Effect of organizational learning on performance of food manufacturing firms in Nairobi County, Kenya

Abstract

The evolving dynamic changes in the business environment have led to a focus on knowledge as a driver of superior performance in firms. As a result, some firms are adopting organizational learning to manage their knowledge assets for competitive advantage and increased performance. While past studies have demonstrated the importance of organizational learning to firms, few have empirically examined the effect of organizational learning on organizational performance. This study sought to examine the effect of organizational learning on performance of food manufacturing firms in Nairobi County. The objectives of the study were to determine the effect of knowledge acquisition, information distribution, information interpretation and organizational memory on firm performance. A correlational survey research design was adopted for the study. The target population comprised food manufacturing firms in Nairobi which are subdivided into 7 subsectors. A sample of 71 firms was used in the study. Disproportionate stratified random sampling method was used to ensure the sample is representative of the 7 sub-sectors of the food manufacturing industry. Primary data was collected using questionnaires which were administered to executive officers in the firms. To summarize the data, descriptive statistics such as mean and standard deviation were used. To examine the relationship between organizational learning and performance, Pearson’s correlation analysis was used. To examine the effect of organizational learning on organizational performance, multiple regression analysis was used. The results were presented using tables. The results revealed a significant positive relationship between organizational learning and organizational performance. The findings also revealed that among all organizational learning dimensions, information distribution had the strongest relationship with organizational performance. The results also showed that the joint effect of organizational learning components on organizational performance was significant. The study recommended that while information distribution needs to be the key vision of organizational learning goals in firms, all organizational learning dimensions should be combined for a greater increase in organizational performance. The researcher recommends replication of the study in different sectors and countries to enhance understanding of the relationship between organizational learning and organizational performance.