Strategic responses of real estate firms in Kenya to changes in the external environment
To be able to compete and retain competitive edge, organizations need to examine their environment both internally and externally and respond accordingly. Strategy helps firms to cope with the change by designing appropriate and timely responses. Strategic response affects the long term direction of an organization. Successful firms continually scan their environment in order to identify future economic, competitive, technological and political discontinuities, which could affect their operations. This study sought to examine how real estate firms respond to changes in the environment as well as the strategic measures that are taken by these real estate firms to respond to the changing business environment. The study used a survey research design to achieve its objectives. The target population of the study involved the 59 Valuers and Estate Management Surveyors (VEMS) as per Kenya Property Directory, 2009. Semi structured questionnaires were used to collect data. Data analysis was done using descriptive statistics and statistical package for social sciences (SPSS) was used to aid in the analysis. The findings were presented in tables and charts. The study found that the types of challenges experienced by real estate firms are market oriented which are in form of external competitive forces. The problem of frequent loss of skilled employees to competitors influences real estate firms' performance. Real estate firms have resulted to good customer reputation, highly differentiated and quality services as well as experience in the industry in response to these challenges. In response to changing business environment, real estate firms have faced challenges which they have reacted to by adopting strategic responses such as unique and high quality services, coordination within the management structure, differentiation strategies (unique skills/resources) in operations, enhancing their ability to implement more than one project at a time and linking to the global network through internet as well as the use of information and communication technology. This study recommends that policy makers and government in particular should play a positive role in the real estate sub-sector. There is also need to establish a conducive business environment for real estate firms through regulation and lowering of costs associated with real estate business such as registration costs. The policy makers should establish a way to monitor real estate professionals and ensure that ethical standards are adhered to.