Logistics Management Practices and Operational Performance of Commercial Banks in Kenya

Abstract

Stock and Mulki, (2009) observe that the examination of logistics management practices has become more prominent in both the business community and academia in recent years, spanning such diverse areas as recycling, reinventing, information technology, warehousing, operations, and environmental sustainability among others. The purpose of this study was to determine the relationship between logistics management practices and operational performance of commercial banks in Kenya. In this study, descriptive research design was used and the study involved all the 42 commercial banks licensed by CBK to operate in Kenya. Both primary and secondary data were used. Both descriptive and regression analysis were employed in the study. The study found commercial banks generally embrace logistics management practices to a great extent. Such practices include information technology, inventory control practices, transport and traffic practices as well as engineering practices. The study found that there is no significant relationship between logistics management practices and financial performance of commercial banks in Kenya. The study further found that large banks embrace logistics management practices much more than small and medium size banks in virtually all aspects of logistics management practices studied.