctive reason to the consumer to trust the benefit projected is real. This will improve a firms performance in the industry relative to the competitors.

Firms pursuing a differentiation strategy endeavor to develop and market unique products and services for wide-ranging customer segments. They intent to deliver a superior 24

satisfaction of consumer needs in one or numerous product or service features and cultivate customer loyalty which will allow the firm to charge a premium price for the product or service (Morshett, Swoboda, & Schramm-Klein, 2006).

Porter’s generic strategies is another subject that has been well studied. Ouma and Oloko (2015) studied the relationship between Porter’s generic strategies and competitive advantage. They focused on bus companies plying the Kisumu-Nairobi route in Kenya. They argued that the generic of differentiation strategy comprises of developing a market position that is seen as being unique and sustainable in the industry over the long run. As Porter (1985) stated, they posit that competitive strategies entail the creation of attributes that characterize a firm and differentiate its offering and value proposition in comparison to that of competition in the market. Their study found out that the introduction of a wide range of differentiated products and services makes the firm more attractive thus giving it competitiveness against its rivals.

2.5 Chapter Summary

This chapter has discussed the effect of leadership factors on competitiveness with a focus on innovation and strategy implementation; the effect of technology on competitiveness with a focus on research and development and information communication technology and the influence of product marketing on competitiveness with a focus on advertising, differentiation and positioning. Numerous relevant literature has been reviewed in those areas. The next chapter focuses on the research design and methodology used in collecting the data.

CHAPTER THREE

3.0 RESEARCH METHODOLOGY

3.1 Introduction

This chapter presents the research method used to carry out the research in order to attain the objectives of the study. It focuses on the research design, population and sampling design, data collection methods, research procedures, data analysis methods and presentation.

3.2 Research Design

A study research design is the planned structure that clearly demonstrates how the researcher proposes to carry out the numerous activities of the study in order to satisfy the objectives of the study in an orderly way. Cooper and Schindler (2014) defined research design as the plan and strategy constructed so as to enable the researcher to thoroughly answer the research questions. According to Babbie (2015) it is a the comprehensible design that outlines the ways in which data is collected and examined and results be obtained.

This study employed a descriptive survey research design. According to Creswell (2014) a descriptive research design collects information that concerns the current status of the occurrence and describes what exists with regards to the variables in a particular situation. Saunders, Lewis and Thornhill (2016) state that a descriptive design includes case study, correlational design and survey. In a survey, the sampled respondents give answers to the questions of interest either through face-to-face interview, questionnaire or telephone interview. Therefore in order to effectively examine the factors affecting competitiveness of Savannah Cement in Kenya, a descriptive design helped in offering a description of the three dimensions of leadership factors, technology, and product marketing and how they affect the competitiveness of SCL in Kenya. This design was used due to the fact that it supports studies that establish the relationship between study variables and it is very effective in the collection of detailed information.

3.3 Population and Sampling Design

3.3.1 Population

Population is the total collection of elements with common observable characteristics that the researcher plans to collect data that will be used to make conclusion on the population after the data analysis (Cooper & Schindler, 2014). According to Saunders, Lewis and Thornhill (2016) a population is the universe of place, people or things to be examined. The target population of interest in this study consisted of all employees of Savannah Cement Limited in Kenya which currently stands at 168 employees. Table 3.1 shows the study population distribution.

Table 3.1: Population Distribution

Department Population Size Percentage Finance 35 21% Procurement 4 2% Internal Audit 2 1% Security 3 2% Human Resource and Administration 9 5% Executive Office 2 1% Safety, Health and Environment 1 1% Manufacturing 80 48% Sales and Marketing 32 19% Total 168 100% Source: Savannah Cement Limited (2018)

3.3.2 Sampling Design

The sampling design is the sampling frame, sampling technique and the sample size that will be used in the study. These are discussed under the following sub-topics.

3.3.2.1 Sampling Frame

Sampling frame is the complete list of all the items in the target population from which the study obtains a sample (Saunders et al., 2016). In this study, the list constituted all 168 employees of Savannah Cement Limited in Kenya as established as at June 2018. This list was obtained from SCL human resources department.

3.3.2.2 Sampling Technique

There are various types of sampling techniques. Cooper and Schindler (2014) explained sampling technique as the approaches in which the sample will be selected from the population. This study adopted stratified random sampling technique by dividing the population into different groups/ strata. This technique was used as it ensured that all individual groups or strata are represented in the sampling process and fairly represents the population on particular characteristics (Saunders et al., 2016). This sampling technique as noted by Cooper & Schindler (2014) gives chance of selection for the entire target population so that the outcome could be generalized. The population in this study was grouped based on the different departments as shown in Table 3.2. Within each department or strata, individual employees were selected using simple random sampling.

3.3.2.3 Sample Size

Sample size is a smaller set of the entire population (Cooper & Schindler, 2014). The study adopted Yamane (1973) statistical formula to choose an appropriate sample size from the population since the population is known (finite). The formula at 95% confidence level was used to determine the representative sample size from the different departments of Savannah Cement Limited as follows: n=N/(1+ Ne2) Where: n = the required sample size N= size of the population E = alpha level, that is, allowable error e = 0.05 at 95% level of confidence n=168/(1+168(0.05*0.05))=168/1.42 = 118 28

The study utilized a sample size of 118 employees of Savannah Cement Limited which was proportionately allocated based on the population size of each strata as shown in Table 3.2.

Table 3.2: Sample Size Distribution

Department Population % Sample Size (using Sample Size Size proportional allocation procedure) Finance 35 21% 25 Procurement 4 2% 3 Internal Audit 2 1% 1 Security 3 2% 2 Human Resource and 9 5% 6 Administration Executive Office 2 1% 1 Safety, Health and Environment 1 1% 1 Manufacturing 80 48% 56 Sales and Marketing 32 19% 22 Total 168 100% 118 Source: own computation

3.4 Data Collection Methods

Data collection method is described as the gathering of data for the purpose of conducting an analysis on it to come up with inferences from the data (Cooper & Schindler, 2014). A structured questionnaire was adopted in this research as a method of collecting primary data. Saunders et al., (2016) observed that a questionnaire is generally an appropriate tool for standardized questions to avoid misunderstanding as well as appropriate for descriptive study as it allows the examination of the perceptions of respondent with respect to the study variables.

The questionnaire comprised of closed ended questions, checklist questions and five point Likert (1932) scale ranging from 1 – 5 where 1 = Strongly Disagree (SD), 2 = Disagree (D), 3 = Neither (N), 4 = Agree (A) and 5 = Strongly Agree (SA). The design of the questionnaire included four parts with the first part containing questions on the background and

demographic information of the respondent while the other three parts captured questions relating to the study objectives.

