Knowledge Management, Operating Environment, Competitive Strategies and Performance of Retail Pharmaceutical Firms in Nairobi County, Kenya

Abstract

Researchers and practitioners in strategic management are increasingly trying to figure out why some businesses perform better than others even when they are in the same or similar business conditions. With the rise of the information-based economy, knowledge is now seen as the crucial means of generating wealth and prosperity as well as the key factor in determining whether a corporation will succeed or fail. Establishing the impact of the operational environment and competitive tactics on the relationship between knowledge management and performance of retail pharmaceutical companies in Nairobi County, Kenya, was the study's main goal. Based on the goals of the study, the hypotheses were created and evaluated. The Dynamic Capabilities Theory (DCT), Knowledge-Based View (KBV) theory, Environmental Dependence Theory (EDT), and Resource-Based View (RBV) served as the foundation for the study. The theories were developed after an assessment of the body of existing literature. The study used a descriptive research design and positivist mindset. A method of systematic sampling was used. The 720 retail pharmaceutical companies that are registered in Nairobi City County made up the study's population. The owner/manager or an equivalent was the primary responder in 116 retail pharmaceutical businesses in Nairobi County, Kenya that were included in the study sample. With the aid of semi-structured questionnaires, primary data was gathered. Both descriptive and inferential statistics were used to analyze the data. Based on the goals of the study, the hypotheses were created and evaluated. The study's conclusions demonstrated how knowledge management has a big impact on how well businesses function. The findings further supported the idea that the operational environment has a moderating effect on the link between knowledge management and company performance. The study also discovered that the relationship between knowledge management and company performance is significantly influenced by competitive strategies. Last but not least, it was discovered that the combined impact of knowledge management, operating environment, and competitive tactics on performance was stronger than their individual influences. The study's findings support the theoretical claim made by the dynamic capabilities theory, which positioned knowledge management as a key strategic endeavor that ensures a firm's performance and competitive advantage. The study strengthens managerial, theoretical, and policy implications. The operating environment in which a firm runs defines the strategy to be taken by a firm, influencing performance, according to a theoretical argument that was applied to this study. The study helps owners and stakeholders of retail pharmaceutical companies to create policies that support knowledge management in their businesses and have procedures for putting experience-based knowledge to use. The study suggests that, in order to achieve the desired performance for retail pharmaceutical firms, owners and managers must comprehend the environment in which their businesses operate. This will help them build knowledge management capabilities and come up with the best possible combination of strategies that are competitive in the market by identifying the knowledge they have and comparing it with that of its competitors in the given industry to close any gaps that may exist.