Influence of Organizational Structure on the Competitive Advantage of the Top 100 Medium-Sized Enterprises in Kenya
DOI:
https://doi.org/10.47941/jepm.3062Keywords:
Organizational Structure, Competitive Advantage, Medium-Sized EnterprisesAbstract
Purpose: The objective of this study was to establish the influence of organizational structure on the competitive advantage of the top 100 medium-sized enterprises in Kenya.
Methodology: Utilizing a descriptive cross-sectional design, the study analyzes all 100 winners of the 2019 Kenya Top 100 Mid-Sized Companies Survey, ultimately engaging 407 senior management respondents. Employing online questionnaires allowed the researcher to reach a geographically diverse group of participants during COVID-19 restrictions, achieving a substantial 76% response rate. Of the 407 questionnaires sent out, 311 were completed and returned, providing a strong data foundation for analysis. Descriptive statistics (mean and standard deviation) were utilized to gain insights into the central tendencies and variability of the data, while inferential statistics (correlation, regression, and moderated linear regression) were employed to explore the relationships between different variables and test research hypotheses. Findings: The findings revealed that organizational structure has a significant influence on the competitive advantage of the top 100 medium-sized enterprises in Kenya (β = 0.424, t = 8.820, p < 0.05). The study concluded, after a thorough analysis, organizational structure have a significant influence on the competitive advantage of the top 100 medium-sized enterprises in Kenya.
Unique Contribution to Theory, Practice and Policy: The study recommends that selecting the most suitable organizational structure, such as simple, functional, or matrix, should be based on a careful consideration of their specific needs and objectives, ultimately leading to competitive advantage.
Downloads
References
Acheampong, F. (2020). The relationship between organizational structure and competitive advantage in SMEs in Ghana. International Journal of Business and Management, 25(11), 185-196. doi: 10.5539/ijbm.v25n11p185.
Adegbite, O., & Adegbite, O. (2020). A review of the McKinsey 7S framework: A tool for organizational analysis and change. Journal of Business Research, 117, 106423.
Adjabeng, F. N., & Osei, F. (2022). The development of small medium enterprises and their impact on the Ghanaian Economy. Open Journal of Business and Management, 10(6), 2939-2958.
Azeem, M. K., & Rehman, A. U. (2022). The impact of organizational structure on competitive advantage in SMEs in Pakistan. International Journal of Business and Management, 27(3), 201-214. doi: 10.5539/ijbm.v27n3p201.
Alam, P., & Ahmed, T. (2022). The moderating effect of firm age on the relationship between organizational resources and competitive advantage: Evidence from SMEs in Bangladesh. Journal of Business Research, 133, 170-180. doi:10.1016/j.jbusres.2022.01.027.
Ahmady, G. A., Mehrpour, M., & Nikooravesh, A. (2016). Organizational structure. Procedia-Social and Behavioral Sciences, 230, 455-462.
Ajer, B., Ngare, L., & Macharia, I. (2023). Drivers of innovation in the agro-food micro, small and medium enterprises of Uganda. Journal of Agribusiness in Developing and Emerging Economies. doi.org/10.1108/JADEE-09-2022-0206.
Ansoff, H.I. (1965), Corporate Strategy, McGraw-Hill, New York, NY
Bayraktar, M., & Algan, N. (2019). The importance of SMEs on world economies. In International Conference on Eurasian Economies (pp. 11-13).
Barnhill, C. R., Smith, N. L., & Oja, B. D. (2021). Creative and innovative teams. Organizational Behavior in Sport Management: An Applied Approach to Understanding People and Groups, 165-173.
Chakabva, N., Tengeh, J. T., & Dubihlela, J. (2021). The failure rate of small and medium-sized enterprises (SMEs) in East Africa: A case of Uganda. International Journal of Business and Management Studies, 13(1), 19-30.
