Influence of Strategy Implementation on Performance of Financial Services Associations in Kenya. A Survey of Makueni and Kitui Counties

Abstract

Statistics indicated that three financial service associations (FSAs) closed down their business activities in Kitui and Makueni counties between the years 2019 and 2022 which has negatively affected the accessibility to credit among new start-ups in the region, which has indirectly caused insecurities through loss of jobs and livelihood among the residents. This study examined the influence of strategic implementation performance of FSAs in Kitui and Makueni Counties. The specific study objectives implementations were to: establish the influence of organizational structure, strategic leadership, organizational culture, and organizational resources on the performance of FSAs. Anchoring theory was resource base-view theory. Other theories included were stakeholder, stewardship, and communication theories. The study applied a descriptive survey design. The population of interest in the study was middle-level managers working in 37 FSAs in Kitui and Makueni counties. 938 middle-level managers were the target respondents for the study. The sample for the study was 280, achieved through the stratified-random sampling method. This study used electronic and hard copy questionnaires delivered in person at the offices of the target respondents. The research used both qualitative and quantitative methods to analyze the data. Content analysis for the open questions was done through thematic analysis of concepts arising from the data collected. On the quantitative data, both descriptive and inferential analysis were mainly used for data analysis. The inferential analysis involved a binary logistic regression analysis. Results of the study were presented through tables, charts, and narratives for interpretation and discussion of findings. The study obtained 264 responses. This study deduced that the organizational structure consisted of a Wald of 7.572, which was associated with a p-value of 0.006 and an odds ratio of 3.559. The study found a Wald of 13.357 with a p-value of 0.001 and an odds ratio of 1.302. The study also revealed Wald statistics for Innovative culture, Market culture, and Hierarchy culture as (0.014,3.358 and 0.002) whereas the p values corresponding with Wald statistics were (0.906, 0.067, and 0.968) respectively. The study finally found that Organizational Resources had a Wald of 18.439 which was associated with a p-value of 0.001 and odds ratio of 6.411. The study concluded the study variables of structure, leadership, and organizational resources had a positive significant impact on the performance of FSAs. The study recommended that FSAs ensure that they align their structures with the overall business strategy to implement the strategy through the right organizational structure. The strategic leaders in the FSA need to develop a very clear vision and mission and communicate it often to all other employees. The FSAs should encourage employees to work together and communicate freely and openly to ensure they share ideas, insights, and feedback that can lead to better performance. FSAs also need to continuously reassign resources to cope with emerging demands for resources during strategy implementation. Allocating resources should be done where there is a high-value achievement. The study recommends for a future study where more variables are added to the model to improve its prediction of performance, the additional variables can be moderating or intervening variables. Future studies should consider expanding the geographical scope to include FSAs across other counties in the country to overcome current study scope limitations.