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Value Chian Analyis of Banking Industry in Kenya

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Value Chian Analyis of Banking Industry in Kenya
KENYA INSTITUTE OF MANAGEMENT

COURSE: PROJECT MANAGEMENT

SUBJECT: STRATEGIC MANAGEMENT
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NAME: JOSPHAT OMARI
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ADM NO: EMBU/00240

WORKBASED ASSIGNMENT

DATE OF SUBMISSION 31/7/2010

DISCUSS HOW MICHAEL PORTERSCOMPETATIVE FORCES BEING IS APPLIED IN THE BANKING SECTOR Introduction:
The banking Industry in kenya has tremendously changed its dynamics for the last one decade. Many banks have joined the industry both local and foreign. Notably, the no-banks financial institutions have been mushrooming by an alarming speed.. In any industry, including the banking industry, the nature of competition is always a function of the market structure. The trend today is a perfect competition and the central bank has withdrawn from managing the market forces. Banks are now working on their own about what are relevant products and rates to be offered to the market. In this regard the need for the assessment of the attractiveness of the industry becomes a necessity. Porter’s Five Forces Framework has been widely used in analyzing the attractiveness of an industry. Any firm (in this case a bank) needs to answer two fundamental questions; (i) What makes an industry attractive? (ii) What positions within an industry lead to superior performance? Answering these two questions is vital for any firm, which needs to compete competitively. This article makes a clear discussion of the banking industry in kenya and how the Porters Five Forces can be used as a tool of analysis for profitability.

The Banking Industry of Kenya
The industry has various key players. These to include; Fully fledged banks (commercial and non Commercial), Regional Unit Banks, Financial Institutions, Regional Financial Institutions, Regional Unit Financial Institutions and Bureaux de Change.

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