CORPORATE VENTURING, ENVIRONMENTAL DYNAMISM AND COMPETITIVE FINANCIAL PERFORMANCE OF DEPOSIT TAKING SACCOS IN KENYA
Abstract
A firm is said to have competitive financial performance if its financial performance is above the average performance in its industry. Corporate venturing represents a strategic initiative within established organizations to foster innovation and create new ventures that explore opportunities beyond their core business activities. The objective of this study was to establish the influence of Corporate venturing on the competitive financial performance of Deposit Taking Saccos (DTS) in Kenya. The study also sought to determine how environmental dynamism moderates this relationship. Anchored on the ambidexterity theory of leadership for innovation the study was a positivist study of 715 Senior Head Office staff and 159 branch managers from 62 DTS from which a sample of 278 participants was derived. A semi-structured questionnaire having both closed and open-ended questions was used to collect primary data from the respondents, while secondary data was obtained from the Sacco Societies Regulatory Authority (SASRA’s) Annual Sacco Supervision Reports for the years 2017-2021. Data was analyzed using binary logistic regression which revealed that corporate venturing was a positive and significant (B=0.808, S. E=0.327, p=0.013) predictor of the probability of competitive financial performance, with odds ratio indicating that for every one unit increase corporate venturing initiatives, the odds of competitive financial performance changed by a factor of 2.243, implying that the odds increased. Further, the study established that the moderating effect of Environmental Dynamism in this relationship was not significant. The study recommends that for DTS to remain competitive, they ought to intensify use of venture teams to champion the development of new products and launching of new businesses or branches; adequately calculate risks before taking for risky decisions and investments; maintain the delicate balance between exploration of new opportunities and exploiting traditional business practices; as well as continuously pursue and launch profitable, market driven and systematic innovations. On the flipside, although DTS ought to pay attention to and respond appropriately to customer tastes and preferences, changes in technology as well as competitor strategies, they should be careful not to deviate from their traditional business model.
Keywords: Corporate Venturing, Environmental Dynamism, Competitive Financial Performance
CITATION: Chesigor, F. K. (2024). Corporate venturing, environmental dynamism and competitive financial performance of deposit taking SACCOs in Kenya. The Strategic Journal of Business & Change Management, 11 (4), 1015 – 1035. http://dx.doi.org/10.61426/sjbcm.v11i4.3136
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