Role of Strategic Partnerships on Performance of Private Health Insurance Sector in Kenya

Abstract

Strategic partnership is necessitated by the need for an organization to achieve its goals while leveraging on resources of another organization. Strategic partnership can be viewed as a tool for competitive advantage as firms utilize each other’s core competence and specialization to support the competitiveness of the activities concerned. This study sought to establish the influence of transient advantage on performance specifically, the role of strategic partnerships on performance of private health insurance companies. The dynamic capabilities view of the firm and institutional theory were used to anchor the study while a descriptive survey design was adopted in the study targeting a population comprising managers, assistant managers and supervisors. Four respondents were drawn from each of the five departments, namely sales, strategy, finance, operations and customer service departments in the 19 private insurance companies where data was collected from a sample of 308 out of the 380 that were targeted. The analyzed data found that strategic partnerships did not significantly (p >0.05) predict performance of private health insurance sector in Kenya. Strategic partnerships had positive but insignificant predictive power on performance. It was recommended that firms should strengthen these dynamic capabilities to level where their influence on performance can be significant and health insurance firms should strategically partner with entities that share the same goals and objectives and are culturally compatible.