Poor management practices, poor productivity process and lack of innovation are the major factors hurting the profitability of most businesses in the country, it has emerged.
Poor management practices, poor productivity process and lack of innovation are the major factors hurting the profitability of most businesses in the country, it has emerged.
According to experts in business management, most businesses fail to plan full cycle hence leading to poor financial management and production wastage. This is occasioned by high production output without targeted market.
"If organisations learn to plan, practice and prove before running to do things, it would enable them to benchmark performance and competitiveness against industry peers,” Sultan Amri, an expert from Kenya said.
He noted that, as a result of these challenges, companies tend to lose around 25 per cent of their revenues, creating a lukewarm capacity for them to compete with their peers in the region.
Uganda currently holds the lion’s share of Rwanda’s imports with around Rwf5b of the country’s (Rwanda) import receipts, which proportionally reduces the local market potential of Rwandan made products.
David Muturi, the Chief Executive Officer (CEO) of Kenya Institute of Management (KIM), is optimistic that local firms have the capacity to drive continuous improvement to sharpen their competitiveness through adoption of Organisational Performance Index (OPI).
According to Muturi, the OPI which acts as a gold standard and benchmark will play a leading role in empowering organisations to compete globally and influence the development of the sectors and industries in which they operate.
OPI is an excellence model which drives performance excellence and competiveness by generating a rating between 1 and 10 to determine an organisation’s competiveness.
"This means that organisations can now use OPI as a management tool with minimum of external intervention and guidance,” Muturi said during the Company of the Year Awards (COYA), which are given to organisations excelling in OPI.
He added: "These organisations are able, once they have mastered the seven OPI determinants, not only to steer their process towards excellence, but also to measure their performance with reliable accuracy.”
In the Awards, Bank of Kigali emerged the Company of the Year, while World Vision scooped the human resources focus award as Institute of Policy Analysis and Research (IPAR) took the leadership, management, productivity and quality award.
NPD-Contraco was recognised for its corporate, citizenship and environmental focus.
Alfred Lenana board chairman KIM said that efforts to spearhead growth and improvement in the SMEs subsector by bringing entrepreneurs in the region together are in the offing.
"We firmly believe that SMEs have got what it takes to grow our economies.”