Strategic Value Chain Management and Performance of Tea Firms in the West Rift of Kenya

Author

Mutai Felix Kipchirchir and Dr. Anthony Mwendwa

Abstract

 The tea industry is an important component of Kenya’s agricultural and export economy, yet tea firms continue to face pressure from production costs, changing markets, operational inefficiencies, competition and the need to sustain value across the supply chain. This journal article examines the effect of strategic value chain management on the performance of tea firms in the West Rift of Kenya, focusing on strategic logistics management, strategic innovation adoption, strategic stakeholder engagement and strategic operations management. The study was anchored on Porter’s Value Chain Theory, the Resource-Based View, Stakeholder Theory and Innovation Diffusion Theory. A quantitative descriptive survey design was adopted. The target population comprised 63 tea firms in Kericho, Bomet and Nandi counties, from which 114 respondents were sampled; 108 usable questionnaires were returned, giving a 94.74% response rate. Descriptive statistics and multiple linear regression were used to analyse the data. The regression model produced R = .825, R² = .681 and adjusted R² = .667, indicating that the four predictors jointly explained 68.1% of the variation in firm performance. Strategic logistics management had a positive and statistically significant effect on performance (B = .192, β = .211, p = .005), while strategic stakeholder engagement had the strongest positive and statistically significant effect (B = .771, β = .904, p < .001). Strategic innovation adoption (B = -.139, β = -.159, p = .189) and strategic operations management (B = -.045, β = -.054, p = .573) were negative and statistically insignificant. The findings demonstrate that value chain performance in the West Rift tea sector depends strongly on logistics coordination and meaningful stakeholder relationships. The article recommends stronger stakeholder coordination, improved logistics systems and more deliberate integration of innovation and operations initiatives.

Keywords

value chain management; tea firms; logistics management; innovation adoption; stakeholder engagement; operations management; firm performance; Kenya.

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