Theses & Desertations

SUPPLY CHAIN COST OPTIMIZATION, INFORMATION SHARING AND COMPETITIVENESS OF FOOD AND BEVERAGE MANUFACTURING FIRMS IN UASIN GISHU COUNTY, KENYA

Wed, 01 Jan 2025 00:00:00 GMT

SUPPLY CHAIN COST OPTIMIZATION, INFORMATION SHARING AND COMPETITIVENESS OF FOOD AND BEVERAGE MANUFACTURING FIRMS IN UASIN GISHU COUNTY, KENYA KIPTOO, RACHEL JEROTICH The food and beverage processing sector in Kenya are vital to the national economy due to its role in job creation and its contribution to GDP. However, its competitiveness has faced challenges stemming from high operational costs and inefficient supply chain processes. This study examined the moderating effect of information sharing on the relationship between supply chain cost optimization and the competitiveness of food and beverage manufacturing firms in Uasin Gishu County, Kenya. Specifically, the study investigated how inventory management, strategic sourcing, adoption of technology, and logistics costs influence firm competitiveness, and how information sharing moderates these relationships. The study was guided by the Resource-Based View Theory, Lean Manufacturing Theory and Information Sharing Theory. An explanatory research design was adopted, targeting 924 departmental staff across 22 food and beverage firms. A sample of 279 respondents was selected using Yamane’s formula and simple random sampling employed. Data was collected through structured, closed-ended questionnaires, and a pilot study in Nakuru County was conducted to validate the research instrument. Data analysis was performed using SPSS version 25, incorporating both descriptive and inferential statistics, including correlation and hierarchical regression analyses. Findings revealed that inventory management (β1 = 0.152, p = 0.004), strategic sourcing (β2 = 0.173, p = 0.001), adoption of technology (β3 = 0.232, p = 0.001), and logistics cost (β4 = 0.300, p = 0.000) significantly and positively influenced competitiveness. Furthermore, information sharing significantly moderated the relationships between inventory management (β = -0.103, p = 0.002), strategic sourcing (β = 0.059, p = 0.010), technology adoption (β = 0.087, p = 0.009), and logistics cost (β = -0.182, p = 0.002) and competitiveness. The study concluded that effective supply chain practices, enhanced by robust information sharing mechanisms, play a critical role in strengthening firm competitiveness. The study recommends that food and beverage firms adopt modern inventory systems, invest in advanced technologies with adequate employee training, foster long-term supplier relationships, and optimize logistics through lean practices. Importantly, firms should institutionalize information sharing to enhance coordination, responsiveness, and strategic alignment across supply chain functions, ultimately boosting competitiveness and performance. The study's findings would be valuable to food and beverage manufacturing firms by informing managers on optimizing limited resources for competitive advantage through supply chain cost efficiency, guiding the Ministry of Trade in policy formulation within Kenyan borders, and contributing to the broader academic discourse in supply chain management.

FINANCIAL INCLUSION, COMPETITIVE LANDSCAPE AND ORGANIZATIONAL PERFORMANCE OF SELECTED COMMERCIAL BANKS IN UASIN GISHU COUNTY

