Manufacturing Firms’ Performance and Operational Innovation: The Impact of the External Environment
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Date
2024-06-10Author
Adhaya, Zedekia Juma
Wainaina, Gituro
Odock, Stephen
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The goal of this study was to investigate the effect of external
environment on the relationship between innovation and firm
performance in the Kenyan context. Treating product, process,
market, and technological innovation as dimensions of operational
innovation, the study empirically tested the effect on firm
performance while examining the moderating effect of external
environment (customer and supplier, rules and regulation, economic
conditions, and trade unions). One hundred and eighty-two (182)
firms were actively used in this survey research. The recommended
model was tested using hierarchical regression using PROCESS macro
in SPSS. Findings suggested that trade unions play moderating role
in the association between operational innovation and firm
performance while customer suppliers, rules and regulations and
economic conditions have no link to the association. Importantly,
the outcome of this work positively contributed to the existing
literature by examining mechanism between external environment
and the firms’ performance in Kenya with the implementation of
various operational innovations.