Influence of Strategic Management Practi

IOSR Journal of Business and Management (IOSR-JBM)
e-ISSN: 2278-487X, p-ISSN: 2319-7668. Volume 18, Issue 9 .Ver. I (Sep. 2016), PP 87-103
www.iosrjournals.org
Influence of Strategic Management Practices On Performance of

Small Scale Enterprises in the County Government of Trans
Nzoia County
Shimechero Imbuhira Sopha*, & Dr. Josphat Kwasira
Jomo Kenyatta University of Agriculture and Technology P.O Box 62000-00200, Nakuru
Abstract: Small Scale Enterprises are often faced by diverse challenges that prevent their growth and optimum
performance. These challenges are in diverse areas including access to information, access to credit facilities
and finances, poor skills matrix, lack of skills required to cope with market demands and market linkages, and
lack of access to business development services that are critical for their competitiveness as well as
productivity. Other challenges include insufficient knowledge in strategic management, effects of dumping and
low quality products, poor access to financial services, weak business linkages and lack of promotional
services. These challenges when not addressed leads to a high level of collapse of the Small Scale Enterprises.
Strategic management practices assist the Small Scale Enterprises address the challenges that limit their ability
to perform optimally and grow. This occurs through understanding of their operating environment, develop
strategies to undermine the threats in the environment and embrace the opportunities available in their
environment hence leading to performance and growth. The strategic management practices therefore will
assist the Small Scale Enterprises in the acquisition of external financial support, making a choice of the best
way to respond to market dynamics, identifying key results areas, consideration of the various available
alternatives and as a tool of communicating and controlling business factors of production. This study aimed at
examining the influence of strategic management on performance of Small Scale Enterprises with a reference to
Trans-Nzoia County. The variables of the study include competitive practices, strategic planning, strategic
innovation and Total Quality Management (TQM). The study is based on the Resource Based View and the
Dynamic Capabilities Theory. The descriptive research design was used. A sample size of 98 respondents was
used. Questionnaire will be used as the means for data collection. The study found that there was statistical
significance between strategic planning and performance of small scale enterprises in Kitale. The study also
found a statistical significance between strategic TQM and performance of small scale enterprises in Kitale.
The study found a statistical significant relationship between strategic innovation and performance of small
scale enterprises in Kitale. Similarly, the study found a statistical significant relationship between between
competitive practices and performance of small scale enterprises in Kitale. In order to investigate the
cumulative effect of the four independent variables (Strategic Planning, Strategic Innovation, Strategic TQM,
and Competitive Practices) on the performance of the small scale enterprises, the multiple linear regression
analysis was undertaken. The multiple correlation coefficient (R) is positive indicating the cumulative effect
Strategic Planning, Strategic Innovation, Strategic TQM, and Competitive Practices on the performance of the
small scale enterprises is positive. The multiple correlation coefficient of 0.975 indicates a very strong positive
correlation between Strategic Planning, Strategic Innovation, Strategic TQM, and Competitive Practices
metrics and the performance of the small scale enterprises. The coefficient of determination (R Square)
indicates the variance of the performance of the small scale enterprises that is determined or explained by the
four independent variables. In this context, the coefficient of determination of 0.951 indicates that the four
variables account for 95.1% of the variance in the small scale enterprises performance. Further studies should
therefore be conducted to identify on why these metrics were not significant predictors of performance of small
scale enterprises in Kitale.
Keywords: Strategic Planning, Strategic Total Quality Management, Strategic Innovation, Small Enterprises,
Competitive Practices
I. Introduction
There are diverse conceptualizations of performance within the context of Small Scale Enterprises.
Wakaba (2015) argues that performance can be examined within the context of focusing attention on what
makes, identifies and communicates the drivers of success, support organizational learning and provides a basis
for assessment and rewards. Performance can also be examined within the context of a function of an
organization’s ability to meet its goals and objectives through exploiting the available resources in an efficient
and effective way (Osoro, 2012).
DOI: 10.9790/487X-18090187103 www.iosrjournals.org 87 | Page

Influence of Strategic Management Practices On Performance of Small Scale Enterprises in the ...
On the other hand, Kirigo (2008) conceptualizes performance as the firm’s ability to serve and produce
what the market requires at a particular time and efficiency, which means achieving the objectives at the lowest
cost possible with highest possible benefits. Given the diverse definitions, Abera (2012) notes that the
performance has been conceptualized, operationalized and measured in different ways. There are diverse
indicators of a firm performance including profitability, growth in employment, production level, and sales
amongst other aspects. On the other hand, Nyaga (2013) indicates the businesses could measure their
performance using the financial and non- financial measures. The financial measures include profit before tax
and turnover while the non-financial measures focus on issues pertaining to customers’ satisfaction and
customers’ referral rates, delivery time, waiting time and employees’ turnover (Osoro, 2012). On the other hand,
Amurle (2013) conceptualizes performance as achievement in the areas of four perspectives that comprise of
learning and growth, internal business processes, competitive advantage and financial profitability. In this
context, Ngugi (2013) noted that growth of the Small-Scale Enterprises is often viewed in terms of
accumulation of assets, financial growth, employee growth, sales growth, return on assets and return on equity.
Strategic management is of critical importance to the performance and growth of the commercial
enterprises such as Small Scale Enterprises (Otieno, 2010). The strategic management sets the direction of the
firm enabling the organization to meet its financial and non-financial objectives, it enables the company to
become competitive through response to market demands, and acts to respond to changing customer’s demands
and technology (Tsuma, 2013). According to Alese & Alimi (2014) strategic management practices also enables
the Small Scale Enterprises to bring innovation to company which is needed for competition. Small scale
enterprises sector is also characterized by unpredictable and rapid change, which increases uncertainty for
individuals and firms operating within them. This requires strategic management practices in order to
continuously deal with the changing environment. The strategic management practices also leads to prudent
usage of resources in organizations. The strategic management assists in planning on adequate acquisition and
usage of resources in a cost efficient manner and with the optimum level of output. Finally, Kasekende (2013)
notes that Small Scale Enterprises benefit through the development, articulation and sustenance of the
organization and its mission hence giving its a sense of purpose, direction and focus and enables an organization
to adapt under conditions of externally imposed stress or crisis.
The Small-Scale Enterprises are often faced with diverse challenges that prevent their growth and
optimum performance. These challenges are in diverse areas including access to information, access to credit
facilities and finances, poor skills matrix, lack of skills required to cope with market demands and market
linkages, and lack of access to business development services that are critical for their competitiveness as well
as productivity. Other challenges include insufficient knowledge in strategic management, effects of dumping
and low quality products, poor access to financial services, weak business linkages and lack of promotional
services. These challenges when not addressed, leads to a high level of collapse of the Small-Scale Enterprises.
Over 60% of the Small Scale Enterprises within Kenya are estimated to fail each year. People in Small
Enterprises often have low education levels, poor management styles of their enterprises, lack of awareness on
the strategic management practices, and challenges in acquisition of external financial support. There are diverse
scholars who have examined the concept of strategic management in relations to diverse organizations or
industries. The available literature doesn’t examine strategic management practices within the context of Small
Scale Enterprises in a largely agrocultural based economy as that of Trans Nzoia.
II. Literature Review

Theoretical Review
The theoretical review was based on the dynamic capabilities theory. The dynamic capabilities have
been defined as the ability to integrate, build, and reconfigure internal and external competencies to address
rapidly-changing environments (Stanley, 2015). The dynamic capabilities have also been defined as the capacity
to renew competencies so as to achieve congruence with the changing environment by ―adapting, integrating,
and reconfiguring internal and external organizational skills, resources, and functional competencies (Tesot,
2012).
The qualifying characteristic of the dynamic capability is that the capability not only needs to change
the resource base, but it also needs to be embedded in the firm, and ultimately be repeatable. The need for the
dynamic capabilities is informed by the permanent risk of erosion of superior firm-specific resources and
competences in the contemporary business environment of hyper competition. The dynamic capabilities are
built over time as they are organizational processes in which may have become embedded in the firm over time,
and are employed to reconfigure the firm‘s resource base by deleting decaying resources or recombining old
resources in new ways (Reneta, 2012).
This implies that dynamic capabilities are viewed to be essentially path dependent shaped by the
decisions the firm has made throughout its history, and the stock of assets that it holds. Dynamic capabilities are
argued to comprise of four main processes: reconfiguration, leveraging, learning and integration.