Wed, 01 Jan 2025 00:00:00 GMT

FINANCIAL INCLUSION, COMPETITIVE LANDSCAPE AND ORGANIZATIONAL PERFORMANCE OF SELECTED COMMERCIAL BANKS IN UASIN GISHU COUNTY JEPCHIRCHIR, VALLARY Organizational performance in Kenya continues to face challenges, as evidenced by a consistent decline in return on investment. For example, the Return on Assets (ROA) in the Kenyan banking sector dropped from 3.2% in 2022 to 2.8% in 2023, reflecting reduced profitability. The purpose of the study was to investigate the financial inclusion and organizational performance of selected commercial banks in Uasin Gishu County. The study was guided by four specific objectives; to investigate the influence of financial literacy, technology adoption, lending practices, and income levels on organizational performance of selected commercial bank, and a moderator to determine the influence of competitive landscape on the relationship between financial inclusion and organizational performance of selected commercial banks. This study was guided by the following theories; the systems theory of financial inclusion, organizational performance theory, and competitive/market landscape theory. The study adopted explanatory research design. The study targeted 748 employees. This study employed a stratified random sampling to select a sample of 261 respondents determined by Yamane formula. The study used questionnaires as the data collection tool. The study tested for reliability and validity and pilot study carried out in Nakuru County. Both descriptive and inferential statistics were utilized. Multiple regression analysis was used to determine the effect of financial inclusion on organizational performance whereas hierarchical multiple regression was adopted to test for the moderating effect. Results showed that a positive and significant effect of financial literacy (β = 0.289, p < 0.001), technology adoption (β = 0.161, p = 0.004), lending practices (β = 0.325, p < 0.001) and income levels (β = 0.122, p = 0.029) on bank performance. Hierarchical regression showed that competitive landscape significantly moderates the relationship between financial literacy and organization performance (β = 0.56, p < 0.05, R2Δ = 0.11), relationship between lending practices and the organizational performance of commercial banks (β = 0.53, p < 0.05, R2Δ = 0.08), and relationship between income levels and the organizational performance of commercial (β = 0.37, p < 0.05, R2Δ = 0.030). However, findings indicated that the competitive landscape does not significantly increase the explained variance of technology adoption on bank performance (β = 0.33, p > 0.05, R2Δ = 0.000). In conclusion, the study asserts that financial literacy, technology adoption, lending practices, and income levels are essential aspects of financial inclusion that significantly enhance organizational performance. Additionally, the competitive landscape plays a crucial role in shaping this relationship. Based on these findings, the study recommends that regulators implement standardized financial literacy programs to empower consumers. It is also essential to encourage the adoption of technological tools, ensuring the availability of user-friendly mobile and online banking platforms. Furthermore, banks should develop clear communication strategies that clearly outline lending processes and conditions. Conducting thorough market research to understand the diverse financial needs of various income segments is vital for creating suitable financial products, such as affordable loans and savings plans. Finally, banks should regularly perform competitive analysis to remain informed about market trends and competitor strategies, which can help them effectively, navigate the evolving financial landscape.

MODERATING EFFECT OF FINANCIAL LITERACY ON THE RELATIONSHIP BETWEEN ORGANIZATIONAL CULTURE AND FINANCIAL PERFORMANCE OF SMALL AND MEDIUM ENTERPRISES IN NANDI COUNTY, KENYA.

Wed, 01 Jan 2025 00:00:00 GMT

MODERATING EFFECT OF FINANCIAL LITERACY ON THE RELATIONSHIP BETWEEN ORGANIZATIONAL CULTURE AND FINANCIAL PERFORMANCE OF SMALL AND MEDIUM ENTERPRISES IN NANDI COUNTY, KENYA. KEMBOI, PHILIPH KIMUTAI Small and Medium Enterprises sector is a key driver of Kenyan economy as it contributes to the Gross Domestic Product and creates 80% of employment. However, most new businesses end up failing within their early years of operations because of their dismal financial performance. The main aim of the study is to examine the moderating effect of financial literacy on the relationship between organizational culture and financial performance of small and medium sized enterprises in Nandi County, Kenya. The specific objectives are to determine the effects of clan, hierarchy, adhocracy and market cultures on financial performance of small and medium sized enterprises in Nandi County, Kenya. Furthermore, the study examines the moderating effect of financial literacy on the relationship between clan, adhocracy, market, hierarchy cultures and financial performance of Small and Medium Enterprises. Resource Based View, Dual process and Agency Theories guided the study. The study utilized explanatory research design and cluster sampling technique to collect data from a sample size of 376 Small and Medium Enterprises obtained by use of Yamane formula from a target population of 6347 registered Small and Medium Enterprises in Nandi County, Kenya. Primary data was collected using self-administered closed- ended questionnaire. Cronbach’s alpha coefficient was used to test reliability and factor analysis to test the validity of research instruments. Data was analyzed through SPSS Version 23. Correlation and hierarchical regression analysis was used to ascertain the strength and direction of relationships between variables. The study findings indicated that Clan culture (β= 0.322, p=0.000), Adhocracy culture (β = 0.255, p=0.000), Market culture (β=0.140, p=0.012) and Hierarchy culture (β = 0.200, p = 0.000) had a positive and significant direct effect on financial performance. Results of the control variables indicate that firm age (β=.136, P = .045) significantly influences financial performance while firm size (β=.012, P=.898) does not. These control variables explain 1.2% of the variance in financial performance (R2 of .012 and ∆R 2 = 0.12). Additionally, the findings of the study revealed that financial literacy moderates the relationship between clan culture, (β = -0.157, p = 0.000, R2 = 0.618, ∆R2 = 0.032), adhocracy culture (β = 0.156, p = 0.011, R 2 = 0.625, ∆R2 = 0.007), hierarchy culture and financial performance (β = -0.186, p = 0.026, R2 = 0.631, ∆R2 = 0.006). Findings further revealed that Financial Literacy does not moderate the link between market culture and SME’s performance (β = -0.029, p = 0.688, R 2 = 0.625, ∆R2 = 0.000). ∆R2 indicates the variance in financial performance that moderation process accounts for. The study provides new knowledge to the literature that financial literacy moderates the relationship between clan culture and financial performance, adhocracy culture and financial performance, and lastly, hierarchy culture and financial performance. The findings help the owners/managers in developing strategies to cultivate financial literacy and supportive culture, policy makers to formulate policies to enhance financial literacy, manage culture to achieve sustainable improvement in financial performance of SMEs. Further study should be undertaken using longitudinal research so as to allow researchers to look at changes over time in regards to organizational culture.

