Factors Influencing Strategy Implementation by Commercial Banks in Kenya
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Date
2013-11Author
Atamba, Cynthia
Type
ThesisLanguage
enMetadata
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When the important role that commercial banks play in the economy is considered, their
survival becomes evidently critical. In order for them to survive, the sector needs to
ensure that they carry out formulation and implementation of viable strategies
successfully. Johnson, Scholes and Whittington (2008), define strategy as the direction
and scope of an organization over the long term, which achieves advantage in a changing
environment through its configuration of resources and competences with the aim of
fulfilling stakeholder expectations. The Central Bank of Kenya (herein CBK) annual
report published in 2012, lists 43 commercial banks categorized by their market size
index; 6 large, 15 medium and 22 small peer groups. Virtually all the commercial banks
in Kenya have been aggressively opening new branches, all which point to a predisposing
factor towards strategy failure by virtue of the ‘new venture’ criterion as mapped out by
Finkelstein. The banks have diversified their product offerings and explored alternative
delivery channels like agency banking, mobile and internet banking. Various factors and
challenges influence strategy implementation in commercial banks in Kenya. A survey
design was used in the study. This research design was used because the study mostly
involved use of non-numerical data of descriptive nature collected through a
questionnaire. The study used both probability and non- probability sampling techniques
to create a sampling frame for commercial banks. Stratified sampling was one of the
probability techniques used in order to avail equal chances of selection to banks in
different categories of large, medium and small cluster group. The researcher used a
sample size of 33.3% out of the accessible target population. This study was done against
a backdrop of limitations of time and finances. The research outlined communication,
leadership, timing and change management as most significant factors that influence
strategy implementation by commercial banks in Kenya. Commercial banks also face
challenges in change management, pursuing competing activities and incompetence
among the implementers. The study has upheld the Stakeholder theory as well as the
Resource Advantage theory, the two key theories that underpinned this study.
Citation
Atamba,Cynthia;November,2013.Factors Influencing Strategy Implementation By Commercial Banks In Kenya.Publisher
University of Nairobi School of Business