3.5 Research Procedures

Research procedure provides the researcher a better understanding of the specific concepts (Ogwang, 2017). This study was carried out in a systematic process so as to ensure reliability of the final output of the research. The researcher sought permission from management of Savannah Cement Limited through the dean school of business, USIU-A. This facilitated accessibility to the respondents of the study. A pilot study was carried out to test the reliability and validity of the questionnaire. According to Sekaran & Bougie (2016) a pilot test is important for validity of a study and reliability of a research instrument. In the pilot study data was collected from 20 respondents drawn from all strata proportionate to the population distribution. The pilot study enabled the researcher to modify the questionnaire so as clarify ambiguous questions and eliminate irrelevant questions.

The actual study was conducted after adjusting the questionnaire in line with pilot test. The researcher coordinated with human resource management at Savannah Cement Limited to facilitate data collection through a drop and pick method. This helped to guarantee a high response rate because respondents had ample time to give their responses.

3.5.1 Validity and Reliability

Validity refers to an extent to which a concept is adequately measured in a quantitative study while reliability refers to consistent accuracy of an instrument used in the measurement. Therefore a validity and reliability test is used to measure the consistency of responses across all questions utilized in the research questionnaire.

A pilot study to pretest validity and reliability of the research instrument was done using respondents from Savannah Cement Limited. The data gathered from the questionnaires were tested using Cronbach’s alpha test. Bougie, 2016 notes that the Cronbach’s alpha test measures the degree to which the internal scale is consistent and dependable whereby the

Cronbach’s coefficient having a value of 0.7 or higher is considered adequate. The Cronbach’s alpha test also indicates where the research questionnaire items measures the same concept and if not which items can be deleted to improve the consistency of the research questionnaire. The pilot test questionnaire included socio-economic factors as a fourth objective but this was excluded in the actual study. The tables 3.3 present the results of the reliability test.

Table 3.3: Overall Reliability Statistics

Reliability Statistics Cronbach's Alpha Based on Cronbach's Alpha N of Items Standardized Items

0.876 0.873 4

Table 3.4: Item Total Statistics

Scale Corrected Squared Scale Mean if Cronbach's Alpha if Item Variance if Item-Total Multiple Item Deleted Deleted Item Deleted Correlation Correlation

General 10.7436 3.838 0.382 0.254 0.91 Information

Leadership 10.3959 2.663 0.801 0.646 0.83 Factors

Technology 10.224 3.674 0.547 0.414 0.81

Product 10.2424 2.817 0.63 0.472 0.86 Marketing

From the overall reliability statistics table the Cronbach’s alpha test was found to be optimal since the coefficient value was above 0.7. This meant that the scales used to measure the variables were consistent and reliable.

3.6 Data Analysis Methods

Data analysis is the process of examining, sanitizing, converting and analyzing data collected in a study. The research utilized both qualitative and quantitative techniques (Miles, Huberman, & Saldana, 2013). Both descriptive and inferential statistics were used to analyze the data obtained from the research. Descriptive statistics was used to determine the frequency and percentage distributions, standard deviations and mean (Cooper & Schindler, 2014). Cross tabulations were utilized to analyze categorical data like gender of the respondents.

Inferential statistics refers to the use of complex computations, for instance, correlations, chi- square tests, regression models, Analysis of Variance (ANOVA) among others. Pearson correlation was utilized to measure the relationship between the effect of leadership factors, technology and product marketing on competitiveness of Savannah Cement Limited in Kenya. One-Way Analysis of Variance (ANOVA) was used to determine the significant differences between the mean scores by gender and years of employment. Linear regression analysis was used to test the statistical significance on the relationship between the independent variables (the effect of leadership factors, the influence of technology and the influence of product marketing) and the dependent variable (competitiveness of Savannah Cement Limited in Kenya).

3.7 Chapter Summary

This chapter has presented the research methodology that was used in the study. It includes the research design that guided the collection and analysis of data, the target population of the study, the sampling and sampling procedures, data collection methods, research procedure and data analysis and presentation. The next chapter focuses on the study results and findings.

CHAPTER FOUR

4.0 RESULTS AND FINDINGS

4.1 Introduction

This chapter presents the analysis of the primary data collected from the administered questionnaires. In order to give insight and understanding of the various aspects the study made use of Pearson’s correlation coefficient and regression analysis. Pearson’s correlation coefficient method was used to identify whether there was a relationship between the variables and whether it was a negative or positive relationship. It was also used to determine the magnitude of the relationship. Regression analysis was used to identify how much variation of competitiveness was explained by the factors, whether the models used to predict competiveness were significantly fit and if they were by what values did they predict competiveness. The results of the findings were then presented.

4.2 Response Rate and Background

The study collected information on various aspects affecting the competitiveness of SCL. They were broadly categorized into background information, leadership factors, technology and product marketing. All elements were analyzed, and all the result findings presented.

4.2.1 Response Rate The research questionnaire was administered to 118 employees of Savannah Cement Limited. All the questionnaires were duly filled. The response rate was therefore 100%. According to Mugenda (2003), in research a response rate of 50 percent is adequate for analysis and reporting; a rate of above 60 percent is excellent. This research, therefore, had optimal data for analysis and drawing of inference. The response rate is shown in table 4.1 below.

Table 4.1: Response Rate

Response Rate Frequency Percentage Complete 118 100 Incomplete 0 0 Total 118 100

4.2.2 Background Information One of the most important aspects for any research is to determine the background information. As such the study collected key aspects of respondents background information that included; age, gender, level of education, length of time working for the company, department of work and departmental position of management. The results were analyzed and presented in the form of descriptive statistics.

4.2.2.1 Age of Respondents

The study first sought to determine the age of the respondents. It was established that 53.4% of the respondents were aged between 26-35, 22% were in the 36-45 age bracket, 14.4% of the respondents were aged between 46-55 years of age, 6.8% of the respondents were below 25 years of age while 1.7% of the respondents were above 55 years of age. The findings of the data are as presented in figure 4.1.

Figure 4.1 Ages of Respondents

4.2.2.2 Gender of Respondents

The study also collected information on the gender of its respondents. From the findings it was established that a majority of the respondents were male accounting for 64% of the total respondents while females constituted 36% of the respondents. Figure 4.2 presents the results of the study.

Figure 4.2: Gender of Respondents

4.2.2.3 Level of Education

The study asked respondents to identify their various highest levels of education. The findings revealed that 47.5% of the respondents had attained a graduate level, 21.2% had attained diploma level, 18.6% had attained post graduate level while 12.7% had attained other levels of education other than the ones pre-identified by the study. Figure 4.3 presents the findings.

Figure 4.3 Highest Education Level of Respondents

4.2.2.4 Experience in Years

The respondents were also asked to identify the length of time they had been working for the company. From the results the study determined that the quite a good number had worked in the company for a considerable length of time, that is, 33.9% of respondents had worked in the company for 5 years and above, 30.5 % above 3 - 4 years, 18.6% above 2-3 years, 13.6 % between 1-2 years while 0.8% for less than a year. The findings of the study are as shown in figure 4.4.

