STRATEGIC PLANNING ADOPTION ON THE ORGANIZATIONAL PERFORMANCE OF SMALL AND MEDIUM ENTERPRISES IN KAMUKUNJI TRADING CENTRE, NAIROBI CITY COUNTY, KENYA
Abstract
Purpose of the study: The purpose of the study was to assess the effect of strategic planning adoption on the organizational performance of Small and Medium Enterprises (SMEs) in Kamukunji Trading Centre, Nairobi City County, Kenya.
Statement of the problem: SMEs in Kamukunji Trading Centre face numerous challenges, including limited access to financing, stringent regulatory requirements, and intense competition. While strategic planning is widely recognized for its potential to improve organizational outcomes, its specific impact on SMEs in this context remained insufficiently understood.
Methodology: The study employed a descriptive research design, targeting a population of 5,000 registered SMEs in Kamukunji Trading Centre. A sample of 365 SMEs was selected using stratified random sampling. Data were collected using semi-structured questionnaires and analyzed using descriptive statistics, Pearson correlation, and regression analysis.
Findings: The study found that strategic planning adoption had a significant positive impact on the organizational performance of SMEs in Kamukunji Trading Centre. The coefficient of determination (R Square) was 0.469, indicating that strategic planning explained 46.9% of the variation in organizational performance. A strong positive correlation (r = 0.685, p < 0.01) was observed between strategic planning adoption and organizational performance.
Conclusion: The study concludes that strategic planning plays a crucial role in enhancing the performance of SMEs in Kamukunji Trading Centre. Despite the challenges faced by these enterprises, effective adoption of strategic planning practices can significantly improve organizational outcomes.
Recommendations: The study recommends that SMEs in Kamukunji Trading Centre should invest in training and capacity building for strategic planning. Policymakers should design supportive policies and provide access to strategic planning tools tailored for SMEs. Further research should explore additional factors affecting SME performance in this context and investigate the long-term impact of strategic planning adoption.
Keywords: Strategic Planning, SMEs, Organizational Performance, Kamukunji Trading Centre, Kenya
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