Generic Competitive Strategies And The Performance Of Pharmaceutical Manufacturing Companies In Nairobi City County, Kenya

ABSTRACT

Pharmaceutical firms are vulnerable to changes in their operating environment in many ways and these have great consequences on their operation. As a result of this vulnerability manufacturing firms are required to be proactive and able to formulate and adopt appropriate competitive strategies that will enable them to overcome the competitive challenges they experience in the environment they operate in. This study sought to determine generic competitive strategies and the performance of pharmaceutical manufacturing companies in Nairobi City County, Kenya. The specific objectives were to determine the effect of cost leadership strategy, differentiation strategy and focus strategy on the performance of pharmaceutical companies in Nairobi City County, Kenya. A descriptive research design was adopted in this study since it allows for analysis of different variables at the same time. The target population of the study was the 20 pharmaceutical companies in Nairobi City County where 60 respondents comprising the chief executive officers (CEOs), operating managers and marketing managers were targeted. The study used stratified simple random sampling technique where 36 respondents were targeted. The study used closed ended questionnaires as instruments for data collection primary data. Descriptive statistics was used to analyze the primary data of quantitative nature. The results of the analysis was organized, summarized and presented using tables. Inferential statistics such as Pearson correlation and multiple regression were applied to make conclusions. The study targeted a sample size of 36 respondents from which 34 filled in and returned the questionnaires making a response rate of 94.4%. The study concluded that cost leadership affects performance of pharmaceutical companies. It was concluded that differentiation affect performance of pharmaceutical companies and the study also concluded that focus strategy affected performance of pharmaceutical companies. This study recommends that pharmaceutical companies should embrace and invest in cost leadership strategies most especially forming linkages with suppliers and involvement of the stakeholders since it will enable them achieve competitive advantage. The study further recommends that pharmaceutical companies should invest more in differentiating their personnel through continuous training, products and services in order to make them unique and innovative. The study recommends that pharmaceutical companies should know on what basis to focus their products, services and operations.