Value Innovation Strategy and the Performance of Roofing Sheet Manufacturers in Kenya

Abstract

The production and uptake of locally manufactured roofing sheets have been on a steady downward trajectory over the last ten years, leading to a significant decline in revenue and employment in the sector. Kenya's roofing sheet production fell more than 8 percent in 2019 following a decline that started with weakening demand in 2010. Value innovation strategy prescribes a path to positively sustaining performance by shifting firms from cut-throat market competition (the red ocean) to a wide-open new uncontested market space (the blue ocean). It argues that operating in "cutthroat and saturated markets" results in a "red ocean of rivals fighting over a shrinking profit pool." The main purpose of this study was to establish the effect of value innovation strategy on the performance of roofing sheet manufacturers in Kenya. The study adopted a mixed research method and employed a descriptive research design. The target population consisted of 241 employees drawn from all the fifteen (15) roofing sheet manufacturers in Kenya registered with the Kenya Association of Manufactures (KAM), from whom a sample size of one hundred and twenty-seven (127) employees was selected using the Krejcie and Morgan table formula. The findings of this study have illuminated a statistically significant positive effect of value innovation on firm performance, as evidenced by R-squared values of 0.687 (68.7%), with pvalue of 0.00, way below the significance threshold of 0.05. The statistics imply that 68.7% of the variance in the performance of roofing sheet manufacturers can be attributed to the adoption of the value innovation strategy. Consequently, the study recommends that roofing sheet manufacturers must prioritize the adoption of need-based value innovation to ensure sustainable performance.