INFLUENCE OF COMPETITIVE STRATEGY ON COMPETITIVE ADVANTAGE IN TOYOTA KENYA

Abstract

The purpose of the study was to examine the influence of competitive strategy on competitive 
advantage in Toyota Kenya, a company in the motor industry. The study aimed at establishing 
how cost leadership strategy affected competitive advantage in Toyota Kenya, how cost focus 
influenced competitive advantage in Toyota Kenya, determining how differentiation focus 
strategy affect competitive advantage in Toyota Kenya, examining how differentiation strategy 
affect competitive advantage in Toyota Kenya. To strengthen the conceptual framework, the 
study used theories such as resource-based view theory, competitive advantage theory, and the 
neo-institutional theory. The target population for the study was the employees of Toyota Kenya 
in the management and supervisory level. The target population was 150 employees of Toyota 
Kenya Limited. The sample size was 105 employees of Toyota Kenya. A modified Likert scale 
questionnaire was developed and divided into three parts. A pilot study was carried out to refine 
the instrument. The quality and consistency of the study was further assessed using Cronbach's 
alpha. Data analysis was performed on a computer using Statistical Package for Social Science 
(SPSS Version 25) for Windows. Data was presented in form of means, standard deviation, 
percentages and tables. From the findings, it was concluded that the favorite strategy is cost 
leadership owing to strong positive relationship that it holds with firm performance. The 
principle of charging lower price, engaging in sales promotion and investing in technology in a 
bid to lower cost should be held securely to avoid outweighing benefit realized by automation, 
outsourcing, improved internal efficiency and buying raw material at reduced prices. Cost focus 
strategy strives to supply a standard, high-volume product at the most competitive price to 
customers. It is important to note that a company might be a cost leader but that does not 
necessarily imply that the company products would have a low price. The study concluded that 
cost leadership strategy and differentiation strategy have no effect on competitive advantage in 
Toyota Kenya. The study recommends that they should have effectively distribution channels, as 
well as alternative channels in terms of service away from the factory; firm should focus on 
differentiating its products based on segmentation. Marketing lead to increased sales, as well as 
giving the firm a competitive advantage and, as regards product process differentiation, the 
company should adopt technology in an attempt to ease communication during transaction, 
fostered customer-company relationship, which would increase customer satisfaction, improved 
operational efficiency, reduced operational costs and transaction time.