CEO personality on strategic agility and organisational performance of selected airlines in Kenya

Abstract

In Kenya, the airline sector contributes significantly to the economy, with the Kenya Airways alone representing 1.7% of the country's GDP and employing over 5,000 people. Despite this, Kenyan airlines face substantial challenges in maintaining competitive performance and strategic flexibility amid evolving market dynamics and regulatory pressures. Recent research indicates that CEO traits, such as their openness to experience and decision-making style, can profoundly affect strategic agility—the ability of an organization to adapt and respond to market changes swiftly. However, there is a dearth of empirical evidence linking CEO personality traits to the strategic agility and organizational performance of airlines in Kenya, with existing studies providing mixed results on the broader impact of leadership personality on performance. This study therefore sought to investigate the CEO personality on strategic agility and organizational performance of selected aviation airlines in Kenya. The study was guided by the following Specific Objectives; to determine the effects of strategic insight, internal response orientation, and external response orientation on organizational performance of selected Aviation airlines in Kenya and to determine the moderating effect of CEO personality on the relationship between strategic insight, internal response orientation and external response orientation on organizational performance of selected Aviation airlines in Kenya. The study was guided by Balance score card, dynamic capabilities and Eysenck's personality theories. The study employed explanatory research design. The study was done at eight (8) selected aviation airlines in Kenya. The study population included the top four (4) managers of each selected airlines (Executive CEO, financial manager, marketing manager and operations manager), 125 middle level managers, 160 middle level operational managers and 185 managers on ground handling ticketing/dispatching staff from the selected airline making a total target population of 502. The sample size for the study was 223 respondents. The study used simple random sampling to select respondents. This study used primary sources of data to produce quantitative information. The data were collected from the respondents using questionnaires. Quantitative data was analyzed by use of descriptive and inferential statistical techniques. The study results showed that strategic (β 1 =0.556, p<0.05), Internal response (β 2 =0.191, p<0.05) and External response orientation (β 3 =0.274, p<0.05) had a positive and significant effect on organizational performance. CEO personality had a negative and significant moderating effect on the relationship between strategic insight (β=-1.130; p<0.05), external response orientation (β=-0.105; p<0.05) and organizational performance. CEO personality has a positive and significant moderating effect on the relationship between internal response orientation (β=.192; p<0.05) and organizational performance. The study concluded that CEO personality negatively affects the relationship between strategic insight, external response orientation and positively enhances internal response orientation on organizational performance. The study recommends that Airlines should prioritize building strong customer relationships and implementing effective feedback mechanisms to address customer concerns and improve service quality. organizations should invest in developing leadership qualities such as charisma, decisiveness, vision, fairness, and collaboration among CEOs. Additionally, airlines should implement regular performance monitoring and evaluation mechanisms. Future research could explore alternative measures or dimensions of internal response orientation, such as organizational culture, leadership styles, or employee engagement initiatives, to uncover their impact on organizational performance within the airline industry.