Moderating Effect of Operating Environment on the Relationship Between Big Data Technology Capability and Performance of Commercial Banks in Kenya

Gyaviira Ogola; David Nzuki; Morrisson Mutuku

doi:10.37284/eajbe.7.1.2182

Gyaviira Ogola Kenyatta University
David Nzuki Kenyatta University
Morrisson Mutuku Kenyatta University

DOI: https://doi.org/10.37284/eajbe.7.1.2182

Keywords: Operating Environment, Performance, Commercial Banks, Big Data Technology Capability

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Abstract

The banking sector is rapidly transitioning from traditional manual practices to advanced digital methods, generating significant volumes of customer data. Despite this shift, many commercial banks are struggling financially, with some even being placed under receivership due to declining performance. This study aimed to investigate how the operating environment moderates the relationship between big data technology capability and the performance of commercial banks in Kenya. In examining the moderating effect of operating environment (OE) on the connection between big data technology capacity and performance; the two-step approach postulated by Whisman and McClelland (2005) was used. Using an explanatory research approach, the study focused on all 39 commercial banks registered as of December 31, 2020. It highlights that the operating environment plays a crucial role in shaping how big data technological capabilities impact bank performance. The study recommended that policy makers and regulators of the banking sector to establish a friendly environment for commercial banks to operate in. CBK should also enact favourable regulations regarding banking that inspire commercial banks to be innovative and supply the market with state-of-the-art technology. Additionally, it is necessary to put in place updated ICT infrastructure and a solid legal framework within which commercial banks can operate

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