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2022 

 

Influence of dynamic capability on growth 

sustainability of listed construction and 

allied firms in Kenya. 

 
 

Ariga, Caroline 
Strathmore Business School  
Strathmore University 
 
 
 
 
 

 

 

 

Recommended Citation 

Ariga, C. (2022). Influence of dynamic capability on growth sustainability of listed construction and allied firms 

in Kenya [Thesis, Strathmore University]. http://hdl.handle.net/11071/13108 

 
 
 
 

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http://hdl.handle.net/11071/13108
http://hdl.handle.net/11071/13108


INFLUENCE OF DYNAMIC CAPABILITY ON GROWTH SUSTAINABILITY OF 

LISTED CONSTRUCTION AND ALLIED FIRMS IN KENYA 

 

 

 

 

BY 

CAROLINE ARIGA 

REG NO: 082016 

 

 

 

 

 

 

 

 

 

 

 

 

A RESEARCH THESIS SUBMITTED IN PARTIAL FULFILMENT OF THE 

REQUIREMENTS FOR THE DEGREE OF MASTER OF COMMERCE(MCOM) AT 

STRATHMORE UNIVERSITY 

 

 

 

SEPTEMBER, 2022 

 

 



i 

 

DECLARATION 

I declare that this work has not been previously submitted and approved for the award of a 

degree by this or any other University. To the best of my knowledge and belief, the thesis 

contains no material previously published or written by another person except where due 

reference is made in the thesis itself.  

  

© No part of this thesis may be reproduced without the permission of the author and Strathmore 

University  

  

Name of Candidate:Caroline Ariga 

  

Approval  

The thesis of Caroline Ariga was approved by the following:   

  

Name of Supervisor:  Dr.Stella Nyongesa  

School/Institute/Faculty:  Strathmore University Business School 

  

Dr. Angela Ndunge 

Ag. Executive Dean 

Strathmore University Business School. 

  

Dr. Bernard Shibwabo 

Director, Office of Graduate Studies 

 

 

 

 

 

 

 



ii 

 

ABSTRACT 

The business market's climate is becoming increasingly dynamic. This implies that only firms 

that can deploy new capabilities will survive, while those that fail to adapt may cease to exist. 

Today's highlighted concern for any organization is the challenge of surviving in such a 

climate. The fundamental requirement for all organizations is dynamic capability, which allows 

them to adapt to changing circumstances. The study investigated the influence of dynamic 

capabilities on growth sustainability of listed construction and allied firms in Kenya. The 

dynamic capability theory guided the study and the cross-sectional design was also employed 

in the study. Five listed construction and allied firms formed the target population and a census 

survey was used due to the small population; hence all the five firms formed the study sample. 

Senior level staff and middle level staff were the study respondents. They were picked using 

judgemental sampling from the departments of business development, marketing, finance, 

research, human resources and corporate affairs. The judgemental sampling resulted in 30 

respondents being selected from each company. Questionnaires were used to collect data with 

the five-point likert scale type of questionnaire being used in data. Descriptive statistics, 

correlation analysis and regression were employed in data analysis via the SPSS software. Data 

was presented using tables. Only 105 questionnaires out of the 150 were returned, hence the 

study had an adequate response rate. The study descriptive findings indicated that most 

respondents agreed with the assertion that innovation, learning, marketing and networking 

capabilities influenced growth sustainability of the listed construction and allied firms. 

Regression results revealed a statistically significant relationship between innovation 

capability, learning capability, marketing capability, networking capability and growth 

sustainability. The study therefore recommends that the management of the listed construction 

and allied firms increase their innovativeness and proactively think regarding strategic 

management and ensure that their strategies are effective and differentiated. The management 

of the construction and allied firms can ensure innovation in different areas such as new 

products and services and new form of organizations. The study also faced a number of 

limitations where the focus was on companies that are in the construction industry making it 

difficult to generalize the findings. The analysis was also on high growth publicly listed 

construction and allied firms; however, the analysis cannot reveal the gap between average 

growth or low-growth firms. 

 

 

 

 

 

 

 

 



iii 

 

TABLE OF CONTENTS 

DECLARATION........................................................................................................... i 

ABSTRACT ..................................................................................................................ii 

LIST OF TABLES .....................................................................................................vii 

LIST OF FIGURES ................................................................................................. viii 

LIST OF ABBREVIATIONS .................................................................................... ix 

ACKNOWLEDGEMENT ........................................................................................... x 

DEDICATION............................................................................................................. xi 

CHAPTER ONE .......................................................................................................... 1 

INTRODUCTION........................................................................................................ 1 

1.1 Background of the Study ........................................................................................ 1 

1.1.1 Dynamic Capability……………………………………………………………2 

1.1.2 Growth Sustainability………………………………………………………….3 

1.1.3 Listed Construction and Allied Firms in Kenya……………………………….4 

1.2 Statement of the Problem ........................................................................................ 5 

1.3. Research Objective ................................................................................................ 7 

  1.3.1 Specific Objectives of the Study ........................................................................ 7 

1.4 Research Questions ................................................................................................. 7 

1.5 Scope of the Study .................................................................................................. 7 

1.6 Significance of the Study ........................................................................................ 8 

1.7 Chapter Summary ................................................................................................... 8 

CHAPTER TWO ......................................................................................................... 9 

LITERATURE REVIEW ........................................................................................... 9 

2.1 Introduction……… ................................................................................................. 9 

2.2 Theoretical Framework ........................................................................................... 9 

2.2.1 Dynamic Capability Theory……………………………………………………9 

2.2.2 Resource Based View…………………………………………………………11 



iv 

 

2.3 Empirical Review .................................................................................................. 11 

2.3.1 Learning Capability and Growth Sustainability……………………………...11 

2.3.2 Innovation Capability and Growth Sustainability……………………………12 

2.3.3 Networking Capability and Growth Sustainability…………………………...13 

2.3.4 Marketing Capability and Growth Sustainability…………………………….14 

2.4 Summary of Knowledge Gaps in Research .......................................................... 15 

2.5 Conceptual Framework ......................................................................................... 18 

2.6 Operationalization of Study Variables .................................................................. 18 

2.7 Chapter Summary ................................................................................................. 20 

CHAPTER THREE ................................................................................................... 21 

RESEARCH METHODOLOGY ............................................................................. 21 

3.1 Introduction……. .................................................................................................. 21 

3.2 Research Philosophy ............................................................................................. 21 

3.3 Research Design .................................................................................................... 21 

3.4 Population of the Study ......................................................................................... 21 

3.5 Sampling Design ................................................................................................... 22 

3.6 Data Collection ..................................................................................................... 22 

3.7 Research Quality ................................................................................................... 23 

3.7.1 Reliability of Research Instruments…………………………………………..23 

3.7.2 Validity of Research Instruments…………………………………………….24 

3.8 Data Analysis……………………………………………………………………24 

3.8.1 Analytical Model……………………………………………………………24 

3.9 Ethical Considerations .......................................................................................... 25 

CHAPTER FOUR ...................................................................................................... 26 

DATA ANALYSIS, FINDINGS AND INTERPRETATIONS .............................. 26 

4.1 Introduction………. .............................................................................................. 26 

4.2 Response Rate ....................................................................................................... 26 



v 

 

4.3 Demographic Characteristic of the Respondents .................................................. 26 

4.3.1 Gender of the Respondents…………………………………………………...26 

4.3.2 Age of the Respondents………………………………………………………27 

4.3.4 Level of Education of Respondents…………………………………………..28 

4.3.5 Management Role…………………………………………………………….29 

4.3.6 The Department of the Respondents…………………………………………29 

4.3.7 Length of Service…………………………………………………………….30 

4.4 Descriptive Statistics ............................................................................................. 30 

4.4.1 Innovation Capability………………………………………………………...31 

4.4.2 Learning Capability…………………………………………………………..31 

4.4.3 Marketing Capability…………………………………………………………32 

4.4.4 Networking Capability………………………………………………………..33 

4.4.5 Growth Sustainability………………………………………………………...34 

4.5 Correlation Analysis ............................................................................................. 35 

4.7 Regression Analysis .............................................................................................. 36 

4.8 Chapter Summary ................................................................................................. 42 

CHAPTER FIVE ....................................................................................................... 43 

DISCUSSIONS, CONCLUSION AND RECOMMENDATIONS ........................ 43 

5.1 Introduction…… ................................................................................................... 43 

5.2 Summary…… ....................................................................................................... 43 

5.3 Discussion of findings of the Research Study ...................................................... 43 

5.3.1 Innovation Capability and Growth Sustainability……………………………44 

5.3.2 Learning Capability and Growth Sustainability……………………………....45 

5.3.3 Marketing Capability and Growth Sustainability…………………………….46 

5.3.4 Networking Capability and Growth Sustainability…………………………...47 

5.4 Conclusion…… .................................................................................................... 47 

5.5 Recommendations for Further Studies .................................................................. 48 



vi 

 

5.6 Limitations of the Study ........................................................................................ 49 

5.7 Suggestions for Further Studies ............................................................................ 50 

REFERENCES ........................................................................................................... 51 

APPENDICES ............................................................................................................ 59 

Appendix I: Consent Form .......................................................................................... 59 

Appendix II: Introductory Letter ................................................................................ 60 

Appendix III: SU-IERC Ethical Approval .................................................................. 61 

Appendix IV: Questionnaire ....................................................................................... 62 

Appendix V: Listed Construction and Allied Firms in Kenya ................................... 66 

Appendix VI: NACOSTI License ............................................................................... 67 

 

 

 

 

 

 

 

 

 

 

 



vii 

 

 

LIST OF TABLES 

Table 4.1 Response Rate .......................................................................................................... 26 

