The Influence of Organizational Culture and Market Orientation on Performance of Microfinance Institutions in Kenya

Abstract

The objective of our study is to assess the influence of organizational culture and market orientation on performance. The population of the study comprise microfinance institutions that are members of the Association of Microfinance Institutions (AMFI) in Kenya. We used descriptive cross-sectional survey design. We collected primary data using structured questionnaire. We test our hypotheses through regression analysis. Our results demonstrate that organizational culture significantly and positively influence variations in performance. The partial mediation effect of market orientation on the relationship between organizational culture and performance was confirmed. The complimentary effect of organizational culture on market orientation implies that organizations need to spend more resources in nurturing market orientation to create sustainable competitive advantage through delivery of superior customer experience. We conclude that the influence of organizational culture and market orientation on performance is more plausible for mature industries regarded as diverse in terms of customer needs.