1.1 Background of the Study
Corporate organizations in Kenya contribute around 16.3% to GDP and this has remained largely unchanged since 2004 (Kenya Economic Development report,2009), and are faced with many challenges including rapid environmental changes, competition to provide innovative products and services, changing customer and investor demands, poor infrastructure and globalization. Therefore, they are also faced with major challenges of constantly improving their performance by reducing costs, enhancing quality and differentiating their products and services. The market environment in the country has been extremely turbulent during the past decade, and to maintain continuous success in the face of global competition, firms must identify and analyze environmental characteristics and develop strategies to meet changing market needs. According to Kenya Economic Development report (2009), corporate organizations in Kenya employ 25 % of the labour force and contribute over 16.3 % of Kenya’s gross domestic product. The sector is also among the largest employers in Kenya in addition to the tax opportunities it presents. According to this report, the economies of most successful countries in the world originated from their successful business organizations which drive the economy of the country. These organizations need to respond to greater global imperatives and challenges to compete effectively in local and global markets.