| dc.description.abstract | Organizations adopt diversification strategy for several reasons. Some include increasing
their profits to supplement their income and to take advantage of emerging opportunities
in other markets and regions. The purpose of this study was to establish the effect of the
diversification strategy on the performance of Kenya Commercial Bank group. Both
primary and secondary data were collected by the researcher. Primary data was
successfully collected from five senior managers of the bank, whereas secondary data
was collected from the audited financial reports of Kenya Commercial Bank group
limited. The study took the form of a case study of KCB group. Trend and content
analysis were used to establish the effect of diversification on performance. The findings
revealed that Kenya Commercial Bank group has adopted three main diversification
strategies. The first form of diversification is geographical which involves opening of
wholly owned subsidiaries in the region. The other is product diversification where the
bank has managed to unveil several products to its customers to meet their needs. The
bank also engages in unrelated diversification such provision of insurance services
through agency. Diversification has a positive effect on the performance of KCB group.
As the income from diversification increases, the total profits of the banks have also
registered significant increment. In the course of conducting the research, limitations
encountered were inability to access some financial information since the respondents
considered it very confidential. In addition, some of the respondents did not provide some
information in time due to their busy schedules. Some of the recommendations for further
research proposed were that, the bank should explore more ways and forms of
diversification in order to enhance its performance. It too recommended a similar study to
be done on other organizations in the banking industry. | en_US |