Table 4.2 Reliability Coefficients ……………………………………………………………27 

Table 4.3 Response by Gender ................................................................................................ 27 

Table 4.4 Age of the Respondents ........................................................................................... 27 

Table 4.5 Level of Education of the Respondents ................................................................... 28 

Table 4.6 Management Role .................................................................................................... 29 

Table 4.7 Respondents Department ......................................................................................... 29 

Table 4.8 Length of Service of the Respondents ..................................................................... 30 

Table 4.9 Innovation Capability .............................................................................................. 31 

Table 4.10 Learning Capability ............................................................................................... 32 

Table 4.11 Marketing Capability ............................................................................................. 32 

Table 4.12 Networking Capability ........................................................................................... 33 

Table 4.13 Growth Sustainability ............................................................................................ 34 

Table 4.14 Correlation Analysis .............................................................................................. 36 

Table 4.15 Model Summary .................................................................................................... 37 

Table 4.16 Regression Coefficients ......................................................................................... 38 

 

 

 

 

 

 

 

 

 

 

 

 

 



viii 

 

 

 

LIST OF FIGURES 

Figure 2.1 Conceptual Framework .......................................................................................... 18 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



ix 

 

LIST OF ABBREVIATIONS 

CAGR          Compounded Annual Growth Rate 

DCs              Dynamic Capabilities 

DCT             Dynamic Capability Theory 

RBV             Resource Based View Theory 

GC                Growth Sustainability 

IC                  Innovation Capability 

IT                  Information Technology 

KNBS           Kenya National Bureau of Statistics 

LC                 Learning Capability 

MC                Marketing Capability 

MT                Mega Tonnes 

NACOSTI    National Commission for Science Technology and Innovation 

NC                Networking Capability 

NSE              Nairobi Securities Exchange 

R&D            Research and Development 

RBV             Resource Based View 

SGR             Standard Gauge Railway 

SMEs           Small and Medium Enterprises 

SPSS            Statistical Programme for Social Sciences 

 

 

 

 



x 

 

 

ACKNOWLEDGEMENT 

I extend my sincere gratitude and appreciation to everyone who made this research possible. 

First and foremost is my sincere gratitude to my Almighty GOD for giving me the strength, 

focus and determination throughout this journey. A special thanks go to my supervisor, Dr 

Stella Nyongesa, of Strathmore Business School, Strathmore University, for her invaluable 

contribution, guidance and encouragement throughout my studies and without whom the 

completion of this research would have been impossible. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  

 

 

 

 



xi 

 

DEDICATION 

 

I dedicate my work to my family and support system.A special feeling of gratitude to my 

parents for their constant encouragement and following up on the progress to the very last 

detail. 

A special mention to Tanya,Paul and Lydia words cannot explain how grateful I am.Thanks 

for being my biggest cheerleaders. 

To the University staff and colleagues whom I interacted with and made this possible.Thank 

you. 

To my many friends who walked through this journey with me.Special mention to 

Gertrude,Faith,Fatma,Tony,Evans and Stephanie.Thank you. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



1 

 

CHAPTER ONE 

INTRODUCTION 

1.1 Background of the Study 

The business environment is becoming very dynamic due to incorporation of emerging 

technologies, the propagation of new standards that a business must follow and the rising global 

competition. Many companies are finding it difficult to thrive in the environment (Zott, 2003). 

These challenges erode the value of existing firm competencies and encourage firms to build new 

functional competencies. By sensing, reallocating, reconfiguring and renewing internal 

capabilities, dynamic capabilities allow firms to adjust to new market dynamics (Frishammar & 

Hörte, 2007). The development and deployment of these new capabilities, as well as ability to 

create necessary resources in order to adapt to new business conditions are key to sustaining 

growth. For businesses facing a growth slowdown, the long-term feasibility of growth as a business 

strategy is important (Baghai, Smit & Viguerie, 2007). Many companies, approach growth with 

no strategy at all, and only 27.5 percent of such companies survive after six years (Krogh & 

Cusumano, 2001). A company can adopt dynamic capabilities (DCs) to increase market share, 

increase revenue, or improve efficiencies through economies of scale. However, not every 

capability particularly in emerging markets, can guarantee long-term growth (Prats, Sosna & 

Ramakrishna, 2012). Thus, choosing the right dynamic capabilities is critical for maintaining the 

company's growth potential and surviving in the market.  

According to Zahra et al. (2006), the concept of DC is vital for business growth sustainability 

because it allows companies to generate, find, and successfully exploit new opportunities by 

serving as a source of competitive advantage. The long-term sustainability is contingent on 

whether competitors can imitate products or introduce innovation. Since a company is more likely 

to control imitation as a direct form of competition rather than the ability of competitors to 

innovate, the significant barriers to imitation should exist. The more efficient these barriers are, 

the longer growth sustainability will be sustained (Laurie, Doz & Sheer, 2006). Many firms in the 

construction and allied sector have been experiencing a slowdown in demand, which undoubtedly 

impacts on profits. For instance, the sector has been underperforming since 2018. This is evidenced 

by the suspension of Athi River Mining Cement from trading at the Nairobi bourse after the firm 

was placed under administration in 2019.  

Data by the Kenya National Bureau of Statistics also shows cement exports in the period January-

June 2019 was 362.28, a sharp decrease from 1.04 billion in 2018 (KNBS, 2019).  With additional 

production capacity being digitized (online) both locally and regionally, the cement industry in 

Kenya encounters the challenge of balancing medium to long-term demographics. Low per capita 

cement consumption signals expanding markets, but if demand does not materialize in the near 

future, the incentive for cement producers to expand dwindles, especially in the face of aggressive 

imports, rising energy costs and increasing local competition. Thus, cement manufacturers will 

have to identify all the variables that can influence and sustain growth in the long-term in form of 

dynamic capabilities. 



2 

 

1.1.1 Dynamic Capability 

Dynamic capability refers to the creation of difficult-to-replicate resource combinations and the 

successful coordination of inter-organizational relationships that can offer a corporation a 

competitive advantage over competitors (Eisenhardt & Martin, 2000). DC is defined by Teece et 

al. (1997) as a company's ability to assimilate, grow, and reconfigure internal and external skills 

to meet changing market conditions. DC refers to a firm’s ability to adapt, expand, or extend its 

resource base tenaciously in reaction to dynamic markets (Helfat & Peteraf, 2015). 

Although dynamic capability involves utilization of a firm resources, in particular the process of 

integrating, reconfiguring, gaining, and releasing resources for matching and even creating market 

change, it is also viewed in terms of a firm’s activity, processes, and practices that make it more 

competitive, thereby enabling a firm to maintain or gain market share in the industry (Teece et al., 

1997). The word capabilities emphasize the critical role that the leadership of a firm plays in 

planning, reorganizing, and modifying internal and external authoritative capacities, resources, and 

practical capabilities to streamline the demands of a changing environment (Prabowo, Sriwidadi 

& Ikhsan, 2021). 

The way people view organizational resources has evolved over time. Businesses now spend more 

on dynamic resources than on resources that only meet their operational needs. Businesses need a 

precise set of factors since the first industrial revolution to conduct their operations successfully 

and these factors have changed with each succeeding revolution. Numerous studies have offered 

categorizations (based on organizational, human and technological criteria) for these resources 

(Gupta et al., 2020). 

Firms can alter and pursue strategic goals thanks to dynamic capabilities and strategy. In order to 

pursue effective digital business model innovation or digital transformation, for instance, 

incumbent enterprises across industries are constructing their dynamic capabilities. In order to take 

advantage of new technology, adapt to shifting customer behaviors, and ultimately outperform 

rivals, they are restructuring their internal and external resources. Regardless of the sector or types 

of change, a company will benefit in the long-term from investing in dynamic skills (Prabowo, 

Sriwidadi & Ikhsan, 2021). 

Helfat and Winter (2011) opine there is need for a business unit to differentiate dynamic from non-

dynamic capabilities because non-dynamic capabilities are concerned with ordinary or operational 

activities tailored towards maintaining the status quo. Contrary to this, dynamic capabilities are 

structured in a manner that alters the methods through which a firm generates revenue by adjusting 

old routines (Makadok, 2001). Calling a capability into use enables a firm to execute a task 

effectively. The outcome is superior results. Just like other capabilities, execution is the only means 

of maintaining dynamic capabilities (Winter, 2003). 

Learning capability encompasses both accumulation of experience from repeated practices and 

mistakes, as well as the method for searching, articulating, and codifying new information (Zollo 

& Winter, 2002). Marketing capability is a specialized process that is architectural, inter-

functional, and dynamic. This capability is used to acquire, combine and turn marketing resources 



3 

 

into value propositions for target markets (Morgan, 2012). It enables businesses to better 

understand their present and potential consumers' demands. Thus, the businesses will be able to 

service their customers’ needs better, reach out to potential customers and assess the competition 

accurately (Fowler, 2000). Networking capability is the ability of a company to build and exploit 

inter-organizational links to gain diverse resources. Businesses can join forces with suppliers and 

certain competitors to develop a formidable network to obtain and maintain a competitive 

advantage. This collaboration makes it possible for companies to be highly competitive, because 

of introducing companies to new innovations and business strategies (Sawers et al., 2008). 

As a significant component affecting organizational behavior and performance, organizational 

networks have been examined in the past. Recently, the phrase business social capital has become 

popular. The impact of social networks on the performance of a firm is captured by social capital. 

