Strategy implementation practices and organizational performance in commercial banks in Kenya
Abstract
With the dynamic environment in which organizations are operating in today, strategy
implementation is vital as it ensures optimal organizational performance. Strategy
implementation ensures an organization remains competitive and without implementation even
the most superior strategy is rendered useless. Banking environment in Kenya has undergone
many regulatory and financial reforms which have resulted to innovation and changed the
structure in the sector encouraging conversion of Micro finance Institutions to fully fledged
Commercial Banks.
The aim of this research was to explore strategy implementation practices and organization
performance in Commercial Banks in Kenya. The study sought to establish the different strategy
practices adopted by Commercial Banks in Kenya to attain optimal performance. The researcher
used a descriptive research design through structured questionnaires targeting all the 43
commercial banks in Kenya. The design was appropriate as it provided insights into the research
problem by describing the practices and their influence on performance in detail. Primary data
was collected through structured questionnaires to the executives, functional Managers and
strategy champions. The data collected was summarized and analyzed using descriptive
statistics.
The study established that commercial banks in Kenya formulated strategy and had a strategy
document in place, and revealed that different Banks adopted different strategy implementation
practices with the prevalent practice being performance target. Further, the study revealed that
strategy implementation in Commercial banks was not effective and faced challenges such as
lack of commitment from the senior managers, inadequate communication of the strategy to all
the employees. From the study findings there was a positive correlation between strategy
implementation and Organizational performance of Commercial Banks in Kenya, and that the
structure played a key role in strategy implementation.
To thoroughly understand the industry, the researcher recommends a comparative study to be
carried out between one of the successful banks and a least performing bank.This study gives
limitations and suggestions for further research. One of the limitations identified by the
researcher included lack of commitment by the respondents in answering the questions due to
their busy work schedules and a research on another industry recommended to enable arrive at an
objective conclusion as regards organization performance.
Publisher
University of Nairobi