THE MODERATING EFFECT OF COMPETITIVE INTENSITY ON THE RELATIONSHIP BETWEEN MARKET ORIENTATION AND PERFORMANCE OF PRIVATE SECURITY FIRMS IN KENYA

Abstract

The objective of this study was to establish the moderating effect of competitive intensity on the relationship between market orientation on the performance of private security firms in Kenya. Data was collected from key informants in the private security firms and they were either the marketing managers or the Chief Executive Officer of the firms. The theoretical perspective to the study was Market based View. The study targeted 39 firms that were members of the Kenya Security Industry Association (KSIA) in a census study that was cross-sectional in nature and 37 firms participated in the study. Data was collected using a semi-structured questionnaire. Results of the regression analysis indicated that market orientation had a positive and significant effect on both nonfinancial and financial performance of the private security firms in Kenya. The results also indicated that competitive intensity moderated the relationship between market orientation and non-financial performance but not with financial performance. The study recommended that managers of private security firms and firms in other industries should view market orientation as a resource that can enhance the firms’ ability to achieve sustainable competitive advantage. It also recommended that management of firms should invest their time in developing a market orientation culture among all departments of their firms. The study also recommended that managers should evaluate performance implications of their internal firm resources and use them to develop and implement strategies that will help the firm to counter competitor actions through exploration or exploitation of market opportunities. A longitudinal study was suggested since the industry competition will be significantly affected by the strong government regulation through the Private Security Regulatory Authority.