Strategic Response and Performance of Commercial Banks in Kenya

Abstract

Strategic response can be classified as the skill of formulating, evaluating, and implementing certain critical choices that allow an organization to remain justifiable as well as accomplish its goals while in a chaotic environment. It includes a detailed description of the company's goals, procedures, and strategies. The success of strategic response success is heavily dependent on the business environment. This includes the sociological, political, environmental, social and economic contexts of an organization. The rate of success of a strategy response is also determined internally, by the resources available to a business, the overall assets assigned to implementing strategies, personnel capacity, organizational processes and technologies. “The goal of this research was to determine how strategic responses impact performance of Kenyan banks guided by the objectives; to determine the impact of strategic response on organization performance, to study the effect of strategic crisis management on organization performance, and to establish the effect of strategic leadership on performance. The environmental dependency theory and the resource based view theory guided the investigation. A descriptive research design was used to this end. The 38 licensed commercial banks served as both the population and the sample for the study.” This research relied on primary data collected through questionnaires. Google forms were made use of in the questionnaire administration. “The data obtained was converted into quantitative format to be analyzed using spss. This generated descriptive statistics which included mean and standard deviation and inferential statistics which included both correlation analysis and multiple linear regression. From the study, a substantial positive relation between strategic innovation, strategic crisis management, and strategic leadership and organizational performance was found among commercial banks.” Regression analysis revealed that 60.2% variations in organization performance among the banks were linked to the three variables selected in this study. In conclusion, strategic innovation, strategic crisis management and strategic leadership are responsible for improved organizational performance. Based on the findings, strategic leadership had the greatest influence on performance followed by strategic innovation and strategic crisis management had the least influence. As a result, it is recommended that commercial bank managers and owners concentrate on strategic responses, as this improves overall performance