Reconfiguration refers to the transformation and recombination of assets and resources, such as the
consolidation of manufacturing resources often occurring as a result of an acquisition. Leveraging refers to the
replication of a process or system that is operating in one area of a firm into another area, or extending a
resource by deploying it into a new domain, for instance applying an existing brand to a new set of products
(Nyariki, 2013). As a dynamic capability, learning allows tasks to be performed more effectively and efficiently,
often as an outcome of experimentation, and permits reflection on failure and success.
Finally, integration refers to the ability of the firm to integrate and coordinate its assets and resources,
resulting in the emergence of a new resource base. The dynamic capabilities reflect on the firm’s ability to
achieve new and innovative forms of competitive advantage given path dependencies and market positions. The
dynamic capabilities enable the firm to continuously renew its operational capabilities and hence sustaining its
performance in the long term (Tesot, 2012).
The dynamic capability theory has been criticized for the lack of the rigorous attempts to operationalize
the various dimensions of dynamic capabilities in a content-valid manner, avoiding the risk of tautological
definitions and operationalize the construct in a way that allows to explicitly differentiate between dynamic
capabilities’ existence and their effectsThe dynamic capabilities theory is important to this study because the
Small Scale Enterprises must be in a position to identify the opportunities and threats in their environment,
seize these opportunities and maintain competitiveness in light of the changing business environment.
Strategic Planning and Performance of Small Scale Enterprises

Strategic planning is the development of the long range policies and plans for effective management of
environment opportunities and threats, in light of corporate strengths and weaknesses (Naser, 2015). Strategic
planning has been conceptualized as the designing and developing the company strategies (Mbwaya, 2014).
Strategic planning has also been conceptualized as the determination of how the organization‘s mission, vision,
goals and objectives, will be met (Kuria, 2014). Similarly, Ndung’u (2014) argues that strategic planning is the
process of diagnosing an organization‘s external and internal environments, deciding on a vision and mission,
developing overall goals, creating and selecting general strategies to be pursued, and allocating resources to
achieve the organization‘s goals. On the other hand, Ngatia (2013) indicates that strategic planning involves the
development of a vision and mission, identification of an organization’s external opportunities and threats,
determination of the internal strengths and weaknesses, establishment of long-term objectives, generation of
alternative strategies, and choosing of the particular strategies to be pursued.
In this context, Mbogo (2013) argues that strategic planning decisions commit an organization to
specific products, markets, resources, and technologies over an extended period of time and the identified
strategies are aimed at determining long-term competitive advantages. Other activities undertaken under
strategic planning include decisions on product or service acquisition or manufacture, deployment of physical
resources, and relationships with key stakeholders (Alese & Alimi, 2014). The strategic planning is divided into
three organizational groups that is operational, competitive, and corporate levels (Thagana, 2013). The
operational strategic planning is often short term in nature and touch on diverse operational departments such as
finance, and production amongst others (Sola, 2012). The operational strategy is concerned with the day to day
operational aspects. On the other hand, the competitive strategic planning involves conceptualization of
strategies to compete in certain business or industry in which an in-depth knowledge of the competitors is
required in its formulation (Onyango, 2014).
According to Ochieng (2012) there several steps involved in strategy formulation. These steps include;
environmental scanning, formulation of mission and vision statements, specification of achievable objectives,
strategy development and setting of policy guidelines (Theuri, 2015). The environmental scanning (analysis)
involves the process through which the organization management monitor the environmental sectors (economic,
political/legal, social/cultural, technological or ecological) with a view of determining the organization’s
Strengths, Weakness, Opportunities and Threats (SWOT) (Mzera, 2015). Amongst the aspects that would be
involved in the environmental scanning include the examination of shifting customer preferences. The shifting
customer preferences are informed by changes in technology, habits, and new products in the market. The
ability to note the changes in customer preferences and plan for the changes is critical in addressing such
changes.
The mission statement is the firm’s overall broad guiding statement of purpose that includes basic
description of the firm, its nature and its philosophy. The mission statement defines an organization’s scope of
business that is product or service, markets, customers and philosophy. According to Kasekende (2013), the
mission statement should be as precise as possible; indicate the major components of strategy; indicate how
objectives are to be accomplished; define the firm's products and functions; designate markets to be reached,
specify the means for financing operations; and describe how the goals might be attained. On the other hand, the
vision a short, succinct and inspiring statement of what the organization intends to become and to achieve at
some point in the future. The strategy development is often divided into two components that is intended

strategy and emergent strategy (Otundo, 2009). The intended strategy arises as result of careful consideration of
the external environment while the emergent strategy do not develop on the basis of a grand plan but rather tend
to emerge over time (Watuka, 2014).The setting of the achievable objectives is of importance to the strategic
planning within Small Scale Enterprises.
The objectives have been defined as the long term results that an organization seeks to achieve through
its basic mission or the end products of the planned activities that the organization seeks to achieve through its
existence and operation (Ochieng’, 2015). There are diverse ways in which the objectives assist in the
performance of the organization. The objectives setting assists the firm to have a sense of direction, acts as a
platform for setting performance targets and organizational synergy, and assist in forming a platform for the
tracking of organizational performance and progress (Watuka, 2014). The organizational objectives should be
specific, measurable, achievable, realistic and time bound. The strategic planning is critical to the Small Scale
Enterprises. According to Kasekende (2013), the importance of the strategic planning within Small Scale
Enterprises arise due to the fact that the firms offer diverse services and products with a view of enhancing
their performance and hence providing a means of livelihood to the owners. In order to enhance their
performance, the Small Scale Enterprises must continually adjust to meet the existing and emerging business
challenges as well as utilizing the existing opportunities (Mwitari, 2014).
The strategic planning therefore enables the Small Scale Enterprises to align the available resources
with the market demands in order to develop and sustain competitive advantage. The strategic planning enables
the organizations to confront market forces that may undermine its performance including the threat of potential
entrants, intensity of rivalry among industry competitors, bargaining power of suppliers, threat of substitutes,
and bargaining power of buyers (Ncurai, 2013).
Competitive Practices and Performance of Small Scale Enterprises

