Abstract:
In the highly competitive hospitality industry, hotels continually seek effective
strategies to enhance their performance and maintain a competitive edge. The growth in
the number of hotels in Kenya in the recent past has resulted in competition. This has
prompted lodges to come up with strategies to enable efficient and effective operations
with a focus on strategies tailored to the market segment and geographic location.
However, it is not clear if these strategies are effective in lodges in Isiolo County. This
study sought to establish the effect of competitive strategies on the performance of
lodges in Isiolo County. Specifically, the study determined the effect of cost leadership
strategy, differentiation strategy and focus strategy on performance of lodges in Isiolo
County. The study was anchored on Porter’s Generic strategies framework and
Balanced scorecard. Explanatory research design was adopted. The target population of
the study was 192 employees from 4 lodges in Isiolo County out of which 128 formed
the sample size. Purposive sampling was used to select the lodges while stratified and
simple random sampling techniques selected the employees. A structured questionnaire
was used to collect data from the employees which was analyzed using multiple linear
regression. The regression model coefficient determination R 2 =.433 considered with all
independent variables explains 43.3% of variation on performance of lodges. The
findings of the study found that cost leadership strategy (β 1 =0.021, p=0.837), focus
strategy (β 2 =0.123, p=0.199) and differentiation strategy (β 1 =0.097, p=0.246) do not
affect performance of lodges in Isiolo County (p>0.05). The study therefore concludes
that cost leadership, focus and differentiation strategies do not affect performance of
lodges in Isiolo County. The study recommends that the lodges reduce cost of
operations, source supplies directly from the market and form linkages with suppliers to
achieve cost leadership; undertake analysis of the lodges strength, weaknesses, threats
and opportunities to focus on the targeted goals of the niche market and develop unique
products to differentiate from competitors in order to achieve high ranking, increased
revenue and customer patronage to improve performance of the lodges.
