Strategy development by Tea exporting companies in Kenya
Various approaches to strategy development have been advocated by two different schools of thought namely the planning and design school and the emergent school The planning and design school proposes a rational logical view to strategy development where strategy is furmulated through rational analysis of the context of the business environment and the organization. The emergent school of strategy development holds that strategy development is the resuit of continuing organizational decisions that take a form or pattern over time. The third approach is the lens (experimentaQ strategy development model This approach views strategy development as a deliberate development of strategy by learning through doing or crafting of strategy by managers who have a view of where they want the organization to he in yearS to come and try to move towards this position incrementally. consequently, the study sought to determine the approaches to strategy development and the factors that have influenced strategy development by tea exporting companies. To this end a descriptive census survey was undertaken with questionnaires distributed to all the 72 cEOs of tea exporting companies in Momha'' This etrort produced a 63 per cent response rate. The data was thereafter analyzed using ftequencies, percentages, mean scores and standard deviations. Further, to establish relationships between different variables cross-tahalation analysis was applied with 6 the results presented in tables and discussed in narrative form. The findings revealed that only 20 per cent of sampled firms have documented vision and mission statements. The number offinns with formal and infurmal strategic planS was evenly distributed at 49 and 51 per cent respectively. This statistic is consistent with the percentage of respondents non-responsive to the statement related to the frequency that strategic plans are reviewed (51%). Incidentally, all the respondents affirmed that long-term planning is important to the success of their organization. Sixty-four (64) per cent of respondents indicated that their environment is fairly to very stable. Also very few sampled firms (9%) have any form of quality certifIcation. The analysis further indicated that strategy development by the majority of firms was neither planned nor deliberate. The fmdings also do not support the use of lens approach to strategy development in tea buying firms, However, it was clear from the fmdings that the most pervasive approach to strategy development is the emergent strategy development model. Respondents affirmed all the variables related to this model. These were; commitment to strategy tentative to review (2.17); strategy emerges gradually in response to change (2.15); and strategy developed based on daily operations (2.22). The results ofthe study further determined that strategy development at sampled firms is influenced by; senior management (2.24); organizational politics (2.6); past experience (2.4); groups contro\\ing resources in the organization (2.6); and customers (2.22). Cross-tabulation analysis revelaed that; foreign owned firms consist of the majority of large firms (71%), that is firms purchasing over 15 million kilograms oftea per year; 94 per cent of predominantly foreign tea buying firms follow the formal and design approach to strategy development as compared to a meagre 29 per cent of predominantly local firms; all large firms have formal strategic development modes as compared to 43 per cent of small to medium-sized firms. Likewise it is clear that firms with formal company structures adopt formal strategy development modes, 100 per cent as compared to 40 per cent for firms with informal structures. Lastly the analysis reveals that 100 per cent of firms led by foreign CEOs have adopted formal strategic development modes as compared to 55 per cent of Kenyan led firms. Based on the fmdings of the study, the following recommendations would made; tea exporters should craft and document vision and mission statements to provide greater strategic focus; small and medium sized tea exporters should emulate their larger and more successful counterparts engage in long-term planning as it is important to the success of their organizations; there is an urgent need for them to acquire internationally recognized quality certifications such as ISO 9000 and ISO 22000 for these firms to compete in the global market; and finally the Government of Kenya and relevant authorities should put in place measures such as legislation to encourage greater participation by local-owned firms in the industry. Time constraints limited the number of respondents. Secondly, due to the nature of the data collected, quite a number of respondents were reluctant to reveal information deemed confidential. Finally it was suggested that similar studies should be undertaken in other sections of the tea industry such as tea broker firms, tea manufacturing companies, and tea warehouses to give a clearer picture of strategy development in the tea industry as a whole.