Diversification Strategies and Competitive Advantage of Hfc Limited

Abstract

Diversification strategies in today’s organizations is paramount to the successful and profitable services delivery in those organizations and enhancement of customer retention. The motive of this study was to establish the effect of diversification strategies and competitive advantage of HFC bank. The study used the following theories; Porter’s theory of competitive advantage and open systems theory. The study was qualitative in nature, hence adopting a case study as its design. The research instrument used to collect the data was an interview guide. The data obtained by the researcher was analyzed qualitatively by the help of content analysis. The study found that HFC bank had come up with several diversification strategies such as; full bank services include; personal banking where customers can open a personal banking account, savings account, investment account, get finance solutions, foreign exchange, open a diaspora account and money transfer services. The study established that existing products were rebranded to fit the needs of the customers while new products were developed which were in line with the modern markets and customer needs. The bank had also diversified into the digital market in order to attract more customers and make services easily accessible to the customers. The bank has also diversified by expanding its market base. The bank has opened branches all over the country as a way of targeting more customers. The researcher concluded that diversification strategies played a vital role to the competitive edge of HFC bank. The study recommended HFC bank to continue developing more diversification strategies for better improvement of customer services. The study also recommended that HFC bank incorporate data protection in its diversification strategies. Lastly, the study also recommended the government to offer support to banks by offering favorable taxes and working environment.