Figure 4.4 Experience in Years

4.2.2.5 Department of Work

The study also sought to find out the different departments in which the respondents worked. The study established that; 39.8% of the respondents were from the manufacturing department, 25.4% from finance department, 16.1 % from sales and marketing department, 5% from other departments other than the ones pre-identified by the study, 4.2% from human resource and administration department, 3.4 % from security, 2.5 % from procurement department, 1.7% from security health and environment department, while 0.8% were from executive and internal audit departments respectively. Figure 4.5 presents findings of the study.

Figure 4.5 Departments of Work

4.2.2.6 Departmental Position of Management

The study also asked respondents to indicate their various positions of management they occupied in the various departments. From the findings it was determined that 41.5% of the respondents had a non-managerial position, 25.4% were in lower management, 13.6% of the respondents were in middle management while 7.6% were in top management. Unfortunately, 11% of the respondents failed to indicate their departmental position of management. The results of the study are as presented in figure 4.6.

Figure 4.6 Departmental Position of Management

4.3 Leadership Factors and Competitiveness of Products

Under this section of the study the research sought to examine how various leadership factors affected competitiveness of Savannah Cement Limited. In order to gain insight into these factors the study employed the use of a Likert scale to rate the respondents’ feelings. The Likert scale was divided on a 5 point scale, where: 1-Strongly Disagree, 2-Disagree, 3- Neutral, 4-Agree, 5- Strongly Agree. The results are tabulated in table 4.2.

Table 4.2: Leadership Factors

Strongly Strongly Statement Disagree Disagree Neutral Agree Agree Total

The company leadership style has enabled it perform well in the market 11% 15.30% 19.50% 42.40% 11.90% 100% The company leadership encourages the employees to participate when it comes to decision making time and tries to implement their ideas and suggestions 15.30% 25.40% 29.70% 19.50% 10.10% 100% The company leadership inspires and motivates the employees to deliver world class results 12.70% 24.60% 22% 28.80% 11.90% 100% The company leadership encourages innovation and creativity of its employees 9.30% 33.90% 22.90% 20.30% 13.60% 100% There is a positive relation between innovation and competitiveness of the company 6.80% 15.30% 23.70% 43.20% 11% 100% The company leadership is keen on nurturing and developing the company employees 14.40% 27.10% 26.30% 20.30% 11.80% 100% The company leadership quickly adapts to change and new realities in the market 15.40% 23.10% 27.40% 24.80% 9.40% 100% The company leadership has been successful in Savannah Cement Ltd strategy implementation 6.80% 21.20% 30.50% 31.40% 10.10% 100% There is a positive relation between leadership and competitiveness of the company 6.80% 13.60% 26.30% 39.80% 13.50% 100%

More than 50% of the respondents agreed and strongly agreed that the company leadership style has enabled it perform well in the market, that there is a positive relation between innovation and competitiveness of the company, and that there is a positive relation between leadership and competitiveness of the company.

However, a majority of the respondents (more than 50%) were either neutral or disagreed/strongly disagreed that the company leadership encourages the employees to participate when it comes to decision making time and tries to implement their ideas and suggestions, that the company leadership inspires and motivates the employees to deliver world class results, that the leadership encourages innovation and creativity of its employees,

that the company leadership is keen on nurturing and developing the company employees, that the company leadership quickly adapts to change and new realities in the market, and that the company leadership has been successful in Savannah Cement Ltd strategy implementation.

In addition, the mean and standard deviation of the factors considered under leadership were computed. The results are presented in Table 4.3.

Table 4.3: Mean and Standard Deviation of Leadership Factors and Competitiveness

Statement N Mean Std. Deviation The company leadership style has enabled it perform 118 3.54 0.2983 well in the market The company leadership encourages the employees to participate when it comes to decision making time and 118 2.82 0.1193 tries to implement their ideas and suggestions The company leadership inspires and motivates the 118 3.81 0.8959 employees to deliver world class results The company leadership encourages innovation and 118 2.91 0.1191 creativity of its employees There is a positive relation between innovation and 118 4.16 0.887 competitiveness of the company The company leadership is keen on nurturing and 118 2.86 0.1224 developing the company employees The company leadership quickly adapts to change and 118 3.68 0.9043 new realities in the market The company leadership has been successful in 118 3.95 0.8965 savannah cement ltd strategy implementation There is a positive relation between leadership and 118 4.18 0.8945 competitiveness of the company

The table above shows the mean and standard deviation of the various ratings that the respondents gave statements connected leadership factors. The mean indicate the attitudes of the ratings while the standard deviation measures how far-fetched the statement was from the ratings.

The respondents agreed (3.54

implementation with a mean (3.95), positive relation between innovation and competitiveness with a mean (4.16) and positive relation between the leadership and competitiveness of the company with a mean(4.18) were some of the major ways through which leadership factors influenced competitiveness.

However, the respondents were neutral(2.82

4.3.1 Correlation Analysis of Leadership

Correlation analysis of leadership variables was contacted and results presented in Table 4.4. The results reveal existence of both positive and negative relationship at different p values. Table 4.3 below shows that competitiveness was positively correlated with leadership factor variable: Leadership style(r=0.011, p=0.902), leadership adaptation(r=0.131, p value=0.158), leadership strategic implementation success(r=0.131,p value=0.157), positive relation between leadership and competitiveness(r=0.129,p value=0.164). Competitiveness was negatively correlated with leadership factors; employee participation(r=-0.009, p value=0.926), leadership inspiration(r=-0.004,p value=0.964),positive relation between innovation and competitiveness(r=-0.011,p value=0.908), leadership nurturing (r=-0.12,p value=0.894) and leadership encouragement on creativity and innovation(r= -0.31, p value=0.741).

Table 4.4: Leadership Factors Correlation Analysis

Correlations

Leader Encourag Leadersh Leader Positive Leadersh Leadersh Leadersh Positive Competi ship ement of ip ship relation ip keen ip quick ip has relation tiveness style employee inspirati encour between interest change been between s to on and agemen innovati on and success leadershi participat motivati t on on and nurturin adaptatio in p and e in on innovat competit g n to new strategy competit decision towards ion and iveness employe market impleme iveness time employe creativi es realities ntation of the e ty company

Pearson .011 -.009 -.004 -.031 -.011 -.012 .131 .131 .129 1 Correlat ion

Sig. (2- .902 .926 .964 .741 .908 .894 .158 .157 .164 tailed)

N 118 118 118 118 118 118 117 118 118 118

Competitiveness

4.3.2 Regression Analysis of Leadership Factors

The study conducted a regression analysis to help establish whether a relationship between leadership factors and competitiveness existed. Table 4.5, Table 4.6 and Table 4.7 present the findings from the study.

Table 4.5 Leadership Factors Model Summary

Model Summary

Adjusted R Model R R Square Square Std. Error of the Estimate 1 .085a 0.007 -0.001 5.43758 a. Predictors: (Constant), Leadership factors

From the model summary table above the study found the R Square to be 0.085. This R Square implies that only 0.85% of the variability in competitiveness can be explained by leadership factors.

Table 4.6 Leadership Factors Anova

ANOVAa Mean Model Sum of Squares Df Square F Sig.

