Moderating Effect of Competency Trap on the Relationship Between Reengineering and Firms’ Competitiveness of Insurance Companies in Kenya

Abstract

The purpose of this study is to evaluate the moderating effect of competency trap on the relationship between reengineering and the competitiveness of insurance companies in Kenya. The study was guided by an epistemological research philosophy employing a descriptive research design. The study targeted 50 insurance firms in Kenya. Using a census sampling approach, five senior managers were selected as respondents from each firm, resulting in a total sample size of 250 respondents. Primary data was collected through self-administered questionnaire. Data were analysed using both descriptive and inferential statistics. Pearson correlation analysis showed a strong, positive, and statistically significant relationship between reengineering and firm competitiveness (r = 0.656, p < 0.001), with a weaker but significant correlation between competency trap and competitiveness (r = 0.200, p = 0.004). Regression results further indicated that reengineering had significant positive effect on competitiveness of insurance companies in Kenya (B = 0.228, t = 2.833, p = 0.005). However, moderated regression analysis found no significant interaction effect between reengineering and competency trap (B = 0.003, ΔR² = 0.000, p = 0.676), suggesting that competency trap does not alter the influence of reengineering on competitiveness. The study concludes that strategic reengineering positively influences competitiveness of insurance companies in Kenya. Although competency trap did not show a significant moderating effect, firms should avoid over-reliance on outdated routines to sustain long-term competitiveness. The study recommends that insurers invest in continuous improvement, technology integration and organisational learning, while regulators and industry bodies support innovation through targeted policy and training initiatives.