Most past studies examined the characteristics, and purpose of social capital, but they did not 

define it in terms of networking capabilities (Li & Liu, 2014). In order to conceptualize the social 

capital of construction and allied firms, the study examined the networking capabilities of these 

enterprises. The impact of learning on business performance and general assessment methods, has 

received minimal attention. The learning capability’s role in achieving growth sustainability is 

unclear from most of the studies that have been conducted. It is considered that the presence of 

dynamic capabilities favors the development of marketing capabilities, which take place at 

different levels within the company ranging from the individual to the corporate level (Protogerou 

et al., 2011).  Deviatykh and Sobakina (2014) operationalize dynamic capabilities using learning, 

innovation, marketing and networking capabilities.  Similarly, the current study operationalized 

DCs using similar variables. 

1.1.2 Growth Sustainability 

Growth sustainability refers to the attainable growth that firms can maintain without running into 

capital limitations, budget constraints or unwarranted losses (Yudanov, 2008). Growth is 

accomplished by growing revenue through increasing sales of both goods and services or by 

reducing costs (Mass, 2005). Growth sustainability is a business adoption strategy that 

simultaneously meets the needs of an enterprise and its stakeholders while maintaining, protecting 

and optimizing natural and human resources (Mass, 2005). As such, managers focused on growth 

sustainability must recognize and maintain resources that are vital to the organization efficiency 

(Phelps, Adams & Bessant, 2007).  

The challenge of sustaining fast growth is most difficult for high-growth private firms in emerging 

markets (Prats et al., 2012). To maintain growth, a business must focus on maintaining competitive 

advantage as well as managing growth resulting from the exploitation of competitive advantage 

(Furlan & Grandinetti, 2011). Grant (2013), opines that the transferability and replicability of 

competitive advantage, as well as its longevity, can be used to determine growth sustainability. 

Geographical immobility, incomplete knowledge on resources and capabilities, complementarity 

of resources and proven organizational capabilities that are the most difficult to imitate, are sources 

of immobility of resources and capabilities that form competitive advantage. The ability of rivals 



4 

 

to mimic a company's competitive advantage is characterized by the transferability and 

replicability of these resources (Furlan & Grandinetti, 2011). 

Organizations that successfully implement dynamic capabilities, are most likely to experience high 

growth (Pettus, 2001). Companies, however, need to understand the multidimensional nature of 

growth to have long-term growth. Furlan and Grandinetti (2011) examined the multi-dimensional 

nature of growth in terms of growth in size, relational growth and innovation growth. These three 

dimensions of growth are interrelated. How well these interdependencies are managed influences 

the firm's growth plan's effectiveness and durability. 

Size growth refers to a company's borders expanding over time. i.e., expansion of current 

organizational units or the creation of new production, logistical, commercial units or subsidiaries 

(McKelvie & Wiklund, 2010). Relational growth is the increase in the degree to which external 

resources are utilized by an organization over-time. External resources are known as assets that 

are not personally held by the corporation, but which are available through partnerships with other 

institutions. This form of growth is also predetermined by the number and value of the company's 

strategic partners (Zhou, Park & Ungson, 2013). Innovation growth, on the other hand, refers to 

the creation of significant new value for clients and the organization by creatively modifying one 

or more business system dimensions.  

The justification for using size, relational and innovation growth to measure growth sustainability 

is that a company's growth is multidimensional. According to Furlan and Grandinetti (2011), 

financial growth results from other growth aspects that should be evaluated first. Davidsson et al. 

(2005) opine that sales and profit growth are only partial indicators of a successful organization; 

therefore, size, relational, and innovation growth must precede financial growth. According to 

Pettus (2001), a company that successfully executes its dynamic capabilities, i.e. a sustainable 

competitive edge, is most likely to sustain growth. Firms must however, consider the 

multidimensional character of growth which includes size growth, relational growth, and 

innovation growth to deliver long-term growth. This study measured growth sustainability using 

size growth, relational growth and innovation growth. 

1.1.3 Listed Construction and Allied Firms in Kenya 

The construction industry in Kenya comprises 8 firms, including Bamburi Cement Limited, Athi 

River Mining Limited (ARM), East Africa Portland Cement Company Limited (EAPCC), Crown 

paints, EA Cables Mombasa Cement Limited, National Cement Company Ltd, and Savannah 

Cement Company (Kenya Construction Industry Databook, 2020). Five of the eight firms are listed 

at the NSE: Bamburi Cement, EA cables, Athi river mining, Crown paints and EA Portland. 

Bamburi Cement Company is the largest cement manufacturer in the country. Apart from 

producing the largest volume of cement consumed in the country, it also has the largest market 

share. Besides producing cement, the construction and allied firms also make precast concrete, 

paving blocks, cables and paints (Dyer and Blair, 2019). The Capital Markets Authority regulates 

the NSE-listed firms. The COVID-19 pandemic is predicted to impact key industries significantly 

by restricting growth in the medium term. Key construction sectors like residential and commercial 



5 

 

sectors would be the hardest hit, while the infrastructure sector is expected to continue growing 

due to government spending (Kenya Construction Industry Databook, 2020).  

Kenya's construction sector is predicted to grow at 10.4% compounded annual growth rate to 

1023.4 billion by 2024 (Kenya Construction Industry Databook, 2020). In 2019, infrastructure 

development was estimated to be KES 339.3 billion, representing a CAGR of 10.2 % over a five-

year period. Exports of cement to other nations fell by 58.3% to 42,000 tonnes in 2019. Cement 

imports, however, rose by 14.6% in 2019 from 23,000 tonnes in 2018. (Economic Survey Report, 

2020). Lower building costs and more affordable home ownership ways, may be the key to 

growing low-end housing demand and, as a result, cement consumption. Low per capita cement 

consumption signals expanding markets, but if demand does not materialize in the near future, the 

incentive for cement producers to expand dwindles, especially in the face of aggressive imports, 

rising energy costs and increasing local competition (Dyer and Blair, 2019). Thus, cement 

manufacturers will have to identify all the variables that can influence and sustain growth to enable 

them navigate the expected challenges. This study therefore aimed to investigate the influence of 

dynamic capabilities on growth sustainability of listed construction and allied firms in Kenya. 

1.2 Statement of the Problem 

Kenya being a highly turbulent emerging market, necessitates that companies adopt new strategies 

to counter rapidly evolving markets. The recession in the third quarter of 2020 is proof that the 

Kenyan economy is highly unstable, as measures introduced to reduce the spread of Covid-19 

pandemic continued to hurt the economy unabated (World Bank, 2020). The recessionary effects 

spilled over to new government policies and industry regulations, consequently posing serious 

challenges to key sectors in the economy.  

The most critical challenge in the construction sector is that firms do not reach sustained growth 

and last in the market for a long time (World Bank, 2020). Most of the listed construction firms 

operate in the market with a constant growth rate for 6-8 years, before they either go bankrupt or 

remain in the market growing slowly and insignificantly thus, lacking the normal level of 

profitability (Simiyu & Ruagmi, 2018). Kenya had only three cement producers in 2008, with the 

dominant player accounting for 65 percent of the market. With fresh competition, the dominant 

player's market share had fallen to 32.6 percent by 2017.  High operating costs, poor governance, 

political uncertainty, poor marketing, poor market penetration, price stagnation and high demand, 

all led to change in the market share (Simiyu & Ruagmi, 2018). To ensure long-term growth and 

avoid any losses resulting from misalignment as circumstances change, construction and allied 

firms should aim to fit their operational variables to contingencies through dynamic capabilities 

(Molonket, 2014). 

Putri, Irwansyah and Aprilia (2018) explored the relationship between dynamic capability and 

long-term success of Indonesian print media enterprises. The study was limited to one print media 

company. The dependent variable of the study was sustainability development, while this study 

variable is growth sustainability. Deviatykh and Sobakina (2014) examined dynamic capability 

and long-term viability of growth strategies in Russian high-growth private enterprises. The study 



6 

 

limitation is that only firms in the IT sector were considered. The current study extends the 

discussion to construction and allied firms. D'Annunzio, Carattoli, and Dupleix (2015) studied 

how SMEs in Argentina acquire capabilities to grow. The study lacked delineation in terms of the 

scope of the capabilities addressed. The current study however was explicit in terms of the DCs 

that were investigated.  

Eikelenboom and De Jong (2019) investigated dynamic capability and SMEs' long-term viability 

in the Netherlands. The study was limited to integrative capability while this study examined 

innovation,learning,marketing and networking capabilities. The study context was limited to 

SMEs whereas the current study examined firms in the construction and allied sector. Acquier, 

Carbone and Acosta (2013) examined dynamic capability and sustainable innovation. DC was 

investigated in terms of relational and organizational capabilities. The study limitation is that it 

focussed on two aspects of DCs: relational and organizational capability and it is important to add 

to the pool of knowledge and develop it further by analysing   other   categories of   DCs   that are   

necessary   for   organizations to   achieve sustainable growth. Zayed and Alawad (2017) 

investigated the association between dynamic capabilities (market and learning) and Egyptian 

SMEs' performance. The study presents methodological gaps as innovation and culture were used 

as mediating variables, while in the current research, innovation is employed as an independent 

variable. A conceptual gap also arises since the focus was on business performance, not growth 

sustainability. Bayarcelik, Tasel and Apak (2014) determined the vital innovation elements that 

influence SME growth. The study presents conceptual gaps as it focused on SMEs, not 

construction and allied firms and only explored the innovation capability variable. 

