Strategic Planning in the Banking Sector: A Case of Co-Operative Bank

A Research Project Report Submitted to the School of Business in Partial Fulfillment of the Requirements for the Degree of Masters in Business Administration (MBA)The general objective of the study was to explore ways through which Co-operative Bank would be more strategic in its planning due to the increasing competition in its environment. The study was guided by three objectives which were; to identify ways through which Co-operative Bank strategically planned market penetration, to establish ways through which Co-operative Bank would develop new products and finally to find out ways through which Co-operative Bank would diversify its markets and products. The study was a case of Co-operative bank and it specifically concentrated on the strategic planning of the bank. The researcher sought to establish the challenges that are faced by the bank through the use of a descriptive research design. The population of the study was made up of 60 permanent employees from Co-operative bank that were based in the head office. From that population a sample of 30 employees was chosen and data was collected using stratified random sampling. The researcher used questionnaires to collect data. The questionnaires had initially been pretested for validity and correctness. The collected data was coded then analyses using Statistical Package for Social Scientist (SPSS). The data was then presented in form of tables and figures. The researcher was able to establish through the first research question that the cost of loans was prohibitive to the bank achieving its successful strategic planning objectives. It was established that Co-operative bank needed more advertising for the customers to get the needed information on their products. Co-operative Bank was also facing a lot of competition from her competitors and therefore controlled a small percentage of the customer base. Finally, the products from Co-operative bank were found to be attractive to the customers that the bank had managed to gather however there need sensitization from Co-operative bank on their products. From the second research question the researcher was able to establish that introduction of new products by Co-operative Bank would contribute significantly to the success of strategic planning in the organization. Modification of products and then reintroducing them into the market would have an adverse effect on the successful strategic planning of the organization. The mode through which Co-operative Bank had chosen to supply their services to their customers using had contributed significantly to the achievement of the banks strategic plan. From the study it was clear that the bank had not invested significantly on the employee competencies and therefore did contribute to the education of their employees. Finally, the third research question showed that through engaging in other forms of business that were related to the banking sector the bank would have a more successful achieve its strategic plan. The researcher was also able to establish that by getting into partnerships with non-banking institutions Co-operative bank would be able to have a more successful strategic plan. The researcher was able to establish that Co-operative bank would avoid partnering with other banks since it did not contribute significantly to strategic planning of the bank. In conclusion the study established that Co-operative bank was better off introducing new products to the market as opposed to modifying the older products. The researcher also concluded that by lowering the cost of production the bank’s products would be considered to be inferior when compared to those of the competitors. On the second research question the researcher was able to conclude that Co-operative bank was not actively involved in the promotion of it products and therefore the customer base was smaller compared to the other competitors in the market. Finally, the researcher was able to concluded that Co-operative Bank was able to have a more successful business plan through diversifying its form of business The researcher recommended that Co-operative Bank would set reasonable prices that would be considered affordable to the customers and also increase their promotional activities. Secondly the researcher also recommended that the bank would avoid modification of products and re-introducing them to the market. Finally, the researcher recommended that Co-operative bank would continue to diversifying their area of operation since by so doing they reduced the risk of failure in case of a loss in one area of business