KNOWLEDGE MANAGEMENT AS A STRATEGY FOR ACHIEVING COMPETITIVE ADVANTAGE AMONG SAVINGS AND CREDIT COOPERATIVES (SACCOS) IN NAIROBI COUNTY, KENYA

Abstract

ABSTRACT Savings and Credit Cooperative (SACCO) movement in Kenya play a critical role in national development by reducing poverty amongst citizens. This is demonstrated in the Kenya Financial Sector Stability Report of 2015 which indicates that the sector to date has mobilized savings to the tune of Kenya shillings 420 billion. It has an asset base of Kenya shillings 500 billion which accounts for 35% of the National savings. However, the SACCO sector faces numerous challenges which include, weak processes, shifting markets, rapid product obsolesces, high competition and financial upheaval. The aim of this study was, therefore, to explore knowledge management as a strategy for achieving competitive advantage among SACCOs in Nairobi County, Kenya, and propose a knowledge management framework which SACCOs can adopt. The study assumed that by harnessing knowledge management assets, SACCOs would be in a better position to deliver quality services to the customers thereby improving their competitive advantage. The objectives of this study were: to examine knowledge management practices in selected SACCO's in Nairobi County; assess knowledge sharing strategies employed by SACCOs in Nairobi County; investigate the factors influencing successful implementation of knowledge management strategies among SACCOs; explore the challenges experienced in harnessing knowledge management strategies; and propose a framework for improving knowledge management among SACCOs in Nairobi County. The study was informed by ‘Knowledge based theory of the firm’ by Carla Curado (1959) which states that knowledge is the most strategically significant resource in a firm. Because the study needed to grasp meanings, reasons and occurrences, qualitative method was employed in gathering data. The study was of the view that the concept of knowledge management is new in SACCOs hence exploratory research design was chosen. The study population was limited to three SACCOs namely: Police SACCO, Sheria SACCO and UNSACCO which were selected using information oriented purposive sampling. Target population totaled to twenty-one which comprised of top management, heads of departments, ICT personnel and Records Officers. They were also selected using purposive sampling because purposive sampling enabled the study to reach its targeted population quickly based on study objectives and population characteristics. Data was collected using in-depth interview schedules with open ended questions and analyzed using thematic analysis. The findings provided evidence that although SACCOs practice some aspects of knowledge management it is not as comprehensive hence an ideal knowledge management strategy ought to be adopted by SACCOs. The study therefore recommended that SACCOs adopt a 3-cycle knowledge management model by Kimiz (2013) which encompasses knowledge creation and capture, knowledge sharing and dissemination and knowledge acquisition and application. The study has proposed a knowledge management framework which SACCOs can adopt to improve knowledge management practices for competitive advantage.