There are diverse competitive practices that the Small Scale Enterprises may adopt in order to enhance
their performance in terms of market share, growth, customer retention and profitability. The competitive
practices that the firms may adopt include cost leadership, differentiation and focus (Dinga, 2012). The Small
Scale Enterprises must make a choice on the type of the strategy it needs to pursue dependent on the industry in
which it operates and what it intends to achieve from the competitive practice. The cost leadership strategy
implies that the company works to achieve the lowest cost of production and distribution so that it prices its
products much lower than competition hence gaining greater market share (Kagendo, 2013). In this strategy, the
Small Scale Enterprises must continually seek to finds areas within its value chain in which it can reduce on the
cost in order to have an overly lower production cost that competition.
This is a strategy ideal for the low margins and high volume business models such as wholesale shops
and other types of shops where items can be sold in bulk. The cost leadership competitive practices works
through acquisition of a huge market share in order for the model to work and to defray the lost economic
opportunities through reduced pricing. In most cases, the cost leadership involves the sale of a standard or no
frills product. The differentiation competitive strategy aims at creating an impression of being market leader
through development of a highly differentiated product and services (Shaviya, 2013). The differentiation
strategy could be in areas of service, product qualities, and distribution infrastructure. The Small Scale
Enterprises pursuing this kind of competitive strategy must investigate the items in their value chain that the
buyers place a premium importance on and position itself to meet those needs (Ndanu, 2014). The Small Scale
Enterprises that have positioned themselves as the providers of the attributes the customers place a premium on
are then able to serve a niche market.
The niche market on the other hand is able to pay a premium price to access the services from the
small enterprise hence driving the performance of the small enterprise. The firm achieves the competitive
advantage if the premium price exceeds the extra costs incurred in being unique (Thuku, 2009). The means of
differentiation could be the product, customer service, delivery channel, and marketing approach (Wu, 2010).
The differentiation strategy is ideal for the Small Scale Enterprises that serve a market need that requires high
margins but low volumes such as consultancy services and some service oriented services. This means that the
profitability per unit customer is extremely high compared to the cost leadership competitive practice. The final
competitive practice involves the focus strategy in which the Small Scale Enterprises segments the market and
opts to focus on a particular segment (Ndanu, 2014). The chosen segment could be attractive to the Small Scale
Enterprises due to diverse reasons including low competition in the segment or high returns in the given
segment. The small enterprise then seeks to tailor its operations, products and services to meet the needs of this
select segment at the exclusion of other segments. The firm may therefore achieve the competitive advantage on
the target market either through cost leadership or differentiation strategies (Mwanzia, 2012). The target
segments must either have buyers with unusual needs or else the production and delivery system that best serves
the target segment must differ from that of other industry segments (Havarungsi, 2006).

Strategic Innovation Practices and Performance of Small Scale Enterprises

The strategic innovation practices refers to the firm‘s ability to seek new and better ways to identify,
acquire, and implement ideas and tasks (i.e. management and administrative systems, internal cultures,
processes, products, services, distributing channels, and marketing methods-segments) within the organization
(Olusanya & Adegbola, 2014). The strategic innovation can be concerned with the inventions of diverse aspects
within the value chain in a business which may be completely new, or an improvement of an existing product or
system, and/or a diffusion of an existing innovation into a new application (Muguchu, 2013).
The innovation of the existing systems of services or goods production may lead to cheaper production
process. The cheaper production process leads to lower costs of production and hence better pricing of the
products. The business could also have new delivery model for their business leading to an increase in the
market share of the organization. The strategic innovation may also lead to the creation of new businesses
within the existing businesses or the renewal of ongoing business that have stagnated over time and in need of
transformation. The small enterprise capability to undertake strategic innovation is related to the firm’s ability to
the firm’s capacity to respond properly to changes in the environment (Kariuki, 2013).There are different
sources of strategic innovation practices within the Small Scale Enterprises. These sources include harvesting of
ideas and expertise from internal and external environment, possession of tacit knowledge, emerging knowledge
and technology, academic and research institutions, customer feedback and observations, and external changes
in the environment (Gică, 2011). In the context of the ideas harvesting from the environment, Al-ansari (2014)
notes that systematic innovation can lead to the observation of different sources of innovative opportunities
within and/or outside a firm.
These observations are critical in the identification of the unexpected (i.e. unforeseen opportunity),
incongruity (i.e. opportunity between reality and behaviour), industry and market restructures, demographics
(i.e. change in population and perception), process need, and localized, embedded, and research-based
knowledge. In the context of the tacit knowledge as a source of innovation, Huang (2015) notes that the tacit
knowledge which is an unspoken knowledge (i.e. observations, ingrained habits, inspirations, hunches, or other
forms of awareness) that are typically not written down or codified providing the firm much of its distinctive
edge over competitors. This is in comparison to explicit knowledge that is absorbed intellectually or delivered in
trainings session. The strategic innovation practices are considered critical for the performance of the Small
Scale Enterprises across the world. In this context, Al-ansari (2014) notes that innovation is considered to be of
importance to the growth of firms, despite their size, with great leverage in creating economic values and
competitive advantages and in driving changes. The strategic innovation can be inspired and affected by both
macro (external-driven) and micro (internal-driven) environmental determinants. There are different ways in
which the strategic innovation can be used to enhance the performance of the Small Scale Enterprises (Wanjau,
Gakure, & Kahiri, 2012).
Strategic innovation within Small Scale Enterprises has been used to improve business operations,
improve competitive advantages, and creation of the unique selling preposition (Majumdar, 2016). Within the
context of improvement of business operations, innovation is related with the ability to seek new and better
ways to identify, acquire, and implement ideas and tasks in an organization. The innovation is therefore used to
enable faster operational processes in a cost efficient manner and with little manpower as possible thus
improving the overall Small Scale Enterprises performance. Innovation is also associated with better resources
utilization amongst the firms despite having a similar set of resources in order to deliver superior business
performance of the Small Scale Enterprises (Alazem & Reid, 2016). In this context, Al-ansari (2014) noted that
while a firm with a higher business growth performance is considered to have a competitive advantage due to its
valuable, unique, and difficult to imitate resources and capabilities, the sustainability of its competitive
advantage might depend on its innovative capacity.
Strategic Total Quality Management (TQM) Practices and Performance Of Small Scale Enterprises
The quality has been conceptualized as the totality of features and characteristics of a product or
service that bear on its ability to satisfy stated or implied needs. On the other hand, Quality Management (QM)
is a method for ensuring that all the activities necessary to design, develop and implement a product or service
are effective and efficient with respect to the system and its performance (Seila, 2014). The Total Quality
Management (TQM) has been conceptualized as a total corporate focus on meeting and exceeding customer’s
expectations and significantly reducing costs resulting from poor quality by adopting a new management system
and corporate culture (Swayer, 2014). On the other hand, Gitangu (2015) indicates that TQM is an approach
which focuses on improving the organization's effectiveness, efficiency and responsiveness to customers' and
other stakeholders' needs by actively harnessing people's skills and competencies in the pursuit of achieving
sustained competitive advantage. The TQM has also been seen as a comprehensive and structured approach to
organizational management that seeks to improve the quality of products and services through ongoing
refinements in response to continuous feedback (Amurle, 2013).

