Influence of Change Management Strategies On Performance of Commercial Banks in Kenya

Abstract

Commercial banks in Kenya have faced low growth over the years, leading to closures, mergers, and exits from the market, resulting in job losses and stalling industrial development. This study investigated the influence of change management strategies on the performance of commercial banks in Kenya. Specifically, the study assessed the impact of communication, employee involvement, resource allocation, and monitoring on bank performance, anchored on Kotter’s 8-Step Model for Change, Kurt Lewin’s Change Management Model, and Enterprise Risk Management Theory. The study utilized a descriptive research design. Targeting 39 commercial banks and 190 middle-level managers, stratified random sampling selected 129 respondents. Data was collected through online and physical questionnaires for primary data, and financial statements and magazines for secondary data. Quantitative analysis utilized descriptive and inferential statistics, while qualitative data was analyzed thematically. Findings revealed significant positive relationships between performance and communication (β=0.200, p=0.0307), employee involvement (β=0.407, p=0.001), resource allocation (β=0.536, p=0.001), and monitoring (β=0.156, p=0.009). The study concluded that robust communication, effective resource allocation, proactive monitoring, and employee involvement significantly enhance performance. The study recommended robust feedback mechanisms, effective financial planning, and proactive auditing to strengthen performance during change initiatives.