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Operations Management and Performance of Manufacturing Small and Medium Enterprises in Kenya

MwamishaD. Mkala, Kenneth L. Wanjau and TeresiaN. Kyalo
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MwamishaD. Mkala: Department of Business and Entrepreneurship, School of Business
Kenneth L. Wanjau: Professor of Entrepreneurship,Department of Business and Entrepreneurship,School of Business
TeresiaN. Kyalo: Department of Business and Entrepreneurship, Karatina University, Kenya

International Journal of Research in Business and Social Science (2147-4478), 2018, vol. 7, issue 2, 01-13

Abstract: Manufacturing small and medium enterprises (SMEs) are the breeding ground for human capitalcompetencies, creativityand innovation,which are important inputs for manufacturing competitiveness. In Kenya, manufacturing SMEs contribute 14% of gross domestic product (GDP), and trainand employ 30% of the workforce. However, their growth and competitiveness are undermined by challenges in the firms’ operations management. Consequently, the firmsstruggle to survive as competitive enterprises,both domestically and globally. The purpose of this study was to establish how entrepreneurial orientation (EO) enhances the relationship between operations management and firm performance. Quantitative primary data were collected from managers of 83firms registered by the Kenya Association of Manufacturers in the food and beverage sub-sector using a self-administered questionnaire. Structural equation modelling was used to analysethe data for relationships between the study variables. The study found a positive relationship between operations management and EO, and between EO and firm performance. The study also found that EO is a mediator of the relationship between operations management and performance of manufacturing SMEs in Kenya.The study recommends that for manufacturing SMEs toeffectivelydeploy operations management competencies and gain global competitiveness, they mustengageEO as astrategyto foment organisational experimentation and exploration and commercialize the resultant innovations. At the macroeconomic level, the government should support manufacturing SMEs through enactment and promotion of policies that enableoperationsmanagers to exploit their firm’s EO stock. Key Words: Operations Management; Business Plan; Production Schedules; Quality Control Measures

Date: 2018
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