RELATIONSHIP BETWEEN STRATEGY...

download RELATIONSHIP BETWEEN STRATEGY ...chss.uonbi.ac.ke/sites/default/files/chss/RELATIONSHIP...RELATIONSHIP BETWEEN STRATEGY IMPLEMENTATION AND PERFORMANCE IN COMMERCIAL BANKS IN KENYA

of 72

  • date post

    02-Apr-2018
  • Category

    Documents

  • view

    213
  • download

    1

Embed Size (px)

Transcript of RELATIONSHIP BETWEEN STRATEGY...

  • RELATIONSHIP BETWEEN STRATEGY IMPLEMENTATION AND

    PERFORMANCE IN COMMERCIAL BANKS IN KENYA

    BY

    WINSTONE NJAGI MUCHIRA

    RESEARCH PROJECT SUBMITTED IN PARTIAL FULFILMENT OF

    THE REQUIREMENTS OF THE DEGREE OF MASTER OF BUSINESS

    ADMINISTRATION, SCHOOL OF BUSINESS, UNIVERSITY OF

    NAIROBI

    NOVEMBER 2013

  • ii

    DECLARATION

    This project is my original work and has not been presented for the award of a degree in

    this University or any other Institution of higher learning for examination.

    Signature Date .

    WINSTONE NJAGI MUCHIRA

    D61/63041/2011

    This project has been submitted for examination with my approval as the University

    Supervisor.

    Signature Date

    DR KITIABI

    University of Nairobi

  • iii

    DEDICATION

    This project is dedicated to my lovely wife Ann, my sons; Dan and Isaac and my

    daughter Joy for their love, care, support and encouragement.

  • iv

    ACKNOWLEDGEMENT

    I am humbled to God for His abundance grace and for good health throughout my

    studies and for bringing me this far.

    I sincerely thank the lecturers and the academic staff in the School of Business,

    University of Nairobi and especially my supervisor Dr Kitiabi for her valued advice,

    constant guidance and most of all for her patience and understanding.

    I also acknowledge my dear parents, Mr and Mrs Muchira for their prayers, love, care,

    and encouragement and my wife, kids, brothers and sister who encouraged me

    throughout the study period.

    My appreciation further goes to my classmates, with whom I weathered through the

    storms, giving each other encouragement and for their positive criticism.

    Although it has not been possible to mention by name all those people that helped me in

    one way or another to make my work a success, to you all I say thank you and God

    Bless you abundantly.

  • v

    ABSTRACT

    Strategy implementation involves organization of the firm's resources and motivation of

    the staff to achieve objectives. Organisationals performance is the measure of standard

    or prescribed indicators of effectiveness, efficiency, and environmental responsibility

    such as, cycle time, productivity, waste reduction, and regulatory compliance. The

    objective of this study was to assess the relationship between strategy implementation

    and performance in commercial banks in Kenya. The study was a cross-sectional survey

    as it sought to describe data and characteristics about the population or phenomenon

    being studied. The target population for this study involved all the commercial banks

    operating in kenya. Both primary and secondary data was collected for the purpose of

    this study and analysed using descriptive statistics. From the study findings it was clear

    that strategy implementation influences organisation performance where organization

    use various measures such as organization use projected performance of competitors,

    organization goals, Past performance of the business and projected performance of

    organisation in other industrities to access their perfomance. On financial perfomance

    the study establsihed that implementation influence organization financial perfomance

    positively. The study concluded that implementation influence organization financial

    perfomance positively to a great extent resulting to increased organization profitability,

    business turnover and volumes of sale. On organization growth the study established

    that strategy implementation influence organisation growth at great extent. The

    researcher used questionnaires with both closed and open ended questions to collect

    data. Closed ended questions have the disadvantage of limiting the responses whereby

    the respondent is compelled to answer questions according to the researchers choice.

    However to mitigate this limitation the researcher ensure that the questions were well

    thought out and comprehensive enough to cover all important aspects of the study

    objectives. The study recommended that for the organization to perform effectively on

    its financial perfommance clear strategies that guides it operation should be formulated

    and guideline be provided to all concerned department in order to eradicate occurenec of

    compromise. On financial perfomance, the study recommended that in order for

    organization to achieve their goal such as profitability, large market share and customer

    retention, there should be effective strategies that cater for the customer need

    organization goal and environmental changes. The study also suggested further research

    to be done on impact of strategy implimentation on organization perfomance in other

    institutions in order to depict reliable information that illustrates real situation in across

    all sectors.

  • vi

    TABLE OF CONTENTS

    DECLARATION ............................................................................................................. ii

    DEDICATION ................................................................................................................ iii

    ACKNOWLEDGEMENT ............................................................................................. iv

    ABSTRACT ..................................................................................................................... v

    LIST OF TABLES .......................................................................................................... ix

    LIST OF FIGURES ......................................................................................................... x

    LIST OF ABBREVIATIONS/ ACRONYMS .............................................................. xi

    CHAPTER ONE: INTRODUCTION ........................................................................... 1

    1.1 Background of the Study ......................................................................................... 1

    1.1.1 Concept of Strategy .......................................................................................... 1

    1.1.2 Strategy Implementation .................................................................................. 3

    1.1.3 Commercial Banks in Kenya ............................................................................ 5

    1.2 Research Problem .................................................................................................... 7

    1.3 Research Objective .................................................................................................. 9

    1.4 Value of the Study ................................................................................................... 9

    CHAPTER TWO: LITERATURE REVIEW ............................................................ 11

    2.1 Introduction ........................................................................................................... 11

    2.2 Theoretical foundation .......................................................................................... 11

    2.3 Organisational Performance .................................................................................. 13

    2.4 7s Model, Strategy Implementation and Performance .......................................... 14

    2.5 Strategy Implementation and Performance ........................................................... 17

    2.6 Challenges in Strategy Implementation ................................................................ 20

    CHAPTER THREE: METHODOLOGY ................................................................... 22

  • vii

    3.1 Introduction ........................................................................................................... 22

    3.2 Research Design .................................................................................................... 22

    3.3 Population of the Study ......................................................................................... 23

    3.4 Sampling ................................................................................................................ 23

    3.5 Data Collection ...................................................................................................... 24

    3.6 Data Analysis ........................................................................................................ 25

    CHAPTER FOUR: DATA ANALYSIS, RESULTS AND DISCUSSION ............... 26

    4.1 Introduction ........................................................................................................... 26

    4.2 Demographic Characterization of the Respondents .............................................. 26

    4.2.1 Gender of the Respondent .............................................................................. 26

    4.2.2 Age ................................................................................................................. 27

    4.2.3 Highest level of education .............................................................................. 28

    4.3 Strategy Implementation ....................................................................................... 29

    4.3.1 Extent that Strategy Implementation Influences Organisation Performance . 29

    4.3.2 Measures of Future Organization Performance .............................................. 30

    4.3.3 Aspects of Organization Perfomance and Strategy Implemetation ................ 31

    4.4 Fin