Leaving aside the enormous issue of the obvious disparity between Kuwaiti and Coalition forces (both in scale and quality), Iraq's successful invasion of Kuwait benefited greatly from the experience of the Iran-Iraq War. Although the Iraqi military did not cover itself in glory in that conflict, the armed forces gained a modicum of experience and competency in carrying out specific missions. The Republican Guard had been retooled from an elite praetorian formation (and this was still an important component of their duties) into a force capable of both combined arms and night attacks. Although the Guard formations were not as proficient at these operations as Western forces, it was enough to overwhelm Kuwaiti forces. The prior war also underscored the need for accurate intelligence and the Iraqi Air Force's MiG-25s conducted extensive overflights over Kuwait in July 1990 and the regime disseminated the aerial photographs to ground units. Commercially available tourist maps also contributed to the Iraqi success.
The swift victory in Kuwait masked many of the flaws of the Iraqi armed forces. One of the fundamental problems of Iraqi military effectiveness was the compartmentalization of its armed forces into various satraps. Iraqi naval, army, and air forces often operated in the dark as to what other branches were doing. The Army operated under the assumption that the Iraqi Air Force would provide an air umbrella for its operations. However, the Air Force assumed that its attacks on Kuwaiti airbases would suffice and it kept a number of units on alert over Iraq itself to prevent any repeat of the Israeli 1981 bombing of the Osirak nuclear plant. The Kuwaitis did mount some airstrikes against Iraqi forces much to the consternation of Republican Guard commanders. The swift occupation of Kuwaiti airbases ended this threat, but the inability of the left hand to know what the right was doing was a precursor of the later disasters in 1991. The successful invasion of al-Qulayah Navy base by elements of the Iraqi Navy showed that the Iraqi forces were capable of acting with initiative and daring. The Iraqi commander Colonel Muzahim Mustafa occupied the harbor despite losing one missile boat and suffering equipment malfunctions. Yet Mustafa's bold tactical leadership was atypical of Iraqi forces; crucial mission leaders were often kept in the dark about their operations until the last minute. Air mobile helicopter pilots only had rudimentary training and were assured that the Air Force would eliminate Kuwait's Hawk missiles. The Air Force's failure to do so led to high helicopter losses and the rudimentary training in night formation flying also led to a large number of crashes. The Iraqi approach to operational planning inhibited tactical initiative as frontline troops barely knew the basic plan and had to focus great efforts on carrying it out, so improvisation when the plan went awry was less likely.
Ultimately, these defects were not as much of an issue given that the Kuwati response to Iraq was much more passive than it could have been. Civilian refugees prevented the effective deployment of Kuwaiti armed forces. The speed of the Iraqi assault prevented the Kuwaitis from exploiting the Mutla Pass as a defensive line, which was one of the few natural barriers in Kuwait. The result was that the Kuwaiti response was often in penny-packets that the Iraqi's could quarantine. Again, defects within the Iraqi command and communication system meant that Iraqi troops were often unaware sister unit's status, so it was up to the unit being attacked to deal with the Kuwaitis alone. Coalition forces would exploit this disjointed command structure in 1991 as they destroyed the Iraqi forces in a piecemeal fashion.
In short, the Iraqis were competent enough to take Kuwait, but lacked the ability to hold Kuwait against a military
foe like the United States.
Sources
Al-Marashi, Ibrahim, and Sammy Salama. Iraq's Armed Forces An Analytical History. London: Routledge, 2008.
Woods, Kevin M. Iraqi Perspectives Project Phase II. Um Al-Ma'arik (The Mother of All Battles): Operational and Strategic Insights from an Iraqi Perspective, Volume 1 (Revised May 2008). Ft. Belvoir: Defense Technical Information Center, 2008. http://handle.dtic.mil/100.2/ADA484530.