Effect of Organizational Culture on Strategic Reactions of Commercial Banks in Kenya

Abstract

Every organization develops and keeps a completely unique culture which influences the whole organization. Thus, strategic reactions in an organization depict sudden major changes and results in multiple uncertainties. When organizational culture is changed within the Kenyan commercial banks, most activities in the bank are affected. The objective of this study iwas ito establish the effects iof organizational culture ion strategic reactions of commercial banks in Kenya. This study was anchored on two theories namely; Deal Kennedy Theory and Miles and Snow Typology. The research hired descriptive cross-sectional survey design. The study population consisted of all commercial banks licensed by the Central Bank of Kenya to carry out business in Kenya and also that participate directly in the clearing house. A census on the 46 registered banks was carried out. Primary data was collected through close-ended questionnaires. The questionnaire was made of two sections, that is, organization culture and strategic reactions. The questionnaires was issued via the drop and pick method. The researcher employed descriptive statistics. Regression model was also be used to predict the effects of organizations culture on strategic reactions of commercial banks in Kenya. The results further revealed that organizational culture of commercial banks in Kenya positively correlate with the strategic reactions. Also, the results reveal that the organizational culture positively affect the strategic reactions of commercial banks in Kenya. The study recommended that the management of commercial banks in Kenya should work towards a better culture that includes its employees in decision making and that encouraged its employees to take risks for the betterment of the banks. The study also recommended that the Kenya Bankers Association as the authority that oversees the operations of commercial banks in Kenya should support the commercial banks in Kenya in implementation of organizational cultures that will positively impact of the strategic reactions.