Service Differentiation and Organization Performance: An Empirical Analysis of Deposit Taking Saccos in Nairobi City County, Kenya

摘要

The Sacco sub sector occupies a strategic position in the socio-economic development of the country. Cost of doing business and reduced saving power of the Saccos customers have reduced the revenue and access to cheap deposits that they use to give as loans to their members making them re-think their competitive strategy in order to remain competitive and increase performance. This study sought to determine the effects of service differentiation strategy on performance of deposit taking Saccos in Nairobi City County, Kenya. Descriptive research design was employed with respondents drawn from 123 deposit taking Saccos that were obtained using stratified random sampling technique. Data analysis was done by the use of descriptive statistics and simple linear regression statistics. The study found that staff provided consistent service to the members, gave commission incentives to the members who gave referrals, offered differentiated mobile platform financial services, gave unique service experience to the members, were prompt in handling customer's complaints and members were happy with the services. The study also found that Deposit Taking Saccos were not using members' feedback and quarterly surveys to improve service. The study found that Service differentiation had the following values (β=0.348, p=0.0050.05). The study concluded that service differentiation had positive and significant effect on performance of deposit taking Saccos. The study recommends that Sacco management should come up with standard procedures and guidelines that will be used to reinforce the effective implementation of feedback received from customers to spearhead service improvement.