MODERATING EFFECT OF DIGITAL FINANCE SERVICE ON THE RELATIONSHIP BETWEEN FINANCIAL MANAGEMENT PRACTICES AND FINANCIAL PERFORMANCE OF SELECTED SMEs IN ELDORET CITY, KENYA.

Wed, 01 Jan 2025 00:00:00 GMT

MODERATING EFFECT OF DIGITAL FINANCE SERVICE ON THE RELATIONSHIP BETWEEN FINANCIAL MANAGEMENT PRACTICES AND FINANCIAL PERFORMANCE OF SELECTED SMEs IN ELDORET CITY, KENYA. JEPLETING, GLADYS Financial performance refers to the measure of how well a company is using its assets to generate revenue, profit, firm credibility, and value for shareholders and its ability to pay off debts. Challenges affecting SMEs financial performance include poor financial management, lack of technological skills and enough resources. As a result, it was necessary to investigate the moderating effect of digital finance service on the relationship between financial management practices and financial performance of selected SMES in Eldoret city, Kenya. The specific objectives of the study were to examine the effect of cash flow management, budget planning, investment decision and digital financial services on financial performance of selected SMEs. In addition, the study sought to examine the moderating effect of digital financial services on the relationship between; cash flow management, budget planning, investment decision and financial performance of selected SMEs. The research was guided by the priority- based budgeting theory, modern portfolio theory and resource-based theory. The study utilized explanatory research design. Target population was 1236. Simple random sampling techniques was utilized to collect data from 302 selected SMEs using self- administered questionnaires. Cronbach alpha was applied to test reliability while factor analysis was applied to test construct validity. Hierarchical regression analysis was employed to examine direct and moderating effects, with firm age and firm size controlled as covariates. The findings indicate that firm age has a statistically significant positive effect on financial performance (β=0.282, p=0.022), whereas firm size does not (β=0.070, p=0.149) affirming the need to control these variables. The study revealed that cash flow management (β=0.237, p=0.000), budget planning (β=0.364, p=0.000), and investment decision (β=0.366, p=0.000) positively influence financial performance, collectively accounting for 71% of the variance (R2=0.742, ∆R2=0.713, p≤0.05). The study further examined the direct effect of digital finance services on financial performance, with results showing a positive and significant influence (β=0.137, p=0.007), contributing an additional 1% variance (∆R2=0.007) to the model. However, digital finance services did not moderate the relationship between cash flow management and financial performance (β=0.002, p=0.852), indicating no significant interaction (∆R2=0.000). Conversely, digital finance services significantly moderated the relationship between budget planning and financial performance (β=-0.049, p=0.000, ∆R2=0.016), and between investment decision and financial performance (β=0.035, p=0.042, ∆R2=0.003), resulting in a combined explained variance of 80% in financial performance (R2=0.798). The study provides valuable insights for SME managers, policymakers, and financial institutions, emphasizing the importance of targeted digital finance tools to optimize financial management practices and support SME growth. SMEs owners or managers should assess and adopt digital finance solutions that align with their financial management practices.

