Strategy Implementation by Commercial Banks in Kenya
Abstract
Strategy implementation is a carefully considered process of ensuring that strategies
which have been formulated within the organization are executed effectively and
efficiently in order to achieve organizations goals and objectives. It is a continuous
feedback mechanism process that ensures that strategies are relevant, objective and
effective to the organizations goals. Currently banking institutions in Kenya face a
dynamic, fast paced, competitive environment not only on a local but on a global scale.
It is therefore imperative for each to develop strategies that enable it to survive and
maximize value to all its stakeholders. However, the mere formulation is not important
as the mere formulation of strategies will not guarantee its success. The banks will be
successful only when the strategy formulation is sound and implementation is excellent.
The study was carried out to find out how strategy implementation is carried out by
commercial banks in Kenya. The study was conducted through a descriptive cross
sectional survey targeting all the commercial banks in Kenya. Out of the 43 licensed
banks 35 responded giving a response rate of 83.3%.The study established that:
Majority of the banks develop guidelines/models to guide the process of strategy
implementation but the adherence to the guidelines varies. The responsibility is
assigned to different levels of staff (Board of directors and senior management, lower
management and relevant departmental staff). Different steps are given varying level of
emphasis in different institutions the high scored steps were ensuring the staff have the
required skills, allocating ample resources to those activities critical to strategic success
and installing information and operating systems that enable personnel better carry out
their roles. A variety of internal and external factors unique to each institution influence
the process of strategy implementation. The following attained the highest scores out of
those provided to respondents: level of ‘ownership’ of strategy implementation among
key employees, competence of the institution to plan, manage and implement strategic
initiatives, level of upper management support, understanding the role of organizational
structure and design in the implementation process, commitment to providing financial
resources needed, human resources and technological resources and communication
process. It recommends that banks may outsource the process to firms with experience
in the field, banks should not overlook the myriad of factors that influence the process
and policy makers can enforce best practices identified like developing guidelines for
the process and setting of key performance indicators. Limitations arose owing to
respondents giving positive information to present a good picture of their organization
and senior officers not responding on claims of being too busy. Comparative research
could be conducted in other industries to identify any similarities or differences or
specific study could be done for banks in similar tiers.
Publisher
University of Nairobi
Description
Masters