Response to Business Turbulence by Kenya Commercial Bank

Abstract

Purpose: Understanding the environmental changes in the banking sector and their effect on banking business could help the players in the banking industry develop rational strategies to effectively respond. This study sought to examine the strategic responses to business turbulence by Kenya Commercial Bank. The study was guided by the following specific objectives: to determine the environmental factors that affect the business of Commercial Banks in Kenya; to  establish the strategic responses which have been employed by Kenya Commercial Bank to cope with the business turbulence; and to suggest possible response mechanisms that could be used by Kenya Commercial Bank.Methods: The survey method was used to collect data. Since the Kenya Commercial Bank branches to be studied are located in Nairobi and its environs, the researcher administered the questionnaires by hand delivery. In addition, the researcher conducted personal interviews with ten randomly selected respondents using a list of open ended questions, aimed at clarifying certain issues that had not been well responded to in the questionnaires. Analysis: The data pertaining to profile of respondents was analyzed by employing content analysis while descriptive statistics were used to analyze data pertaining to objectives of the study. The findings pertaining to the three objectives of the study were presented in form of frequency tables, percentages, charts, graphs and mean scores. Results: Findings of the study show that the factors that environmental factors causing business turbulence include an unstable political climate, Government regulations liberalization of the financial sector, socio-cultural factors, abrupt and rapid changes in Information and Communication Technology (ICT), competition and changing Customer Preferences. The responses to business turbulence by Kenya Commercial Bank include adoption of product diversification, market differentiation, increased branch network, personal selling, offering products and services online, reduction of premiums costs and related charges.

Keywords: Turbulence, Kenya Commercial Bank,