1 Regression 25.207 1 25.207 8.053 .0358b Residual 3429.801 116 29.567 Total 3455.008 117 a. Dependent Variable: Competitiveness b. Predictors: (Constant), Leadership factors

The Anova table above reveals F value=8.053 is greater than p value=0.0358. Therefore the data provides sufficient evidence that a model with leadership factors as a predictor for competitiveness was fit for predicting competitiveness.

Table 4.7 Leadership Factors Coefficients

Coefficientsa

Unstandardized Standardized Coefficients Coefficients Model B Std. Error Beta t Sig.

1 (Constant) 4.549 0.622 7.312 0 Leadership factors 0.073 0.79 0.085 0.923 0.0358 a. Dependent Variable: Competitiveness

The coefficients table above is useful in fitting a simple linear regression model between competitiveness and leadership factors, thus helping explain the relationship between leadership factors and competitiveness. From the table above the study established the model fit was:

Y=4.549 +0.073X1+ε

Where Y=competitiveness, X1=leadership factors, ε=error term

The model fit shows that for every unit increase in leadership factors competitiveness goes up by 0.073 units.

4.4 Technology and Competitiveness

With the aim of identifying whether technology influenced competitiveness the study established major areas through which influenced could be exerted and asked respondents to identify them. To gauge the respondents attitude towards the factors the study employed the use of a five point likert scale where: 1-Strongly Disagree, 2-Disagree, 3- Neutral, 4-Agree, 5- Strongly Agree. The results are tabulated in the table 4.8.

Table 4.8 Technology and Competitiveness

Strongly Strongly Statement Disagree Disagree Neutral Agree Agree Total The company uses the newest technology in the production process to remain competitive 9.30% 12.70% 17.80% 47.50% 12.70% 100% The production process in the company is quite effective and efficient and helps the company remain competitive 7.60% 26.30% 26.30% 32.20% 7.60% 100% The company reviews its processes from time to time to enhance its competitiveness 5.10% 32.20% 28.80% 22% 11.80% 100% The company has a robust research and development function 35.60% 24.60% 22% 13.60% 4.20% 100% The company has robust information communication technology (ICT) tools and systems 7.60% 12.70% 23.70% 41.50% 14.40% 100% The company's ICT effectively supports the company's processes and operation 2.50% 12.70% 20.30% 50% 14.40% 100% The company is keen on promoting R&D and ICT 22% 20.30% 26.30% 24.60% 6.70% 100% The company's R&D and ICT have decreased the company's coordination costs and enhanced its capacity to conduct R&D 8.50% 21.20% 36.40% 26.30% 7.60% 100% There is a positive relation between technology and competitiveness of the company 2.50% 8.50% 27.10% 46.60% 15.20% 100%

More than 50% of the respondents agreed and strongly agreed that the company uses the newest technology in the production process to remain competitive, that the company has robust information communication technology (ICT) tools and systems, that the company's 46

ICT effectively supports the company's processes and operation, and that there is a positive relation between technology and competitiveness of the company.

A majority of the respondents (more than 50%) were, however, neutral or disagreed that the production process in the company is quite effective and efficient and helps the company remain competitive, that the company reviews its processes from time to time to enhance its competitiveness, that the company's R&D and ICT have decreased the company's coordination costs and enhanced its capacity to conduct R&D. In response to whether the company has a robust research and development function and whether the company is keen on promoting R&D and ICT, the respondents strongly disagreed at 35.6% and 22% respectively.

In addition, the mean and standard deviation of the factors considered under technology were computed. The results are presented in Table 4.9.

Table 4.9: Mean and Standard Deviation of Technology and Competitiveness

Statement N Mean Std. Deviation The company uses the newest technology in the production 118 4.72 0.9624 process to remain competitive The production process in the company is quite effective 118 3.04 0.1086 and efficient and helps the company remain competitive The company reviews its processes from time to time to 118 3.02 0.1098 enhance its competitiveness The company has a robust research and development 118 2.21 0.1138 function The company has robust information communication 118 3.41 0.1115 technology (ICT) tools and systems The company's ICT effectively supports the company's 118 3.6 0.965 processes and operation The company is keen on promoting R&D and ICT 118 3.51 0.9023 The company's R&D and ICT have decreased the company's coordination costs and enhanced its capacity to 118 3.81 0.8973 conduct R&D There is a positive relation between technology and 118 4.42 0.8904 competitiveness of the company

The table above shows a summary of descriptive statistics in terms of mean and standard deviation for technology. The respondents strongly agreed that the use of newest technology in the production process with mean (4.72) was the major way through which technology influenced competitiveness.

The respondents agreed (3.51

The respondents were neutral (3.02

Additionally the respondents disagreed that the company robust research and development function with a mean (2.21).

4.4.1 Correlation Analysis of Technological Factors

Technology variables correlated against competitiveness revealed that all variables were positively and significantly correlated at 0.01 level. The results of the findings are presented in table 4.8 below.

Table 4.10 Technology Correlation

Correlations Use of The The The The ICT Prom R&D and Positive Compet the productio company compan company effecti oting ICT have relation itivenes newest n process reviews y has a has vely R&D decreased between s technol in the of its robust robust suppor and the technolog ogy in company processes researc informati ts the ICT company's y and the is quite from time h and on compa coordinati competiti product effective to time develop communi ny's on costs veness of ion and ment cation proces and the process efficient functio technolo ses enhanced company n gy (ICT) and its tools and operat capacity to systems ion conduct R&D Competit Pears .587** .591** .632** .424** .545** .535** .314** .336** .308** 1 iveness on Corr elati on Sig. .000 .000 .000 .000 .000 .000 .001 .000 .001 (2- taile d) N 118 118 118 118 118 118 118 118 118 118 **. Correlation is significant at the 0.01 level (2-tailed).

4.4.2 Regression Analysis of Technology and Competitiveness

To determine whether a linear relationship exists between technology and competiveness exist the study conducted a regression analysis. Table 4.11, Table 4.12 and Table 4.13 present the findings from the study.

Table 4.11 Technology Model Summary

Model Summary Adjusted Model R R Square R Square Std. Error of the Estimate 1 .677a 0.458 0.453 4.01910 a. Predictors: (Constant), Technology

The table 4.9 reveals that R squared is 0.458. Consequently, 45.8% of variation in competiveness is explained by technology.

Table 4.12 Technology Anova

ANOVAa Sum of Mean Model Squares df Square F Sig. 1 Regression 1581.239 1 1581.239 97.890 .000b Residual 1873.769 116 16.153 Total 3455.008 117 a. Dependent Variable: Competitiveness b. Predictors: (Constant), Technology

From the regression table above F=97.890 is greater than p value=0.000. This implies that the technological factors significantly affect the competitiveness of Savannah product. The significance was also confirmed by computing the coefficients as shown in Table 4.13.

