Using Jovanovich’s Learning Effects Model to Predict Advantageous Product among Micro and Small agro-food manufacturing Enterprises in Kenya

Dr.Sc. Francis Okumu Omillo


Advantageous product is a product with a competitive edge over others in the market. It attracts more revenue for the enterprise, fulfils sophisticated customer demands and is highly differentiated. In this paper, enterprise’s size and age influence on advantageous food products for local and export markets are examined. Formality is considered as a moderating factor. The study sampled 132 food-manufacturing Micro and Small Enterprises (MSEs) in Busia and Nairobi Counties. The researcher used Jovanovich’s Learning Effect Model to inform the conceptual framework. A seven Likert Scale questionnaire was used to measure the MSEs’ gradation in opinion, attitude and behaviour on size, age, registration and how they influenced their advantageous product. Research instruments’ reliability was tested by chronbach’s alpha and realized 0.97 which was greater than 0.70 showing excellent internal consistency. Due to weak information management system of agro-food processors in Busia county, snowballing sampling techniques was used and fisher sampling techniques formula at standard normal deviate of 1.96 on Nairobi County Government given its numerous food manufacturing enterprises. The data was analyzed using moderated Logit model at a corresponding 5% level of significance using Statistical Package for the Social Sciences (SPSS) version 21.0. The study found out that enterprise size, age and registration status (as a whole) significantly influenced agro-food processors to produce advantageous product (wald (1) =41.297, p=.000, sig<.05, 2-tailed) but not as independent stand alone factor. The study recommends census of all agro-food manufacturing enterprises in Kenya. It also suggests combination of size and age factors in the registration and development of the enterprises. Finally the study recommends establishment of a food and beverage administration authority to support MSEs for export market.


Jovanovich’s Learning Effect; liability of newness; liability of smallness; Advantageous product; Agro-food processing;


Abatecola, G., Cafferata, R., & Poggesi, S. (2012). Arthur Stinchcombe's "liability of newness" contribution and impact of the Construct. Journal of Management History, 402-418.

Aldrich, H., & Auster, E. R. (1986). Even dwarfs started small: Liabilities of age and size and their strategic implications. Research in Organizational Behaviour, 165-198.

Bryman, A. (2012). Social Research Methods. New York: Oxford University Press.

Carayannopoulos, S. (2009). How Technology-Based New Firms Leverage Newness and Smallness to Commercialize Disruptive Technologies. Entrepreneurship Theory and Practice, 419-438.

Choi, R., & Shepherd, D. A. (2005). Stakeholders Perception of Age and other Dimentions of Newness. Journal of Management, 573-596.

Cusumano, M., Suarez, F., & Kahl, S. (2007). Product, Process and Service: A new Industry Lifecycle Model. Cambridge: MIT Sloan School of Management.

Djupdal, K., & Westhead, P. (2015). Environmental certification as a buffer against the liability of newness and small: Firm performance benefits. International Small Business Journal, 148-168.

FKE. (2012). The Employer's Manifesto: Employers Call for an Improved Business Climate for Growth and Job Creation from the next Government. Nairobi: Federation of Kenya Employers (FKE).

Fonseca, F. (2015). Brazil Food Processing Ingredients. Annual Report. Brasilia: USDA Foreign Agricultural Services.

Freeman, J., Carroll, G. R., & Hannan, M. T. (1983). The Liability of newness: age dependence in organisational death rates. American Sociological Review, 692-710.

Germany Trade & Invest. (2015). 2014/2015 The Food & Beverage Industry in Germany. Berlin: Germany Trade & Invest.

Greiner, L. (1998). Evolution and Revolution as Organisations Grow. Havard Business Review.

Haltiwanger, J., Jarmin, R., & Miranda, J. (2013). Who Creates Jobs? Small Vs. Large Vs. Young. The Review of Economics and Statistics, 347-361.

Han, J. K., Kim, N., & Srivastava, R. (1998). Market Orientation and Organisational performance: Is Innovation a Missing Link? Journal of Marketing, 62(4)30-45.