INFLUENCE OF E-LOGISTICS ON SUPPLY CHAIN PERFORMANCE OF MANUFACTURING FIRMS, IN UASIN GISHU COUNTY, KENYA. MODERATED BY ELECTRONIC RESOURCE PLANNING

Wed, 01 Jan 2025 00:00:00 GMT

INFLUENCE OF E-LOGISTICS ON SUPPLY CHAIN PERFORMANCE OF MANUFACTURING FIRMS, IN UASIN GISHU COUNTY, KENYA. MODERATED BY ELECTRONIC RESOURCE PLANNING CHEPKEMOI, CLARA Supply chain performance is crucial for businesses to increase efficiency, reduce expenses, and meet changing client needs in a competitive environment. However, manufacturing firms in Kenya face challenges such as competition, high production costs, and untimely product availability. This study aimed to examine the moderating influence of Enterprise Resource Planning (ERP) on the relationship between e- logistics and supply chain performance of manufacturing firms in Uasin Gishu County, Kenya. Specific objectives were to assess the influence of electronic order processing, transportation management, automated warehousing, inventory management, and enterprise resource planning systems on supply chain performance. The study further assessed the moderating influence of enterprise resource planning on the relationship between electronic order processing, transportation management, automated warehousing, inventory management systems, and supply chain performance of these firms. The study was guided by Resource-Based, Innovation, and Transaction Cost Theories. Explanatory research design and a census approach were adopted in collecting data using a closed-ended questionnaire from 270 Heads of 9 Departments closely linked to the study variables in 30 manufacturing firms. Cronbach’s alpha and factor analysis were used to assess reliability and construct validity. Data analysis was performed using descriptive and inferential statistics, with a hierarchical regression model used to test all the study hypotheses. Results indicate that firm age (β=0.190, p = 0.021) significantly influences supply chain performance while firm size (β=0.101, p=0.223) does not. These control variables explain 4.8% of the variance in supply chain performance, as shown by an R2 of 0.048. Findings further revealed that electronic order processing system (β1=0.316, p=0.001), transportation management system (β2=0.167, p=0.011), automated warehousing systems (β3=0.217, p=0.008), and inventory management system (β4=0.232, p=0.001) significantly influence supply chain performance. These variables explain 56.6% of the variance in supply chain performance (R2 = 0.566 inclusive of the controls) and 51.8% (∆R2 = 518 exclusive of the controls). Results further indicate that ERP (β=0.094, p=0.010), influences supply chain performance. It explains 1.2% of the variation in supply chain performance (∆R2 =0.12). Furthermore, ERP was found to moderate the relationship between electronic order processing system (β=0.100, p=0.000), transportation management system (β=0.054, p=0.012), inventory management system (β=-0.120, p=0.002), and does not moderate the link between automated warehousing system and supply chain performance (β=-0.013, p=0.701). The entire Hierarchical model accounts for 64.5% (R2 = 0.645) of the variance in supply chain performance, much more than the direct effect model, which explains 56.6% (R2 = 0.566). The study concludes that electronic order processing, transport management, automated warehousing, inventory management systems, and ERP influence supply chain performance. ERP moderates the link between electronic order processing, transport management, inventory management systems, and supply chain performance, but does not moderate automated warehousing systems and supply chain performance. This study contributes to knowledge by examining the interaction of ERP and study variables. Future scholars will benefit from the study's findings as they conduct new research in e-logistics and supply chains in various industries. The policymakers and management may use the results to develop policies and strategies for investing in e-logistics and ERP, as these enhance efficiency in supply chain performance.