Prior research on dynamic capability has primarily focused on companies that operate in the 

western developed markets; little is known about dynamic capability and its connection to 

sustainable growth in developing countries. This focus restricts theoretical completeness and 

creates a large vacuum in literature because established markets and developing economies differ 

greatly from one another. The review of extant literature presents conceptual, contextual and 

methodological gaps. Conceptual gaps arise in studies, such as Acquier, Carbone, and Acosta 

(2013), who viewed dynamic capabilities as either relational or organizational capabilities and 

Eikelenboom and De Jong (2019), who considered DCs from the integrative capability 

perspective. However, the current study examined DC from the concept of networking, learning, 

marketing and innovation. Contextual gaps are evident in studies that focus on SMEs and IT firms 

whose operations are distinct from large construction firms, such as Zayed and Alawad (2017), 

Eikelenboom and De Jong (2019) and Bayarcelik, Tasel and Apak (2014) focused on SMEs. 

Deviatykh and Sobakina (2014) examined IT firms. However, the current study examined 

construction and allied firms that have more resources at their disposal and operate in a competitive 

business environment, thus DCs would impact them differently. Methodological gaps arise in 

cases where scholars used variables such as innovation and marketing as mediating factors and 

adopted interview guides. Given the above knowledge gaps, the current study sought to establish 

the relationship between dynamic capabilities and growth sustainability among Kenya's listed 

construction and allied firms. 



7 

 

1.3. Research Objective 

To establish the influence of dynamic capabilities on growth sustainability of listed construction 

and allied firms in Kenya.  

1.3.1 Specific Objectives of the Study 

The specific objectives of the study were: 

i. To establish the influence of learning capability on growth sustainability of listed 

construction and allied firms in Kenya.  

ii. To establish the influence of innovation capability on growth sustainability of listed 

construction and allied firms in Kenya.  

iii. To establish the influence of marketing capability on growth sustainability of listed 

construction and allied firms in Kenya.  

iv. To establish the influence of networking capability on growth sustainability of listed 

construction and allied firms in Kenya.  

1.4 Research Questions 

Based on the specific research objectives above, the study sought to answer the following research 

questions: 

i. What is the influence of learning capability on growth sustainability among listed 

construction and allied firms in Kenya? 

ii. What is the influence of innovation capability on growth sustainability among listed 

construction and allied firms in Kenya? 

iii. What is the influence of marketing capability on growth sustainability among listed 

construction and allied firms in Kenya? 

iv. What is the influence of networking capability on growth sustainability among listed 

construction and allied firms in Kenya? 

1.5 Scope of the Study 

The scope of the study included five construction and allied companies licensed and approved by 

the Capital Markets Authority. The study examined four independent variables: learning, 

innovation, networking, and marketing forms of DCs. Size, relational and innovation growth were 

used as measures of growth sustainability, denoting dependent variables. The relationship between 

the variables were analyzed using a correlation matrix and the relationship between the 

independent and dependent variables were analyzed using regression analysis. The study limited 

its geographical scope to Nairobi County. The respondents were senior and middle-level 

employees since they are well-versed in their firms operations and strategies.  



8 

 

1.6 Significance of the Study 

To the management and employees of construction and allied firms, the findings of this study will 

be beneficial in establishing the dynamic capability strategies that impact on growth sustainability, 

and advantages DCs offer to an organization. A careful analysis of the DCs and means of dealing 

with challenges associated with them will help drive these firms to greater success. 

Government policymakers can benefit from the findings of the study in terms of being guided in 

the formulation of appropriate policies. The government can encourage the use of high-strength, 

low-carbon-dioxide materials through policy formulation. By moving to high-quality cement with 

a high value, businesses can increase profits while reducing production volumes but still meeting 

demand for construction materials as effectively as they currently do. 

To the scholarly field, the study findings will be beneficial to scholars and academicians in 

understanding dynamic capabilities and growth sustainability in construction and allied firms. This 

research will help add to the pool of literature available on the subject from which future research 

may be based and from which areas for further research may also be identified. 

1.7 Chapter Summary 

The chapter discusses the concept of dynamic capability and growth sustainability. DC is defined 

as the creation of difficult-to-replicate resource combinations and the successful coordination of 

inter-organizational relationships that can offer a corporation a competitive advantage over 

competitors, while growth sustainability refers to the attainable growth that firms can maintain 

without running into capital limitations, budget constraints or unwarranted losses. The chapter also 

discusses the statement of the problem and highlights the various empirical studies conducted 

locally and international on dynamic capability and growth sustainability in an attempt to identify 

the conceptual and contextual gaps. The chapter highlights the general and specific objectives of 

the study and concludes by looking at the scope and significance of the study. 

 

 

 

 

 

 

 

 



9 

 

CHAPTER TWO 

LITERATURE REVIEW 

2.1 Introduction 

This chapter discusses the theories on which the study is based, covers the empirical literature on 

the topic, presents the conceptual framework and concludes with a synopsis of the research gaps 

and operationalization of the variables. 

2.2 Theoretical Framework 

Theoretical literature is mainly studied under two main schools of thought, namely;Resource-

Based view and Dynamic Capability Theory.  However, for this study, the theory underpinning 

the study was the Dynamic Capability Theory.  

2.2.1 Dynamic Capability Theory 

The dynamic capability of a business are resources that are both external and internal that allow it 

to integrate, learn and reconfigure its assets and processes to attain and maintain competitive 

advantage (Teece et al, 1997). The theory conjectures that firm level dissimilarities in capabilities 

are embedded in their asset positions. 

Dynamic capabilities theory appeared as an alternative approach to solve some of the weaknesses 

of RBV theory (Galvin et al, 2014). Dynamic capability theory presents path-dependent processes 

that allow firms to adapt to rapidly changing environments by building, integrating and 

reconfiguring their resource and capabilities portfolio (Teece et al, 1997). 

Both Pisano and Teece (1994) advanced DCT and they made a major contribution to DC theory 

by writing about the micro-foundations for each of the three following dimensions: sensing 

(identification and assessment of an opportunity), seizing (mobilization of resources to address an 

opportunity and to capture value) and transforming (continued renewal reconfiguring the business 

firm’s intangible and tangible assets) and Martin and Eisenhardt (2000) further refined the theory 

by stating that the functionality of dynamic capabilities can be duplicated, so that value for 

competitive advantage lies in the arrangement of resources. Therefore, dynamic capabilities are 

organization and strategic routines that enables firms to achieve new resource configurations as 

markets, emerge, and evolve. 

Dynamic capability is a concept of a larger system that includes a resource and a strategy. 

Resources include people, equipment, structures, and intangible assets. Many resources are 

generic, meaning they can be replaced, if necessary, through a market transaction. Barney's (1991) 

criteria of value, scarcity, imperfect imitability, and non-substitutability apply to the most critical 

type of resource (VRIN). VRIN resources can assist a company in gaining sustainable competitive 

edge. Because most intangible assets have ill-defined property rights, they are effectively non-

tradable and thus difficult to obtain (Teece, 2015). 

 



10 

 

The concept of dynamic capability arose from the company's resource-based view's fallibility. The 

RBV was faulted for disregarding resource factors, believing that they simply exist. How resources 

are produced, reconfigured in the organization and how they are integrated were under-explored 

in the RBV model (Priem & Butler, 2001). The RBV focused on the choice of resources or the 

selection of suitable resources whereas the dynamic capability theory emphasized on resource 

development and renewal.  

Dynamic capabilities go even further by recognizing that organizations do not only adapt to their 

environment; they frequently aim to alter it as well. Dynamic capability theory eliminates resource 

view gaps by acting as a buffer between firm resources and the changing dynamic environment 

through execution of a process strategy (Teece, 2015). In this study the researcher aimed to look 

at whether dynamic capabilities affected growth sustainability of listed construction and allied 

firms. Based on the results of the study, it showed that dynamic capabilities influenced growth 

sustainability and the tenets of this theory were upheld. 

Dynamic capabilities are key to long-term growth, because they enable a firm to successfully 

evolve over time (Sirmon, Hitt & Ireland, 2007). Thus, the company's growth plan needs to be 

relatable to the dynamic resource it possesses. Dynamic capabilities allow companies to choose 

strategies. According to Prats et al., (2012), emerging markets need clear strategic choices to 

endure volatility and react to market changes. The researcher opines that in emerging markets, 

high-growth firms prefer using certain strategies or a mix of strategies. Polunin (2013) argues that 

most businesses find it difficult to survive after expansion because they lack strategic 

specialization and provide the same product or service as competitors with minor variations. This 

is true for developing markets, that have recently begun to register economic development but still 

have substantial product gaps in their product offerings. Hence, firms that are able to find a clear 

narrow niche in the market are more likely to take advantage, grow quickly, and sustain growth. 

DC theory has been criticized on the basis of difficulties in analyzing the merits of the outcomes. 

In addition, there are no clear frameworks for measuring dynamic capabilities and their influence 

on performance (Zott, 2003). Inspite of the criticisms, dynamic capability theory is relevant to the 

study because dynamic capabilities influence the company's resource base (internal and external), 

which are sources of competitive advantage (Ambrosini & Bowman, 2009). Dynamic resources 

assist a business to change its resource mix and thereby preserve the longevity of its competitive 

advantage that could otherwise be extinguished. A company's overall strategy is primarily 

concerned with ensuring a fit between the organization's offerings and the demands of the 

environment (Miles & Snow, 1978). Attaining this fit again calls for the organization to be able to 

alter its processes. As such a business must have DCs which in addition to raising the company 

survival chances, also offers growth possibilities (Helfat et al., 2007).  

 

 

 

 



11 

 

2.2.2 Resource Based View 

This Resource based principle underlines the value of organizational internal resources to gain a 

competitive advantage. A resource holder can maintain a relative position in relation to another 

holder when they act reasonably (Wernerfelt, 1984). Furthermore, Barney (1991) makes the case 

that businesses in the same industry may differ in terms of their own capital, and because resources 

are difficult to transfer between businesses, this heterogeneity and the resulting competitive 

advantage may be long-lasting. 

