Organizational Learning Strategies and Performance of Insurance Companies in Kenya

Abstract

The objective of this study was to establish the relationship between organizational learning strategies and performance of insurance companies in Kenya. The population of the study was the 49 registered firms which provided the research data. Questionnaire was used as the instrument of data collection. Primary data was collected from the insurance companies managing directors who served as the respondents. Descriptive and inferential statistics were used to analyse the data. Statistical Package for Social Sciences (SPSS) software was used for data analysis. The findings revealed that insurance companies used learning strategies of; strategic alliances, team learning, leadership, technological learning and individual learning. Balance score card (BSC) formed the basis of performance measurement. BSC had categories of non-financial and financial performance measures which were analyzed together. Multiple regression was used to establish relationship between organizational learning strategies and performance. The influence was found to differ between different learning strategies with some having positive influence on the performance and other negative influence. Technological and team learning strategies were found to have a positive relationship with performance. Use of technology in the insurance companies to share skills and knowledge, for data and customers’ information storage and for prompt dissemination of information brings about efficiency and effectiveness in operation and hence the positive influence to the company performance. Team learning contribute much to the creativity and innovation, this has a direct effect on the customers satisfaction and prompt release of new product to the market and products agility. This explains the reason for the positive influence to the performance. Strategic alliance, leadership and individual learning strategies were found to have a negative relationship. Many insurance companies have strategic alliance with other financial institutions like banks and insurance brokers, however, most of them focus on the benefit of enhancing profitability instead of tapping in the necessary knowledge from these partners. In some organizations, leadership as learning strategies is not well put in place as many lack the mechanism to continuously communicate the vision and mission and aligning it to the leaning of the organization. Individual learning on the other hand is not well institutionalized in many company. These explain the reasons for the negative influence to the company performance. The study concluded that insurance companies need to strategically select learning strategies which impact on the whole organisation and influence performance.