MODERATING EFFECT OF SELF-CONTROL ON THE RELATIONSHIP BETWEEN FINANCIAL LITERACY AND RETIREMENT PLANNING AMONG COMMERCIAL BANK EMPLOYEES IN ELDORET CITY, KENYA

Wed, 01 Jan 2025 00:00:00 GMT

MODERATING EFFECT OF SELF-CONTROL ON THE RELATIONSHIP BETWEEN FINANCIAL LITERACY AND RETIREMENT PLANNING AMONG COMMERCIAL BANK EMPLOYEES IN ELDORET CITY, KENYA CHESEREK, GLADYS Retirement planning, defined as a goal-oriented behavior where individuals devote effort to prepare for their retirement life, can effectively reduce retirement worry, keep stress under wraps, and enhance retirement preparedness and confidence. However, there is little literature about retirement planning among employees working in Kenyan Commercial banks. To fill this gap, this study aimed to establish the moderating effect of self-control on the relationship between financial literacy and retirement planning among commercial bank employees in Kenya. The study was guided by the following specific objectives: to assess the effect of financial knowledge, financial behavior, financial attitude, and self-control on retirement planning among commercial bank employees in Eldoret City, Kenya. In addition, the study examined the moderating effect of self-control on the relationship between financial knowledge, financial behavior, financial attitude, and retirement planning. This study was guided by goal- setting theory, social cognitive theory, and behavioral life cycle theory. The study adopted an explanatory research design, with data being collected from a target population of 1058 employees of 32 commercial banks in Eldoret town. A sample size of 290 respondents was obtained using Yamane’s formula. The study used systematic sampling techniques to select employees as respondents. Data was collected using a structured, closed-ended questionnaire. The researcher ensured the reliability of the research instrument through a pilot study and further confirmed it with Cronbach's alpha, which was above the score of 0.7. Construct validity was assessed using factor analysis, while content validity was assessed by having supervisors and experts in the field review the test items to make sure they were relevant and representative of the content that was being measured. Descriptive and inferential statistical analyses were conducted using SPSS (Statistical Package for the Social Sciences) version 25, with study hypotheses tested through a hierarchical regression model. It was found that Financial Knowledge had a significant positive impact on retirement planning (β = 0.402, p < 0.05), confirming that employees with better financial knowledge are more likely to plan effectively for retirement. Financial Behavior also showed a positive and significant influence on retirement planning (β = 0.182, p < 0.05), indicating that prudent financial actions enhance retirement preparedness. Financial Attitude similarly exhibited a significant positive effect on retirement planning (β = 0.267, p < 0.05). Self- control not only directly impacted retirement planning (β = 0.174, p < 0.05) but also moderated the relationship between financial knowledge (β = 0.120, p < 0.05), financial behavior (β = 0.099, p < 0.05), financial attitude (β = -0.047, p < 0.05), and retirement planning. The study concludes that self-control moderates the relationship between financial knowledge, financial behavior, financial attitude, and retirement planning among commercial bank employees in Eldoret City, Kenya. The results of this study can be used by practitioners and policymakers in developing strategies and formulating policies for retirement systems in the workplace. The findings contribute knowledge to the literature and theory related to financial literacy, self-control, and retirement planning.

EFFECTIVENESS OF CREDIT POLICY ON MANAGEMENT OF NON-PERFORMING LOANS IN KENYAN COMMERCIAL BANKS

Sun, 01 Jan 2023 00:00:00 GMT

EFFECTIVENESS OF CREDIT POLICY ON MANAGEMENT OF NON-PERFORMING LOANS IN KENYAN COMMERCIAL BANKS ATIENO, EUNICE MACREAN The financial growth and stability of commercial banks majorly depend on regular loan repayments by their borrowers. In the recent past, commercial banks have been facing challenging matters originating from steady increases in Non-Performing Loans due to borrowers defaulting in making their loan repayments as scheduled. The purpose of this study was to determine the effectiveness of credit policy on management of NonPerforming Loans in Kenyan Commercial Banks. The specific objectives were to determine the effect of credit terms, credit appraisal and collection policy on management of non-performing loans in Kenyan Commercial Banks. The study literature was supported by information from the Theory of Information Asymmetry and Credit Scorecard Theory. The study adopted an explanatory type of research design on a sample size of 222 credit officers working in the 41 commercial banks within Nairobi city. Cronbach alpha and factor analysis were applied to test the reliability and validity of the research instruments respectively. Data collection was done using self-administered questionnaires. A multiple regression model using SPSS (version 23) was used to analyze the obtained data and test the hypotheses. The findings revealed that credit terms (ꞵ= .570, p < .000), credit appraisal (ꞵ = .302, p < 0.000), and collection policy (ꞵ = .201, p < .000) all had a positive and significant effect on management of Non-Performing Loans. Based on the new findings, the management of commercial banks and policy makers should develop effective strategies, policies and techniques that would make borrowing affordable to attract creditworthy borrowers to the banks. The study brings new knowledge that credit terms have the greatest predictive power on management of Non-Performing Loans compared to credit appraisal and collections policy. Whereas the study used quantitative data, future studies may consider using mixed approaches as they may uncover other issues affecting the management of Non-Performing Loans in commercial banks.

