Organizational Agility and Organizational Performance of Commercial Banks in Nairobi City County, Kenya
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Date
2024-01
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Kenyatta University
Abstract
The business environment globally is dynamic, exerting strong influences on institutions. Strategic
management has over time been characterized with variations as a result of the dynamics of
organizational management. As such, it remains vital for organizations to have direct or indirect
adjustment as regards to those changes posing as threats to their performance as well as survival
In Kenya, the commercial banks are responsible for providing transaction services such as
withdrawals and deposits, investment options and loan services to the citizens. Due to globalization
and evolving technologies, banking institutions in Kenya have been faced with declining
performances, increased inflation, competition and new prudential regulations. Various studies
have been carried out at different geographical areas, using different methodology and different
indicators. This research aimed to investigate the influence of organizational agility on the
performance of commercial banks in Kenya. Specifically, it sought to explore the effects of
innovation agility, information technology agility, and human resource agility on the
organizational performance of Kenya commercial banks. The study drew support from
institutional, learning organization, and contingency theories. The research design employed was
descriptive, and primary data were gathered through the distribution of questionnaires. The target
population included 43 commercial banks operating in Kenya, with a proportional stratified
sampling technique applied to three tiers. Purposive sampling was used for seven departments, and
random sampling was applied to senior managers, IT managers, and HR managers. A pilot test
ensured the validity and reliability of the questionnaire, incorporating content validity and
Cronbach's Alpha internal consistency test. Statistical Package for Social Sciences (SPSS)
facilitated the analysis of data, employing multiple regression analysis and descriptive statistics.
The results, presented in tables, indicated that the three-agility metrics—Innovation Agility,
Information Technology Agility, and Human Resource Agility—could collectively predict
approximately 86.8% of the variance in overall performance. Notably, Information Technology
Agility demonstrated a statistically significant positive impact on organizational performance with
a coefficient of 0.244. Human Resource Agility had the most substantial positive impact, reflected
in a coefficient of 0.509. However, while Innovation Agility exhibited a positive coefficient with
performance (0.210), it did not attain statistical significance.
Description
A Research Project Submitted to the School of Business, Economics and Tourism in Partial Fulfillment of the Requirements for the Award of Degree of Master of Business Administration (Strategic Management) of Kenyatta University January, 2024
Supervisor
mary rugui