Strategic Capabilities as a Source of Competitive Advantage in the Five Star Hotels in Nairobi, Kenya

Abstract

A rapidly changing environment requires an organization to rapidly adapt to keep its competitive advantage. Thus, a sustainable competitive advantage requires differentiating strategic capabilities - capabilities which are rare, highly valuable and are very difficult to copy. Due to the different strategies, firms differ based on organizational capabilities it has and that such capabilities are used to create and exploit external opportunities and develop sustained advantages. Therefore, the development and effective configuration of unique capabilities within an organization enables them to perform processes better and in a different manner compared with other firms and this will be able to generate value to the individual firms. The objective of the study was to establish the strategic capabilities as a source of competitive advantage in the five star hotels in Nairobi, Kenya. The research design was a survey of all five star hotels operating in Nairobi. The study used primary data which was collected using a questionnaire. The data was analyzed by the use of descriptive statistics to summarize and relate variables which were obtained from the administered questionnaires. The data was summarized using descriptive measures, percentages and frequency distribution tables while tables and graphs will be used for presentation of findings. The study found out that adoption of strategic capabilities by the hotels lead to achievement of competitive advantage through being able to focus target clients much more effectively, customer satisfaction, customer retention and market share, products prices being competitive than other competitors due to cost leadership advantage, overall hotel financial performance improvement, been able to differentiate better products and thus retaining customers due to the strategic capabilities and effectively anticipating market performance. The challenges which were encountered includes financial constraint, instability in business due to politics, uncertainty in future business, mismanagement by previous managers, economic conditions prevailing in the country, employee turnover and reduced business volume. I he study recommended that the hotels should continue pursuing some other capabilities which they can utilize. The process of harnessing the organizations strategic capabilities should be backed by the support cf the organizations top management and the staff.