MODERATING EFFECT OF TECHNOLOGY ON THE RELATIONSHIP BETWEEN INVENTORY MANAGEMENT PRACTICES AND PERFORMANCE OF SELECTED SUPERMARKETS IN ELDORET CITY, KENYA

Mon, 01 Jan 2024 00:00:00 GMT

MODERATING EFFECT OF TECHNOLOGY ON THE RELATIONSHIP BETWEEN INVENTORY MANAGEMENT PRACTICES AND PERFORMANCE OF SELECTED SUPERMARKETS IN ELDORET CITY, KENYA JELIMO, SHARON Inventory management practices play a vital role in minimizing costs and maximizing profits, as well as meeting customer demands by making sure there is enough stock at the right quantity and quality and available at the right time and the right place. To make sure inventory is managed properly, there needs to be the adoption of inventory management systems. The objective of the study was to determine the moderating effect of technology on the relationship between inventory management practices and the performance of selected supermarkets in Eldoret City, Kenya. Specifically, the study sought to determine the effect of economic order quantity (EOQ) on performance, the effect of vendor managed inventory (VMI) on performance, the effect of ABC on performance, the effect of just in time on performance, and the moderating effect of technology on the relationship between inventory management practices and performance of selected supermarkets in Eldoret City, Kenya. The study was informed by game theory, transaction cost theory, and the technology acceptance model. The philosophical foundation of this study is in line with the positivist approach. Anchoring on an explanatory research design, the study target population was 1,004 employees of selected supermarkets in Eldoret City, Kenya. The study sample size was 317 employees, computed using the Yamane formula. The employees were selected using stratified and simple random sampling techniques. Data was collected using structured questioners and items anchored on a five-point Likert scale. The study hypotheses were tested using a multiple regression model and Hayes process macro for moderation analysis. The results showed that economic order quantity (EOQ) (β = 0.438, p = 0.00), vendor managed inventory (VMI) (β = 0.556, p < 0.05), ABC analysis (β = 0.548, p = 0.00), and just in time inventory management (β = 0.578, p = 0.00) had a positive and significant effect on performance. In addition, technology moderated the relationship between economic order quantity (EOQ) (β = 0.141, p = 0.009), vendor managed inventory (VMI) (β= 0.132, p = 0.004), ABC analysis (β = 0.155, p = 0.032), and just in time inventory management (β = 0.370, p = 0.00) with performance. The study concluded that inventory management practices (economic order quality, vendor management inventory, ABC inventory management, and just-in-time inventory management) are important in enhancing organization performance. Additionally, technological innovations in processes improve productivity and efficiency, which reduce costs and improve profit margins while making businesses more competitive. From the findings, the study recommends utilizing inventory management practices in meeting customer demands while minimizing carrying costs and stock-outs. The study is beneficial to the government and policymakers since it may uncover some specific challenges or barriers faced by supermarkets related to inventory management, technology adoption, or financial performance. The management of fast-moving consumer goods needs to adopt proper inventory management practices in order to reduce operation costs such as holding costs and ordering costs, among others, hence increasing company performance

