LEADERS’ RISK-TAKING DYNAMICS AND CORPORATE STRATEGIC CHOICES BY FLOWER FIRMS IN KENYA

Jerome K. Kaveke, Dr. Jared Deya, Dr. Lucy Wamalwa

Abstract


In Kenya, the flower sector is a fast-growing sector and the third largest foreign exchange earner in the agriculture industry.  It has created direct employment to over 50,000 people and over 2 million people through related economic activities. The sector contributes about 30% to the gross domestic product (GDP) annually and in effect, helping the country achieve its long-term development plans of vision 2030. In spite of its fast growth and its significant contribution to the economic growth, the industry has been facing a number of challenges. This study examined the influence of leaders’ risk-taking dynamics on corporate strategic choice by flower firms in Kenya. Specifically, the study explored whether the flower firms’ corporate strategic choices are influenced by leaders’ risk-taking dynamics.  A moderating role (firm size) was established. Descriptive research design was adopted and embedded on the positivistic paradigm. The study targeted the flower firms in Kenya. The total number of flower firms in Kenya as per the current Kenya Flower Council (KFC) data is 70. This figure constituted the sample size from where primary data was collected using structured questionnaires. Questionnaires were administered to the respondents and given a day to complete.  The secondary data was collected from journals, books and the internet. Descriptive statistics, regression and correlation analysis were carried out. Descriptive statistics were done to describe the data set of 70 flower firms. Analysis of variance was done to test the research hypothesis. Presentation of the data was done in form of charts and frequency tables. The study found that leaders’ risk-taking dynamics are statistically significant in explaining corporate strategic choices by flower firms in Kenya’. The influence was found to be positive. This means that unit increase in leaders’ risk-taking dynamics would lead to an improvement in corporate strategic choices by flower firms in Kenya’. Based on the findings, the study concluded that leaders’ risk-taking dynamics positively and significantly influences corporate strategic choices by flower firms in Kenya’. The study also concludes that firm size has significant moderating effect on the relationship between leaders’ risk-taking dynamics and corporate strategic choices by flower firms in Kenya. Based on the findings, the study recommends that in order to make the right strategic choices, leaders need to take risks, often in an uncertain environment. Understanding one’s preferences toward risk, and surrounding oneself with others who hold different preferences toward risk, are solid first steps in recognizing just the right balance of risk a leader should take in today’s business environment.

Key Words: Leaders Risk Propensity, Firm Size, defensive Strategic Choice, Flower Firms


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