Strategic responses to changes in the external environment: the case of Kenya Re-Insurance Corporation
The environment in which organizations operate is constantly changing with different factors influencing organizations. Since the turn of the millennium, the general business environment has become more volatile, unpredictable and very competitive. The days when firms could simply wait for clients to beat a path to their door are long gone. Organizations must realize that their services and products, regardless of how good they are, simply do not sell themselves. Decisions by managers have a strategic impact and contribute to strategic change. This study was designed to determine environmental changes that face Kenya Reinsurance Corporation and to identify the responses adopted by the company to deal with the changes in the external environment. The study was carried out using a case study design. Data was collected using a semi-structured questionnaire which was administered using drop and pick method. Several personal visits to the premises were held to prompt the respondents to respond. The sample size for the study was 15 managers in the company. Secondary data was also used to corroborate the data from the primary sources. Statistical Package for the Social Sciences (SPSS) was used to generate data which was analyzed using descriptive statistics. The study found out that the company faces a lot of challenges from economic, regulatory to technological factors. The most prevalent challenges came from the economic environment. The company has responded to challenges in the economic environment by increasing the level of capitalization and diversification of investments. To deal with the technological challenges, the company has introduced new systems and automated its operations. Technical staff has also been hired to enable the company venture into highly technical businesses. These findings have implications for the company and the policy makers in the insurance industry.