The key component of TQM is that all the employees must actively be involved in the improvement of
the quality of services and products of the company. The Total Quality Management (TQM) is critical to the
performance of the Small Scale Enterprises in different ways. According to Olusanya & Adegbola (2014) has
been used to ensure customer satisfaction and loyalty, improvement of products and service quality and
reinforcement of the continuous improvement within Small Scale Enterprises. The TQM enhances the Small
Scale Enterprises performance through enhancing customer satisfaction, customer comfort, accommodating the
customer’s preferences and expectations, and enhancing the customer relationship management (Olusanya &
Adegbola, 2014). In the context of the customer satisfaction, TQM aims at improving quality, and identifies the
best measure of quality as matching customer expectations in terms of service, product, and experience.
Amongst the customer initiatives that the TQM introduces in order to enhance customer satisfaction include
reduction of waiting time by changing the method of appointment scheduling or client handling; making
changes to the delivery process so that the product reaches the customer faster; and better quality products
requiring no repairs improving customer loyalty (Seila, 2014).
The customer satisfaction increases the profitability, market share, and return on investment which
leads to competitive advantage. The TQM has also been associated with continuous improvements, meeting of
customers’ requirements, increased employee involvement/teamwork and problem-solving (Carlyle, 2013). The
Total Quality Management (TQM) is also associated with organizational development through organizational
culture change and amendment. The TQM promotes the concept of quality improvement for the business across
its service and products through all the organizational employees (Seila, 2014). In this context, the TQM
therefore improves on the teamwork and coordination amongst employees in different departments leading to
cross-functional knowledge sharing (Gitangu, 2015). These interventions leads to improvement in
communication skills of individual employees and overall organizational communication; knowledge sharing,
resulting in deepening and broadening of knowledge and skill-set of team members, and the making of a
learning organization; and flexibility for the organization in deploying personnel, contributing to rightsizing, and
ensuring cost competitiveness (Swayer, 2014).
There are different TQM practices that Small Scale Enterprises often practice including management
commitment, customer focus and satisfaction, benchmarking, relationship with suppliers, continuous
improvement, employee empowerment, and quality focus (Ballard, 2008). The management commitment is key
to the performance of the small enterprise as they formulate and help execute diverse strategies that the
company needs to pursue in order to create and retain competitive strategy in its operations (Kangu, Wanjau,
Kosimbei, & Arasa, 2013). In this context, Gitangu (2015) notes that in the top management typically acts as a
leader or driving force in the implementation of the TQM such as creating values, goals and systems for
customer’s satisfaction.
In the context of the customer focus and satisfaction, the Small Scale Enterprises’ customer have
become diverse, segmented, expectant of consultation, and change has become pervasive, persistent, and faster
within the business environment (Seila, 2014). The Small Scale Enterprises must use the TQM practices in order
to keep on acquiring customers, retaining them, building relationships with them and discovering ways of being
more valuable to them before the competition does (Chandra, 2013). In order to improve on its customer
satisfaction, the company may undertake benchmarking activities in order to gain and retain competitive
advantage in its area of operations. The benchmark refers to the measurement and analysis of products, services
and techniques of competitors in the same sector (Kangu et al., 2013). The benchmarking activities can be used
for the purposes of eliminating the weaknesses and threats within the business model while exploiting any
strengths and opportunities available in the market. The role of the supplier in the services and products that the
company offers is of critical concern with the view that the suppliers provide the inputs required for the diverse
processes.
In this context, Mwanzia (2012) notes that the qualities of products manufactured or services provided
depend on the extent of quality of the materials supplied or by flexibility, speed and cost of the services
provided by the suppliers. In the context of the importance of the suppliers, the ability to maintain a good
relationship with the supplier is of critical importance. The supplier relationship is a key relationship enabling
the organization to deliver the quality services with ease. The concept of the continuous improvement is critical
in ensuring that the organization keeps of meeting and exceeding the customers’ expectations.In this context,
Seila (2014) notes that the organizations need to improve the production and service systems consistently to
improve quality and productivity, hence reducing costs. On the other hand, in the context of the employee
empowerment, TQM principles notes that in order for the organization to meet the customer satisfaction then it
must empower its employees through training (Mogeni, 2013). The training and development of employees
enables the employees to meet customer demands in a professional manner. Finally, the small scale enterprises
must have a focus on the quality of the product and services as it leads to higher customer satisfaction.

III. Objective of the Study

The specific objectives of the study included;
i) To establish the influence of strategic planning practices on performance of Small Scale Enterprises in
County Government of Trans Nzoia.
ii) To examine the effect of competitive practices on performance of Small Scale Enterprises in County
Government of Trans Nzoia.
iii) To examine the influence of strategic innovation practices on performance of Small Scale Enterprises in
iv) To determine the effect of strategic Total Management Quality (TQM) practices on performance of Small
Scale Enterprises in County Government of Trans Nzoia.
IV. Research Hypotheses

The study was guided by the following research hypotheses;
H01: Strategic planning has no significant influence on performance of Small Scale Enterprises in County
H02: Competitive strategies have no significant influence on performance of Small Scale Enterprises in County
H03: Strategic innovation practices have no significant influence on performance of Small Scale Enterprises in
H04: Strategic Total Management Quality (TQM) practices have no significant influence on performance of
Small Scale Enterprises in County Government of Trans Nzoia.
V. Methodology
This study used the descriptive research design. The descriptive research design has been
conceptualized as a design used to describe characteristics of objects, people, groups, or organizations
(Mugenda, 2003). In particular, the survey method of descriptive research design was used to enable getting of
views from different small scale enterprises. Saunder, Lews, & Thornhill (2007) further indicates that the
purposes of the descriptive method of research is used to gather information about the present existing condition
where the researcher interacts freely with the respondents without undue influence; the emphasis is on
describing rather than on judging. . The target population of this study was the managers or assistant managers
of the Small Scale Enterprises within Kitale Town of Trans Nzoia County. There is an estimated 4,245 Small
Scale Enterprises within Kitale town.
This study employed Nassiuma’s (2009) formula to calculate the size of the sample. The formula to
scientifically derive the sample from the target population is illustrated hereunder.
NC 2
n 2
C  N  1e 2
Where
n = sample size
N =size of target population
C = coefficient of variation (0.5)
e = error margin (0.05)
Substituting these values in the equation, estimated sample size (n) will be:
n = 4,245(0.5)2 / (0.52+ (4,245-1)0.052)
n =98 respondents
One manager or assistant manager was drawn from each Small Scale Enterprise to make 98
respondents for the study .The simple random sampling was used for the purposes of the sampling of the SMEs
managers or assistant managers. This is because the simple random sampling enables equal chance to all the
respondents. Therefore, 98 questionnaires were returned. The constant reminders through telephone calls and
short text messages saw a high number of the questionnaires being returned that is 90 questionnaires making a
return rate of 91.8%. However, 7 questionnaires were rejected due to various issues such as incompletely filled
questionnaires (5) and questionnaires with identifiers (2). Therefore, the analyzed questionnaires were 83
making a response rate of 84.6%. This is considered sufficient by Upagade & Shende (2012).
VI. Findings and Discussions

Strategic Planning Practices and Performance of Small Scale Enterprises
In order to investigate the effect of strategic planning practices on the performance of the small scale
enterprises, the multiple linear regression analysis was undertaken. The individual metrics or indicators of the

strategic planning were regressed against the composite variable of the performance of the small scale
enterprises. The multiple correlation coefficient (R) is positive indicating the cumulative effect of strategic
planning practices metrics on the performance of the small scale enterprises. The multiple correlation coefficient
of 0.978 indicates a very strong positive correlation between strategic planning exercises metrics and the
performance of the small scale enterprises. The coefficient of determination (R Square) indicates the variance of
the performance of the small scale enterprises that is determined or explained by the strategic planning practices.
In this context, the coefficient of determination of 0.956 indicates that strategic planning practices account for
95.6% of the variance in the small scale enterprises performance.
Table 1; Model Summary of Strategic Planning Practices

