MODERATING EFFECT OF FIRM AGE AND SIZE ON THE RELATIONSHIP BETWEEN SUSTAINABLE OPERATIONS MANAGEMENT PRACTICES AND COMPETITIVE ADVANTAGE OF MANUFACTURING FIRMS IN KENYA

Abstract

The Kenyan government has identified manufacturing as one of its big fouragenda
for growth and employment creation. However, manufacturing activities
consume considerable amounts of resources which are non-renewable and energy
intensive, emits toxic wastes leading to negative environmental challenges.
Therefore manufacturing firms have to embrace technologies that utilize
alternative energy sources and minimize pollution by implementing sustainable
operations management practices (SOMPs). SOMPs are environmental initiatives
taken to care for the environment, improve life and for economic gains. If
appropriately addressed, SOMPs have likelihood of becoming crucial to
competitive advantage and a solution to the problems experienced. Sustainable
practices implementation requires resources and capability. However, little is
known about the moderating effect of firm age and size on the relationship between
SOMPs and competitive advantage. For business models to be able to solve real
business problems they need to specify moderating variables. The objective of this
paper was to examine the effect of firm age and size on the relationship between
SOMPs and competitive advantage. The relationship was grounded on the theory
of performance frontiers and open system theory. Cross sectional survey design
was used. The population of the study was made up of 903 manufacturing firms
and the sample size was 300 which was calculated using Slovin’s formula. Primary
data was collected and covariance-based structural equation modeling was used to
analyze it. The test for validity and reliability were also conducted. The findings
indicated that, firm age had a significant moderating effect on the relationship
between SOMPs and firm competitive advantage hence new firms should aim at
adopting the practices early enough to ensure that they enjoy the benefits. The
findings also indicated that firm size does not moderate the relationship between
SOMPs and firm competitive advantage.