Sustainable competitive advantage in the insurance industry in Kenya
With the accelerating pace of competition and innovation, cutting-edge companies are defined by innovative strategies. Industry leaders create a competitive advantage that enables them to drive superior financial performance through boom and bust cycles. They focus on building long-term strategic advantages rather than investing aggressively when the market is strong and summarily cutting programs when the economy and pricing environments weaken. The study was based on the insurance industry and was to provide an understanding of the nature of sustainable competitive advantage adopted by insurance firms in Kenya. The objectives were to establish how insurance companies are creating sustainable competitive advantage and the challenges faced in creating the sustainable competitive advantages. The study adopted a survey design with the population being randomly sampled. Data was collected through questionnaires and analyzed. The results indicated that majority of the firms used cost leadership strategy to create sustainable competitive advantage. They also indicated that all players irrespective of the competitive strategy adopted experienced strategy implementation challenges. The study had some limitations which included the categorization of the firms based on the different services offered as a whole as opposed to their individual categories. Other limitations were not considering process of strategy implementation as a whole and not considering the role of regulation and policy framework in the industry. Based on the study, it is recommended that players in the industry constantly evaluate their strategies with an aim of staying ahead of the competition. This can be done through adopting cost reduction strategies, focus strategy and investing in resources. Further studies can be carried on to determine the strategic responses other firms adopt to different competitive strategies and factors considered when doing so. The study can also be extended to other industries to see if the same strategies are used across industries.