The resource-based view (RBV) characterizes a firm as a pool of resources and knowledge capable 

of developing and maintaining competitive advantage (Talaja, 2012). Barney (1991) proposed four 

unique resources that a firm should possess to remain competitive: He suggests that the resources 

should be durable, scarce, imitable and irreplaceable. Amit and Schoemaker (1993) referred to the 

resources as inventories of open factors owned or controlled by a firm. They include both tangibles 

like money and physical assets like machinery, land, and buildings as well as intangibles like 

people resources, customer trust, firm reputation, and know-how (Nath et al., 2010). 

The theory is relevant to the current study as it emphasizes the importance of possession of unique 

resources (dynamic capabilities) for firms to attain and sustain growth.  A firm is able to gain and 

sustain growth if it possesses resources that are rare, valuable, inimitable and organizable. The 

resource-based theory posits that its easier for industrial firms to build and maintain their growth 

by developing internal capabilities rather than relying on external capabilities that are prone to be 

copied by other firms in the same market. 

2.3 Empirical Review 

The section provides a review of related empirical research which is in line with the study. 

2.3.1 Learning Capability and Growth Sustainability 

Learning capability encompasses the accumulation of experience from repeated practices and prior 

mistakes, as well as a more devoted method for searching, articulating, and codifying new 

knowledge relevant to a dynamic setting (Zollo & Winter, 2002). Once organizations recognize 

the value of learning, they need to ensure that knowledge is constantly acquired and mastered by 

staff (Drucker, 1993). Huysman (2001) notes that by establishing structures and developing 

strategies that enable workers to learn, a firm creates conditions that are vital in improving 

performance. Once the learning processes is in place, it is possible to achieve outcomes such as 

creativity, alignment of the firm’s internal and external factors, efficiency and competitive 

advantage.  

Kaya and Patton (2011) opine that learning capability is a vital component in information 

acquisition and dissemination process. They opine that because information is communicated or 

shared between employees of the organization through the activities of individuals and the 

corporation as a whole, it would have a beneficial influence on the performance of the firm and 

hence impact on the growth prospects. 



12 

 

Altinay, Madanoglu, Vita and Arasli (2013) determined the link between organizational learning 

and SME growth in North Cyprus. 350 SMEs sampled had between 2 to 50 employees. Data was 

collected via questionnaires which were semi-structured. The measurement of growth consisted of 

sales growth, market share growth and employment growth. Data analysis was via exploratory 

factor analysis. The study found a positive association between organizational learning and SME 

growth. Firms that aggressively innovate (new products and services), behave proactively to seize 

market opportunities, and take risks are more likely to succeed.  

Zheng and Khavul (2005) explored the link between learning capability and growth in Chinese 

firms.  Technological firms in China formed the study population. Data collected was for the period 

September 2003 to December 2003. 146 firms were selected for the study. Interviews were 

conducted to gather data. Overall, the results of the study supported the notion that entrepreneurial 

firms must build core skills internally while also learning from international markets in order to 

achieve growth. Companies that succeed in these tasks would attain faster international growth. 

Oketch, Kuria and Kariuki (2018) investigated the association between organizational learning and 

organizational culture among NGOs in Kenya. 3 NGOs in Nairobi County formed the study 

population.  84 respondents were sampled for the study. Research design used was descriptive in 

nature. Data was collected using questionnaires that was mailed to respondents. The results 

revealed that every aspect of organizational culture has an influence on the multiple perspectives 

of organizational learning.  

Gicheru and Kariuki (2019) investigated dynamic capability impact on commercial banks 

performance in Kenya. 40 banks formed the population and 202 respondents formed the sample 

population. Questionnaires were used in collating data and analysis was by SPSS software The 

learning capabilities dimensions investigated were systems thinking, team learning and 

information sharing. Descriptive design tool was used in the study. All the learning capabilities 

dimensions were found to impact on organizational performance positively. 

Most studies on learning capability have focused on entrepreneurial firms, SMEs, IT firms and 

banks and not construction and allied firms. Even for studies conducted in the construction sector, 

the focus was on organizational sustainability and not growth sustainability. A gap also arises in 

the context of the data collection tool used as some studies relied on interview guides while the 

study utilized questionnaires as the collection tool.  

2.3.2 Innovation Capability and Growth Sustainability 

The ability or tendency of a business to innovate or produce new products, services and processes 

is innovation capability (Andreassi & Sbragia, 2002). Hult et al., (2004) argues that innovation 

may be an element of a firm’s culture, its desire, propensity and readiness to be imaginative and 

to introduce new ideas and abandon common routines. This makes innovativeness an intrinsic 

feature of the business, a powerful and difficult resource to emulate.  

Gabriele and Corsino (2010) explored product innovation and firm growth in Italy. The study 

covered the integrated circuit industry in Italy. The study covered the period 1998-2004. 30 

companies were selected for the study. Interviews were used as data collection tools. The research 



13 

 

design used was descriptive. According to the results of the study, increased product innovations 

had a beneficial impact on firm growth, especially for units domiciled in dynamic markets. 

Bianchini, Pellegrino and Tamagni (2014) investigated innovation strategies and firm’s growth in 

Spain. The study covered the period 2004 to 2011. Growth indicator was sales while innovation 

indicator was product innovation and process innovation. The study focuses on manufacturing 

firms. The study sample is 26,386 firms. Research findings revealed that internal research and 

development (R&D) impacted positively on sales growth. Additionally, external R&D and process 

innovation were found to have insignificant impact on sales growth.  

Santi and Santoleri (2016) established the association between innovation and growth of firms in 

Chile. The researchers focused on product and process innovations. Data covered the years, 2007, 

2009 and 2013. 1668 firms in the manufacturing and retail sector were utilized. Data was obtained 

from the Chilean manufacturing survey database. Research findings indicated that product 

innovation and sale growth were negatively associated.  Process innovation and sales growth were 

found to be positively associated. 

Mugambi and Kinyua (2020) determine the link between innovation capability and banks 

performance in Nairobi County. The researcher examined response to market change and 

technological infrastructure. Design used was descriptive. Respondents were 40 senior managers. 

A questionnaire was created with the number of statements regarding each dimension. The 

findings showed that innovation capability was crucial for invention management and creativity 

that can boost growth. 

Past studies on innovation capability examine its relationship to sales growth and not growth 

sustainability. The current study sought to extend the discussion to relational growth and 

innovation growth. Moreover, the studies seem to have focused on process and product innovation 

and not innovation capability as a whole, hence the knowledge gap. 

2.3.3 Networking Capability and Growth Sustainability 

The ability of a firm to build and exploit inter-organizational relationships to gain diverse resources 

is networking capability (Walter, Auer & Ritter, 2006). It refers to a company's ability to place 

itself strategically inside a network and form beneficial partnerships with specific partners. 

Businesses can cooperate with suppliers and competitors to develop a formidable network to 

achieve and maintain growth. Companies will be more competitive when they adopt inter-

organizational collaboration that exposes them to fresh ideas and business techniques (Sawers, 

Pretorius & Oerlemans, 2008).  

Shah, Yasir, Majid and Javed (2019) established the link between networking capability and 

organizational survival of SMEs in Pakistan. Study respondents consisted of 469 managers/owners 

of SMEs. Data collection was via self-administered questionnaires using Likert scale. Research 

design adopted was descriptive. Correlation and regression were employed in data analysis. 

Results findings indicated that all the aspects of networking capability impacted on the 

organization survival positively. 



14 

 

Inigo, Ritala and Albareda (2020) explored networking capability and sustainability orientation in 

innovation. The study focused on alliance capability. 170 firms in Spain formed the study sample. 

The model used was the partial least square model. Study findings revealed that alliance capability 

link to sustainability-oriented innovation was positive. The study recommends that companies 

focusing on incremental sustainable innovation will gain more from open innovation by partnering. 

Roininen (2008) examines networking as a competitive advantage tool in Swedish ventures. The 

study population consisted of 7520 new Swedish business ventures. The study narrowed to 1384 

firms obtained through random sampling. Secondary data was derived from Swedish database. 

Cross-sectional design was employed. Data was gathered by use of questionnaires. Firms with 

high levels of network capabilities were found to improve their competitive advantage. 

The reviewed studies on networking capability majorly focused on the link to competitive 

advantage or organizational survival. In addition, the researchers limited studies to either new 

venture firms or SMEs overlooking firms in the construction and allied sector hence the knowledge 

gap. 

2.3.4 Marketing Capability and Growth Sustainability 

Marketing capability is a company's willingness to systematically and intentionally learn about 

consumers, rivals and channel participants in ways that allow not only for a thorough grasp of 

current market trends, but also prediction of potential market changes (Morgan, 2012). Marketing 

capabilities enable businesses to better understand their present and potential consumers' demands 

so that they may improve on their products and services, as well as assess their competition 

accurately (Fowler, 2000). The marketing expertise of one person may be combined with that of 

other experts in various areas and cross-functional teams (Teece et al. 1997). 

Naidoo (2010) explored the influence of marketing orientation and marketing innovation on firm’s 

survival in China. The study covered the period 2008 to 2009. 184 SMEs in the manufacturing 

sector were sampled. Questionnaires were used in data collection. The findings revealed that 

Chinese manufacturing SMEs had a higher chance of survival if they built and maintained a 

competitive advantage and that marketing innovation capabilities of the manufacturing SMEs 

increased because they were competitor-oriented and had clear inter-functional capabilities. 

Shen, Sha and Wu (2020) investigated marketing capabilities and innovation link in China. The 

research focused on market vigilance, market experimentation and open marketing capabilities. 