Chen, Y., & Zhang, J. (2022). The moderating role of organizational age on the relationship between organizational resources and competitive advantage: Evidence from Chinese high-tech firms. Sustainability, 14(1), 126.
Douglas, J., Douglas, A., Muturi, D., & Ochieng, J. (2017, September). An exploratory study of critical success factors for SMEs in Kenya. In Toulon-Verona Conference" Excellence in Services (pp. 223-234).
Dubihlela, J., & Nqala, L. (2017). Factors influencing the failure of small and medium-sized enterprises (SMEs) in the Cape Metropole. International Journal of Business and Management Studies, 9(2), 87-103.
East Africa Top 100. (2022). https://eastafricatop100.com/.
Eketu, C. A., Ogbu Edeh PhD, F., Ule, P. A., Fern, Y. S., Kumari, P., & Eder, J. (2020). Effects of Organizational Structure on Employee Resilience. Prince Alamina and Fern, Yeo Sook and Kumari, Pallavi and Eder, Johnson, Effects of Organizational Structure on Employee Resilience (November 20, 2020).
EastAfricaTop100. (2022). Winners. Retrieved from https://eastafricatop100.com/
Evans, J. R., & Lindsay, W. M. (2017). Managing for quality and performance excellence. Cengage Learning.
Egelhoff, W. G. (2020). How a flexible matrix structure could create ambidexterity at the macro level of large, complex organizations like MNCs. Management International Review, 60, 459-484.
Farida, I., & Setiawan, D. (2022). Business Strategies and Competitive Advantage: The Role of Performance and Innovation. Journal of Open Innovation: Technology, Market, and Complexity, 8(3), 163.
Fincham, J. E. (2008). Response rates and responsiveness for surveys, standards, and the Journal. American journal of pharmaceutical education, 72(2),1-3.
Gümüş, S., & Sezgin, M. (2020). The relationship between mission statements and competitive advantage: An empirical study on Turkish SMEs. Journal of Business Research, 115, 208-214.
Gamba, F. J. (2019). SME development policies of Tanzania and Rwanda: Comparability of policy presentation on focus, significance, challenges and participation. Journal of Development and Communication Studies, 6(1), 1-17.
Hopej, T., Hansen, T. D., & Wincent, J. (2017). Organization design and the ability to meet specific customer demands. Journal of Operations Management, 55, 222-238.
Haque, M. G., Munawaroh, M., Sunarsi, D., & Baharuddin, A. (2021). Competitive Advantage in Cost Leadership and Differentiation of SMEs “Bakoel Zee” Marketing Strategy in BSD. PINISI Discretion Review, 4(2), 277-284.
Hamama, M., & Tayeb, B. (2020). The impact of organizational learning on competitive advantage Case Study of “Algerie Telecom” of Laghouat. Dirassat Journal Economic Issue, 11(1), 507-520.
Kovaçi, I., Tahiri, A., Bushi, F., & Zhubi, M. (2021). Organization as a Function of Management and the Types of Organizational Structures that Apply in SMEs in Kosovo. Calitatea, 22(181), 3-6.
Lieberman, M. (2021). Is competitive advantage intellectually sustainable. Strategic Management Review, 2(1), 29-46.
Mutuku, A. K., Kiilu, B. N., Mathuku, P., & Auka, D. O. (2022). Effect of Entrepreneurial Skills on Organizational Performance of Small and Medium Enterprises in Nakuru City-Kenya. International Journal of Economics & Business Administration (IJEBA), 10(3), 156-173.
Mogaka, C. O., Odari, S., & Arani, W. (2022). Functional integration and competitive advantage of food and beverages manufacturing firms in Kenya. Journal of Sustainable Development of Transport and Logistics, 7(1), 99-111.
Madzimure, J., & Tau, L. P. (2021). Challenges Facing Small to Medium Enterprises in Metsimaholo Municipality, South Africa. Eurasian Journal of Social Sciences, 9(1), 14-23.
