Moderation of Organizational Policies on the Relationship between Competitive Strategies and Operational Performance of Star Rated Hotels in Uasin Gishu County, Kenya

Abstract

The hotel industry in Kenya has in the past few years experienced a lot of changes and growth which have affected the state of competition. These demands for formulation and implementation of strategies would cope with competitive pressure. The purpose of this study was to establish the moderating effect of organizational policies on the relationship between competitive strategies and operational performance of Star rated Hotels in Uasin Gishu County. The study adopted the Resource Based View Theory, Porter's Five Forces Model, and Igor Ansoff's Theory. It employed descriptive cross-sectional survey design with a target population of 204 hoteliers in 25 star rated hotels. The study applied a census sampling. Questionnaires were used to collect data. Questionnaires were pre-tested on a pilot of 21 staff with a validity index of 0.924 and a reliability Cronbach's alpha coefficient of 0.853.  The study used both descriptive statistics and inferential statistics aided by Statistical Package for Social Sciences computer software. Descriptive statistics included mean, frequencies and standard deviation. Inferential statistics involved regression and correlation analysis. Findings indicated that on introduction of the moderating variable (organizational policies) creates a positive shift in the correlation coefficient from R= 0.548 to R= 0.661. The R-square also shifts positively from R²= 0.301 to R²=0.437. The adjusted R-square also shifts positively from R²= 0.289 to R²=0.428. The study therefore concluded that there was a significant statistical effect of cost leadership; product differentiation; and market development; on operational performance of the Star Rated Hotels in Uasin Gishu County. The study to recommend incorporation of cost leadership; product differentiation; and market development; in both short- and long-term strategic plans for hotels.