Customer Focus, Supplier Partnerships and Operational Resilience of Manufacturing SMES in Kenya
Main Article Content
Keywords
Customer focus, supplier partnership, operational resilience, SMEs, manufucturing
Abstract
In Kenya, SMEs play a fundamental role in the economy, representing approximately 98% of all enterprises and supporting employment for over 14 million individuals. The SME sector makes substantial contributions by driving innovation, opening new markets, contributing significantly to tax revenues, and creating employment opportunities, all essential factors in the fight against poverty. The question is, are they resilient enough to sustain shocks from uncertainties? This study aims to analyse how manufacturing firms in Kenya maintain their operational resilience through customer focus and supplier partnership. The study was guided by Dynamic Capabilities Theory and employed a quantitative research design targeting manufacturing SMEs operating in Nairobi County. A final sampling frame was developed by cross-referencing the Nairobi County licensing office records with the Kenya Association of Manufacturers (KAM) database. A sample of 100 SMEs was drawn from a population of 134 registered manufacturing SMEs using probability sampling, with the sample size determined through Taro Yamane’s formula. Data were analyzed using Hayes Process Macro Model 4, a mediation model, to assess the direct and indirect effects of customer focus (X) on operational resilience (Y) via supplier partnerships (M). Mediation effects were estimated using the bootstrap method, providing insight into the mechanisms through which customer focus enhances SME resilience. The results revealed that customer focus significantly influences supplier partnerships (β = 0.586, p < .001), which in turn significantly impacts operational resilience (β = 0.319, p < .001). The direct effect of customer focus on operational resilience also remained significant (β = 0.168, p < .001), while the indirect effect through supplier partnerships was statistically significant (β = 0.187, 95% CI [0.072, 0.326]). These findings demonstrate that SMEs that prioritize customer needs and maintain strategic supplier relationships enhance their ability to adapt to disruptions. Reliable suppliers ensure consistent access to raw materials, components, and services, reducing the risk of disruptions due to supply shortages. Strong partnerships allow SMEs and their suppliers to share information and jointly develop strategies for managing risks. This proactive approach helps mitigate potential disruptions before they impact operations.
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Nehemiah Kosgei Chenuos , Department of Management Science, Communication and Development Studies, Alupe University, PO Box 845 Busia, Kenya
Department of Management Science, Communication and Development Studies, Alupe University, PO Box 845 Busia, Kenya
Hillary Busolo , Department of Marketing, Hospitality and Human Resource, Alupe University, PO Box 845 Busia, Kenya
Department of Marketing, Hospitality and Human Resource, Alupe University, PO Box 845 Busia, Kenya
Irene Chelagat Chelulei, I & M Bank LTD, Eldoret, Kenya
I & M Bank LTD, Eldoret, Kenya