Effect of Strategic Management Practices on Competitive Advantage in Level Six Private Hospitals in Nairobi County, Kenya

Abstract

Despite the rapid growth of private-level Six hospitals in Nairobi County, many continue to struggle with maintaining a sustainable competitive advantage. Less than 30 percent of these hospitals report consistent growth in patient volumes and financial performance. The purpose of this study was therefore to establish the effects of strategic management practices on competitive advantage in Level Six private hospitals in Nairobi County, Kenya. The specific objectives were; to determine the effects of strategic planning on the competitive advantage in Level Six private hospitals in Nairobi County, to evaluate the effects of resource management practices on competitive advantage in Level Six private hospitals in Nairobi County, to examine the effects of innovation adoption on competitive advantage in Level Six private hospitals in Nairobi County and to establish the effects of performance monitoring and evaluation practices on competitive advantage in Level Six private hospitals in Nairobi County. This study was underpinned by Resource-Based View theory, Dynamic Capabilities theory, Diffusion and Innovations theory and the Balance Scorecard Framework. The study selected all Level Six private hospitals in Nairobi County, focusing on eight key departments within each hospital that play a critical role in supporting the hospital’s strategic objectives. A quantitative cross-sectional survey design with descriptive and explanatory components was employed utilizing a census approach to include all 64 targeted respondents, eight senior managers from each Level Six private hospital, owing to their key roles in strategic decision-making. The research instruments underwent tests for validity and reliability to ensure data quality. Data was examined using the Statistical Package for Social Sciences (SPSS) version 24, utilizing both descriptive and inferential statistics, such as multiple regression analysis. The findings revealed that strategic planning, resource management, innovation adoption, and performance monitoring and evaluation jointly explained 61.7% of the variation in competitive advantage among Level Six private hospitals in Nairobi County, Kenya. The ANOVA results showed that the model was significant in explaining the relationship between strategic management practices and competitive advantage. Additionally, the findings showed that strategic planning, resource management, innovation adoption and performance monitoring and evaluation were all positively and significantly related to competitive advantage. The study concludes that strategic management practices are significant determinants of competitive advantage in Level Six private hospitals. In light of the findings, the study recommends that private hospitals should strengthen strategic planning, resource management, innovation adoption and performance monitoring and evaluation to enhance competitiveness.