The Relationship Between Growth Strategy and Performance of Commercial Banks in Kenya
Abstract
Most of the research done so far has focused on growth and its antecedents in commercial banks. Firms are employing different strategies to accomplish growth and gain competitive advantage in the market. Among the key strategies that firms employ in attaining and sustaining competitive advantage is expansion. Commercial banks in Kenya have grown regionally as the industry has undergone internal and external expansion. The on-going regional integration efforts and the increasing competition in the banking sector has seen a number of Kenyan banks grow in order to increase their client base. This research therefore sought to establish the relationship between growth strategy and performance of commercial banks in Kenya. The main purpose of the study was to determine if there was a link between growth and performance. The research target was the entire population of commercial banks in Kenya data was collected from the senior managerial staff. Both primary and secondary data were used. Primary data was collected by means of a questionnaire. The data was coded, tabulated and analyzed using Statistical Package for Social Science (SPSS) software and Excel. Descriptive statistics such as frequency distribution and percentages were used to analyze the data. Research questions were analyzed using descriptive statistics. The study found out that commercial banks in Kenya had employed a myriad of growth strategies to enhance their performance. They included product development, market expansion, market penetration and diversification strategies. The study concludes that product development strategies have a positive and significant relationship on performance of commercial banks in Kenya. The study also concludes that market development and expansion strategies have a positive effect on performance of commercial bank in Kenya. The study concludes that diversification strategies have a positive and significant effect on performance of commercial banks in Kenya. The study recommends that commercial banks should increasingly apply a range of growth strategies highlighted in expanding the scope of markets and operations of their entities in a bid to improve performance of the banks.
Publisher
University of Nairobi
Rights
Attribution-NonCommercial-NoDerivs 3.0 United StatesUsage Rights
http://creativecommons.org/licenses/by-nc-nd/3.0/us/Collections
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