The Effect of business process management on financial performance of Tier one supermarkets in Nairobi County, Kenya

Abstract

The business environment is increasingly challenging as competition intensifies. The success of a business requires the development of a customer-centric approach to differentiate itself and build customer loyalty. Business activities must be aligned with this purpose, forming interconnected processes that execute organizational strategy. This study examined the effect of BPM on the financial performance of Tier 1 supermarket chains in Nairobi County, Kenya, specifically focusing on the effects of process discipline, process improvement, and cross-process integration. The study was anchored on Lee and Dale’s BPM model, focusing on three constructs: process discipline, process improvement, and cross-process integration. A descriptive cross-sectional survey research design was employed. The target population comprised seven Tier 1 supermarkets as classified by the Competition Authority of Kenya. Using purposive sampling, 105 respondents in supervisory roles from core departments- Finance, Procurement, IT, Marketing, and Human Resource Management- were selected. Data was collected using structured questionnaires with closed-ended items. The collected responses were sorted, cleaned, and coded, then analyzed using the Statistical Package for Social Sciences (SPSS). The analysis employed the use of descriptive statistics to summarize the data and inferential techniques to test the relationships between variables. The results demonstrated that BPM has a statistically significant and positive influence on financial performance among Tier 1 supermarkets. More precisely, the three BPM dimensions examined were each found to exert a significant effect on the key financial indicators in this study- sales turnover, ROA, and ROI. The study concluded that structured process management enhances financial outcomes and recommends BPM adoption for sustainable competitive advantage.