PROCESS INNOVATION AND COMPETITIVENESS OF FOOD AND BEVERAGE MANUFACTURING FIRMS IN NAIROBI CITY COUNTY, IN KENYA
Abstract
Purpose of the Study: This research study assessed the influence of process innovation on the competitiveness of Food and Beverage Manufacturing Firms in Nairobi City County, Kenya.
Statement of the Problem: Food and beverage manufacturing firms in Kenya are crucial to the economy, yet they face significant challenges in maintaining competitiveness. In 2017, food processing accounted for only 2.8% of Kenya's GDP (Ksh 58.6 billion), indicating underperformance.
Methodology: The study employed a mixed method research design surveying 201 licensed food and beverage manufacturing firms in Nairobi City County. Data was collected using questionnaires, with stratified and random sampling techniques used to select respondents. The unit of analysis consisted of owner/managers from these firms. Data analysis utilized SPSS software for quantitative analysis and content analysis for qualitative data.
Results: The findings revealed that process innovation significantly influenced firm competitiveness, explaining 62.9% of the variability in competitiveness (R² = 0.6293, F (1, 190) = 322.449, p = 0.000). Process innovations showed strong positive correlations with competitiveness (Beta = 0.793, p = 0.000). The interaction between process innovations and firm size was statistically significant (p = 0.001), confirming firm size's moderating effect on the relationship between innovation and competitiveness.
Conclusion and Recommendations: The study concluded that process innovation is crucial for enhancing competitiveness in food and beverage manufacturing firms, with firm size playing a significant moderating role. Based on these findings, it is recommended that managers adopt comprehensive innovation strategies and foster a culture of innovation through leadership commitment, while policymakers should provide financial incentives and facilitate access to innovation hubs for these firms. Keywords: Process Innovation, Competitiveness, Food and Beverage, Manufacturing Firms, Nairobi City County
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