Harwell, M. (2011). Research Design: Qualitative, Quantitative and Mixed Methods. In C. Conrad, & R. C. Serlin, The Sage Handbook for Research in Education: Pursuing Ideas as the Keystone of Exemplary Inquiry. Thousand Oaks: Sage.

Homburg, C., & Pflesser, C. (2000). A multi-layer Model of Market-oriented Organisational Culture: Measurement Issues and Performance Outcomes. Journal of Marketing Research, 37(4):449-462.

Johanson, J., & Vahlne, J. (2009). The Uppsala Internationalisation Process Model Revisited: From Liability of Foreignness to Liability of Outsidership. Journal of International Business Studies, 1411-1431.

Kale, S., & Arditi, D. (1998). Business failures: Liability of newness, adolescence, smallness. Journal of Construction, Engineering and Management, 458-467.

Kamunge, S. M., Njeru, A., & Tirimba, I. O. (2014). Factors Affecting the Performance of Small and Micro Enterprises in Limuru Town Market of Kiambu County, Kenya. International Journal of Scientific and Research Publications, 1-20.

Ko, W. W., & Liu, G. (2016). Overcoming the liability of smallness by recruiting through a network in China: a guanxi-based social capital perspective. International Journal of Human Resource Management, 1-28.

Langerak, F., Hultink, E. J., & Robben, H. S. (2004). The Impact of Market Orientation, Product Advantage, and Launch Proficiency on New Product Performance and Organisation Performance. The Journal of Production Innovation Management, 21: 79-94.

Levy, Y., & Ellis, T. J. (2006). A Systems Approach to conduct an Effective Literature Review in Support of Information Systems Research. Informing Science Journal, 181-212.

Lohrke, F., Bird, B., & Gordon, R. (2010). Comercializing New Technologies: The Impact of Liability of Newness, Liability of Smallness, and Technological Innovativeness (Summary). Frontiers of Entrepreneurship Research, 1-2.

Monteiro, C., & Levy, R. (2010). A new classification of food based on the extent and purpose of their processing. Public Health Nutrition, 2039-2049.

Munguti, J. (2013). Food Industry in Kenya. Nairobi: Ministry of Industriali-zation & Enterprise Development.

Muturi, P. M. (2015). The Role of Micro and Small Enterprises(MSEs) in achieving Kenya Vison 2030. International Journal of Economics, Commerce and Management, 1337-1352.

Narver, J. C., & Slater, S. (1990). The Effect of Market Orientation on Business Profitability. Journal of Marketing, 54(4):20-35.

Ndirangu, A. N., & Mukulu, E. (2014). Effects of Entrepreneurial Training Content on the Growth of Micro and Small Enterprises in Kenya, Kangemi: Nairobi. The International Journal of Business and Management, 85-91.

Ng'ang'a, S. I., Onyango, G. M., & Kerre, B. W. (2011). Collective efficiency and its effects on infrastructure planning and development for small manufacturing enterprises in Kenya. International Journal of Business and Public Management, 75-84.

Republic of Kenya. (2005). Sessional Paper of 2005 on Development of Micro and Small Enterprises for Wealth Creation, Employment Generation and Poverty Eradication. Nairobi: Government Printers.

Stinchcombe, A. (1965). Social Structure and Social Organization. In The Handbook of Organisations (pp. 142-193). Chicago: Rand McNally.

Stradomskyte, I., Dai, X., & Hauge, S. (2012). All you need is trust - to overcome the liability of newness by forming alliances. Msc Thesis in Innovation and Entrepreneurship. Oslo: Centre for Entrepreneurship - University of Oslo.

Velthuijsen, J. W., & Janszen, M. (2014). Megatrends impacting the Dutch agrifood industry towards a cleaner, healtheir, safer, smarter and stronger sector. Amsterdam: PriceWaterhouse Coopers.

Full Text: PDF

DOI: 10.21113/iir.v9i2.520

Article Metrics

Metrics Loading ...

Metrics powered by PLOS ALM


  • There are currently no refbacks.

Comments on this article