ORGANIZATIONAL STRATEGY AND EMPLOYEE PERFORMANCE IN BANKING SECTOR: A CASE STUDY OF ECOBANK PLC, LAGOS TAFAWA BALEWA SQUARE (TBS)
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Background of the study
Organizational strategy refers to the comprehensive plan crafted by an organization to achieve long-term objectives and sustain competitive advantage. This plan encompasses various aspects, including resource allocation, business processes, and employee engagement strategies. A well-defined organizational strategy is crucial for aligning the activities and efforts of employees with the overarching goals of the organization, thereby enhancing overall performance (Porter, 2015).
Employee performance, on the other hand, pertains to the effectiveness and efficiency with which employees fulfill their job responsibilities. High employee performance is indicative of not only individual productivity but also the collective output of the organization. The link between organizational strategy and employee performance has been a focal point of research, with numerous studies highlighting how strategic alignment can lead to improved performance outcomes (Kaplan & Norton, 2016).
Ecobank PLC, a prominent financial institution in Africa, operates extensively in Nigeria with its Lagos Tafawa Balewa Square (TBS) branch being a critical node in its network. Given the competitive nature of the banking industry, Ecobank PLC has continually strived to implement effective organizational strategies to enhance employee performance and, by extension, overall organizational performance (Ugwuegbu, 2018).
Previous research has underscored the significance of strategic human resource management (SHRM) in fostering employee performance. SHRM integrates organizational strategies with HR practices, ensuring that recruitment, training, and development align with strategic goals (Guest, 2017). This alignment is particularly relevant in the banking sector, where rapid technological advancements and changing customer expectations necessitate a proactive and strategic approach to managing human resources (Bamberger, Biron, & Meshoulam, 2014).
The concept of strategic fit, which refers to the congruence between organizational strategy and various organizational components, is also crucial in this context. Strategic fit enhances organizational performance by ensuring that all elements, including employee roles and responsibilities, are aligned with the strategic direction of the organization (Venkatraman & Camillus, 1984). In the case of Ecobank PLC, achieving strategic fit can potentially lead to improved employee performance and greater competitive advantage (Olanipekun, Abioro, & Durojaiye, 2019).
Moreover, empirical studies have demonstrated that effective communication of organizational strategy to employees significantly impacts their performance. When employees clearly understand the strategic objectives and how their roles contribute to these objectives, they are more likely to be motivated and committed to achieving high performance levels (Aguinis, 2019). This underscores the importance of leadership in communicating and reinforcing the strategic vision within the organization (Hitt, Ireland, & Hoskisson, 2015).
In the context of Ecobank PLC, exploring the relationship between organizational strategy and employee performance is essential for several reasons. Firstly, it provides insights into how strategic initiatives can be tailored to enhance employee productivity and satisfaction. Secondly, it highlights the role of effective strategy implementation in achieving competitive advantage in the banking sector. Lastly, it contributes to the broader discourse on strategic management and human resource practices within the context of a developing economy (Okpara, 2016).
The study of organizational strategy and employee performance at Ecobank PLC's Lagos TBS branch is not only relevant but also timely. As the banking sector continues to evolve, understanding the dynamics of strategic alignment and employee performance will be crucial for sustaining organizational success. This study aims to fill existing gaps in the literature by providing empirical evidence on the impact of organizational strategy on employee performance in a key African financial institution.
1.2 Statement of the problem
The relationship between organizational strategy and employee performance has been a focal point in management research due to its significant impact on the overall success of businesses. In the context of financial institutions like Ecobank PLC, particularly at the Lagos Tafawa Balewa Square (TBS) branch, understanding this relationship is crucial for fostering a productive work environment and achieving organizational goals.
Despite the critical importance of aligning organizational strategies with employee performance, there remains a gap in empirical research specifically addressing this within the Nigerian banking sector. Organizational strategies encompass a wide range of activities including goal setting, resource allocation, and performance measurement, all of which can influence employee behaviors and outcomes (Porter, 2017). However, inconsistencies in strategy implementation and employee performance metrics have been observed, suggesting potential misalignments that could hinder optimal performance (Barney, 2018).
Moreover, the dynamic and competitive nature of the banking industry necessitates continuous adaptation of strategies to maintain a competitive edge (Mintzberg, 2015). Ecobank PLC, like many other banks, faces challenges such as regulatory changes, technological advancements, and evolving customer expectations. These challenges require strategic responses that not only address external pressures but also effectively mobilize and motivate employees to achieve high performance levels (Hitt, Ireland, & Hoskisson, 2017).