Model R R Square Adjusted R Square Std. Error of the Estimate
1 .978a .956 .954 .13530
a. Predictors: (Constant), Identification of the Firm’s Competitors, Identification of the Firm’s Threats,
Identification of the Firm’s Weaknesses, Identification of the Firm’s Opportunities , Identification of the Firm’s
Strengths
The null hypothesis (H01) that is Strategic planning has no significant influence on performance of
Small Scale Enterprises in County Government of Trans Nzoia was tested using one way ANOVA. Since the
hypothesis testing was tested under a significance level of 0.05, then the p value of the strategic planning
ANOVA table was compared with the significance level in order to make a reject or fail to reject the null
hypothesis decision. In cases where the p value was less than the significance level, then the null hypothesis was
rejected. The null hypothesis was rejected since F (5, 77) = 337.452, P<0.005. Since p value is 0.000, it implied
that there is a 0.000% likelihood or probability that the model will give a wrong prediction and therefore the
model was found to a good fit of the data. Therefore, the alternative hypothesis that Strategic planning has
significant influence on performance of Small Scale Enterprises in County Government of Trans Nzoia was
adopted. An alternative way of testing the null hypothesis (which reinforces what has already being observed
using p value) would be the examination of the F statistic that is F ratio. In this context, if F Observed (Degrees of
Freedom (df) Numerator (Num), Degrees of Freedom (df) Denominator (Demon),) ≥ F α (df Num, df Denom) then the null
hypothesis is rejected. Thus since F Observed (5, 77) = 337.452 and F α (5, 77) =2.33 (as observed from F
distribution table), then F Observed (dfNum, df Demon) ≥ F α (df Num, df Denom) thus leading to the rejection of the null
hypothesis (H01).
Table 2; ANOVA of Strategic Planning

Model Sum of Squares df Mean Square F Sig.
1 Regression 30.887 5 6.177 337.452 .000b
Residual 1.410 77 .018
Total 32.297 82
a. Dependent Variable: Performance of SE
b. Predictors: (Constant), Identification of the Firm’s Competitors, Identification of the Firm’s Threats,
Identification of the Firm’s Weaknesses, Identification of the Firm’s Opportunities , Identification of the
Firm’s Strengths
With a view of understanding the individual effect of the strategic planning metrics with the other the
other metrics kept constant, then the unstandardized coefficients were examined. The five strategic planning
metrics that is identification of the firm’s strengths, weaknesses, opportunities, threats and competitors had
positive effect (variance) on the performance of small scale enterprises as illustrated through the coefficients. In
this context, the regression model was constructed as per below;
Performance of Small Scale Enterprises = 0.316+ 0.098 (x1) + 0.193 (x2) +0.137 (x3) + 0.022 (x4) + 0.283 (x5)
where
x1 = Identification of the Firm’s Strengths
x2 = Identification of the Firm’s Weaknesses
x3 = Identification of the Firm’s Opportunities
x4 = Identification of the Firm’s Threats
x5 = Identification of the Firm’s Competitors
The coefficient for the intercept is 0.316 which indicates that if the strategic planning metrics are at
zero then performance of small scale enterprises would stand at 0.316. The beta coefficient of identification of
the firm’s strengths is 0.098 indicating that a unit increase in the identification of the firm’s strengths would lead
to 0.098 increases in performance of the small enterprises. Similarly, a unit increase in identification of the
firm’s weaknesses would lead to a 0.193 increase in performance of the small scale enterprises. On the other

hand, a unit increase in identification of the firm’s opportunities would lead to a 0.137 increase in the
performance of the small scale enterprises.
Similarly, a unit increase in identification of the firm’s threats would lead to 0.022 increase in
performance of the small scale enterprises performance. Finally, a unit increase in the identification of the firm’s
competitors would lead to a 0.283 increase in the performance of the small scale enterprises. Therefore, the
identification of the firm’s competitors led to the biggest change in the performance of the small scale
enterprises. The results of this section are in tandem with the broader literature review. This is because the
identification of the firm’s strengths, weaknesses, opportunities, threats, and competitors enables the
organization to react to changes in its environment that affect its performance (Theuri, 2015). These changes
include economic, political/legal, social/cultural, technological or ecological aspects (Mzera, 2015). Other
aspects that can be examined include shifting customer preferences. The shifting customer preferences are
informed by changes in technology, habits, and new products in the market. The ability to note the changes in
customer preferences and plan for the changes is critical in addressing such changes.
The examination of whether each of the strategic planning metric is a significant predictor of the
performance of the small scale enterprises was undertaken using both the critical value and the p value
approach. An independent variable is a significant predictor of the dependent variable if the absolute t-value of
the regression coefficient associated with that independent variable is greater than the absolute critical t-value
that is to > tα/2, n-2. In this context the absolute value to of identification of the firm’s strengths, identification of
the firm’s weaknesses, identification of the firm’s opportunities, identification of the firm’s threats, and
identification of the firm’s competitors were 3.230, 10.285, 4.243, 13.492, and 7.428 respectively. In all the
cases, the absolute value to were greater than t0.025, 3 which is 2.353 as derived from a t test table and therefore
were significant predictor’s of small scale enterprises performance.
The t test results tallied with the p value results in which the independent variable is a significant
predictor of the dependent variable if the p value is less than the significance level of 0.05. In this context, the p
values of identification of the firm’s strengths, identification of the firm’s weaknesses, identification of the
firm’s opportunities, identification of the firm’s threats, and identification of the firm’s competitors were all
0.000 except for identification of firm’s strengths which was 0.002. Therefore, in all the cases the strategic
planning metrics were significant predictors of the performance of the small scale enterprises.
Table 3; Coefficients of Strategic Planning

Model Unstandardized Coefficients Standardized t Sig.
Coefficients
B Std. Error Beta
1 (Constant) .316 .106 2.991 .004
Identification of the Firm’s .098 .030 .150 3.230 .002
Strengths
Weaknesses
Opportunities
Threats
Competitors
i. Competitive Practices and Performance of the Small Scale Performance

In order to investigate the effect of competitive practices on the performance of the small scale
competitive practices were regressed against the composite variable of the performance of the small scale
enterprises. The multiple correlation coefficient (R) is positive indicating the cumulative effect of competitive
practices metrics on the performance of the small scale enterprises. The multiple correlation coefficient of 0.953
indicates a very strong positive correlation between competitive practices metrics and the performance of the
small scale enterprises. The coefficient of determination (R Square) indicates the variance of the performance of
the small scale enterprises that is determined or explained by the competitive practices. In this context, the
coefficient of determination of 0.908 indicates that competitive practices account for 90.8% of the variance in
the small scale enterprises performance.
Table 4; Model Summary of Competitive Practices

1 .953a .908 .902 .19683
a. Predictors: (Constant), High margins per customer, Distribution channel differentiation , Achievement of the highest market
share , Product qualities differentiation , Service differentiation

The null hypothesis (H02) that is Competitive strategies has no significant influence on performance of
Small Scale Enterprises in County Government of Trans Nzoia was tested using one way ANOVA. The
individual metrics or indicators of the Competitive strategies were regressed against the composite variable of
the performance of the small scale enterprises. Since the hypothesis testing was tested under a significance level
of 0.05, then the p value of the Competitive strategies ANOVA table was compared with the significance level
in order to make a reject or fail to reject the null hypothesis decision. In cases where the p value was less than
the significance level, then the null hypothesis was rejected. The null hypothesis was rejected since F (5, 77) =
151.329, P<0.005. Since p value is 0.000, it implied that there is a 0.000% likelihood or probability that the
model will give a wrong prediction and therefore the model was found to a good fit of the data. Therefore, the
alternative hypothesis that competitive strategies have significant influence on performance of Small Scale
Enterprises in County Government of Trans Nzoia was adopted.
An alternative way of testing the null hypothesis (which reinforces what has already being observed
using p value) would be the examination of the F statistic that is F ratio. In this context, if F Observed (Degrees of
Freedom (df) Numerator (Num), Degrees of Freedom (df) Denominator (Demon),) ≥ F α (df Num, df Denom) then the null
hypothesis is rejected. Thus since F Observed (5, 77) = 151.329 and F α (5, 77) =2.33 (as observed from F
distribution table), then F Observed (dfNum, df Demon) ≥ F α (df Num, df Denom) thus leading to the rejection of the null
hypothesis (H02).
Table 5; ANOVA of Competitive Practices

