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Impact of Technological Innovation on Customer Retention at Safaricom Plc in Kenya

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dc.contributor.author Hinga, Michael
dc.date.accessioned 2019-07-12T09:40:02Z
dc.date.available 2019-07-12T09:40:02Z
dc.date.issued 2019
dc.identifier.uri http://erepo.usiu.ac.ke/11732/4606
dc.description A Research Project Report Submitted to the School of Business in Partial Fulfillment of the Requirement for the Degree of Masters in Business Administration (MBA) en_US
dc.description.abstract The general objective of the study was to establish the impact of technological innovation on service user retention by Safaricom PLC in Kenya. The specific objectives were to; examine the impact of product innovation on customer retention of Safaricom PLC in Kenya, assess the impact of process innovation on customer retention of Safaricom PLC in Kenya and establish the impact of service innovation on customer retention of Safaricom PLC in Kenya. To achieve these objectives, the study adopted a descriptive research design and a target population of 147 respondents which consisted of employees working in Safaricom Customer Service Centres and Technical and Innovation Departments based at Safaricom Care Center. Probability sampling design was utilized in selecting the sample size of the study. The sample size consisted of 107 respondents. Primary data was collected with the help of self-administered questionnaires that were administered by dropping and picking later. Data was analyzed using quantitative and qualitative approaches, quantitative approaches involved use of descriptive statistics that entails percentages, frequency, mean and standard deviation while qualitative approach used content analysis. Correlation analysis and regression analysis were used to establish existing relationships between technological innovation and customer retention at Safaricom PLC in Kenya. The findings established that product innovation recorded the highest overall mean of 3.818 followed by service innovation with a mean value of 3.725 and lastly, process innovation that attained a mean value of 3.461. Correlation findings of product innovation revealed that mobile money and Safaricom fibre recorded a strong correlation with customer retention (R=0.772 and R=0.762, respectively), however network quality was weakly and moderately correlated to customer retention (R=0.554). Correlation findings of process innovation revealed that KYC attained a strong correlation with customer retention (R=0.749); customer service attained a moderately strong correlation with customer retention (R=0.622) while switching barriers attained a weak correlation with customer retention (0.450). Correlation results of service innovation established that both support and interactive services were strongly and moderately correlated to customer retention (R=0.562 and R=0.682, respectively).The coefficient of determination for; product innovation was 67.5%, process innovation was 63.5% and service innovation was 42.5%, these implied that the regression equation used for the study was a good fit for the data. Overall regression model adopted in the study was significant as evidenced by the p-values of product innovation, process innovation and service innovations which were all below 5% (0.000, 0.000 & 0.000). Product innovation was significantly linked to customer retention because p-values of all its predictor variables (mobile money, Safaricom fibre and network quality) were below 5%. Similarly, process innovation and customer retention were significantly linked since p-values of its predictor variables: KYC and customer services were below 5% except switching barriers which was insignificant. Service innovation and customer retention was significantly related since p-values of predictor variables: support and interactive services was below 5%. The study concluded that product innovation was used to a great extent with its sub-variables namely mobile money being a key contributor towards customer retention followed by Safaricom fibre and network quality. Correlation results showed that product innovation was strongly correlated to customer retention. It was further revealed that product innovation was positively and significantly linked to customer retention as evidenced by all its predictor variables: mobile money, Safaricom fibre and network quality. Process innovation was the least used compared to product and service innovation: KYC greatly contributed to customer retention followed by customer services and lastly switching barriers. Process innovation attained a moderately strong correlation with customer retention. Process innovation was positively and significantly related to customer retention as revealed by its predictor variables: KYC and customer services. However, switching barriers was insignificantly linked to customer retention. Service innovation was used to a great extent with both support services and interactive services contributing greatly towards customer retention. There was a moderately strong correlation between service innovation and customer retention. Service innovation was positively and significantly related to customer retention as revealed by predictor variables: support services and interactive services.The study recommends that telecommunications firms need to do a comparison of what their competitors are offering in the market to ensure that developed products serve specific and unmet needs of the customers. Also, there is need for telecommunication firms to invest on continuous training and development programs to ensure that employees are updated and conversant with the systems and processes so as to effectively execute their roles. Telecommunication firms should integrate and align customer feedback mechanisms to enhance efficiency in customer feedback, and improved access and flexibility to customer response services. en_US
dc.language.iso en en_US
dc.publisher United States International University - Africa en_US
dc.subject Technological Innovation en_US
dc.subject Customer Retention en_US
dc.subject Safaricom Plc en_US
dc.subject Kenya en_US
dc.title Impact of Technological Innovation on Customer Retention at Safaricom Plc in Kenya en_US
dc.type Thesis en_US


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