Sustainable competitive advantage in the insurance industry in Kenya

With the accelerating pace of competition and innovation, cutting-edge companies are \ndefined by innovative strategies. Industry leaders create a competitive advantage that \nenables them to drive superior financial performance through boom and bust cycles. They \nfocus on building long-term strategic advantages rather than investing aggressively when \nthe market is strong and summarily cutting programs when the economy and pricing \nenvironments weaken. The study was based on the insurance industry and was to provide \nan understanding of the nature of sustainable competitive advantage adopted by insurance \nfirms in Kenya. The objectives were to establish how insurance companies are creating \nsustainable competitive advantage and the challenges faced in creating the sustainable \ncompetitive advantages. The study adopted a survey design with the population being \nrandomly sampled. Data was collected through questionnaires and analyzed. The results \nindicated that majority of the firms used cost leadership strategy to create sustainable \ncompetitive advantage. They also indicated that all players irrespective of the competitive \nstrategy adopted experienced strategy implementation challenges. The study had some \nlimitations which included the categorization of the firms based on the different services \noffered as a whole as opposed to their individual categories. Other limitations were not \nconsidering process of strategy implementation as a whole and not considering the role of \nregulation and policy framework in the industry. Based on the study, it is recommended \nthat players in the industry constantly evaluate their strategies with an aim of staying \nahead of the competition. This can be done through adopting cost reduction strategies, \nfocus strategy and investing in resources. Further studies can be carried on to determine \nthe strategic responses other firms adopt to different competitive strategies and factors \nconsidered when doing so. The study can also be extended to other industries to see if the \nsame strategies are used across industries.