The extent to which banks in Kenya apply the concept of strategic grouping

Abstract

The topic of the research project was on the extent to which banks in Kenya apply strategic group concept. The main objective of the study was to determine whether banks in Kenya apply strategic group concept and the extent of its application. The survey intended to benefit the government, the banks operating in Kenya and future researchers. The research questions were systematically generated from the objectives. In the data analysis, descriptive statistics were used to help draw comparisons and conclusions based on the results. Pie charts were among mode of descriptive statistics used in the presentation of the results which mostly had two categories. Tables of frequencies were used to present the results most of which had more than two categories. It was assumed in the data analysis that the results obtained were quite representative for the general population considering that the sampled size was the entire population of all the banks in the Kenyan banking industry. The conclusions of the study are based on the research questions leading to the main purpose of the study. First, the banks are applying the concept of strategic grouping. Secondly, the banks in Kenya are symmetrical to a great extent in, their degree of vertical integration, formal organization, cost structure, their degree of product differentiation and control systems. The banks from the research data indicated that they follow the same or a similar strategy along the strategic dimensions of other banks in the Kenyan banking industry, since their clients are the same, banking is a service and it allows comprehensive and compact strategy. The banking industry is a set of firms competing within an industry. Thirdly, the key factors that have bound the banks in the banking sector in Kenya to a great extent are: similar marketing models, strategic group stability, similar management construct, market-related strategies, similar -high annual advertising, similar cognitive research, similar firm characteristics and similar decision-making. Lastly, the key benefits that have resulted from strategic grouping in the banking sector in Kenya to a great extent are: good after sales service, good client service, quick client service delivery, allowing competitive dynamics over time to be effectively measured and evolutionary pathways. Raced; being readily accessible to, and useable by, managers.