Strategic Intelligence Systems and Performance of the Insurance Industry in Kenya

Abstract

Changes and challenges that have occurred in the past two decades have forced a radical shift in the basic foundations of how business is conducted. Internal, as well as external forces have forced organizations to constantly monitor their surrounding environment in order to create an awareness of opportunities and threats to allow them to survive in their competitive environment. The objective of this study was to identify the relationship between Strategic Intelligence, Strategic Information ship and performance of the Insurance Industry in Kenya. In this study, qualitative and quantitative data collection techniques were used. The study chose positivism because of the belief that the influence of Strategic Intelligence on the organization performance constructs as pertaining in Kenya’s insurance industry can be examined objectively through the use of established theoretical frameworks and structured instruments to assess and analyze it, upon which generalizations can be made from the findings. The target population of the study was 306 senior management employees and 711 middle management employees both totaling to 1017. The sample size was 278 which constituted 27% of the target population. Descriptive research design was employed in this study. The data used were both primary and secondary. The primary data were collected using self administered questionnaires and structured interviews. For the secondary data, the information was obtained from internal company information of the insurance companies, annual financial reports of the companies, annual reports of Association of Kenya Insurers and the Insurance Regulatory Authority. The study found that product value, product awareness, product satisfaction, service quality and financial prudence have a positive and a significant influence on the organization performance. In addition, the study found that strategic information system has a moderating effect on the aggregation of strategic intelligence and the performance of the insurance industry in Kenya. Based on the findings, the study concluded that strategic intelligence leads to improved gross total premiums (income). In addition it leads to an increased total assets and also growth in insurance profit. Based on the findings and conclusion, the study recommend that insurance firms have a clear focus on expense ratio, claims and net income so as to xxvi improve on their organization performance. Product value is one of the contributory factors to performance of insurance firms. For any insurance organization that wants to grow and maintain its market share, the study recommends for product awareness campaigns. Renewal ratio, coverage ratio and growth ratio are critical components of product awareness. The study further recommends that insurance firms emphasize on satisfaction of the customers since the study found out that product satisfaction has a positive effect on performance. From the findings and conclusion, the study finally recommends that insurance firms to offer proper and quality services to the customer. The quality of customer service have proven to be the yard stick of determining whether companies will retain and get new customer or lose them. From this study the policy makers will be able to know how well to incorporate strategic intelligence and Strategic Information System in the sector and how effectively to ensure full participation. To the scholars in insurance industry and overall financial sector, the study will provide a source of reference, literature review and basis upon which further studies can be developed. Finally understanding the extent in which Strategic Intelligence and Strategic Information Systems as utilized in the insurance industry in Kenya including identifying the benefits and/or challenges that are experienced by implementing and using Strategic Intelligence and Strategic Information Systems as an input to the Strategic Management process and what value Strategic Intelligence adds in the decision making process.