Innovation Strategies and Competitive Advantage at Cytonn Real Estate Kenya

Abstract

Innovation strategies are significant components of a firm’s competitive approach and strategy. For companies, one way to gain competitive advantage is to develop an innovative strategy that is consistent with business trends and in proportion to the company's capabilities and resources. However, despite being innovative, competitive advantage is difficult to realize as companies are exposed to the global and industry competition. The Kenyan real estate is one of the significant sector in economic development and provision of housing. However, the industry has witnessed increasing competition in both commercial and residential properties and the Kenyan real estate sector performance is currently fragile in comparison to preceding years. This study thus sought to determine the effect of innovation strategies on competitive advantage at Cytonn real estate. The Schumpeter theory of innovation, the resource-based view and diffusion of innovation theory formed the theoretical foundation of the study. The study adopted a case study design which comprises of intensive and detailed study of single unit. This study entirely used primary data, which was gathered by means of an interview guide. The interview guide was administered to 10 senior management staff from the various departments at Cytonn Real Estate. The data gathered using the interview guide was qualitative in nature and was analyzed using content analysis where the generated responses were categorized based on identified themes and the study objectives. The study established that Cytonn real estate had adopted various innovation practices with the mostly adopted one being product innovation, followed by technological innovations, process innovation, marketing innovation strategies and finally organizational innovation strategies. The study also established that continuous review of firms’ innovation practices and subsequent adoption of new strategies led to enhanced competitive advantage and adoption of innovation sends a signal to the market that the firm is offering unique and differentiated products. The study also established that costs associated with innovation do not have any adverse effect on firm competitiveness as the costs were factored on the final product and is normally passed to the client. The results revealed that there was no specific competitive strategy which Cytonn real estate preferred but the firm used all the targeting, differentiation and cost leadership but at different levels and the strategies adopted by the firm were effective as the adopted strategies were carefully discussed and it implications assessed before it was put into practice. The study concluded that various innovation strategies complement one another and adoption of one may force the adoption of another strategy and thus adoption of innovation leads to enhanced competitive advantage at Cytonn Real Estate. The study recommends that the management of Cytonn real estate should continue using the various innovative strategies because they enhance their competitive advantage.