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EFFECT OF STRATEGIC KNOWLEDGE MANAGEMENT ON PERFORMANCE OF COMMERCIAL BANKS IN KENYA

Esther Wacuka Gakuo - Master of Business Administration, Jomo Kenyatta University of Agriculture and Technology, Kenya

Dr. Gladys Rotich - Jomo Kenyatta University of Agriculture and Technology, Kenya


ABSTRACT

Globalization, rapid technological developments and dynamic business environment have contributed to uncertainty and unpredictability in all sectors which have emphasized the importance of the ability of an organization to adapt to unexpected changes. To cope with changes in business environment, organizations are embracing the concept of strategic knowledge management (SKM) as a process of gathering, managing and sharing employees' knowledge capital throughout the organization to ensure organizational effectiveness. Knowledge sharing throughout the organization enhances existing organizational business processes, introduces more efficient and effective business processes and removes redundant processes. Many organizations are agreeing that to grow, stay competitive and survive, they have to constantly change their strategies to meet new business demands and this explains the growth of interest in knowledge management over the last decade. The study adopted a descriptive research design. This approach was suitable for this study, since the study intended to collect comprehensive information through descriptions which would be helpful for identifying variables. The target population of this study was 322 management staff working in the bank’s headquarters. The study focused more on the top, middle and low level management staffs who are directly dealing with the day to day management of the bank since they are the ones conversant with the subject matter of the study. The study was employed stratified random sampling technique in coming up with a sample size of 146 respondents from a total of 322 of representatives of management staff. The primary research data was collected from the management staff. Data analysis tool that was dependent on the type of data to be analyzed depending on whether the data was qualitative or quantitative. The quantitative data in this research was analyzed by descriptive statistics using statistical package for social sciences (SPSS) version 21. Content analysis was also be used in processing of this data and results presented in prose form. In addition, a multivariate regression model was applied to determine the relative importance of each of the four variables with respect to performance. Data was presented in tables, charts and graphs. The results showed that that knowledge acquisition significantly affects performance of commercial banks in Kenya. The analysis of the findings deduced that knowledge conversion significantly influence organizational performance of commercials banks. The findings of the study showed that knowledge protection had great effect on performance of commercial banks in Kenya. The research established that knowledge applications affect the performance of commercial banks in Kenya to a great extent. Based on the research findings, the study concludes that knowledge management processes capability is key in achieving performance of commercial banks in Kenya. To enhance the level of KM the commercial banks in Kenya, the study makes the following suggestions; Managers of commercial banks of Kenya should understand and develop a better way of implementing an overall KM which is composed of acquisition, conversion, protection and processes. The managers of commercial banks of Kenya should improve knowledge acquisition in their organization. The managers of commercial banks of Kenya should coordinate and synchronize internalization, externalization and socialization in the organization in order to establish their significant effect on performance of the organization.  


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