Response Strategies Adopted by Sarova Hotels Limited, Kenya to Changes in the Environment

Abstract

Change in the business environment is likely to create pressure for change in an organization. Specific factors in the business environment will likely affect different organizations in different ways, favoring others while posing a threat to others. It is important for organizations to continuously study the environment and respond to its instability and uncertainty if they are to retain their competitive advantage. Strategic response is important in dealing with environmental changes because if a firm wants to succeed in the long run it has to make every effort to make sure it is not adversely affected by the environmental changes. The research was conducted as a case study of the Sarova Hotels Limited. This is a chain of hotels located in Kenya that has been a market leader in the hotel and tourism industry in East Africa. The environment in which Sarova is operating is very competitive and highly affected by the changes in the business environment in Kenya that include economic and political forces that can potentially have a negative or positive impact on Sarova Hotels. The objective was to determine the response strategies that have been adopted by Sarova Hotels Limited to help them deal with the dynamic changes they face. The data collected was primary and secondary in nature. The primary data was collected by conducting interviews of top managers at Sarova Hotels Limited. The findings were that the group of hotels has used a number of competitive and responsive strategies to deal with the changes in the environment. They include cost leader ship, differentiation, outsourcing, product innovation and diversification. The conclusion made from the study was that the strategies being used by Sarova Hotels Limited to respond to changes in the environment are helping it retain and grow their market share and increase their revenues. The study made recommendations that research and development is key to any organization that seeks to keep up with the changes in the external environment, it is not only important to be aware of the change but also to respond accordingly to remain in business. Theoretical implications of this study illustrate support of the structural contingency theory that different units of an organization face different types of external environments and also support for the population ecology theory that the external environment selects organizations or rejects depending on their coexistence.