Blue Ocean Strategy and Organizational Performance of Jomo Kenyatta International Airport Freight Management Companies in Kenya.
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Date
2024
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
Daystar University, School of Business and Economics
Abstract
The freight management companies at Jomo Kenyatta International Airport in Nairobi, Kenya are facing significant performance challenges caused by market saturation and increasing operation cost. Furthermore, profit margins for many freight forwarders and cargo handling companies operating at JKIA are under pressure, with some reporting declines of 10-15% over the past 3 years. The purpose of this study was to investigate the effect of blue ocean strategy on performance of JKIA freight Management Companies in Kenya. The specific objectives were to assess the extent of adoption of blue ocean strategy by JKIA freight Management Companies in Kenya, to evaluate the organizational performance of JKIA freight Management Companies in Kenya and to determine the effect of blue ocean strategy on organizational performance of JKIA freight Management Companies in Kenya. The study further sought to determine the moderating effect of organizational culture on the relationship between blue ocean strategy and organizational performance of JKIA freight Management Companies in Kenya. It was anchored on the Resource Based View and dynamic capabilities Theory. The study employed descriptive and explanatory research design. The population in this study was all the 40 freight management companies in JKIA. The target population was all the 534 top and middle level management employees in the freight management companies in JKIA. A sample of 229 employees was selected using stratified random sampling technique. This study collected primary data using a structured questionnaire. Data analysis entailed descriptive and inferential statistics. The descriptive statistics include means, frequencies and standard deviations while inferential statistics entailed Pearsons’s correlation and multiple linear regression analysis. The study revealed that JKIA freight management companies have adopted various aspects of the Blue Ocean Strategy, including differentiation, cost leadership, and value creation, all of which significantly contribute to their organizational performance. Most firms have implemented advanced technologies, customized services, lean management practices, and flexible pricing, which have improved operational efficiency and customer satisfaction. Additionally, the study found that a positive and significant relationship exists between Blue Ocean Strategy elements and performance (β=0.879,p=0.002), and that organizational culture moderates and the relationship between BOS and performance(β=0.227,p=0.006). It was concluded that most JKIA freight management companies have adopted Blue Ocean Strategy. It was concluded that the firms have automated logistics processes to increase productivity and reduce labor costs. It was also concluded that the companies excel in shipment accuracy, timeliness, and minimizing damage, but there is room for improvement in fleet management. It was also concluded that differentiation, cost leadership, and value creation significantly influence performance. It was as well concluded that organizational culture, enhances the relationship between Blue Ocean Strategy and performance in these firms. Based on the study’s findings, it was recommended that the companies may continue optimizing their transportation routes and modes to reduce fuel consumption and delivery expenses while expanding the adoption of fuel-saving technologies. These firms may also deepen their investment in automation and lean management techniques to further eliminate waste, enhance operational efficiency, and reduce labor costs.
Description
MASTER OF BUSINESS ADMINISTRATION in Strategic Management
Keywords
Freight management companies, Performance challenges, Blue ocean strategy
Citation
Gatwiri, M. G. (2024). Blue Ocean Strategy and Organizational Performance of Jomo Kenyatta International Airport Freight Management Companies in Kenya. Daystar University, School of Business and Economics.