A survey of business growth strategies used by Commercial banks in kenya

Abstract

Businesses in the real world are faced by a challenge to either grow their portfolio or shut down due to the state of competition in many industries. The shareholders also demand value for their investments. Managers in these organizations have to craft and implement strategies that will spur growth. This study focused on the basic growth strategies being used by Commercial Banks in Kenya and especially in the last ten years up to year 2010 to grow and maximize return to their shareholders. The study adopted a descriptive census survey of all the commercial banks in Kenya. The population of interest was all the commercial banks in Kenya. The type of data to be collected was both primary data and secondary data. The researcher collected primary data by the use of questionnaires, which contained both open-ended and close ended questions. Secondary data was collected from the respective banks financial reports and management reports on performance especially the business growth strategies in use in their banks. Descriptive analysis which aims at finding out what, where and how of a phenomenon was used mainly to summarize the data collected. The data was presented using statistical measures such as bar graphs, frequency tables and graphical presentations. The study concludes that commercial banks in Kenya have employed business growth strategies. These include product development as the main strategy, market development and diversification strategies. The study further concludes that there were various factors that influence growth strategies adopted by commercial banks in Kenya. These included better performing economy, improved technological factors and management changes in senior management leading to better strategy implementation and hence increased growth The study recommends that commercial banks in Kenya need to employ various growth strategies in order to stay competitive and increase productivity and growth. Low performing commercial banks need to merge with better performing banks to boost growth of their operations. In addition, commercial banks in Kenya need to invest in technology and market penetration methods such as increasing number of bank branches in various locations to target more customers and hence boost growth