STRATEGIC ORIENTATION AND PERFORMANCE OF MULTINATIONAL PHARMACEUTICAL FIRMS IN NAIROBI CITY COUNTY, KENYA

Johnson Gachau Kimotho, Dr. Paul Kariuki

Abstract


Statistics from the World Bank show that multinational pharmaceutical firms operating in Kenya registered stagnation and declining profits for the last five years due to a turbulent operating environment. The pharmaceutical industry in Kenya has been characterized by many changes and an increasingly turbulent environment. The configuration of competitive forces such as intensity of competition, new entrants, substitute products and supplier and buyer power have transformed the environment a great deal, creating the need for firms to change their competitive positions. The general objective of this study was to examine the effect of strategic orientation on performance of multinational pharmaceutical firms in Nairobi city county, Kenya. The specific objectives were to assess the effect of technological innovation and process innovation on performance of multinational pharmaceutical firms in Nairobi city county, Kenya. This study was guided by the following theories; innovation diffusion theory and dynamic capability theory. The descriptive research design was employed where cross-sectional data was used. The target population for the study included 90 top managers in the 15 multinational pharmaceutical firms in Nairobi City County where a census technique was adopted. Data was collected using a self-administered semi-structured questionnaire. A pilot test was conducted from 15 managers from the firm at Dawa Limited. Descriptive statistical including frequency, percentages, mean and standard deviation, Inferential statistical analysis to be used was multiple regression and correlation analysis. Tables were used to display the rate of responses and to facilitate comparison. The study established that Technological innovation facilitates operational efficiency and process innovation enhances productivity and cost-effectiveness. Based on the t-values and p-values, the study concludes that that all four independent variables (technological innovation and process innovation) positively and significantly impact the performance of multinational pharmaceutical firms.  Based on the significant impact of studies variables, it is recommended that firms intensify their efforts in these areas. Investing in cutting-edge technologies, optimizing operational processes, and expanding market reach should be prioritized. Additionally, strategic planning and resource allocation in these domains can enhance overall firm performance and competitiveness. Continuous evaluation and adaptation of these strategies will ensure sustained growth and adaptability in the dynamic pharmaceutical sector.

Key Words: Strategic Orientation, Performance of Multinational Pharmaceutical Firms, Technological Innovation, Process Innovation


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