Mutuku, A. K., Kiilu, B. N., Mathuku, P., & Auka, D. O. (2022). Effect of Entrepreneurial Skills on Organizational Performance of Small and Medium Enterprises in Nakuru City-Kenya. International Journal of Economics & Business Administration (IJEBA), 10(3), 156-173.
Ma, H. (2000). Competitive advantage and firm performance. Competitiveness Review: An International Business Journal Incorporating Journal of Global Competitiveness, 10(2), 15-32.
Mintzberg, H. (2009). Managing. Berrett-Koehler Publishers.
Mogaka, C. O., Odari, S., & Arani, W. (2022). Functional integration and competitive advantage of food and beverages manufacturing firms in Kenya. Journal of Sustainable Development of Transport and Logistics, 7(1), 99-111.
Nalucha, I., & Mwanza, B. G. (2022). A Study of the Effectiveness of Competitive Strategies Employed by Real Estate Organisations in Lusaka. Available At SSRN 4190306.
Pearce, J. A., & Robinson, R. B. (2015). Strategic management: Planning for domestic & global competition.
Persada, I. N., & Nabella, S. D. (2023). The Influence Of Leadership, Motivation And Incentives On The Performance Of Personnel Of The Operations Section Of Polda Kepri. International Journal of Accounting, Management, Economics and Social Sciences (IJAMESC), 1(4), 403-416.
Porter, M. E. (1985). Technology and competitive advantage. Journal of business strategy, 5(3), 60-78.
Porter, M.E. (1985). Competitive Advantage: Creating and Sustaining Superior Performance.The Free Press, New York, NY
Pulka, B. M., & Gawuna, M. S. (2022). Contributions of SMEs to employment, gross domestic product, economic growth and development. Jalingo Journal of Social and Management Sciences, 4(1), 1-18.
Ramdan, M. R., Abd Aziz, N. A., Abdullah, N. L., Samsudin, N., Singh, G. S. V., Zakaria, T., ... & Ong, S. Y. Y. (2022). SMEs performance in Malaysia: The role of contextual ambidexterity in innovation culture and performance. Sustainability, 14(3), 1679.
Reuben, A. O., & Olajide, J. O. (2019). The impact of organizational learning on competitive advantage of firms in the telecommunication industry in Nigeria. Journal of Business Research, 108, 303-311.
Roberts B., Cohen M. (2002). Enhancing sustainable development by triple value adding to the core business of government. Economic Development Quarterly, 16, 127-137.
Sigalas, C. (2015). Competitive advantage: the known unknown concept. Management Decision, 53(9), 2004-2016.
Simiyu, A. K. A., Ndemo, E. B., Kinoti, M. W., & Wainaina, G. (2023). Entrepreneurial Orientation as Antecedent of Business Model Innovation among Medium Enterprises in Kenya. ESI Preprints, 13, 65-65.
Ur Rehman, A., & Belhaouari, S. B. (2021). Unsupervised outlier detection in multidimensional data. Journal of Big Data, 8(80),1-27
Vedaste, B. K., & Ruranga, C. (2018). The effect of short-term bank loan financing on financial performance of manufacturing Small and Medium Enterprises (SMEs) in Rwanda. Economic Policy Research Network, Rwanda.
Waterman Jr, R. H., Peters, T. J., & Phillips, J. R. (1980). Structure is not organization. Business horizons, 23(3), 14-26.
Zhang, X., Chu, Z., Ren, L., & Xing, J. (2023). Open innovation and sustainable competitive advantage: The role of organizational learning. Technological Forecasting and Social Change, 186, 122114.
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2025 Dr. Anne Kiboi, Prof. Allan Kihara Ph.D
This work is licensed under a Creative Commons Attribution 4.0 International License.
Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution (CC-BY) 4.0 License that allows others to share the work with an acknowledgment of the work's authorship and initial publication in this journal.
