Influence of Strategic Management Practices On Organizational Performance of Savings and Credit Co-Operative Societies in Kiambu County, Kenya

Abstract

Kenya's cooperative societies are essential to the nation's development because they give their members access to reasonably priced financing options and financial guidance. Because the business environment is always changing, companies must regularly revise their strategies in order to stay competitive. However, low customer deposit and increased nonperforming loans has been the most significant issue threatening SACCO performance in Kenya. (KUSCCO, 2018; SASRA, 2022). These cooperative societies suffer from a number of issues, including the lack of strong institutional strategies and laws, low trained staff, hence resulting to incompetent administration, weak leadership that supports the implementation of poorly researched pricing strategies, insufficient governance, and political interference. The study's objective was to determine the influence of strategic management practices on organizational performance of savings and credit co-operative societies in Kiambu County, Kenya. The specific objectives were to establish the influence of innovation strategies, customer relations strategies, staffing strategies, and pricing strategies on the organizational performance of SACCOs in Kiambu county. The research was based on open systems analysis, institutional theory, and resource-based theory. The research was descriptive with a population of 62 SACCOs in Kiambu County and a total of 250 employees under consideration. The study randomly selected 154 employees. The researcher utilized questionnaires with both closed and open questions to gather primary data. Before administering all the questionnaires to employees, a pilot study of 15 respondents was applied where a Cronbach alpha of more than 0.7 was considered an appropriate reliability score measure. Frequency, percentage, standard deviation, and mean, were used for descriptive statistics. To analyze the link between the variables, the research used regression analysis whereas content analysis was used to analyze qualitative data. Results were presented on, tables, graphs, and narratives. The innovation strategy correlations r= 0.443 at a p-value of 0.001<0.05; Customer relation strategies’ correlations r= 0.511 at a p-value of 0.001<0.05; Staff training strategies’ correlations r= 0.346 at a pvalue of 0.000<0.05; and product pricing strategies’ correlations r= 0.544 at a p-value of 0.000<0.05. Therefore, since all the variables had correlations of less than 1 and p-values of less than 0.05, the study rejected all null hypothesis and concluded that innovation strategies, customer relations strategies, staff training strategies, and product pricing strategies had a significant influence on organizational performance of SACCOs in Kiambu County. The study came to the conclusion that the success of SACCOs in Kiambu County was significantly impacted by creative tactics, customer relationship strategies, staff training strategies, and product price strategies. To improve performance, the report suggests that SACCOs deepen their current partnership with fintech firms. The study also recommends an enhancement of training and capacity building for the staff to strengthen the customer service relations skills which are tailor-made to focus on communication and problemsolving capabilities. In addition, SACCO should promote a culture of continuous learning to enhance improvement among the employees through regular training, recognition for improvement, and feedback mechanisms to enhance organizational performance as well. Lastly, the study recommended the application of diversified pricing strategies such as competitive pricing, cost-price strategies, and tailor-made pricing strategies to enhance the SACCOs' organizational effectiveness in Kiambu County.