BUSINESS PROCESS RE-ENGINEERING PRACTICES ON ORGANIZATIONAL PERFORMANCE OF SELECTED COMMERCIAL BANKS IN NAIROBI CITY COUNTY KENYA

ANNE MUEMA

Master of Business Administration (Strategic Management Option),

Kenyatta University

Dr. FELISTUS HILDA MAKHAMARA

Department of Business Administration, School of Human resource,

Kenyatta University

CITATION: Muema, A & Makhamara, H. F (2019). Business Process Re-Engineering Practices on Organizational Performance of Selected Commercial Banks in Nairobi City County Kenya: International journal of strategic management. Vol. 8(7) pp 54 – 70.

ABSTRACT

The organizational performance of Kenya commercial banks in Nairobi City County had continually declined of due to stiff competition from other financial institutions. The innovation of lending applications and mobile banking had given room for loan defaults by customers from the main banks hence reduced organizational performance. The main study objective was to establish influence of business process reengineering practices on organizational performance of commercial banks in Nairobi City County, Kenya. Specifically, the research sought to initiate the impact of leadership change, customer focus, information technology and innovation on organizational performance of Commercial banks in Nairobi City County, Kenya. The study scope was limited to Nairobi County commercial banks. The study focused on 43 commercial banks in Nairobi city County, Kenya. A descriptive research design was utilized for the study. A population of 1020 staffs from the 43 commercial banks at Nairobi headquarters in Kenya was used, where a sample of 278 staffs was selected. The researcher based the study on Resource Based View Theory, Institutional Theory and Stakeholder Theory. A descriptive design and stratified sampling were utilized for the research. The study utilized primary information. The data gathered was analysed using inferential and descriptive statistics. Multiple linear regressions was used. The study revealed that leadership change maintaining all the other factors constant would positively change commercial bank performance. Customer focus had a significance influence on commercial banks performance. Most banks identify all its customers and address customer’s complaint immediately. An information technology change while keeping other factors constant could affect commercial bank performance. Most banks had introduced new technologies and adoption of M-commerce was growing fast in the bank. A unit increase in innovation holding all the other factors constant would positively change commercial bank performance. The study recommended that firms needed to invest in information technology and educate their employees on how to use the technologies to reduce operation costs, increase operation speed and improve service and product quality. The research also recommended that studies in the future need to focus on non-commercial banks since the current study was only limited to commercial banks in Kenya.

Keywords: Business Process; Re-Engineering; Practices; Organizational Performance; Commercial Ban

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