PRODUCT INNOVATION AND PERFORMANCE OF LARGE MANUFACTURING FIRMS IN KENYA: A CASE OF BAMBURI CEMENT LIMITED (LAFARGE HOLCIM)

Abstract

The increasing demand for cement in Kenya has attracted new entrants into the market, increasing competition amongst producers of cement. This study finds out the role of product innovation on performance of large manufacturing firms, a case study of Bamburi Cement Limited. The study was guided by Innovative Firm theory, theory of Dynamic Capability, Resource Dependence Theory and the Institutional Theory. This study adopted a descriptive research design. The study's population entailed all workers of BCL serving in 6 departments in the Corporate Office, Industrial Area and also in Athi River. The departments include Innovation and Technical Services Department, the Commercial Department, the IT Department, Human Resource Department, Production & Maintenance Department and the Finance Department. A total of 470 employees formed the target. The Yamane formula (1967) was applied to obtain the sample for the study. From the 470 workers 216 of them were to be obtained from the targeted departments. A Stratified random sampling was applied for proportionately selecting the 216 sample of employees from the population targeted. A questionnaire was used to collect primary data. Qualitative data was analysed using content analysis and presented in different themes. The study concluded that there exists a positive relationship between product innovation strategy and performance of large manufacturing firms. Therefore, large manufacturing firms should continually embrace product innovation as this strategy provides a framework for creating new products and improving the performance. Manufacturing companies need to implement policies that encourage a process innovation culture.