163 IT firms formed the population. Chemical engineering, biotechnology, and machinery 

manufacturing were among the industries representing the respondents. Study findings revealed 

that all the marketing capabilities forms impacted positively on sustainable innovation 

performance.  

 

 

 



15 

 

Takahashi, Bulgacov, Semprebon and Giacomini (2017) explore marketing capability and 

performance in Brazil. 316 universities formed the population. Because of its highly competitive 

nature, the study focused on the private sector, which had developed academic and administrative 

standard procedures. Marketing capability was found to positively influence organizational 

performance. 

The reviewed studies on market capability centred on SMEs, higher institutions of learning and IT 

firms whose size growth is not that typical as it is in the construction industry thus a knowledge 

gap. Moreover, the studies majorly focused on marketing capability and organizational 

performance and not growth sustainability which the current study sought to explore.  

2.4 Summary of Knowledge Gaps in Research 

Many studies conducted on dynamic capability have centred on its effect on competitive 

advantage, organization performance and firm’s growth. There has been few research on DCs and 

growth sustainability, resulting in a conceptual gap. Naidoo (2010) explores marketing orientation 

and firm’s survival while Roininen (2008) examines networking and competitive advantage. Some 

studies focused on the direct link between the variables while ignoring the causal effect and the 

magnitude of the effect:  Inigo et al., (2020) looks at networking capability and sustainability 

innovation while Opoku and Fortune (2011) investigated organizational learning and sustainability 

in the UK.  

Contextual gaps arise where studies were done in other sectors, ignoring the construction sector: 

Zheng and Khavul (2005) investigated learning capability in technological firms whereas 

Bianchini, et al., (2014) investigated innovation capability in manufacturing firms. The findings 

have also been mixed with respect to some DC variables like innovation capability: Santi and 

Santoleri (2016) find product innovation and sales growth are negatively linked. This study sought 

to fill these gaps by investigating the influence of dynamic capability on growth sustainability of 

listed construction and allied firms in Kenya. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



16 

 

Table 2.1 Research Gaps 

 

Author Focus of study Methodology Findings Research Gap 

Gabriele and 

Corsino 

(2010) 

To investigate 

the association 

between 

product 

innovation and 

firm growth in 

the integrated 

circuit industry 

in Italy. 

The study covered 

the period 1998-

2004. Research 

design was 

descriptive and 

regression was used 

in analysis of data. 

The study found that 

increased product 

innovations had a 

beneficial impact on 

firm growth, especially 

for units domiciled in 

dynamic markets. 

Need to incorporate 

other variables such as 

networking capability, 

learning and marketing 

capability. and extend 

the study to developing 

countries such as 

Kenya. 

Mugambi 

and Kinyua 

(2020) 

To determine 

the link 

between 

innovation 

capability and 

banks 

performance in 

Nairobi 

County 

The period covered 

by the study was 

from 2002 to 

2011.Multiple 

regression was 

applied in the 

analysis 

The findings show that 

innovation capability is 

crucial for invention 

management and 

creativity that can 

boost growth 

Extension of the study 

to other sectors such as 

construction and allied 

sector and do the 

findings hold true in 

other regions such as 

Kenya. 

Bianchini, 

Pellegrino 

and Tamagni 

(2014)  

 

 

 

To establish 

the effect of 

product and 

process 

innovation 

strategies on 

manufacturing 

firm’s growth 

in Spain. 

The study covers 

the period 2004 to 

2011.Regression 

was used in the 

analysis 

Research findings 

revealed that internal 

research and 

development (R&D) 

impacted positively on 

sales growth. 

Need to incorporate 

other variables such as 

networking capability, 

learning and marketing 

capability and extend 

the study to developing 

countries such as 

Kenya. 

Altinay, 

Madanoglu, 

Vita and 

Arasli 

(2013) 

To determine 

the link 

between 

organizational 

learning and 

SME growth in 

North Cyprus. 

The measurement 

of growth consisted 

of sales growth, 

market share 

growth and 

employment 

growth. Data 

analysis was via 

exploratory factor 

analysis. 

The study finds a 

positive association 

between organizational 

learning and SME 

growth 

Need to explore other 

growth measures like 

size, relational and 

innovation growth.  

Oketch, 

Kuria and 

Kariuki 

(2018) 

To investigate 

the association 

between 

organizational 

learning and 

organizational 

culture among 

NGOs in 

Kenya 

Research design 

used was 

descriptive in 

nature. Data was 

collected using 

questionnaires that 

was mailed to 

respondents 

Research design used 

was descriptive in 

nature. Data was 

collected using 

questionnaires that was 

mailed to respondents. 

Investigation of growth 

sustainability and not 

organizational culture. 



17 

 

 

Source: Author (2022) 

 

 

 

 

 

 

 

 

 

Shah, Yasir, 

Majid and 

Javed (2019) 

To establish 

the link 

between 

networking 

capability and 

organizational 

survival of 

SMEs in 

Pakistan 

Data collection was 

via self-

administered 

questionnaires 

using Likert scale. 

Research design 

adopted was 

descriptive. 

Correlation and 

regression were 

employed in data 

analysis 

Results findings 

indicated that all the 

aspects of networking 

capability impacted on 

the organization 

survival positively. 

Need to extend the 

study to construction 

and allied firms. 

Roininen 

(2008) 

To examine 

networking as 

a competitive 

advantage tool 

in Swedish 

ventures 

Cross-sectional 

design was 

employed. Data was 

gathered by use of 

questionnaires. 

Networking capability 

and competitive 

advantage were found 

to be positively related. 

Information lacking on 

the growth 

sustainability variable. 

Naidoo 

(2010) 

The influence 

of marketing 

orientation and 

marketing 

innovation on 

firm’s survival 

in China 

The study covered 

the period 2008 to 

2009. Data was 

analyzed using 

regression. 

The findings revealed 

that Chinese 

manufacturing 

marketing innovation 

capabilities increased 

because they were 

competitor-oriented 

and had clear inter-

functional capabilities. 

Need to incorporate 

other variables like 

growth sustainability. 



18 

 

2.5 Conceptual Framework 

It represents the relationship between dynamic capability and growth sustainability. The 

independent variable for the research is dynamic capability while the dependent variable is 

growth sustainability. 

Figure 2.1 Conceptual Framework 

Independent Variable                                                                             Dependent Variable 

Dynamic Capability                                                                                     Growth Sustainability                                                                                               

 

                                                                          

                                                                                                                     

 

      

                                                                    

 

 

 

 

 

 

 

 

 

 

Source: Author (2022) 

2.6 Operationalization of Study Variables 

It is the conversion of variables into measurable components. The method defines concepts and 

enables them to be emperically and statistically measured. Dynamic capabilities are the 

independent variables while growth sustainability is the dependent variable. The table 2.2 

below demonstrates how the study variables were measured.

Learning capability 

• Knowledge acquisition 

• Knowledge sharing 

• Knowledge integration 

Networking capability 

• Internal communication 

• Knowledge of their partners 

• Relational skills with partners 

 

 

 

• Size growth 

• Relational growth 

• Innovation growth 

 

 

 Marketing capability 

• Ability to market new products 

• Product promotion and pricing 

• High visibility in the market 

 

 

 

Innovation capability 

• New product development 

• Improvement in existing 

products 

• Technological advancement 

 

2.  

3.  

 



19 

 

Table 2.2 Operationalization of the Variables 

Source: Author (2022)

Type of 

variable 
Indicators 

Operational 

Definition 

Rating 

Measures 

Data 

Analysis 

Literature 

Source 

 

Independent 

variable 

 

 

 

 

 

 

 

 

 

 

 

Dynamic 

Capability 

Learning 

capability 

Knowledge acquisition 

 

Knowledge sharing 

 

Knowledge integration 

 

5-point 

Likert 

scale 

 

Descriptive 

and 

Regression 

 

 

(Pavlou & El 

Sawy, 2011; 

Lichtenthaler, 

2009). 

 

Innovation 

capability 

New products and 

services development. 

 

Improvements in 

existing products. 

 

Technological 

advancement. 

 

5-point 

Likert 

scale 

Descriptive 

and 

Regression 

 

Gunday et al. 

(2011), 

Hassan et al. 

(2013), 

Atalay et al. 

(2013),  

Networking 

capability 

 

Internal 

communication. 

 

Knowledge of their 

partners. 

 

Relational skills with 

other firms. 

 

5-point 

Likert 

scale 

Descriptive 

and 

Regression 

 

Walter et al., 

(2006) 

Marketing 

capability 

Identification of 

customers. 

 

High visibility in the 

market. 

 

Monitoring of prices 

and products. 

5-point 

Likert 

scale 

Descriptive 

and 

Regression 

 

Cepeda and 

Vera, 2007; 

Wang and 

Ahmed, 2007) 

Dependent 

variable 

 

 

 

Growth 

Sustainability 

 

Size growth 

 

Relational 

growth 

 

 

Innovation 

growth 

 

Gain in market share 

(size growth) 

 

New relationships and 

non-equity 

partnerships with other 

firms or organizations. 

 

Introducing innovative 

features to the existing 

products or creating 

and developing brand 

new projects 

 

 

 

 

5-point 

Likert 

scale 

 

 

 

Descriptive 

and 

Regression 

 

 

Furlan and 

Grandinetti 

(2011), Li and 

Liu (2014) 

and Peters et 

al. (2016). 



