The Effects of Corporate Entrepreneurship and Strategic Management on Performance of Insurance Companies in Nairobi, Kenya

Abstract

The insurance industry in Kenya has been growing in leaps and bounds in the recent past. There are many factors that have contributed to this this growth this research sought to establish how corporate entrepreneurship and strategic management affect the way insurance companies in Nairobi, Kenya perform. This study used descriptive survey design. A questionnaire was used to collect primary data. The questionnaire was executed using the drop and pick method to senior executives and managers of all the 49 registered insurance firms in Nairobi. Data was analysed using descriptive analysis to summarise the data and presented the findings using tables. Data was interpreted using frequencies, percentages and mean score and presented in form of frequency tables. The results indicated that insurance companies use rewards to motivate proactive and innovative employees. Insurance companies also use management support and organisational boundaries to set precise explanations of outcomes expected from organizational work and development of mechanisms for evaluating, selecting, and using innovations exists within the organization. The insurance companies are not open to risk taking as a strategy to encourage entrepreneurship and as such they do not offer employees work autonomy or time to come up with these innovative ideas. It is evident that new products have been the reason behind high organisational performance among insurance companies. The study concludes that though corporate entrepreneurship is a new concept in the field of research, insurance companies in Kenya are well aware of the concept and they are incorporating that in their strategy. Also, through rewarding employees and offering them the necessary support, they can continuously provide innovative products to the market which will then lead to higher firm performance. However, it is also important for the insurance companies to carry out research before they bring a new product in the market. The study recommends that companies should leverage internal resources, especially the employees, to help them gain competitive advantage. The researcher also recommends that this strategy be used in conjunction with others because there is no one way to success in strategy.