Technostructural Interventions And Performance Of Commercial Banks In Kenya

ABSTRACT

Kenya‟s banking industry has for many occasions experienced turbulence, leading to growing aspersions as to its stability and continued performance. Commercial banks have consequently been seen to be putting in place measures to enable them continue performing as expected. Some of these strategies have included embracing organization development interventions, such as technostructural interventions. From the literature, studies still point to the fact that there exists a theoretical quandary on whether technostructural interventions can indeed lead to desirable organization performance outcomes, or not. The need to fully comprehend the effects of technostructural interventions on performance of commercial banks in Kenya thus became necessary. As well, given that employee commitment has been argued to be an important determinant of organization performance, incorporating the same in study, as a mediating variable, in exploring the extant relationship between technostructural interventions and performance of commercial banks in Kenya, was considered vital. Buoyed by scholarly arguments, this study, besides, incorporated leadership styles, specifically transformational and transactional leadership styles, as a moderating variable in the relationship between technostructural interventions and organizational commitment, and also as a moderating variable in the relationship between employee commitment and organizational performance. The study objectives hence were : To determine the effect of job enrichment on performance of commercial banks in Kenya; to determine the effect of employee involvement on performance of commercial banks in Kenya; to determine the effect of physical layout on performance of commercial banks in Kenya; to establish the mediating effect of employee commitment on the relationship between technostructural interventions and performance of commercial banks in Kenya; to establish the moderating effect of leadership styles on the relationship between technostructural interventions and performance of commercial banks in Kenya; to establish the moderating effect of leadership styles in the relationship between technostructural interventions and employee commitment in commercial banks in Kenya and to establish the moderating effect of leadership styles in the relationship between employee commitment and performance of commercial banks in Kenya. The theories that illumined this study included the sociotechnical systems theory, the Herzberg two factor theory, the Job Characteristics Model and the AMO theory of organisation performance. The study adopted a posivist philosophy and blended cross sectional and descriptive research designs. The population comprised of all the commercial banks in Kenya. Sample size for the respondents was determined by the Yamane formula. Research data was collected using questionnaires. Descriptive analysis was undertaken on respondent‟s biographics and bank characteristics. Multiple regression models were then used to analyses the relationships and as such to test the hypotheses at 0.05 significance. The study established that employee involvement has a positive and significant effect on the performance of commercial banks in Kenya. The study also established that employee commitment partially mediates the relationship between technostructural interventions and the performance of commercial banks in Kenya and that leadership styles moderate the relationship between employee commitment and performance of commercial banks in Kenya. On the basis of these characteristics, conclusions and recommendations were made, chief being that banks be cautious in using physical layout and job enrichment interventions as strategies of driving performance and that other studies be undertaken to establish under what circumstances job enrichment and physical layout interventions can be used to drive performance of commercial banks in Kenya. Even so, it is expected that the findings of this study will help inform policy in commercial banks besides contributing to the field of organization development in Kenya.