| dc.description.abstract | The operations of any organization are affected by influences emanating from both
internal and external environment. Most of those from the internal environment are
effectively addressed by the management. However, the external environment in which
organizations operate is characterized by constant changes resulting from remote factors
that are beyond the organizations capability to respond. Continuous changes in the
external environment require that management continuously formulate and implement
strategies that will effectively address challenges brought about by these changes. A host
of external factors influence a firm’s choice of direction and action and ultimately its
organizational structure and processes. Coping with the increasingly competitive and
dynamic environment has called on firms to continuously rethink their strategies. The
study adopted case study as the research design and opted for Taifa Sacco Society
Limited as the Sacco had gained sustainable competitive advantage both in the
cooperatives and financial services sector. Its outstanding performance had made it
receive prestigious awards of recognition both at the national and international events.
The objectives of the study were to identify changes in the external environment faced by
Taifa Sacco Society Limited and to establish the response strategies that the Sacco had
adopted to cope with the changes in its external environment. Qualitative Primary data
was collected using self administered interview guides. The data collected was then
analyzed using conceptual content analysis. From the findings, the study concluded that
the external environment in which Taifa Sacco Society Limited operates is dynamic with
changes occurring in unpredictable manner. The political, economic, social cultural,
technological, ecological and legal changes had brought with them opportunities and
threats to the Sacco. The study established that Political changes had been occurring after
every five years bringing with them regime changes which in turn developed new legal
and policy framework to guide the operations of Saccos. Economic changes including the
economic meltdown had lead to high inflation rates that negatively affected the saving
culture of the Sacco’s customers. The social cultural changes had in turn brought with
them a new ‘Y’ generation of consumers who constantly demanded new products to meet
their changing consumption patterns. Technological innovations and advancements had
rendered obsolete the Sacco’s machines and computer software. The study further
established that Taifa Sacco Society Limited had developed and implemented various
strategies to respond to the threats and maximize on the opportunities presented by the
changes in its external environment. On political/legal changes, the management adopted
lobbying strategy. On economic changes, the management adopted market development
strategy. To respond to social cultural changes, the management adopted product
development strategy. Strategies to respond to technological changes included the
adoption of the modern technology and computer software, continuous training of staff
and networking with firms that offer computer backup programmes that may be too
expensive for the Sacco to acquire. The department of research and development has
been crucial in identifying the changes occurring in the external environment through
continuous forecasting. The findings are then discussed during board meetings at which
strategies to respond to these changes are recommended.
Key Words: Response Strategies, External Environment, Opportunities, Threats and
Competitive Advantage. | en |
