Influence of Competitive Strategies on the Performance of Kenya Commercial Bank

Abstract

Modern banking sector operates in a dynamic and turbulent environment faced with a variety of challenges brought about by competition in the sector. The competition in banking sector has various consequences both positive and negative where firms need to strive to survive, grow and increase market share. Organizations therefore formulate and implement various competitive strategies, extensively evaluate them to yield high firm performance. Competitive strategies developed after carrying out environmental scanning and optimally application of organization core competences well implemented and extensively evaluated yields high firm performance. Competitive strategies leads to competitive advantage which needs to be reviewed via environmental scanning to have sustainable competitive advantage. The objective of study was to investigate the influence of competitive strategies on the performance of KCB. A case study research design was used to handle this research problem. The study involved both primary and secondary data. The researcher used interview guide in data collection. Data was qualitative in nature which was analyzed using content analysis. The study found out that KCB limited adopts different competitive strategies like cost leadership strategy, differentiation strategy, focus strategy, mergers and acquisition, strategic alliance, diversification, globalization strategy, innovation and invention strategies and other strategies to outcompete rivals. The research concluded that Porter’s generic competitive strategies which include cost leadership, differentiation and focus strategy are mostly applied in KCB to yield high firm performance. The researcher found out those competitive strategies had high influence on firm performance at KCB. Positive influence includes banks high quality services, increase in market share, growth and sustainable competitive edge through competitive strategies like diversification strategies where KCB had expanded its branches both locally and internationally. High investment in R&D, adoption of technological advancement, inventions and innovations had high cost to organization. The study concluded that KCB had invested a lot in technological advancement, inventions and innovations and R&D. Such strengths may be anchored on quality service, firm’s image, and firms Intense investment in R&D, technological advancement, and customer satisfaction level. The study also noted that opportunities also affected banks performance in terms of competence thus bank needs to take advantage of available opportunities in order to outcompete competitors.