Application of diversification strategies at Safaricom Limited, Kenya
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The purpose of diversification is to allow the company to enter 1 mes of business that are different from current operations. In this study the main focus is fjJ1 diversification. Safaricom Limited is a leading mobile network operator in Kenya Safaricom Limited has implemented diversification strategies and has remained the largest operator in the country with the largest market share in the Kenyan telecommunication industry. The literature review summarizes the information from the available literature in the same field of study. The specific areas covered are the concepts of corporate strategy. The areas covered include; the value of diversification, problems of diversification and diversification and performance. Diversification' strategies allow a firm to expand Its product lines and operate in several different economic markets. The most common strategies include concentric, horizontal and conglomerate diversification. This study employed a case study. Face to face interviews were used as a primary data collection method. The researcher used the interview guide to aid in obtaining information from the respective respondents who are the top management staff that are well conversant with the companies' operations. The respondents included ten tol' management staff at Safaricom Limited. The data was analyzed using Content anaysis According to the results of the study, the Company has applied product diversification strategies over the years to become the leading telecommunication company in the country The study also established that the diversification strategies used by Safaricom contribute to its growth and help the Finn to retain its relative position. Diversification generally requires new skills, new techniques, and new facilities. As a result, it almost invariably leads to physical and organizational changes in the structure of the business which represent a distinct break with past business experience. The study concludes that there are various diversification strategies used by Safaricom which allows it to expand its product lines and operate in several different economic areas. The study further concludes that the reasons for adopting diversification strategies include improving product value/quality, to gain competitive edge and to maintain product loyalty.
University of Nairobi, Kenya