Convergence between Safaricom Kenya limited and Kenya Commercial Bank group

Abstract

Business environment today has become complex, competitive and demanding. Customers are also increasingly becoming aware and demanding of effective and faster services. Corporate organizations have positioned themselves in different ways in response to the current demands. Convergence is one of such strategies that have been adopted - world over. The main objective of this paper was to investigate on the effect of convergence between Kenya Commercial Bank Group and Safaricom Kenya Limited on the provision of financial services to the Kenyan market. The study also sought to determine the challenges facing the convergence between Kenya Commercial Bank Group and Safaricom Kenya Limited; to find out the drivers of the convergence between Kenya Commercial Bank and Safaricom Kenya Limited; and to determine the benefits of the convergence between Kenya Commercial Bank and Safaricom Kenya Limited. This study adopted an exploratory descriptive design. The target population was 322 staff working in finance, corporate strategy, marketing, risk management, legal and regulatory departments in both Safaricom Kenya Limited and Kenya Commercial Bank Group. This study used stratified random sampling to select 30% of the target population. The sample size of the study was 51 staff working in Safaricom Kenya Limited and 46 staff working in Kenya Commercial Bank Group. The study used primary data which was collected by use of semi structured questionnaires. Quantitative data was analyzed by use of Statistical Package for Social Sciences (SPSS) version 21. Data was then presented in graphs and tables. On the other hand, content analysis was used to analyze qualitative data and the findings were presented in a prose form. The study established that the convergence between Kenya Commercial Bank Group and Safaricom Kenya Limited was facing various challenges like lack of coordination between management teams, staff integration, clash of organization cultures, lack of trust, lack of skills and competency to manage advanced levels of technology, lack of clear goals and objectives, government regulations and high cost of technological infrastructure. The study also found that increased level of awareness on consumer rights necessitates partnership between commercial banks and telecommunication companies to meet customer needs. The study recommends that both organizations should have training programs so as to equip their staff members with enough skills to manage the high level of technology. The study also recommends that the organizations should constantly and frequently hold cross functional meetings to resolve any issues and escalations to the right offices to make decisions in case of any stalemate