Process Improvement Tools, Techniques and Operational Performance of Manufacturing Firms in Kenya

Abstract

Process improvement is a necessity for many organizations both locally and globally as they commit to be effective and efficient for survival in the competitive markets. Company strategy, Process Improvement Tools and Techniques (PITT) and other operational aspects should be integrated to attain a sustainable competitive advantage. Process improvement tool is an instrument with a clear task, mostly restricted in purpose and used independently while a technique has broader utilization, requiring more energy, knowledge, skill, understanding and training to be implemented successfully. The general objective of the study was determining how adoption of PITT affected the operational performance of manufacturing and exporting firms in Kenya with specific objectives of identifying the adoption levels of the techniques and tools, the moderating factors between the techniques, tools and operational performance as well as their relationships. Adoption of process improvement tools and techniques was anchored in the knowledge based view theory and Michael Porters theory of competitive advantage. The scope of the study was 965 companies which were registered in the Kenya Association of Manufacturers and Exporters directory for the year 2017/2018. Divided into 14 categories, primary data was collected through the use of Google form questionnaires from a sample size of 60 respondents in the production departments. Submitted questionnaires were then exported to SPSS version 23 for descriptive analysis and SmartPLS Version 3.2.4 for factor analysis. Results indicated that most companies were locally registered and sold in the local market and a few exported their products. More youths were in the production divisions matched by their less than ten years work experience. All the process improvement tools were statistically significant while process improvement techniques like benchmarking, business process re-engineering, kaizen, brainstorming and total productive maintenance were statistically insignificant with t-test values of 1.465, 0.334, 0.498, and 0.48 and 0.676 respectively. Training on process improvement tools and techniques was a key moderating factor to achieve operational performance with t-statistic value of 4.867 and a correlation coefficient of 0.783. Measures of operational performance that were directly affected by adoption and implementation of PITTs included quality, cost and speed of delivery leaving only the aspect of flexibility. The study recommended that companies should be aware of the process improvement tools and techniques and adopt the ones that fit them most if they are to achieve operational performance, especially quality in their operations. A suggestion for further study was determining if startup companies are aware of process improvement tools and techniques and to what extent they utilize them as well as study the topic on the service industry.