Core competencies and choice of competitive strategies at Equity bank limited in Kenya
Oluoch, Emmaculate O
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Competitive strategies which enable a firm to survive in a fierce competitive business environment and emerge stronger are the most valuable assets possessed by businesses as sources to competitive success are usually hard to determine and imitate. Precisely, sustainable competitive advantage emanates from unique core competencies developed within an organization. Firms wishing to maintain their competitive position or emulate industry leaders need to clearly understand the concept of core competence and how it influences choice of competitive strategies among businesses. Equity Bank has grown rapidly over the past ten years to become the second most profitable in the country. In addition, it has the largest customer base in East Africa and has attracted both local and international recognition on poverty reduction by extending financial and non-financial services to the low income segment and the unbanked population. This prompted the researcher to carry out a study to establish the influence of core competencies on choice of competitive strategies at Equity Bank. This research project conducted between April and November, 2013 answered the following research question, what is the influence of core competencies on the choice of competitive strategies at Equity Bank? The study reviewed literature on concept of strategy, core competence, choice of competitive strategies, and core competencies and choice of competitive strategies. The study was demonstrated on a case study research design and data was collected through personal interview method as guided by an in-depth structured interview guide. The data was analysed using content analysis technique and inferences made based on reliability, sufficiency and consistency of the data. The study findings revealed that core competencies provide very important skills and techniques in building competitiveness and choice of competitive strategies. In addition, core competencies play an important role in the planning, developing, implementing and evaluating strategic competitive policies that result in a competitive advantage. Based on the findings, it was recommended that policy makers should give special consideration to financial institutions that serve the low-income segment. Also, Equity bank managers need to understand, develop and exploit the firm’s core competencies in choosing competitive strategies as well as make them an integral part of their responsibility. Moreover, future researchers should develop models which can assist banks to gain competitive advantages using core competencies. Therefore, the study sets a foundation for more focused research into the importance of core competencies in developing a competitive advantage especially in the banking sector.