An Analysis of the Effects of Globalization on Local Firm Competitiveness: A Case of Regent Automobile Valuers and Assessors Ltd

A Research Project Report proposed to the School of Business in Partial Fulfillment of the Requirement for the Degree Of Masters in Business Administration (MBA)The purpose of the study is to analyze the effects of globalization on local firm competitiveness, and thus to analyze strategies that aid local Kenyan firms to adapt to globalization. In recent years, the world has witnessed constant waves of globalization. These waves have impacted both local and international firms. A sample effect has been the entry of numerous foreign competitors into the Kenyan market. The study aims to come up with strategies by answering three research questions. First, what have been the effects of globalization on local firm competitiveness? Second, which strategies do local firms use to compete with foreign multinational corporations (which possess more resources) in an increasingly globalized local environment? Third, how do local firms enter international markets to gain competitive advantage? Tackling these three research questions will assist local Kenyan firms to better understand and respond to the effects of globalization, while planning for and beginning the process of internationalization. The study used a descriptive research method for its research design. This is used to describe characteristics of a population or phenomenon. The study’s population was picked from Regent Automobile Valuers and Assessors Ltd, a local Kenyan firm that specializes in the valuation of automobiles and machinery. The research utilized a population census. It dealt with primary data. Data was collected using questionnaires. To ensure a high degree of accuracy, the questionnaire was pretested. Once data was collected, it was cleaned and input into a computer. Data analysis was conducted using IBM SPSS Statistical Analysis software and Microsoft Excel Spreadsheet software. Data analysis was then carried out using descriptive statistics and inferential statistics. Descriptive statistics analyzed frequency distribution of responses, measures of central tendency, and reliability. Measures of central tendency included the mean, median, mode, standard deviation, variance, range, minimum values and maximum values. Reliability analysis utilized the Chronbach’s Alpha. Inferential Statistics undertook a correlation analysis using Pearson’s correlation coefficient. Statistical findings were presented in the form of frequency distribution tables, bar graphs and pie charts. The research discovered that globalization forces had a large impact on local firm competitiveness. Analysis discovered that firms that successfully adapted to globalization were likely to be highly successful in the local market, and were also likely to expand; or desire to expand into foreign markets. The research concluded that globalization has a great impact on both the competitiveness of local firms; and the business environments they operate in. Positive effects such as access to foreign technologies and foreign direct investments greatly benefit local firms; while negative effects, such as adverse competition, have the potential to drive companies that do not adapt into extinction. Local firms can successfully compete with foreign firms in the local business environment. They can also successfully enter international markets despite an increasingly hostile, competitive and volatile international business environment. The research recommended that local firms need to analyze the effects of globalization on both their competitiveness and their local business environments. Doing this will aid them to better position themselves to respond, adapt and exploit the effects of globalization to their advantage. The research also recommended that firms conduct thorough industry analyses to map out potential foreign threats, and position themselves in the industry. Local companies need to deeply analyze the special competitive advantages they possess by being local; and learn how to exploit them effectively. Firms that desire to expand into international markets should have an adequate global strategy