 

20 

 

2.7 Chapter Summary 

The second chapter primarily focused on the study's guiding theory: the dynamic capability 

hypothesis. The conceptual framework and four dynamic capability practices were also 

discussed. The goal of literature review was to depict the link between dynamic capability 

practices and growth sustainability. Many studies that have been conducted on dynamic 

capability, centred on its effect on competitive advantage, organization performance, firm’s 

survival or firm’s growth and not growth sustainability. The findings have also been mixed 

with respect to DC variables. The conceptual model depicting the relationship between the 

constructs of interest were also discussed. Growth sustainability was the dependent construct, 

while dynamic capability practices were the independent constructs. Finally, the operational 

framework and the research gap are discussed in the chapter as well. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

21 

 

CHAPTER THREE 

RESEARCH METHODOLOGY 

3.1 Introduction 

The procedures for obtaining and analyzing data are discussed in this chapter. The research 

design, target demographic, sampling design, data collection, validity and reliability of data, 

data analysis and ethics are all covered. 

3.2 Research Philosophy 

A research philosophy is a set of principles for conducting research that is founded on beliefs 

about reality and the nature of knowledge (Collis & Hussey, 2014). Positivism and 

interpretivism are the two basic research philosophies. These two ideologies describe two 

fundamentally different ways in which we as humans make sense of the world around us: 

positivism holds that reality exists independently of us, allowing researchers to observe reality 

objectively. Reality is considered as very subjective in interpretivism since it is molded by our 

perceptions. The study adopted the positivism approach. Positivistic thinkers use scientific 

approaches to standardize the knowledge generating process and use quantification to improve 

the precision of parameter descriptions and relationships. Positivism is focused with finding 

and conveying truth through empirical means (Henning & Van Rensburg, 2004). 

3.3 Research Design 

The study used a descriptive design since it involved a one-time interaction with the 

respondents. The design enabled the researcher to collect data, knowledge and beliefs from the 

population under investigation (Mugenda & Mugenda, 2008).  A descriptive research design 

explains and describes the current state of a phenomenon. A descriptive study is concerned 

with existing situations, practices, structures, distinctions or relationships, held attitudes, 

ongoing processes, or discernible trends (Punch, 2013). As a result, this study used the 

descriptive research approach to describe the dynamic capability practices in the listed 

construction and allied firms and their relationship to growth sustainability. 

3.4 Population of the Study 

The study total population consisted of all five construction firms listed at the NSE as at 31 

July 2022. They include: Bamburi Cement, Athi River Cement, Crown Paints, East African 

Portland and East African Cables (NSE, 2022). 



 

22 

 

A census survey was carried out on the five firms because of the small population size. 

Construction and allied firms are selected as population because product innovation is a key 

strategy for Kenyan firms seeking to be competitive. Secondly, construction and allied firms 

often form networking alliances to fastract innovation and mitigate risks associated with 

economic growth. Thirdly, because of its competitive business climate and increasing 

innovation activities, the construction and allied sector has become a common setting for 

studying innovation.  

3.5 Sampling Design 

The research utilized a judgmental sampling technique where respondents are selected based 

on the researcher’s knowledge as to who provided the best information for the study to succeed. 

Judgemental sampling technique involves selection of informants who posses specific 

knowledge that the researcher is looking out for and does not need to be backed up by theories 

(Tongco,2007)The target respondents were senior level staff and middle level staff in the 

department of business development, marketing, research, finance, human resources and 

corporate affairs. Five respondents were selected from each department (Javis, Mackenzie & 

Podsakoff, 2003). The study therefore had a total of 150 respondents for all the firms.  

3.6 Data Collection 

To gather data from the participants, the study employed primary research tools. Noor (2008) 

opines that primary data can be obtained by a variety of methods, including interviewing, direct 

observation, cultural records, artifact analysis, the use of visual materials, and the use of 

personal experiences. A questionnaire was used as the primary data collection tool because a 

larger number of respondents could be contacted in a short time. Data was collected by emailing 

questionnaires and some were physically dropped to the respondents accompanied with an 

introductory letter from Strathmore Business School and a Nacosti permit. 

The questionnaire had three sections. Section A collected background and demographic data 

about the respondents and the construction and allied companies. Section B collected data on 

the dynamic capabilities’ strategies considered important by the listed firms. Section C 

collected data on the growth sustainability of the construction and allied firms. A five-point 

Likert scale was used in the questionnaire (Blessing & Chakrabarti, 2009). 

 

 



 

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3.7 Research Quality 

This entailed determining the questionnaire's suitability. Piloting helps determine whether the 

questionnaire is legitimate, whether the research participants comprehend the questions in the 

same way, whether the phrasing is clear, and whether implicit bias is present in the study 

(Singh, 2014).  

The study used a 10% of the sample size representing one firm in the manufacturing sector 

(Mugenda & Mugenda, 2003). After piloting, adjustments were made in order to address areas 

of concern. 

3.7.1 Reliability of Research Instruments 

It's a metric for determining the accuracy of the results produced by the research instrument 

after numerous trials. Cronbach's alpha was utilized to verify the instrument's internal 

consistency. Cronbach Alpha of 0.7 or higher is deemed acceptable and suggests that the scale 

is dependable. Questions from the pilot study with a low Cronbach Alpha were modified or 

removed from the questionnaire. 

  Table 3.1 Reliability Coefficients 

 

   Scale                                              Number of items                   Cronbach’s Alpha                         

   Innovation capability                                  4                             0.711 

   Learning capability                                     5                             0.788 

   Marketing capability                                   5                             0.819 

   Networking capability                                 5                             0.833 

   Growth Sustainability                                  5                             0.842 

  Source: Survey Results (2022) 

As shown in Table 3.1, all scales were significant, with an alpha value greater than 0.7. As a 

result, the analysis was judged to be reliable and applicable for further research. The results are 

consistent with those of Cooper & Schindler (2014), who established that a study can proceed 

when the Cronbach's Alpha values are larger than 0.5. 



 

24 

 

3.7.2 Validity of Research Instruments 

Validity refers to how well data accurately reflects the phenomenon being studied as captured 

by the study instrument (Mugenda & Mugenda, 2003). By assessing the validity of the 

instruments, the researcher ensured that the questions are testing the relevant constructs. The 

content validity of the questions was determined by consulting the supervisor, who compared 

questions against the objectives.  

3.8 Data Analysis  

The information gathered was checked for inaccuracies and completeness and the analysis 

procedure included, data cleansing to remove any extraneous information, as well as grouping 

and coding in excel. The data was then entered into the SPSS software and ddescriptive analysis 

was done using percentages, mean, frequency distributions, measures of central tendency, and 

standard deviation. Correlation analysis was done using Pearson correlation to determine the 

nature of interaction between variables using a significance level of 0.05. Any p value above 

0.05 signified insignificant relationship between the variable and vice-versa. The thresholds in 

Pearson correlation also show that any value greater than 0.05 is said to be statistically 

insignificant any value less than 0.05 is said to be statistically significant. Regression was also 

done to establish the relationship between dynamic capability and growth sustainability. 

3.8.1 Analytical Model  

The study adopted the multiple regression model to establish the relationship between dynamic 

capabilities and growth sustainability as shown below: 

Y= α + = β0 + β1X1+ β2X2+ β3X3+ β4X4 + ε 

Where: Y = growth sustainability 

α = constant (y intercept) 

X1= Innovation capability 

X2= Learning capability 

X3 = Marketing capability 

X4 = Networking capability 

βi (i= 1, 2, 3, 4) = Coefficients of regression. 



 

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3.9 Ethical Considerations 

In research, ethics refers to an individual conduct when performing research (Coopers & 

Schindler, 2014). The basic goal of ethics is to protect participants from damage caused by 

research and to ensure that data is obtained and processed fairly in order to yield legitimate 

results (Kothari, 2004). The researcher sought an introductory letter from Strathmore Business 

School and a research permit from NACOSTI since it’s the only state corporation mandated to 

grant research licenses in Kenya. Permission to gather data was also sought from the 

Institutional Ethics Review Committee at Strathmore University. 

To ensure the study was conducted ethically, the respondents involved in the study were treated 

ethically. This was accomplished through obtaining prior consent and maintaining the 

confidentiality of the data obtained. The respondents were informed of their rights and benefits, 

including that participation in the study was entirely voluntary and there was also an 

introductory section that assured the respondents that the research was for educational purposes 

and that they can withdraw at any time.  

 

 

 

 

 

 

 

 

 

 

 

 

 



 

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CHAPTER FOUR 

 DATA ANALYSIS, FINDINGS AND INTERPRETATIONS 

4.1 Introduction 

The data analysis and interpretation are presented in this chapter. The response rate, 

demographic details, descriptive analysis, correlation analysis and regression analysis are 

among the sections examined. 

4.2 Response Rate 

The researcher administered 150 questionnaires but 105 questionnaires were filled and 

returned. Thus, the response rate was 70%. Babbie (2004) argues that a 70% response rate is 

excellent for a researcher to proceed with analysis. Thus, the study proceeded to process the 

questionnaires and the response rate is as shown below: 

Table 4.1 Response Rate 

Questionnaire Frequency Percentage 

 

   

Returned 105 70% 

Unreturned 45 30% 

Distributed 150 100% 

Source: Survey Results (2022) 

4.3 Demographic Characteristic of the Respondents 

This section captures the responses by gender, age, highest education level, level of seniority, 

the department they work for and the length of service. The findings are presented and analyzed 

in the tables and figures. 

4.3.1 Gender of the Respondents 

The researcher asked the respondents to disclose information about their gender and the 

findings are indicated in Table 4.2. 

 

 



 

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Table 4.2 Response by Gender 

Gender Frequency Percentage 

 

   

Male 57 54.29% 

Female 48 45.71% 

Total  105   100% 

Source: Survey Results (2022) 

As shown in Table 4.2 the male respondents registered the highest percentage 57 (54.29%) 

compared to female respondents 48 (45.71%). Therefore, based on the results, men are the 

majority gender among respondents. Further evidence that both genders are fairly represented 

in the studied firms comes from the fair distribution of male and female respondents. This 

suggests that all genders participated in the study and that there was no gender bias in the 

research. 