1 Regression 29.314 5 5.863 151.329 .000b
Residual 2.983 77 .039
Total 32.297 82
b. Predictors: (Constant), High margins per customer, Distribution channel differentiation ,
Achievement of the highest market share , Product qualities differentiation , Service differentiation
With a view of understanding the individual effect of the competitive practices planning metrics with
the other the other metrics kept constant, then the unstandardized coefficients were examined. The five
competitive practices metrics that is achievement of the highest market share, service differentiation, product
qualities differentiation, distribution channel differentiation, and high margins per customer had positive effect
(variance) on the performance of small scale enterprises as illustrated through the coefficients. In this context,
the regression model was constructed as per below;
Performance of Small Scale Enterprises = 0.381+ 0.162 (x1) + 0.121 (x2) +0.331 (x3) + 0.118 (x4) + 0.194 (x5)
where
x1 = Achievement of the highest market share
x2 = Service differentiation
x3 = Product qualities differentiation
x4 = Distribution channel differentiation
x5 = High margins per customer
The coefficient for the intercept is 0.381 which indicates that if the competitive practices metrics are at
zero then performance of small scale enterprises would stand at 0.381. The beta coefficient of achievement of
the highest market share is 0.162 indicating that a unit increase in the achievement of the highest market share
would lead to 0.162 increases in performance of small scale enterprises. The importance of the market share
leading to improvement of the performance of the small scale enterprises is consistent with the available
literature. The market share is often achieved through the cost leadership strategy. The cost leadership strategy
implies that the company works to achieve the lowest cost of production and distribution so that it prices its
products much lower than competition hence gaining greater market share (Kagendo, 2013). In this strategy, the
Small Scale Enterprises must continually seek to finds areas within its value chain in which it can reduce on the
cost in order to have an overly lower production cost that competition.
This is a strategy ideal for the low margins and high volume business models such as wholesale shops
and other types of shops where items can be sold in bulk. The cost leadership competitive practices works
through acquisition of a huge market share in order for the model to work and to defray the lost economic
opportunities through reduced pricing. In most cases, the cost leadership involves the sale of a standard or no
frills product. The differentiation competitive strategy aims at creating an impression of being market leader
through development of a highly differentiated product and services (Shaviya, 2013).
Similarly, a unit increase in service differentiation would lead to 0.121 increases in performance of
small scale enterprises. On the other hand, a unit increase in Product qualities differentiation would lead to
0.331 increase in the performance of the small scale enterprises. Similarly, a unit increase in distribution channel
differentiation would lead to 0.118 increase in performance of small scale enterprises. The differentiation
whether of service, product qualities or distribution channel aims at creating an impression of being market
leader through development of a highly differentiated product and services (Shaviya, 2013). The differentiation
strategy could be in areas of service, product qualities, and distribution infrastructure. The Small Scale
Enterprises pursuing this kind of competitive strategy must investigate the items in their value chain that the
buyers place a premium importance on and position itself to meet those needs (Ndanu, 2014). The Small Scale
Enterprises that have positioned themselves as the providers of the attributes the customers place a premium on
are then able to serve a niche market.
Finally, a unit increase in high margins per customer would lead to 0.194 increase in the performance
of the small scale enterprises. The high margins per customer are often achieved through the creation of a niche
market. The niche market on the other hand is able to pay a premium price to access the services from the small
enterprise hence driving the performance of the small enterprise. The firm achieves the competitive advantage
if the premium price exceeds the extra costs incurred in being unique (Thuku, 2009). The means of
differentiation could be the product, customer service, delivery channel, and marketing approach (Wu, 2010).
The differentiation strategy is ideal for the Small Scale Enterprises that serve a market need that requires high
margins but low volumes such as consultancy services and some service oriented services. This means that the
profitability per unit customer is extremely high compared to the cost leadership competitive practice.
Therefore, product qualities differentiation led to the biggest change in the performance of the small scale
enterprises.
The examination of whether each of the competitive practices planning is a significant predictor of the
that is to > tα/2, n-2. In this context the absolute value to of achievement of the highest market share, service
differentiation, product qualities differentiation, distribution channel differentiation, and high margins per
customer were 4.169, 2.306, 7.287, 2.106, and 7.522 respectively. On the other hand, the critical t value that is
t0.025, 3 is 2.353. Therefore, achievement of the highest market share, product qualities differentiation, and high
margins per customer were significant predictors of performance of small scale enterprises as their t values were
greater than 2.353.
On the other hand, the Service differentiation and distribution channel differentiation had their t values
less than 2.353 and as such were not significant predictors of performance of small scale enterprises. The t test
results tallied with the p value results in which the independent variable is a significant predictor of the
dependent variable if the p value is less than the significance level of 0.05. In this context, the p values of
achievement of the highest market share, product qualities differentiation, and high margins per customer are
0.000 which are less than 0.05 and thus are significant predictors of performance of small scale enterprises
performance. Service differentiation and distribution channel differentiation had their p values as 0.024 and
0.038 which were greater than 0.05 and as such were not significant predictors of performance of small scale
performers.
Table 6; Coefficients of Competitive Practices
ii. Strategic Innovation and Performance of the Small Scale Enterprises

In order to investigate the effect of strategic innovation practices on the performance of the small scale
strategic innovation practices were regressed against the composite variable of the performance of the small
scale enterprises. The multiple correlation coefficient (R) is positive indicating the cumulative effect of strategic
innovation practices metrics on the performance of the small scale enterprises. The multiple correlation
coefficient of 0.937 indicates a very strong positive correlation between strategic innovation practices metrics
and the performance of the small scale enterprises. The coefficient of determination (R Square) indicates the

variance of the performance of the small scale enterprises that is determined or explained by the strategic
innovation practices. In this context, the coefficient of determination of 0.878 indicates that competitive
practices account for 87.8% of the variance in the small scale enterprises performance.
Table 7; Model Summary of Strategic Innovation

1 .937a .878 .870 .22661
a. Predictors: (Constant), New delivery models , New markets for same products , New products/services , Cheaper production process,
Renewal of stagnated business
The null hypothesis (H03) that is Strategic innovation practices have no significant influence on
performance of Small Scale Enterprises in County Government of Trans Nzoia was tested using one way
ANOVA. The individual metrics or indicators of the Strategic innovation practices were regressed against the
composite variable of the performance of the small scale enterprises. Since the hypothesis testing was tested
under a significance level of 0.05, then the p value of Strategic innovation practices ANOVA table was
compared with the significance level in order to make a reject or fail to reject the null hypothesis decision. In
cases where the p value was less than the significance level, then the null hypothesis was rejected. The null
hypothesis was rejected since F (5, 77) = 110.382, P<0.005. Since p value is 0.000, it implied that there is a
0.000% likelihood or probability that the model will give a wrong prediction and therefore the model was found
to a good fit of the data. Therefore, the alternative hypothesis that Strategic innovation practices have significant
influence on performance of Small Scale Enterprises in County Government of Trans Nzoia was adopted. An
alternative way of testing the null hypothesis (which reinforces what has already being observed using p value)
would be the examination of the F statistic that is F ratio. In this context, if F Observed (Degrees of Freedom (df)
Numerator (Num), Degrees of Freedom (df) Denominator (Demon),) ≥ F α (df Num, df Denom) then the null hypothesis is
rejected. Thus since F Observed (5, 77) = 110.382 and F α (5, 77) =2.33 (as observed from F distribution table),
then F Observed (dfNum, df Demon) ≥ F α (df Num, df Denom) thus leading to the rejection of the null hypothesis (H02).
Table 8; ANOVA of Strategic Innovation

