Competitive characteristics on competitive advantage: A case of financial services sector in Kenya

Abstract

This study aimed to determine the influence of competitive characteristics on the competitiveadvantage of firms in the financial services sector in Kenya, that is, banking, microfinance,and savings and credit societies institutions, using the resource-based theory. The studytargeted 1356 members in the financial services sector. From the population, a sample of 340staff members was targeted using the Yamane formula, factoring in a 10% non-response error,and data was collected using a closed-ended questionnaire. The descriptive statistics used weremean, standard deviation, and percentages, while the inferential statistics used were factoranalysis, correlation coefficient, analysis of variance (ANOVA), and regressions analysis. Theresponse rate was 92%. The study found out that competitive advantage had a positive andsignificant correlation with the competitive characteristics constructs; agility r (306) =.592,p<.05; competitive forces, r (306) =.540, p<.05; dynamic capabilities (306) =.587, p<.05. Onthe regression, the competitive characteristics constructs had a significant influence oncompetitive advantage: agility (β = .287 t = 5.157, p<.05); competitive forces (β = .248 t =4.878, p<.05); and dynamic capabilities (β = .286 t = 5.201, p<.05). This shows a change ofdynamic capabilities by a unit influenced competitive advantage by .286. From these results,agility had a higher influence on the competitive advantage with a Beta of .287 followed bydynamic capabilities with a Beta of .286, and lastly, the competitive force with a Beta of .248.On the hypothesis test, the study found out that competitive characteristics have a significantinfluence on the achievement of competitive advantage (β = .687 t = 16.472, p<.05) hencerejected the null hypothesis of the study. The study recommends that managers should consideragility as a predominant principle guiding strategic and operational activities in the businessenvironment on competitive characteristics