Abstract:
Banks often drive their profitability by focusing on cost minimization through investments in efficient-scale operations and effectiveness, while seeking to expand their revenue streams and gaining large market share. They often deploy strategies that lead to low costs in marketing, selling and service delivery and continuously attempt to invest in products and services that satisfy and attract their customers. Thus, seeking a competitively valuable way to reduce cost of supply and production, producing products and services that meet and satisfy client demands and doing so to the right market segment is central to banks strategic formulation and execution. Banks therefore must strive to effectively manage every expense and find new sources of potential cost reduction, increase its market share and divest its revenue channels so as to remain both profitable and relevant in a competitive market environment. The main objective of this study was to assess the effect of competitive strategies on the performance of Equity Bank, Homa Bay Branch. The specific objectives of this study were to; find out whether differentiation strategy has an effect on the performance of Equity Bank, Homa Bay Branch, establish the effect of focus strategy on the performance of Equity Bank, Homa Bay Branch and lastly, determine whether cost leadership strategy has an effect on the performance of Equity Bank, Homa Bay Branch. The study was based on census targeting all the 75 employees of Equity bank Homa Bay within Homa Bay County, with a pilot study involving 25 respondents conducted in Siaya branch of Equity and the researcher employed a descriptive research design and used questionnaires as a research tool to collect data. The researcher with the help of two supervisors was able to ascertain content validity by use of Content Valid Index (CVI) and face validity by use of the colleagues undertaking the strategic management course to measure the validity of the research instrument. The analysis of data was conducted through both descriptive and inferential statistics specifically percentages, likert scale analysis, frequencies and multiple regression analysis. The data was presented using figures and frequency tables and then findings were interpreted. The findings of this study revealed that competitive strategies have an effect on the performance of Equity Bank. The findings of this study has both practical and academic benefits and the researcher recommends that commercial banks adopts competitive strategies in their operations so as to create sustainable competitive advantage leading to superior performance.
