Abstract:
The performance of the telecommunication companies has been soaring over the years
as it’s evident in recent report from the Communication Authority. However, Telkom
Limited has been reporting a slower growth than its competitors with limited margins
of rising market share that raises eyebrows, yet they are the oldest broom in the
telecommunications industry in Kenya. The general purpose of this study is therefore
to determine the moderating effect of Market Orientation on the relationship between
competitive strategies and organizational performance in Telkom Kenya, Nairobi
County. The specific objectives of the study are to; establish the effect of a market focus strategy, cost leadership Strategy, Differentiation Strategy and strategic alliance
on organizational performance and lastly establish the moderating effect of market
orientation on competitive strategies and organizational performance. The study was
guided by Market-based view theory as the main theory and resource-based view
theory and the dynamic capabilities as supplementary theory. The study was guided
by explanatory research design. The target population comprised 300 employees of
Telkom Kenya Limited in Nairobi County. A final sample of 171 respondents was
obtained using simple random sampling method. The study used both descriptive
statistics and inferential to analyze the data. The study employed Hierarchical
regression model. The regression results indicated that market-focus strategy (β =
0.173, ρ <.05), cost leadership Strategy (β = 0.274, ρ <.05), Differentiation Strategy
(β = 0.258, ρ <.05), strategic alliance (β = 0.232, ρ <.05) had a positive and significant
relationship with organization performance.The results further confirmed that market
orientation had a moderating effect on market focus strategy (β = -0.778, ρ <.05), low
cost strategy (β = -0.0581, ρ <.05), differentiation strategy (β = -0.068, ρ <.05), and
on strategic alliance (β = -0.088, ρ <.05) and organization performance. The study
concluded that the competitive strategies are key determinants of Telkom Kenya
Limited performance and that market orientation moderates that relationship. The
study's conclusions have implications for managers and regulators. The study
recommends that Telecommunication companies in Kenya should evaluate their
strategy to differentiate themselves from other players in the service industry market
with effective differentiation strategies in order to improve their current strategies
while aiming to improve organizational performance and competitive advantage.
Future research should investigate the moderating role of market orientation on the
relationship between competitive strategies and organization performance of other
competitors as well as other or firms in other sectors.