Abstract: Strategic planning is important for strategic management of companies. Strategic planning has been regarded as a prerequisite to successful organizational outcomes and while the contexts of strategic planning differs by sector and geographical orientation, there is renewed interest in strategic planning - performance linkage in developing economies, this, due in part to the realization of the role of firm-based factors such as strategic planning dimensions. The purpose of this study was to determine the effects of strategic planning dimensions on organizational performance of commercial banks in Rwanda. To achieve this the study was guided by the following specific objectives; to establish the effects of cross functional integration on the organizational performance of commercial banks in Rwanda, to determine the effects of management participation on the organizational performance of commercial banks in Rwanda, to establish the effects of strategic orientation on the organizational performance of commercial banks in Rwanda and to examine the effects of strategic control on the organizational performance of commercial banks in Rwanda. The study adopted a descriptive survey design. Stratified random sampling was used to determine the sample size. The target population for the study was 150 employees of bank of Kigali. The study used both primary and secondary data, where questionnaires, interview was used for data collection. Data collected was analyzed through SPSS version 21. Data analysis involved statistical computations for averages, percentages, and correlation and regression analysis. Ordinary least squares (OLS) regression method of analysis were adopted to determine the inferential statistics. The results of the correlation analysis revealed that there was positive correlation between cross functional integration and firm performance (r=0.328, p-value < 0.001). Thus, an increase in emphasis on management participation in the firm resulted in an increase in overall firm performance of 32.8%. From the correlation analysis management participation also exhibited a positive correlation with firm performance (r=0.334, p-value < 0.001). This meant that increased use of management participation increased company performance. Strategic orientation presented a weak positive correlation with firm performance (r = 0.399, p-value < 0.001), while strategic control practices displayed the moderately weak positive correlation with firm performance (r = 0.455, p-value < 0.001). The highest correlation was noted between strategic control and firm performance, relative to the other variables. The study recommended high participation and involvement of top management in the whole process of strategic planning, anchoring of deliberate cross functional integration processes in the firm, heightened strategic oriented paradigms for market orientation, customer focus and competitiveness and the development, design and customization of management control systems to enhance implementation, monitoring and evaluation of the strategic planning process outcomes.
Keywords: Cross functional integration, organizational performance, Commercial bank.
Title: EFFECTS OF STRATEGIC PLANNING PRACTICES ON ORGANIZATIONAL PERFORMANCE OF COMMERCIAL BANKS IN RWANDA: A CASE OF BANK OF KIGALI
Author: JOSEPH MWAI, Dr. PATRICK MULYUNGI, Dr. JAYA SHUKLA
International Journal of Management and Commerce Innovations
ISSN 2348-7585 (Online)
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