4.3.2 Age of the Respondents 

The study deemed age an important demographic characteristic with a view to establish any 

pertinent trends in the variables under study as well as to have an overview of the age 

distribution thereof. Table 4.3 presents the findings. 

Table 4.3 Age of the Respondents 

Age Group Frequency Percentage 

 

   

18-24 0 0% 

25-34 10 10% 

35-44 63 60% 

Over 45 years 32 30% 

Source: Survey Results (2022) 

According to Table 4.3, the bulk of respondents 60% fall within the 35-44 age group. A close 

second, at 30%, is individuals over 45 years old. Only 10% of respondents are in the 25-34 age 

range.  



 

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The investigation showed that the listed construction and allied enterprises had a very even 

distribution of ages. Additionally, it was clear that all five listed construction and allied firms 

were made up of senior, experienced workers between the ages of 35 and over 45. 

A rich diversity in experience was thus established in the responses. This is in line with Jan & 

Stoeldraijer (2010) who claimed that a person's age is directly proportionate to their 

contribution to the work. The researcher was confident in the data acquired because the 

majority of respondents were experienced and had the necessary abilities to respond to the 

questionnaire. 

4.3.4 Level of Education of Respondents 

Respondents were questioned about their highest levels of education. In addition to providing 

a general overview of education levels at the listed construction and allied firms, this would 

serve to demonstrate the academic qualifications of respondents in their particular roles. 

Table 4.4 Level of Education of the Respondents 

Education Level Frequency Percentage 

 

   

Masters 42 40% 

Bachelor 53 50% 

Diploma 10 10% 

Certificate 0 0% 

Source: Survey Results (2022) 

The respondents’ highest degrees of education are shown in Table 4.4. According to the results, 

the majority of respondents 50% had earned a bachelor's degree, followed by 40% who had 

earned a postgraduate degree. No one had a certificate, although another 10% claimed to have 

earned a diploma. Overall, it can be claimed that the studied area employs highly literate staff. 

Therefore, it can be inferred that due to their high levels of education, respondents were able 

to understand the objectives and provide accurate answers to questions. 

 

 

 



 

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4.3.5 Management Role 

The respondents were asked to state their role. The findings are as shown in table 4.5. Results 

indicated that majority of the respondents 57.14 % were senior level managers while 42.85% 

were middle level staff.  These findings suggest that senior management roles could be in high 

demand in the construction and allied firm given the high percentages. 

Table 4.5 Management Role 

Role Frequency Percentage 

 

   

Senior level staff     60 57.14% 

Middle level staff     45 42.85% 

Lower-level staff       0   0.00% 

Source: Survey Results (2022) 

4.3.6 The Department of the Respondents 

The respondents were asked to state which department they are deployed. The findings are as 

shown in table 4.6. Results indicated that majority of the respondents 28.57% were employees 

from the marketing department. This suggests that marketers play a significant role in 

influencing and maintaining the growth sustainability of construction and allied firms. 

Table 4.6 Respondents Department 

Department    Frequency Percentage 

 

   

Business Development         20 19.04% 

Marketing         30 28.57% 

Corporate affairs    

 

Research                     

 

Finance      

 

Human Resources                                                       

        12 

        18 

 

        13                                                                       

 

        12 

  11.43% 

17.14% 

12.39% 

11.43% 

 Source: Survey Results (2022) 



 

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4.3.7 Length of Service 

The study found it necessary to establish the length of service of the respondents, in years, 

serving at the institution. Table 4.7 presents the findings. 

Table 4.7 Length of Service of the Respondents 

Education Level Frequency Percentage 

 

   

Below 1 year 10 9.52% 

5-10 years 16 15.24% 

10-15 years 53 50.48% 

Over 15 years 26 24.76% 

Source: Survey Results (2022) 

According to Table 4.7, the majority of respondents, 50.48 percent, had been employed by the 

company for between 10 and 15 years. Only 9.52 percent of respondents were discovered to 

have recently joined the company. The results show a very even distribution of years, indicating 

different experience levels. Responses can be regarded as being adequately informed by 

experience because most respondents had 10 to 15 years of work experience. 

4.4 Descriptive Statistics 

This section presents the employee’s view of dynamic capabilities impact on growth 

sustainability of listed construction and allied firms that were analyzed in four key areas; 

innovation capability, marketing capability, learning capability, networking capability and 

growth sustainability. The study objective was achieved by asking the respondents to indicate 

to what extent they concurred with statements presented to them relating to dynamic capability 

practices used by their organization on a five-point Likert scale where 1 = Strongly Disagree 

(SD), 2=Disagree (D), 3= Neutral (N), 4= Agree (A), 5=Strongly agree (SA). 

 

 



 

31 

 

4.4.1 Innovation Capability 

The respondents were asked to indicate their response to how innovation capability influences 

growth sustainability at their firms. The results presented in Table 4.8 below. 

Table 4.8 Innovation Capability 

Statements                                                                                                          Mean           SD 

 New technologies are easily adopted in the organization.                                       4.66              1.12 

The firm structured new product development can   grasp new opportunities.   4.49             1.77 

The firm is inclined towards pursuing incremental products improvements      4.56             1.43 

with existing products. 

The company develops in house solutions to improve the manufacturing        4.32            1.47       

process.                        

Composite Mean                                                                                               4.51           1.45 

Source: Survey Results (2022) 

The results of table 4.8 indicated that most respondents strongly believed that their organization 

quickly adopted new technology as represented by the highest mean of 4.66. In addition, most 

respondents also agreed that their company preferred to produce new products by upgrading 

their current products, as demonstrated by a mean of 4.56. Similarly, many respondents 

strongly agreed that new or innovative items allowed their companies to take advantage of 

market opportunities, as indicated by the mean of 4.49. Additionally, according to the mean 

value of 4.32, a significant number of respondents strongly agreed that the company develops 

in house solutions to improve the manufacturing process. The overall mean was 4.51 implies 

that most respondents concur that the listed construction enterprises innovation capability 

affected their growth sustainability. 

4.4.2 Learning Capability 

The respondents were asked to indicate their response to how learning capability influences 

growth sustainability at their firms. The results are presented in Table 4.9 below: 

 



 

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Table 4.9 Learning Capability 

Statements                                                                                                           Mean       SD 

The firm foresees changes in the industry and train its staff.                               5.00       0.001                                                     

The firm has improved its innovation capability through learning.                     4.67       0.474                                            

The company has leaders that support learning at the team and firm level.        4.50       0.761                                      

The firm has established systems that capture and share learning.                      3.99       0.814                                                     

To boost growth sustainability, the company applies lessons learned from        4.34       0.745                                                   

earlier product development missteps. 

Composite Mean                                                                                                  4.50       0.56 

 

Source: Survey Results (2022) 

The majority of the respondents agreed that their firms anticipate changes in the industry and 

train staff in advance, as depicted by the highest mean of 5. Most of the respondents also 

strongly agreed that organizational learning had improved the ability of their company to 

innovate, as depicted by the second-largest mean value of 4.67. It was closely followed by 

respondents who also strongly believed that their leaders support learning at their firms. The 

mean value was 4.50.  A considerable number of respondents agreed that their firm applies the 

lessons learned from earlier product development missteps and established systems that capture 

and share learning. The two statements were represented by relatively higher means of 4.34 

and 3.99, respectively. The composite means of 4.5 revealed that learning influenced growth 

sustainability.      

4.4.3 Marketing Capability 

The respondents were asked to indicate their response if marketing capability influences 

growth sustainability at their firms. The results presented in Table 4.10 below. 

Table 4.10 Marketing Capability 

Statements                                                                                                          Mean          SD 

The firm monitor competitors’ prices and price changes.                                   4.32           .470 

The firm has adopted innovative marketing techniques to increase 

their market visibility.                                                                                         4.50           .502 

The firm uses its marketing capabilities to identify new customers in the 

market.                                                                                                                4.50            .502 



 

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The firm marketing capability enables it to monitor competitive products 

in the export market.                                                                                           4.34            .477 

The company makes improvements in customer relationships to ensure 

customer satisfaction.                                                                                          4.31           .424 

Composite Mean                                                                                                4.39           0.48 

Source: Survey Results (2022) 

 

Most respondents, as seen in table 4.10 above, strongly agreed that their firm had adopted 

innovative marketing techniques to increase its market viability. The mean was among the 

highest at 4.50. In addition, they contended that their firms employ market capabilities to attract 

prospective consumers, as represented by a mean of 4.50. Further, majority agreed that by 

continuously improving their customer relations, their firms would increase customer 

satisfaction, as represented by a mean of 4.31. Moreover, they also agreed that their firms 

strongly monitored competitive products in the export market and competitor prices and price 

changes. The two statements were represented by means of 4.34 and 4.32, respectively. The 

high composite means of 4.39 revealed that market capability influenced the growth 

sustainability of the listed firms.                                             

 4.4.4 Networking Capability                           

The respondents were asked to indicate their response if networking capability influences 

growth sustainability of their firms. The results presented in Table 4.11 below 

Table 4.11 Networking Capability 

 Statements                                                                                                      Mean            SD 

 The company can build long-lasting relationships with business partners     4.17              .379                                                

The company strong networking and joint ventures promote relational 

 growth.                                                                                                             4.10             .502 

 The company believes in co-operating with other firms to remain  

 competitive.                                                                                                     4.33             .474 

 Firms' business information is often communicated across departments.      4.16              .695 

The company studies partners strength and weaknesses.                                4.67