CompetitiveAdvantage Practices and Performance of Commercial Banks in Nairobi County Kenya

Abstract

Due to rising rivalry in the Kenyan banking sector in recent years, some banks have modified
 important procedures to strengthen their competitive edge. As a result, this study concentrated
 on the performance and competitive advantage strategies of commercial banks in Nairobi
 County, Kenya, using Equity Bank, Kenya Commercial Bank, Absa, and Family Bank as
 examples. In the recent past, a number of issues, including operating cost efficiency, capital
 deficiency, and liquidity, have affected the performance of commercial banks. Finding out
 how differentiation strategy, innovation, focus strategy, and cost leadership work was the aim
 of the research. Among the theories used are the balanced scorecard model, resource-based
 perspective, stakeholder, and Porter's Five Forces. Using a case study methodology, the study
 asked respondents about the procedures that Nairobi County's commercial banks followed. It
 also looked at how these approaches improve county performance. The dependency between
 the independent variables—differentiation, focus strategy, cost leadership, and innovation—
 and the dependent variable—performance—is explained by the regression model correlation
 coefficient summary. With an emphasis on branch managers, regional managers, and
 departmental managers, the study's primary respondents were staff members and clients of
 the commercial banks in Nairobi County that were sampled. Open-ended questions on
 surveys were used to gather data. A reliability test was conducted, and multiple regression and
 inferential statistics were used for analysis. It is anticipated that the government, future
 scholars, and Equity Bank management would find the four primary practices beneficial.
 According to the study's findings, commercial banks use differentiation approach to provide
 their clients something special, unusual, and different from what their rivals could sell. In
 order to add originality to current product lines or processes and boost market share, revenue,
 and customer happiness, innovation is essential. The focus strategy pinpoints the market
 niches in which the bank can successfully compete. Every product and sector has a varied
 market size when the cost leadership strategy is used. According to the survey, commercial
 banks should develop or generate really original or distinctive goods or services that provide
 value for customers. In addition to establishing cooperative ties with their business partners