| dc.description.abstract | The dynamics of change in the business environments catalysed by globalization, changing
consumer preferences and whirlwind development of technology have exerted immense
pressure on commercial banks to develop strategies for sustainability. Strategic innovation has
thus become the vital tool for survival and development. This study examined the influence of
strategic innovation on the competitiveness of Commercial Banks in Kenya. The study was
guided by the following research objectives: To identify the influence of product innovation
on competitiveness of commercial banks in Kenya, to investigate the influence of marketing
innovation on competitiveness of commercial banks in Kenya, to establish the influence of
service innovation on competitiveness of commercial Banks in Kenya, to examine the
influence of managerial innovation on competitiveness of commercial Banks in Kenya and to
determine the moderating influence of environmental factors on the relationship between
strategic innovation and competitiveness of commercial banks in Kenya. The study was guided
by Creative Destruction theory and supported by RBV, Dynamic Capability and Contingency
theories. The study utilized a positivist research philosophy. Descriptive and correlational
research designs were used. The target population consisted of 175 directors and general
managers of tier one commercial banks based in head office and in the following departments:
R&D, Marketing and Communication, Customer Service, Credit and Payments. Banks were
classified into tiers through stratified sampling. Managers were classified into directors and
general manager levels. Simple random sampling was then employed to select 122
respondents. Primary data was collected using closed and open-ended questionnaires. A pilot
study was conducted in Equity bank. To ensure content validity, the research questionnaire
was subjected to thorough examination by two university supervisors and two experts from
bank sector. The study adopted Principal Component Analysis approach to test for the
construct validity. Descriptive and inferential analysis was utilized. Descriptive analysis
included the use of frequencies, percentages, mean and standard deviation while inferential
statistics employed correlation and regression analyses. Correlation was done using Pearson’s
product moment while regression was conducted using simple linear regression, multiple
regression and hierarchical regression models. Data collected from open ended questionnaire
was analyzed using content analysis. Results were presented in form of tables, graphs and pie
charts. The study found out that product innovation, market innovation, service innovation and
managerial innovation influenced competitiveness of commercial banks in Kenya. The study
similarly concluded that product innovation had the most significant influence on commercial
banks competitiveness followed by market innovation. The study equally revealed that
environmental factors moderated the relation between strategic innovation and
competitiveness of commercial banks in Kenya. The findings may help various policy makers
with vital recommendations to enhance adoption and implementation of strategic innovation
activities in the banking sector in Kenya. The results of this study also add into the pool of
knowledge in the field of strategic management through appreciation of the role of strategic
innovation on attainment of competitiveness in firms. The study thus recommends that
commercial banks apply practices associated with product innovation, market innovation,
service innovation and managerial innovation to improve competitiveness. | en_US |
