DOI: 10.11648/j.sjbm.20261404.12 ISSN: 2331-0634

Driving the Performance of Small and Medium-Sized Enterprises Through Learning Orientation: Empirical Insights from Wajir County, Kenya

Najma Abdikadir, Godfrey Kinyua
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Small and medium-sized enterprises (SMEs) are important contributors to economic growth, employment creation, and poverty alleviation in both developed and developing economies. In Kenya, SMEs are estimated to constitute 98% of all businesses and generate approximately 30% of annual employment. However, a substantial proportion fail within their first five years of operation, raising concerns about the sustainability of the sector. Learning orientation, defined as the extent to which an organization institutionalizes processes of knowledge acquisition, dissemination, and application, has been identified as an important organizational capability associated with SME performance, although empirical evidence remains inconsistent across contexts. This study sought to establish the influence of learning orientation on the performance of SMEs in Wajir County, Kenya. The study was anchored on Dynamic Capabilities Theory and Growth of the Firm Theory and adopted an explanatory research design. The target population comprised 9,717 registered SMEs operating across eight business sectors in Wajir County, from which a sample of 385 owners and managers was selected using stratified sampling. Data were collected using semi-structured questionnaires comprising closed- and open-ended items, with the closed-ended items measured on a five-point Likert scale. Data were analyzed using descriptive and inferential statistics with the aid of SPSS version 24. Of the 385 questionnaires distributed, 320 were duly completed and returned, yielding a response rate of 83.1%. The findings revealed that SMEs in Wajir County moderately embraced learning orientation practices (M = 3.38, SD = 0.52), with the greatest emphasis placed on encouraging employee and customer feedback and the least on cultivating a shared mental model of future goals. Learning orientation exhibited a positive and statistically significant correlation with organizational performance (r =.534, p <.01) and a positive and statistically significant regression coefficient (β =.362, t = 6.400, p <.001). The regression model explained 47.5% of the variation in organizational performance (R 2 =.475, F = 95.207, p <.001). The study concludes that learning orientation is positively and significantly associated with SME performance in Wajir County. It recommends that SME owners and managers institutionalize continuous learning through regular training, mentorship, feedback mechanisms, and structured knowledge-sharing practices, while strengthening shared understanding of organizational goals to enhance adaptability, innovation, and long-term performance.

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