1 Regression 28.343 5 5.669 110.382 .000b
Residual 3.954 77 .051
Total 32.297 82
b. Predictors: (Constant), New delivery models , New markets for same products , New products/services , Cheaper production
process, Renewal of stagnated business
With a view of understanding the individual effect of the strategic innovation practices metrics with the
other the other metrics kept constant, then the unstandardized coefficients were examined. The five strategic
innovation practices metrics that is new products/services, renewal of stagnated business, cheaper production
process, new markets for same products, and new delivery models had positive effect (variance) on the
performance of small scale enterprises as illustrated through the coefficients. In this context, the regression
model was constructed as per below;
Performance of Small Scale Enterprises = 0.358+ 0.231 (x1) + 0.037 (x2) +0.294 (x3) + 0.174 (x4) +
0.192 (x5) where
x1 = New products/services
x2 = Renewal of stagnated business
x3 = Cheaper production process
x4 = New markets for same products
x5 = New delivery models
The coefficient for the intercept is 0.358 which indicates that if the strategic innovation metrics are at
zero then performance of small scale enterprises would stand at 0.358. The beta coefficient of new
products/services is 0.231 indicating that a unit increase in the new products/services would lead to 0.231
increases in performance of small scale enterprises. Similarly, a unit increase in renewal of stagnated business
would lead to 0.037 increases in performance of small scale enterprises. On the other hand, a unit increase in
cheaper production process would lead to 0.294 increase in the performance of the small scale enterprises. The
innovation of the existing systems of services or goods production may lead to cheaper production process. The
cheaper production process leads to lower costs of production and hence better pricing of the products. The
business could also have new delivery model for their business leading to an increase in the market share of the
organization. The strategic innovation may also lead to the creation of new businesses within the existing
businesses or the renewal of ongoing business that have stagnated over time and in need of transformation. The

small enterprise capability to undertake strategic innovation is related to the firm’s ability to the firm’s capacity
to respond properly to changes in the environment (Kariuki, 2013).
Similarly, a unit increase in new markets for same products would lead to 0.174 increase in
performance of small scale enterprises. Finally, a unit increase in new delivery models would lead to 0.192
increase in the performance of the small scale enterprises. Therefore, cheaper production process led to the
biggest change in the performance of the small scale enterprises.
The examination of whether each of the strategic innovation practices is a significant predictor of the
that is to > tα/2, n-2. In this context the absolute value to of new products/services, renewal of stagnated business,
cheaper production process, new markets for same products, and new delivery models 5.765, 0.642, 8.281,
3.558, and 6.407 respectively. On the other hand, the critical t value that is t 0.025, 3 is 2.353. Therefore, the new
products/services, cheaper production process, new markets for same products, and new delivery models were
significant predictors of performance of small scale enterprises as their t values were greater than 2.353.
On the other hand, Renewal of stagnated business had it is t value less than 2.353 and as such was not
significant predictors of performance of small scale enterprises. The t test results tallied with the p value results
in which the independent variable is a significant predictor of the dependent variable if the p value is less than
the significance level of 0.05. In this context, the p values of the new products/services, cheaper production
process, new markets for same products, and new delivery models were all 0.000 except new markets for same
products that had p value 0.001. Since, their p values were less than 0.05 then these metrics were significant
predictors of performance of small scale. On the other hand, renewal of stagnated business had a p value of
0.523 which was more than 0.05 and therefore the renewal of stagnated business was not a significant predictor
of performance of small scale enterprises.
Table 9; Coefficients of Strategic Innovation

Model Unstandardized Coefficients Standardized Coefficients t Sig.
B Std. Error Beta
1 (Constant) .358 .178 2.008 .048
New products/services .231 .040 .275 5.765 .000
Renewal of stagnated business .037 .057 .055 .642 .523
Cheaper production process .294 .035 .445 8.281 .000
New markets for same products .174 .049 .301 3.558 .001
New delivery models .192 .030 .299 6.407 .000
iii. Strategic Total Quality Management (TQM) Practices and Performance of Small Scale Enterprises
In order to investigate the effect of strategic TQM practices on the performance of the small scale
strategic TQM practices were regressed against the composite variable of the performance of the small scale
enterprises. The multiple correlation coefficient (R) is positive indicating the cumulative effect of strategic TQM
practices metrics on the performance of the small scale enterprises. The multiple correlation coefficient of 0.938
indicates a very strong positive correlation between strategic TQM practices metrics and the performance of the
small scale enterprises. The coefficient of determination (R Square) indicates the variance of the performance of
the small scale enterprises that is determined or explained by the strategic TQM practices. In this context, the
coefficient of determination of 0.879 indicates that competitive practices account for 87.9% of the variance in
the small scale enterprises performance.
Table 10; Model Summary of Strategic TQM

1 .938a .879 .872 .22490
a. Predictors: (Constant), Supplier Relationship , Continuous Improvement , Bench Marking , Customer
focus and Satisfaction , Management Commitment to quality
The null hypothesis (H04) that is Strategic Total Management Quality (TQM) practices have no
significant influence on performance of Small Scale Enterprises in County Government of Trans Nzoia was
tested using one way ANOVA. The individual metrics or indicators of the Strategic Total Management Quality
(TQM) practices were regressed against the composite variable of the performance of the small scale
enterprises. Since the hypothesis testing was tested under a significance level of 0.05, then the p value of
strategic Total Management Quality (TQM) practices ANOVA table was compared with the significance level
in order to make a reject or fail to reject the null hypothesis decision. In cases where the p value was less than

the significance level, then the null hypothesis was rejected. The null hypothesis was rejected since F (5, 77) =
112.308, P<0.005. Since p value is 0.000, it implied that there is a 0.000% likelihood or probability that the
model will give a wrong prediction and therefore the model was found to a good fit of the data. Therefore, the
alternative hypothesis that Strategic Total Management Quality (TQM) practices have significant influence on
performance of Small Scale Enterprises in County Government of Trans Nzoia was adopted. An alternative way
of testing the null hypothesis (which reinforces what has already being observed using p value) would be the
examination of the F statistic that is F ratio. In this context, if F Observed (Degrees of Freedom (df) Numerator (Num),
Degrees of Freedom (df) Denominator (Demon),) ≥ F α (df Num, df Denom) then the null hypothesis is rejected. Thus since
F Observed (5, 77) = 112.308 and F α (5, 77) =2.33 (as observed from F distribution table), then F Observed (dfNum, df
Demon) ≥ F α (df Num, df Denom) thus leading to the rejection of the null hypothesis (H02).
Table 11; ANOVA for strategic TQM

