Strategic response by KCB to environmental challenges
In the recent past, the banking industry has faced increased competition and tremendous challenges globalization, privatization of government owned banks, adverse changes in economic and political patterns and narrowing of profit margins. This has prompted the industry players to take competition to a higher level. Increased competition is critical advancing economy growth in banking industry. This study sought to determine the strategic responses by KCB to environmental challenges in Kenya. The research design applied in the study was a case study. The primary data was collected using interview guide done on ten interviewees who are the head of departments at the KCB head office. The qualitative analysis was done using content analysis. The results indicated that KCB has been experiencing environmental turbulence. Economic problems such as inflation and the weakening currency were also found to be conditions creating business problems to the KCB to a large extent. The company`s key strategy was adoption of strategic leadership. The other responses are on the applied use of ICT in its operations and ecommerce in general. The prudent management principles by KCB management also involve corporate governance, management by objectives and the inclusion of stakeholders especially management in strategy formulation and implementation. Owing limitations the researcher was not able to cover the study objective conclusively. Thus, the researcher recommends the following topics to researcher on:-the impact of the government regulations on response strategies adopted by banks in Kenya, the effect of internal challenges on the response strategies adopted by commercial banking, the role of organizational culture on strategic response and growth among financial institutions and the benefits that accrue to the organization as a result of competitive response strategies on environmental challenges. KCB needs to put in place a Research and Development department. This will be charged with not only gathering and analyzing competitor intelligence information but also exploring new markets and new products. R & D will also be charged with innovations and environmental monitoring and possible firm investment. The firm should also consider additional outsourcing of non-core functions such as auditing, archiving, public relations and information technology, among others. The company should review technology needs, have in house group and individual training, improve on a learning culture and reward and implement innovations. More fundamentally, all employees should be turned into marketers of the firm. Also short term products should be developed as well as empowerment of employees to work from wherever they are. IT improvement such as teleconferencing and working from outside the official roofed home should be encouraged. Above all performance management for effectiveness whereby employees` performance is pegged on surpassing key performance indicators should be prioritized.