AN APPLICATION OF PORTER'S DIAMOND MODEL TO ANALYSE ...

AN APPLICATION OF PORTER'S DIAMOND MODEL TO ANALYSE
COMPETITIVENESS OF KENYA'S TOURISM INDUSTRY.
Student Name: WAHOGO JAMES KARARI
Project Supervisor(s): MR. JACKSON MAALU
ABSTRACT Tourism is the world's largest export earner and an important factor in the balance of payments of
many countries. The tourism industry in Kenya has experienced tremendous growth contributing to the
strengthening of the Kenya shilling against regional and international currencies. Tourism earnings grew by 27%
from Kshs 38.5 billion in 2004 to Kshs 48.9 billion in 2005. The sector's remarkable performance was attributed
to rigorous marketing by government and private sector. To achieve competitive advantage for its tourism
industry, any country must ensure that its overall appeal, and the tourist experience offered, must be superior to
that of the alternative destinations open to potential visitors. Existing and potential visitation to any county is
inextricably linked to that country's overall competitiveness, however that is defined or measured. The research
seeks to capture the main elements of competitiveness as highlighted in the Michael Porter diamond model in his
book published in 1998 titled "The Competitive Advantage of Nations", while appreciating the special issues
involved in exploring the notion of competitiveness as emphasized by tourism researchers. The Porter Diamond
model has framework that can be used to measure the competitiveness of any industry within a nation. The set of
indicators allows identification of the relative strengths and weaknesses of Kenya tourism industry and can be
used by industry and Government to increase tourism numbers, expenditure and positive economic impacts. From
the study security, advertising and marketing, airports, natural attractions, and pricing, are the highest rated factors
from the tourism stakeholders perspective. While the presence of tourism clusters, demand by local, science and
technology infrastructure, level of rivalry and rail network are at the bottom of the ranking in terms of their
contribution to Kenya's competitiveness as a tourist destination. Finally, recognising the limitations of this study,
it is recommended that further research be carried on qualitative aspects, using in depth interviews of the
stakeholders. In addition it is recommend that the University of Nairobi and the tourism industry establish formal
collaboration where research as this could be used to guide policy by the government considering the importance
of tourism in the country's economy.

---