EFFECT OF BUSINESS CONTINUITY PLANNING ON THE RESILIENCE OF TIER-ONE COMMERCIAL BANKS IN KENYA

Abstract

Purpose of Study: This study analyzed the effect of business continuity planning on the resilience of tier-one commercial banks in Kenya. It sought to establish how continuity planning practices contribute to operational stability, recovery capacity, and the ability of banks to withstand disruptions while maintaining essential services and sustaining competitiveness in a dynamic banking environment. Methodology: The study adopted a descriptive research design guided by contingency theory and dynamic capabilities theory. The target population comprised 324 employees from nine tier-one commercial banks in Kenya. A sample of 179 respondents was selected using multistage sampling. Data were collected through structured questionnaires, with 163 responses received, representing a 91.1% response rate. Analysis involved descriptive statistics, Pearson correlation, and regression using SPSS. Findings: The findings revealed that business continuity planning had a strong, positive, and statistically significant relationship with resilience (r = 0.615, p < 0.05). Regression analysis further established a positive and significant effect of business continuity planning on resilience (β = 0.312, t = 5.115, p < 0.001). However, business continuity planning practices were moderately implemented, with an overall mean of 2.98. Feedback collection from business continuity drills recorded the lowest mean (2.88), while frequent risk assessment reviews recorded the highest (3.09). Resilience was also moderate, with an overall mean of 3.03. These findings indicate that although continuity planning enhances resilience, inconsistencies in implementation, alternative banking channels, risk assessments, and learning mechanisms constrain its effectiveness. Conclusion: The study concluded that business continuity planning significantly improves the resilience of tier-one commercial banks in Kenya. However, inconsistent implementation limits its full potential. Banks should institutionalize regular continuity drills, strengthen alternative banking channels, conduct proactive risk assessments, and systematically incorporate feedback into future planning to enhance operational continuity, recovery capacity, and long-term institutional resilience.