Table 4.13 Coefficients of Technological Factors

Coefficientsa

Unstandardized Standardized Coefficients Coefficients Std. Model B Error Beta t Sig. 1 (Constant) 2.682 0.432 6.207 0

Technology 0.476 0.048 0.677 9.894 0 a. Dependent Variable: Competitiveness

The coefficients table above determined that the simple linear regression model fit for the data was:

Y=2.682 + 0.476X1+ε ; 50

Where Y=competitiveness, X1=Technology, ε=error term

4.5 Product Marketing and Competitiveness

The study also sought to establish how product marketing influence the competitiveness of the company. To explore this relationship the study utilized the use of a five point Likert scale where: 1-Strongly Disagree, 2-Disagree, 3- Neutral, 4-Agree, 5- Strongly Agree. The results are tabulated in the table 4.15.

Table 4.14 Product Marketing and Competitiveness

Strongly Strongly Statement Disagree Disagree Neutral Agree Agree Total The company engages in positive marketing activities aimed at gaining competitiveness 1.70% 16.90% 11.90% 49.20% 20.30% 100% The company has employed effective advertising activities compared to its competitors 7.60% 28.80% 30.50% 22.90% 10.10% 100% The company has changed its marketing techniques in the past one year with the intention of gaining competitiveness 5.10% 34.70% 33.90% 18.60% 7.60% 100% The company has invested in market research in order to understand consumer needs and drive marketing initiatives for effective competition 10.20% 25.40% 24.60% 30.50% 9.30% 100% The company's products are better positioned in the market compared to its competitors 3.40% 8.50% 17.80% 43.20% 27.10% 100% The company has put in place an adequate advertising budget 5.10% 20.30% 47.50% 24.60% 2.50% 100% There is a positive relation between marketing activities and the competitiveness of the company against its rivals 2.50% 10.20% 28.80% 44.90% 12.50% 100%

More than 50% of the respondents agreed and strongly agreed that the company engages in positive marketing activities aimed at gaining competitiveness, that the company's products are better positioned in the market compared to its competitors, and that there is a positive relation between marketing activities and the competitiveness of the company against its rivals.

However, a majority of the respondents (more than 50%) were either neutral or disagreed/strongly disagreed that the company has employed effective advertising activities compared to its competitors, that the company has changed its marketing techniques in the past one year with the intention of gaining competitiveness, that the company has invested in market research in order to understand consumer needs and drive marketing initiatives for effective competition, and that the company has put in place an adequate advertising budget.

In addition, the mean and standard deviation of the factors considered under technology were computed. The results are presented in Table 4.16.

Table 4.15 Mean and Standard Deviation of Product Marketing and Competitiveness

Statement N Mean Std. Deviation The company engages in positive marketing activities aimed at 118 3.68 0.1031 gaining competitiveness The company has employed effective advertising activities 118 2.97 0.1102 compared to its competitors The company has changed its marketing techniques in the past 118 2.87 0.1005 one year with the intention of gaining competitiveness The company has invested in market research in order to understand consumer needs and drive marketing initiatives for 118 3 0.1142 effective competition The company's products are better positioned in the market 118 3.79 0.103 compared to its competitors The company has put in place an adequate advertising budget 118 2.97 0.856 There is a positive relation between marketing activities and 118 4.35 0.8911 the competitiveness of the company against its rivals

The respondents agreed (3.68

against its rivals with a mean of (4.35) were the major ways through which product marketing influenced competitiveness.

The respondents also recorded a neutral stance (2.87

4.5.1 Correlation Analysis of Product Marketing and Competitiveness

Product marketing variables correlated against competitiveness revealed that all variables were positively and significantly correlated with competitiveness. The results of the findings are as shown in the table 4.17.

Table 4.16 Results of Correlation Analysis for Product Marketing and Competitiveness

Correlations The The The The The The There is a Competitive company company company company company compan positive ness engages in has has changed has 's y has relation positive employe its invested products put in between marketing d marketing in are place an marketing activities effective techniques market better adequat activities aimed at advertisi in the past research positione e and the gaining ng one year to d in the advertisi competitive competitive activities with the understa market ng ness of the ness compare intention of nd compare budget company d to its gaining customer d to its against its competit competitive needs competit rivals ors ness ors

Competitive Pearson .291** .302** .306** .179 .165 .290** .515** 1 ness Correlat ion Sig. (2- .001 .001 .001 .053 .075 .001 .000 tailed) N 118 118 118 118 118 118 118 118 **. Correlation is significant at the 0.01 level (2-tailed). 53

4.5.2 Regression Analysis of Product Marketing and Competitiveness

To determine whether a linear relationship exist between product marketing and competitiveness a regression model was fit to the data. Table 4.18, Table 4.19 and Table 4.20 present the findings from the study

Table 4.17 Product Marketing Model Summary

Model Summary

Adjusted R Std. Error of Model R R Square Square the Estimate 1 .403a 0.162 0.155 4.95586 a. Predictors: (Constant), Product Marketing

From the model summary above the study established the R square to be 0.162. This implied that 16.2% of the total variation in could be explained by Product Marketing.

Table 4.18 Product Marketing Anova

ANOVAa Sum of Mean Model Squares df Square F Sig. 1 Regression 599.807 1 599.807 22.429 .000b Residual 2895.200 116 24.959 Total 3455.008 117 a. Dependent Variable: Competitiveness b. Predictors: (Constant), Product Marketing

The P-value (0.000) show that product marketing significantly influences competitiveness of the product.

Table 4.19 Product Marketing Coefficient

Coefficientsa

Unstandardized Standardized Coefficients Coefficients

Model B Std. Error Beta t Sig. 1 (Constant) 3.610 0.533 6.766 0 Product Marketing 0.271 0.057 0.403 4.939 0 a. Dependent Variable: Competitiveness

From table 4.16 above the study established that the linear model fit in explaining the relationship between product marketing and competitiveness was:

Y=3.610 (constant) +0.271X1+ε ;

Where Y=competitiveness, X1=Product Marketing, ε=error term.

From the model fit it can be explained that for every unit increase in Product Marketing, competitiveness of the company goes up by 0.271 units.

4.6 Relationships between Leadership Factors, Technology, Product Marketing and Competitiveness

This section examined the correlation of the independent variables against competitiveness as well as the predictability of competitiveness based on the independent variables.

4.6.1 Correlation Analysis

Overall leadership factors, technology and Product Marketing correlated against competitiveness revealed that; leadership factors (r=0.085,sig=0.358), Technology (r=0.677,sig=0) and Product Marketing (r=0.403, sig=0) were positively correlated with competitiveness. The summary of the findings is as shown in Table 4.22.

Table 4.20 Competitiveness Factors Correlation

Correlations

Leadership Product Technology Competitiveness Factors Marketing

Pearson Competitiveness 0.085 .677** .403** 1 Correlation

Sig. (2- 0.358 0 0 tailed)

N 118 118 118 118

** Correlation is significant at the

0.01 level (2-tailed).

4.6.2 Regression analysis

The study carried out a regression analysis to determine the predictability of competitiveness based on leadership factors, technology and product marketing. The findings are as shown in Table 4.23, Table 4.24 and Table 4.25.

