Influence of Selected Strategy Implementation Factors on Organizational Performance of Selected Small and Micro Enterprises in Machakos County, Kenya

Abstract

Small and Micro Enterprises performance can be significantly impacted by the adoption of strategies that take into account various functional areas, including accounting, marketing, human resource management, and information management. The study aimed to evaluate the influence of strategy implementation on organizational performance of SMEs in Machakos County. Specifically, influence of structure, financial resources, communication, and monitoring on organizational performance of SMEs in Machakos County was also examined. The study drew upon theories such as strategy fit, the resource-based view, open systems, and human capital as its conceptual foundation. A descriptive research approach was adopted, and a sample of 95 business owners was selected from the target population of 2,113 SMEs in Machakos County using stratification. The researcher collected primary data using a self-administered questionnaire. In order to determine the validity and reliability of the research instruments, a pilot study was conducted in selected SMEs in Nairobi County. Descriptive statistics, were employed in analyzing the primary data, while regression analysis was utilized to derive conclusions from the data. The results of the regression analysis indicated that financial resources and communication had a positive association with the organizational performance of small and micro enterprises in Machakos County. However, organizational structure and monitoring showed an inverse relationship. The significance value for the predictor variables, except for communication, was below 5 percent, leading to the conclusion that organizational structure, financial resources, and monitoring were statistically significant predictors of organizational performance of small and micro enterprises in Machakos County. Communication was found to be insignificant. Based on the findings, it is recommended that organizations adopt a less complex organizational structure, use their own resources rather than borrowed resources, maintain a shorter chain of command, and conduct regular and frequent monitoring.