Strategic Capabilities as Determinants of Firm Performance in Women - Owned Entrepreneurial Ventures in Nairobi, Kenya

Abstract

Strategic capabilities are complex bundles of skills and accumulated knowledge that enables firms to coordinate activities and make use of their resources to create economic value and achieve and maintain better performance. This paper examines the relationship between strategic capabilities and firm performance in women owned enterprises. The conceptual model was drawn from the resource based view theory,the dynamic capability framework and the social role theory. The study hypothesized that strategic capabilities, operationalized as; marketing capabilities, market-linking capabilities, technology capabilities, information technology capabilities and management capabilities are positively related to performance. The study used explanatory research design. A sample of 450 women was selected using multistage cluster and systematic sampling techniques. Data was collected using structured questionnaires and analysed using multiple regression and epsilon analysis. The study revealed that strategic capabilities have a significant effect on the overall performance. Further IT capabilities and Technological capabilities had a positive and the most significant effect on performance. The study therefore recommends thatwomen entrepreneurs build their strategic capabilities. Specifically they need to build their IT and technology capabilities as these strongly influence the performance of their businesses. This they could do through acquisition of relevant technologies that would improve their businesses and using IT for market knowledge creation. Women are also encouraged to join associations to enable them not only build their capabilities but also be exposed to new ideas and new technologies the capacity of women entrepreneurs be enhanced to ensure that they are able to build on their capabilities particularly technological capabilities. Policy makers should initiate programmes for entrepreneurship developments that are more focused on buildingstrategic capabilities of women entrepreneurs