Table 4.21 Competitiveness Factors Model Summary

Model Summary Adjusted R Std. Error of the Model R R Square Square Estimate 1 .780a 0.609 0.599 3.44236 a. Predictors: (Constant),Technology, Product Marketing, Leadership factors

R square from the model summary above indicates that 60.9% of the model used to predict the company competitiveness is explained by leadership factors, technology and product marketing. The rest of the variation is explained by other factors other than the ones captured in the study.

Table 4.22 Competitiveness Factors Anova table

ANOVAa Sum of Mean Model Squares df Square F Sig. 1 Regression 2104.129 3 701.376 59.189 .000b Residual 1350.879 114 11.850 Total 3455.008 117 a. Dependent Variable: Competitiveness b. Predictors: (Constant), Technology, Product Marketing, Leadership factors

From the Anova table above F value (59.189) at significance level (.000) implies that the model is significantly fit to predict competitiveness based on leadership factors, technology and Product Marketing.

Table 4.23 Competitiveness Factors Coefficients

Coefficientsa Unstandardized Standardized Coefficients Coefficients Model B Std. Error Beta t Sig. 1 (Constant) 1.548 0.459 3.371 0.001 Leadership factors -0.019 0.051 -0.022 -0.375 0.708 Technology 0.473 0.042 0.671 11.361 0 Product Marketing 0.262 0.039 0.390 6.643 0 a. Dependent Variable: Competitiveness

From the coefficients table the study found out that technology was the strongest predictor for competitiveness (beta=0.473, sig=0.000). Product Marketing was also a positive predictor for competitiveness (beta=0.262, sig=0.000). Leadership factors (beta=-0.019, sig=0.708) negatively predicted competitiveness. 57

The model fit for predicting competitiveness was determined to be:

Y=1.548(constant)-0.019X1+0.473X2+0.262X3+ε ; where Y=Competitiveness,

X1=Leadership factors, X2=Technology, X3=Product Marketing, and ε=error term.

Thus for every unit increase in leadership factors competitiveness goes down by -0.019 units, for every unit increase in technology competitiveness goes up by 0.473 units and for every unit increase in Product Marketing competitiveness goes up by 0.262 units.

The study further determined that the multiple linear model fit is better in helping explain competitiveness of Savannah Cement Company Limited than when each predictor is fit alone.

4.7 Chapter Summary

The chapter provided an analysis and presentation of the findings of the study with the aim of establishing a relationship between leadership factors, technology, and Product Marketing and their influence on competitiveness. Variables data collected from the questionnaires was largely categorized in general information, leadership factors, technology, Product Marketing and competitiveness. The next chapter provides the summary, discussion, conclusion and recommendation based on the study findings.

CHAPTER FIVE

5.0 DISCUSSIONS, CONCLUSIONS AND RECOMMENDATIONS

5.1 Introduction

This chapter gives a summary, discussion of the results, conclusions, and recommendations of the study. The summary provides a brief account of the purpose of study, specific objectives, research methodology used and major findings from the study. The discussion focuses on interpretation of the results while comparing it with major findings of other research studies. The conclusion section sums up major findings from each objective of the study while the recommendation offer suggestion for improvement as well as suggestions for further studies.

5.2 Summary

The study sought to establish the factors affecting competitiveness of Savannah Cement Limited in Kenya. To investigate into these factors the study accessed the specific objectives; to examine establish how leadership factors affect competitiveness of Savannah Cement Limited in Kenya; to establish the influence of technology on the competitiveness of Savannah Cement Limited in Kenya; and to find out establish how product marketing influence competitiveness of Savannah Cement Limited in Kenya

The study adopted a descriptive research design in which a sample of 118 employees of Savanah Cement was selected using stratified random sampling. Descriptive statistics was used to present figures about general information of the respondents. Inferential statistics in the form of correlation and regression analysis was used to help establish a relationship between the dependent variable competitiveness and independent variables; leadership factors, technology and product marketing.

The first objective on how leadership factors affect competitiveness revealed that leadership factors; leadership style, leadership encouragement to employees, leadership inspiration and motivation to employees, leadership encouragement on innovation and creativity, positive relation between innovation and competitiveness, leadership interest in nurturing employees, 59

leadership adaptation to new market realities, leadership success in strategic implementation and positive relation between leadership and competitiveness had influence on competitiveness. A majority of the respondents demonstrated an understanding of the factors and how they affect competitiveness as shown by the different correlation values. Leadership style (r=0.011, p=0.902), leadership adaptation to new realities (r=0.131, p value=0.158), leadership success in strategic implementation success (r=0.131,p value=0.157), positive relation between leadership and competitiveness(r=0.129,p value=0.164) had a positive correlation with competitiveness. Leadership factors such as leadership encouragement to employees ( r=-0.009,p value=0.926),leadership inspiration and motivation to employees (r=-0.004,p value=0.964),positive relation between innovation and competitiveness (r=-0.011,p value=0.908), leadership interest in nurturing employees (r=- 0.12,p value=0.894) and leadership encouragement on creativity and innovation (r= -0.31, p value=0.741) was negatively correlated with competitiveness. A weak positive relation between leadership factors and competitiveness was established at beta value=0.082.

The second objective on influence of technology on competitiveness revealed that all technology areas tested had significant influence on competitiveness. Newest technology (r=0.587), effective and efficient production process (r=0.632), reviews of company processes (r=0.424), robust research and development function(r=0.545), robust ICT tools (0.535), effective ICT support (r=0.314), promotion of R&D and ICT (r=0.308), reduction on coordination cost(r=0.336) and positive relation between technology and competitiveness (r=0.308) all had a positive correlation with competitiveness. As such a positive relationship between technology and competitiveness was established at beta value =0.478.

The third objective on how product marketing influence competitiveness reveled that all product marketing assessed by the study had an impact on competitiveness of the company to some extent. Positive marketing activities (r=0.291), effective advertising activities (r=0.302), change in marketing techniques (r=0.306), investment in market research(r=0.179), better positioning of products (r=0.165), adequate budgeting techniques funds (r=0.290) and positive relation between marketing activities and competitiveness (r=0.515) all were positively correlated with competitiveness. Consequently, on overall the

study was able to establish a positive relationship between product marketing and competitiveness at beta value = 0.279.

5.3 Discussion

5.3.1 Leadership Factors Effect on Competitiveness

The study found out that the company leadership style enabled it perform well in the market. As such, the company leadership was conscious of its market and adapted well to the changing market dynamics. Further, the study revealed that there was a positive relation between leadership and competitiveness of the company. This was in agreement with earlier findings where (Menguc et al., 2013) noted that effective leadership is critical for competitiveness of a company.

The study revealed that there was a positive relation between innovation and competitiveness of the company underscoring the importance of innovation for the company to remain competitive in the cement industry. According to Lochomoruk (2014), in today’s turbulent environment, creativity and innovation was fundamental to achieve organizational success. She argued that it is the role of leaders to tap creativity in organizations by establishing conducive environment for incubation and delivery of creativity and innovation. Such innovation and creativity will enhance the firms’ competitiveness. This was in line with the observations by Kaur (2012) that leaders are the promoters that establish and manage the firms’ internal environment, culture and strategies that fuel sustained innovation, creativity and organizational success.