DETERMINANTS OF FINANCIAL PERFORMANCE OF COMMERCIAL BANKS LISTED IN NAIROBI SECURITIES EXCHANGE, KENYA

Mon, 01 Jan 2024 00:00:00 GMT

DETERMINANTS OF FINANCIAL PERFORMANCE OF COMMERCIAL BANKS LISTED IN NAIROBI SECURITIES EXCHANGE, KENYA OSEKO, DEBORAH KWAMBOKA The main goal of every banking institution is to operate profitably in order to maintain stability and sustainable growth. External and internal economic environments are viewed as critical drivers for bank performance. According to the Financial stability report released in 2020, despite the resilience across the Kenyan banks, they were still experiencing increased non-performing loans affecting their profitability. The resolve of the study is to investigate the effect of bank specific and macroeconomic determinants on financial performance of commercial banks listed in Nairobi Securities Exchange, Kenya. The study is guided by the following specific objectives; to determine the effect of bank capital, bank assets, bank tax, bank debt ratio, bank concentration, inflation rate and lending interest rate on financial performance of commercial banks listed in Nairobi Securities Exchange, Kenya. The study was anchored on transaction cost economic theory and inverted U hypothesis. Longitudinal research design approach was adopted with panel secondary data spanning from the period 2011-2020. Stationarity, normality, heteroscedasticity, multicollinearity and serial correlation diagnostic tests were performed. Data was examined using STATA software and results were presented in form of descriptive and inferential statistics. Hausman test results suggested a fixed effect estimation model was appropriate over random effect model. Regression analysis established that, total bank assets (β1 = .06, p = .000 < .05), bank capital (β1 = 7.7, p = .000 < .05), and debt ratio (β1 = .06, p = .000 < .05) had a positive and significant effect on financial performance while bank concentration (β1 =. −.001, p = 0.012 < .05) had a negative and significant effect on performance. The study recommends that banks ought to adopt strategic asset management for better asset allocation. Government oversight is crucial to prevent crises like Chase Bank in Kenya. Banks should prioritize efficient capital allocation and diversification. Additionally, on the effect of bank taxes, the government should implement counter- cyclical policies to reduce risks during economic downturns. Further research could investigate industry-specific factors impacting banking profitability, extend case studies to specific banks, and explore the influence of behavioral economics principles on consumer financial decisions, product design, and profit margins

EFFECT OF STRATEGIC LEADERSHIP STYLES ON INNOVATIVE PERFORMANCE OF SMALL AND MEDIUM ENTERPRISE IN UASIN GISHU COUNTY KENYA

Mon, 01 Jan 2024 00:00:00 GMT

EFFECT OF STRATEGIC LEADERSHIP STYLES ON INNOVATIVE PERFORMANCE OF SMALL AND MEDIUM ENTERPRISE IN UASIN GISHU COUNTY KENYA OKONJO, LINDA ACHIENG Small and medium size enterprises are an integral part of a growing economy; According to Uasin Gishu County records there are 1611 registered SMEs in Eldoret Town. The focus therefore, should be directed at the establishment of the growth of the sector; hence the need to establish the effect of strategic leadership styles on innovative performance for small and medium enterprises in Uasin Gishu County. Proper strategic leadership is an essential part of decision making to ensure short term success and longterm sustainability, given the current volatile business environment. The study was guided by the following objectives; to establish the effect of transformational leadership style, transactional leadership style, inspiration leadership style and paternalistic leadership style on SME innovation performance within Uasin Gishu County. The population of study comprised 1611 registered SMEs in Uasin Gishu County. Cluster sampling technique to select the SMEs was used to select a sample of 290 respondents. Collection of primary data was done through a structured questionnaire. Data analysis was facilitated by use of Statistical Package for Social Science (SPSS) version 24 to generate the means, standard deviation and variances which were presented using tables, frequencies and percentages. A descriptive method was employed in analyzing qualitative data where frequencies and proportions were used in interpreting the respondent’s perception of issues that were raised in the questionnaires. Correlation analysis was used to establish the strength of association between variables and regression to determine the relationship between variables. The study findings revealed that there was positive linear effect of transformational leadership style on innovation performance in small and medium enterprises within Uasin- Gishu County (β1=.119, p=0.041). Transactional leadership style has a positive and significant effect on innovation performance in small and medium enterprises within Uasin- Gishu County (β2=.157, p=0.002). Inspirational leadership style was found to have a positive and significant effect on innovation performance in small and medium enterprises within Uasin- Gishu County (β3=.258, p=0. 000). Paternalistic leadership style was found to have a positive and significant effect on innovation performance in small and medium enterprises within Uasin- Gishu County (β4=.271, p=0.000). The study concluded that transactional, inspiration and paternalistic leadership style had a positive influence on SME innovation performance within Uasin Gishu County. The study recommends that SMEs within Uasin Gishu County adopt leadership style which allows managers to make employees feel valued and comfortable in their respective duties which helps bring out the best in them to achieve their goals and personal growth.