Employee performance in the banking sector is influenced by various factors, including job satisfaction, motivation, training and development, and organizational culture (Armstrong & Taylor, 2017). However, the extent to which these factors are integrated into the strategic planning processes of banks like Ecobank PLC remains underexplored. This research aims to fill this gap by examining how organizational strategies at Ecobank PLC, Lagos Tafawa Balewa Square (TBS) branch, are formulated and implemented to enhance employee performance.
The problem statement addresses the need to investigate the alignment between organizational strategies and employee performance in Ecobank PLC, Lagos TBS branch. The findings are expected to provide insights into how strategic management practices can be optimized to improve employee performance and, consequently, organizational success.
1.3 Objective of the study
- To examine the relationship between organizational strategy and employee performance in Ecobank Plc, Lagos Tafawa Balewa Square (TBS).
- To identify the specific organizational strategies that influence employee performance.
- To determine the extent to which organizational strategy predicts employee performance.
1.4 Research Questions
- What is the relationship between organizational strategy and employee performance in Ecobank Plc, Lagos TBS?
- What specific organizational strategies are most strongly associated with employee performance?
- To what extent does organizational strategy predict employee performance in Ecobank Plc, Lagos TBS?
1.5 Research hypotheses
Null Hypothesis (H0): There is no significant positive correlation between organizational strategy and employee performance in Ecobank Plc, Lagos TBS.
Alternative Hypothesis (H1): There is a significant positive correlation between organizational strategy and employee performance in Ecobank Plc, Lagos TBS.
1.6 Significance of the study
1. Improving Organizational Effectiveness
Understanding the relationship between organizational strategy and employee performance can help Ecobank PLC optimize its strategic initiatives to boost overall effectiveness. By identifying which strategies most significantly impact employee performance, the bank can tailor its approaches to enhance productivity, engagement, and morale, leading to better business outcomes and competitive advantage in the financial sector.
2. Enhancing Employee Satisfaction and Retention
This research can provide insights into how strategic decisions affect employee satisfaction and retention at Ecobank PLC. With a clearer understanding of these dynamics, the bank can implement strategies that foster a positive work environment, reduce turnover rates, and attract top talent. This is particularly crucial in the competitive banking industry, where skilled employees are vital to maintaining high service standards and achieving organizational goals.
3. Contributing to Strategic Management Literature
The findings of this study will contribute to the existing body of knowledge in strategic management and human resource management. It will provide empirical evidence from a specific context (Ecobank PLC, Lagos Tafawa Balewa Square) that can be used by other researchers and practitioners to understand the interplay between organizational strategy and employee performance in similar settings. This contribution is valuable for developing more effective strategic frameworks that can be adapted across various industries and geographical locations.
1.7 Scope of the study
This study focuses to examine the relationship between organizational strategy and employee performance in Ecobank Plc, Lagos Tafawa Balewa Square (TBS), identify the specific organizational strategies that influence employee performance, and determine the extent to which organizational strategy predicts employee performance. Hence employee of Ecobank Plc, Lagos Tafawa Balewa Square (TBS) shall serve as enrolled participants for this study.
1.8 Limitation of the study
Like in every human endeavour, the researchers encountered slight constraints while carrying out the study. The significant constraint are:
Time: The researcher encountered time constraint as the researcher had to carry out this research along side other academic activities such as attending lectures and other educational activities required of her.
Finance: The researcher incurred more financial expenses in carrying out this study such as typesetting, printing, sourcing for relevant materials, literature, or information and in the data collection process.
Availability of Materials: The researcher encountered challenges in sourcing for literature in this study. The scarcity of literature on the subject due to the nature of the discourse was a limitation to this study.
1.9 Definition of terms
1. Organizational Strategy
Organizational strategy refers to the comprehensive plan devised by a company to achieve its long-term goals and objectives. It involves setting vision and mission statements, determining strategic goals, and formulating policies and procedures to guide the organization's operations and decision-making processes. In the context of Ecobank PLC, organizational strategy encompasses the bank's approaches to market positioning, resource allocation, and competitive actions aimed at achieving sustainable growth and profitability.
2. Employee Performance
Employee performance is the measure of how well employees carry out their assigned tasks and responsibilities to meet the objectives and standards set by the organization. It encompasses various aspects such as productivity, quality of work, efficiency, and adherence to company policies. At Ecobank PLC, employee performance is critical in delivering high-quality banking services, ensuring customer satisfaction, and contributing to the bank's overall success and competitive edge.
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