The study further revealed that the company was not performing well in the area of employee motivation and inspiration. The company leadership did not encourage the employees to participate when it comes to decision making time and did not try to implement their ideas and suggestions. Employees would naturally own the process when they feel their ideas and suggestions are considered in decision making. In the same stance, the company leadership did not inspire and motivate the employees to deliver world class results and did not encourage innovation and creativity of its employees. The company should strive to improve

in this area in line with the findings of Katuse, Kiriri, & Kyalo (2016) who noted that employee motivation increases employee performance. This was similarly noted by Kaur (2012), who argued that a positive perception of employees towards leadership behaviour puts in more effort in their duties when they get inspiration to shine their performance and ensure both financial and non-financial rewards as required in return by their leaders. He argued that leaders appraise, give feedback and coach their employees when productivity is below expectation and reward them upon achievement of targets. According to him, there are many mechanisms of motivating employees by their leaders which includes being a role model, challenging them to take responsibility and ownership for their work and understanding them.

The study further found out that the company leadership was not keen on nurturing and developing the company employees. This hinges on employee training and skill development. If well implemented, training and skill development of employees increases the employee capacity and growth and the organization thus increasing competitiveness (Arthur, Bennett, Edens, & Bell, 2003). Kaur (2012), observed that good leadership will identify and nurture talent and will support their employees to learn and develop as individuals by inspiring and encouraging them with a handy range of behavioral and decision-making skills.

The company leadership did not quickly adapt to change and new realities in the market. The company leadership, however, seemed to have just succeeded in strategy implementation. These findings were drawn from the positive correlation between leadership strategic implementation and competitiveness. These findings agree with the findings of Rajasekar (2014) who investigated factors affecting effective strategy implementation in a service industry: a study of electricity distribution companies in the Sultanate of Oman. In his study he argues that successful strategy implementation is a key for any organization’s survival. In his findings he demonstrates that for an organization to sustain their competitive advantage in any industry then the leadership of the organization should be able to influence the organization competitive advantage.

5.3.2 Influence of Technology on Competitiveness

The study found out that the company used the newest technology in its production process and had a robust information communication technology (ICT) tools and systems. In addition, the company's ICT effectively supported the company's processes and operations. This underscored the central role played by technology in enhancing the company’s performance and thereby increasing its competitiveness. These findings were in agreement with previous findings where technology was noted to be a key driver for a firm’s survival in the market place (Vassakis, Voulgaris, Xekardakis, & Lemonakis, 2015).

From the analysis of this objective the study found a positive relationship between technology and competitiveness. According to the study technology had the most positive influence on competitiveness. Wambugu (2012) notes technology is a key factor that influences competitiveness. She further mentions that technological change can create new possibilities for the design of a product, the way of commercialization, produce it or deliver it and the subsequent auxiliary provided services. Finally from the findings of her study she concludes that technology as a factor influencing competitiveness it has at least more than moderate influence.

The findings of this study also concur with the findings of Irungu (2017) who investigated factors influencing competitiveness of small and medium enterprises (SMEs) in Nairobi County, Kenya. In their study they found out that sustainable competitive advantage of any firm stem out from effective use of technology.

The study further revealed that the company did not have a robust research and development (R&D) function and was not keen on promoting R&D and ICT. This is a key area for improvement if the company is keen on enhancing its competitiveness. The study noted that the company still needed to improve on its production process in the company to make it more effective and efficient. The company should review its processes from time to time to enhance its competitiveness. As noted by Muthoni (2017), constant review of the company’s processes will increase its efficiency and cut down on costs while improving the product features. According to Mithas, Tafti, Bardhan, and Goh (2012), ICT had a positive impact on 63

a firms profitability through enabled revenue growth. They argued that with a firms continuous investment in ICT the firm can maintain a more proactive digital posture and benefits from the learning thus becoming better at managing ICT. Second, such continuous investment and experience in ICT benefits the firm with respect to improving the firms capacity to leverage from information and strengthen organizational capabilities such as improved customer satisfaction and reduced marketing spend. Thirdly, technology investments enhance revenue growth through new marketing and distribution channels, new value propositions and better management of the customer life cycle.

The company’s survival is increasingly dependent on its use of technology in its operations. A key area of focus is to continuously update its technology ahead of the ever changing market and customer needs and leverage on this to remain competitive. Accordingly, the firm should maintain a keen eye on the two key areas in technology namely knowledge creation and access to information given the significant bearing they have on the firms’ competitiveness.

5.3.3 Product Marketing and Competitiveness

The study found out that the company engaged in positive marketing activities aimed at gaining competitiveness and that its products were better positioned in the market compared to its competitors. This was in agreement with Armstrong & Kotler (2015) who noted that a firm can generate competitiveness by differentiating and positioning itself as providing superior consumer value in the market place.

The study found out that product marketing based on positive marketing activities, effective advertising activities, change in marketing techniques, investment in market research, better positioning of products, adequate budgeting techniques and positive relation between marketing activities had a positive relationship with competitiveness. These findings concur with the findings of Mahmood (2010) who investigated on the impact of marketing on creating a sustainable competitive advantage. The findings from their study concluded that there exists a positive relationship between marketing and a firm’s creation of sustainable competitive advantage. 64

The study further noted that the company had not employed effective advertising activities compared to its competitors. Effective advertising activities are critical as noted by Manickam (2014) that the role of advertising is expanded in today’s competitive business world, as companies allocate enormous sums of money to build brands, identify, target, reach, and influence consumers of their products or services. It creates awareness, provides the required information to the target consumers and increase knowledge of the firms product or service leading to purchase by the customer. Without effective advertising the consumers’ awareness and knowledge of the firms’ products is diminished adversely affecting its competitiveness.

The study revealed that the company had not changed its marketing techniques in the past one year with the intention of gaining competitiveness and that the company had not invested in market research in order to understand consumer needs and drive marketing initiatives for effective competition. The company should invest in market research and change its marketing techniques in line with the consumer needs. As noted by Armstrong & Kotler (2015), for a firm to cultivate profitable relationships with target consumers, a firm must comprehend consumer needs and deliver more value than competition. Marketing research is good tool for understanding consumer needs. They further observe that this would help the company to implement tactical marketing tools combined into an integrated marketing package that actually delivers the intended value to target consumers.

Finally the study found out that the company had not put in place an adequate advertising budget. As Armstrong & Kotler (2015) further noted, an effective advertising program must be supported by an adequate budget. The company should relook into its marketing budget with a view to generating maximum return from advertising initiatives. Of course, the firm should firm start by mapping out its marketing activities driven by consumer needs and then allocate adequate budget to these activities.