1 Regression 28.402 5 5.680 112.308 .000b
Residual 3.895 77 .051
Total 32.297 82
b. Predictors: (Constant), Supplier Relationship , Continuous Improvement , Bench Marking , Customer focus
and Satisfaction , Management Commitment to quality
With a view of understanding the individual effect of the Strategic TQM metrics with the other the
other metrics kept constant, then the unstandardized coefficients were examined. The five Strategic TQM
metrics that is management commitment to quality, customer focus and satisfaction, continuous improvement,
bench marking, and supplier relationship had positive effect (variance) on the performance of small scale
enterprises as illustrated through the coefficients. In this context, the regression model was constructed as per
below;
Performance of Small Scale Enterprises = 0.594 + 0.194 (x1) + 0.072 (x2) +0.213 (x3) + 0.167 (x4) +
0.221 (x5) where
x1 = Management Commitment to quality
x2 = Customer focus and Satisfaction
x3 = Continuous Improvement
x4 = Bench Marking
x5 = Supplier Relationship
The coefficient for the intercept is 0.594 which indicates that if the strategic TQM metrics are at zero
then performance of small scale enterprises would stand at 0.594. The beta coefficient of management
commitment to quality is 0.194 indicating that a unit increase in the Management Commitment to quality would
lead to 0.194 increases in performance of small scale enterprises. The management commitment is key to the
performance of the small enterprise as they formulate and help execute diverse strategies that the company
needs to pursue in order to create and retain competitive strategy in its operations (Kangu et al., 2013). In this
context, Gitangu (2015) notes that in the top management typically acts as a leader or driving force in the
implementation of the TQM such as creating values, goals and systems for customer’s satisfaction.
Similarly, a unit increase in Customer focus and Satisfaction would lead to 0.072 increases in
performance of small scale enterprises. This is in tandem with the reviewed literature. The TQM enhances the
Small Scale Enterprises performance through enhancing customer satisfaction, customer comfort,
accommodating the customer’s preferences and expectations, and enhancing the customer relationship
management (Olusanya & Adegbola, 2014). In the context of the customer satisfaction, TQM aims at improving
quality, and identifies the best measure of quality as matching customer expectations in terms of service,
product, and experience. Amongst the customer initiatives that the TQM introduces in order to enhance
customer satisfaction include reduction of waiting time by changing the method of appointment scheduling or
client handling; making changes to the delivery process so that the product reaches the customer faster; and
better quality products requiring no repairs improving customer loyalty (Seila, 2014).
In the context of the customer focus and satisfaction, the Small Scale Enterprises’ customer have
become diverse, segmented, expectant of consultation, and change has become pervasive, persistent, and faster
within the business environment (Seila, 2014). The Small Scale Enterprises must use the TQM practices in order
to keep on acquiring customers, retaining them, building relationships with them and discovering ways of being
more valuable to them before the competition does (Chandra, 2013).
On the other hand, a unit increase in continuous improvement process would lead to 0.213 increase in
the performance of the small scale enterprises. The TQM has also been associated with continuous
improvements, meeting of customers’ requirements, increased employee involvement/teamwork and problem-
solving (Carlyle, 2013). The Total Quality Management (TQM) is also associated with organizational
development through organizational culture change and amendment. The TQM promotes the concept of quality
improvement for the business across its service and products through all the organizational employees (Seila,
2014).
Similarly, a unit increase in bench marking would lead to 0.167 increase in performance of small scale
enterprises. In order to improve on its customer satisfaction, the company may undertake benchmarking
activities in order to gain and retain competitive advantage in its area of operations. The benchmark refers to the
measurement and analysis of products, services and techniques of competitors in the same sector (Kangu et al.,
2013). The benchmarking activities can be used for the purposes of eliminating the weaknesses and threats
within the business model while exploiting any strengths and opportunities available in the market. The role of
the supplier in the services and products that the company offers is of critical concern with the view that the
suppliers provide the inputs required for the diverse processes.
Finally, a unit increase in supplier relationship would lead to 0.221 increase in the performance of the
small scale enterprises. In this context, Mwanzia (2012) notes that the qualities of products manufactured or
services provided depend on the extent of quality of the materials supplied or by flexibility, speed and cost of
the services provided by the suppliers. In the context of the importance of the suppliers, the ability to maintain a
good relationship with the supplier is of critical importance. The supplier relationship is a key relationship
enabling the organization to deliver the quality services with ease. The concept of the continuous improvement
is critical in ensuring that the organization keeps of meeting and exceeding the customers’ expectations.
Therefore, supplier relationship led to the biggest change in the performance of the small scale enterprises.
The examination of whether each of the strategic TQM practices is a significant predictor of the
that is to > tα/2, n-2. In this context the absolute value to of management commitment to quality, customer focus
and satisfaction, continuous improvement, bench marking, and supplier relationship were 2.903, 1.130, 8.036,
5.413, and 4.662 respectively. On the other hand, the critical t value that is t0.025, 3 is 2.353. Therefore,
management commitment to quality, continuous improvement, bench marking, and supplier relationship were
significant predictors of performance of small scale enterprises as their t values were greater than 2.353.On the
other hand, customer focus and satisfaction had it is t value less than 2.353 and as such was not significant
predictor of performance of small scale enterprises. The t test results tallied with the p value results in which the
independent variable is a significant predictor of the dependent variable if the p value is less than the
significance level of 0.05. In this context, the p values of continuous improvement, bench marking, and supplier
relationship were significant predictors of performance of small scale enterprise were all 0.000 except
management commitment to quality that had p value 0.005. Since, their p values were less than 0.05 then these
metrics were significant predictors of performance of small scale. On the other hand, customer focus and
satisfaction had a p value of 0.262 which was more than 0.05 and therefore customer focus and satisfaction was
not a significant predictor of performance of small scale enterprises.
Table 12; Coefficients for strategic TQM

Model Unstandardized Standardized Coefficients t Sig.
Coefficients
B Std. Error Beta
1 (Constant) .594 .155 3.821 .000
Management Commitment to quality .194 .067 .285 2.903 .005
Customer focus and Satisfaction .072 .063 .107 1.130 .262
Continuous Improvement .213 .026 .330 8.036 .000
Bench Marking .167 .031 .266 5.413 .000
Supplier Relationship .221 .047 .299 4.662 .000
VII. Recommendations
The study recommends that the strategic management principles should be used for the performance
improvement of small scale enterprises.
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IOSR Journal of Business and Management (IOSR-JBM)

Influence of Strategic Management Practices On Performance of

DOI: 10.9790/487X-18090187103 www.iosrjournals.org 87 | Page

II. Literature Review

DOI: 10.9790/487X-18090187103 www.iosrjournals.org 88 | Page

Strategic Planning and Performance of Small Scale Enterprises

DOI: 10.9790/487X-18090187103 www.iosrjournals.org 89 | Page

Competitive Practices and Performance of Small Scale Enterprises

DOI: 10.9790/487X-18090187103 www.iosrjournals.org 90 | Page

Strategic Innovation Practices and Performance of Small Scale Enterprises

DOI: 10.9790/487X-18090187103 www.iosrjournals.org 91 | Page

DOI: 10.9790/487X-18090187103 www.iosrjournals.org 92 | Page

III. Objective of the Study

IV. Research Hypotheses

VI. Findings and Discussions

DOI: 10.9790/487X-18090187103 www.iosrjournals.org 93 | Page

Table 1; Model Summary of Strategic Planning Practices

Table 2; ANOVA of Strategic Planning

DOI: 10.9790/487X-18090187103 www.iosrjournals.org 94 | Page

Table 3; Coefficients of Strategic Planning

i. Competitive Practices and Performance of the Small Scale Performance

Table 4; Model Summary of Competitive Practices

DOI: 10.9790/487X-18090187103 www.iosrjournals.org 95 | Page

Table 5; ANOVA of Competitive Practices

Table 6; Coefficients of Competitive Practices

ii. Strategic Innovation and Performance of the Small Scale Enterprises

DOI: 10.9790/487X-18090187103 www.iosrjournals.org 97 | Page

Table 7; Model Summary of Strategic Innovation

Table 8; ANOVA of Strategic Innovation

DOI: 10.9790/487X-18090187103 www.iosrjournals.org 98 | Page

Table 9; Coefficients of Strategic Innovation

Table 10; Model Summary of Strategic TQM

DOI: 10.9790/487X-18090187103 www.iosrjournals.org 99 | Page

Table 11; ANOVA for strategic TQM

Table 12; Coefficients for strategic TQM

DOI: 10.9790/487X-18090187103 www.iosrjournals.org 101 | Page

DOI: 10.9790/487X-18090187103 www.iosrjournals.org 102 | Page

DOI: 10.9790/487X-18090187103 www.iosrjournals.org 103 | Page

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