Capacity management and service delivery of commercial banks in Kenya
The capacity of a firm to satisfy demand in a timely manner and at a reasonable cost is one of the main objectives in an organization because of its attendant benefit to the organization as well as to the customers being served. A firm capacity management is concerned with matching its capacity of the operating system and the demand placed on that system by the customers and involves decision making on matters relating to planning, analyzing and optimizing capacity to satisfy demand in a timely manner and at a reasonable cost. The firm‘s ability to meet demand forecast can influence its customer satisfaction which in turn is influenced by service delivery system that is in place. On this basis, the study aimed at establishing the capacity management practices adapted by commercial banks in Kenya and how the same affects service delivery. A descriptive research design whereby all the 42 commercial banks in Kenya formed the sample frame. The primary data was collected using the questionnaire as the primary research instrument. The findings was that the common capacity management practices employed by the banks shifting capacity, offloading capacity, sub-contracting and level capacity management. Of these, the popular capacity management was shifting capacity which involved enhancement of employee capacity through offering staff training to enable them to handle more than one task and therefore being able to be redeployed when the need arise, offering overtime services to the staff such as paying them at a premium in times when they work outside the normal working hours as well as providing transport services for the staff. The study indeed found that the capacity management practices employed by a bank has a positive influence on the service delivery of the banks. The conclusion was that there is an interaction between capacity management practices that a firm adopts, quality of service, and resources productivity or efficiency management which is at the heart of the planning and control process for operations management in services production. The study recommends that the managers of the Kenyan commercial banks should embrace fully capacity management strategies such as introduction of systems in which the customers can be able to serve themselves without the intervention of the bank employees. As a limitation, the survey design adopted might not have allowed for the capture of potentially important control variables that facilitate the interactions and influence of actions and performance by other functions in the organization.