5.4 Conclusion

5.4.1 Leadership Factors Effect on Competitiveness

Based on the analysis of this objective it can be concluded that leadership factors had a weak positive influence on competitiveness of the company. Definite leadership factors variables such as leadership adaptation to new realities and leadership success in strategic implementation were positively correlated to competitiveness. Other leadership factors such as leadership interest in nurturing employees, and leadership encouragement on creativity and innovation were negatively correlated with competitiveness perhaps because they are difficult to test.

5.4.2 Technology and Competitiveness

Based on the findings of the study it was concluded that technology; newest technology, effective and efficient production process, reviews of company processes, robust research and development function, robust ICT tools, effective ICT support, promotion of R&D and ICT, reduction on coordination cost and positive relation between technology and competitiveness all positively and at a p value 0.000 significantly influenced competitiveness. This explained why technology was the strongest positive predictor of competitiveness.

5.4.3 Product Marketing and Competitiveness

The study concluded that the product marketing; positive marketing activities, effective advertising activities, change in marketing techniques, investment in market research, better positioning of products, adequate budgeting techniques funds and positive relation between marketing activities and competitiveness all were positively correlated with competitiveness at different p values. Product marketing also had a positive influence on competitiveness.

5.5 Recommendations

5.5.1 Recommendations for Improvement

5.5.1.1 Leadership Factors Effect on Competitiveness

Leadership as a role is dynamic in nature. It is therefore paramount for the company leadership to understand it’s role in not only influencing tangible factors such as success in strategic implementation but as also other factors which are difficult to assess yet crucial to the organization competitiveness such as nurturing and motivating employees and adapting to change and new realities in the market place.

5.5.1.2 Technology and Competitiveness

Technology runs the world today. Through the various technology assessed it was established that indeed these were the strongest positive predictors of the company competitiveness. The study therefore recommends that the company continues to embrace technology that is beneficial to its competitiveness.

5.5.1.3 Product Marketing and Competitiveness

Marketing as a factor is crucial in influencing competitiveness of a product in any market. Despite the fact that the product marketing adopted by Savannah Cement Limited seem to be having a positive influence on competitiveness, changing its marketing techniques based on market research and allocating an adequate marketing budget could yield a better results.

5.5.2 Recommendations for Further Studies

Through the study it was determined that leadership factors, technology and product marketing together only account for 60.9% of total variation in competitiveness. It would be valuable to explore what other factors help explain competitiveness of company. As such a pool of knowledge would conclusively map out the factors that play a role in explaining the competitiveness of the company.

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APPENDICES

APPENDIX I: INTRODUCTORY LETTER

Anton Mang’ea David P.O. Box 27910 – 00100 NAIROBI

Respondent Savannah Cement Limited P.O. Box 27910 – 00100 NAIROBI

Dear Respondent,

My name is Anton Mang’ea David an MBA student at USIU-A, Nairobi, Kenya. I am conducting a study on the factors affecting competitiveness of Savannah Cement Limited in Kenya, which is a requirement for the award of the degree of Masters of Business Administration.

I am kindly requesting for your help in filling this questionnaire by marking [√] and writing appropriate answers. This survey is anonymous and the data and information provided will be handled with utmost confidentiality.

Your support is much appreciated.

Anton Mang’ea

APPENDIX II: RESEARCH QUESTIONNAIRE

PART A: GENERAL INFORMATION

Complete this section of the questionnaire by filling in the relevant detail or by ticking (√ or ×) appropriately

1. What is your age:

Below 25 [ ] 26-35 [ ] 36-45 [ ] 46-55 [ ] Above 55 [ ]

2. What is your gender? Male [ ] Female [ ]

3. What is your highest level of education?

Diploma [ ] Graduate [ ] Post Graduate [ ] Other [ ]

4. How long have you been working in the company (in years)?

Less than 1 [ ] 1-2 [ ] Above 2-3 [ ] Above 3-4 [ ] 5 and above [ ]

5. Which department of the company do you work?

Finance [ ] Procurement [ ] Internal Audit [ ] Security [ ] Human Resource and Administration [ ] Executive Office [ ] Safety, Health and Environment [ ] Manufacturing [ ] Sales and Marketing [ ] Other [Specify…………………………………………………………..] [ ]

6. What is your position in the department?

Top Management Middle Lower Management Non managerial position [ ] Management[ ] [ ] [ [ ]] [ ] ]

PART B: LEADERSHIP FACTORS

7. Please respond to the following statements by circling a number between 1 and 5 on the scale that best represents your organization.

[1] Strongly Disagree, [2] Disagree, [3] Neutral, [4] Agree, [5] Strongly Agree

QUESTIONS 1 2 3 4 5 a. The company leadership style has enabled it perform well in the market.

b. The company leadership encourages the employees to participate when it comes to decision-making time and tries to implement their ideas and suggestions.

c. The company leadership inspires and motivates the employees to deliver world-class results.

d. The company leadership encourages innovation and creativity of its employees

e. Because of the innovation activities in the company it is able to compete favorably with competitors

f. There is a positive relation between innovation and competitiveness of the company.

g. The company leadership is keen on nurturing and developing the company employees.

h. The company leadership quickly adapt to change and new realities in the market.

i. The company leadership has been successful in Savannah Cement Ltd strategy implementation.

j. There is a positive relation between leadership and competitiveness of the company.

PART C: TECHNOLOGY

8. Please respond to the following statements by circling a number between 1 and 5 on the scale that best represents your organization.

[1] Strongly Disagree, [2] Disagree, [3] Neutral, [4] Agree, [5] Strongly Agree

QUESTIONS 1 2 3 4 5 a. The company uses the newest technology in the production process to remain competitive.

b. The production process in the company is quite effective and efficient and helps the company remain competitive.

c. The company is innovative with respect to its processes.

d. Attaining competitive advantage through process innovation is one of the main objectives of the company.

e. The company reviews its processes from time to time to enhance its competitiveness.

f. The company has a robust Research & Development (R&D) function.

g. The company has robust Information Communication Technology (ICT) tools and systems.

h. The company’s ICT effectively supports the company’s processes and operations.

i. The company is keen on promoting R&D and ICT.

j. The company’s R&D and ICT have decreased the company’s coordination costs and enhanced its capacity to conduct R&D.

k. There is a positive relation between technology and competitiveness of the company.

PART D: PRODUCT MARKETING

9. Please respond to the following statements by circling a number between 1 and 5 on the scale that best represents your organization.

[1] Strongly Disagree, [2] Disagree, [3] Neutral, [4] Agree, [5] Strongly Agree

QUESTIONS 1 2 3 4 5 a. The company engages in positive marketing activities aimed at gaining competitiveness.

b. The company has employed effective advertising activities compared to its competitors.

c. The company has changed its marketing techniques in the past one year with the intention of gaining competitiveness. d. The company has invested in market research in order to understand consumer needs and drive marketing initiatives for effective competition. e. The company’s products are better positioned in the market compared to its competitors. f. The company has created a compelling and differentiated brand positioning compared to its competitors g. The company has put in place an adequate advertising budget. h. The company offers differentiated products to the market which has enhanced its competitiveness. i. There is a positive relation between marketing activities and the competitiveness of the company against its rivals.