Effect of Growth Strategies on Competitive Advantage in the Petroleum Industry In Kenya A Case Of Libya Oil Kenya Limited

Abstract

The purpose of this study was to assess the effect of growth strategies on competitive advantage in the petroleum industry in Kenya with a specific focus on Libya Oil Kenya Limited. The objectives were to; identify the growth strategies adopted by Libya Oil Kenya Limited, establish the competitive advantage gained, and assess the effect of growth strategies on competitive advantage. The study was anchored on Schumpeter’s growth theory, comparative advantage theory of competition, and Ansoff’s growth matrix. The study adopted descriptive research design and the target population was limited to 206 employees of Libya Oil in Nairobi County. A sample of 61 respondents was selected through stratified sampling. A questionnaire was used to collect primary data which was analyzed using Statistical Package for Social Sciences (SPSS) version 23.0. The study found that the key growth strategies that were adopted and implemented by Libya Oil Kenya Limited were; market penetration strategy (84.1%), product development strategy (81.8%), market development strategy (72.7%), and diversification strategy (68.9%). The study also found that Libya Oil Kenya Limited had been able to gain competitive advantage, with an increase in new market segments being key at 50%. The study found that two growth strategies (market development and diversification) implemented by Libya Oil Kenya Limited had a positive and strong a significant effect on competitive advantage, especially on sales volume as shown by a Pearson correlational coefficient (r) of 0.641 and 0.759 respectively. From these findings the study recommends that management of Libya Oil Kenya Limited should implement other growth strategies in the organization, besides market penetration, product development, market development, and diversification strategies.