Innovative Structure and Performance of Manufacturing Small and Medium Enterprises in Kenya

In the evolving landscape of business, successful organizations of the future will be distinguished by their ability to cultivate exceptional skills in innovation, particularly in the realms of strategy development and organizational design. Innovation, whether manifested in product development, process enhancement, organizational methodologies, or marketing strategies, constitutes a multifaceted and intricate endeavor. It encompasses various dimensions across a singular firm, its clientele, and its network of suppliers (Tafti, Abdolvand, & Harandi, 2019). The study sought to examine the role of innovative structure on performance of SMEs in Kenya. The study applied Organizational Control Theory to investigate the role of innovation strategy implementation on the competitive performance of manufacturing SMEs in Nairobi City County, Kenya. The target population comprised 538 manufacturing SMEs located in Nairobi City County, chosen due to its cosmopolitan nature and concentration of manufacturing businesses. Top managers were selected as respondents because they primarily handle strategic management issues within organizations. Stratified sampling was employed to select the sample, with the population divided into sectors based on the classification provided by the Kenya Association of Manufacturers (KMA). The research adopted a positivism philosophy, aiming to gather empirical evidence to support its hypotheses. A cross-sectional survey design was utilized, combining qualitative and quantitative mixed methods. Data collection relied on a questionnaire, whose validity and reliability were confirmed through a pilot study. Statistical Package for Social Sciences (SPSS) version 25 software was used to analyze quantitative data, while qualitative data underwent thematic analysis and were presented in narrative form. The analysis included descriptive statistics to summarize quantitative findings, which were presented in tables and figures. The study employed a rigorous methodological approach to comprehensively investigate the relationship between innovation strategy implementation and the competitive performance of manufacturing SMEs in Nairobi City County, Kenya. The study also computed correlation and regression analysis to test the relationship between study variables and test the research hypothesis. The study concludes that Innovative structure has a positive and significant effect on the performance of SMEs in Kenya. The study revealed that centralization, integration, and decision-making influence the performance of SMEs in Kenya. This implies that improvement in innovative structure (centralization, integration, and decision- making) would improve the performance of SMEs in Kenya. This study recommends that the management of manufacturing SMEs in Kenya should formulate and implement effective strategies of investing in innovative strategies to increase the SMEs' competitiveness and improve their performance.