The Moderating Role of Environmental Turbulence in the Relationship Between Strategic Orientation and Organization Performance: The Case of Ethiopian Commercial Banks.
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Date
2024-06-13
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A.A.U
Abstract
Strategic orientation creates conditions that enhance organisational competitiveness and performance but existing studies gives less attention. The Purpose of the study was to investigate the relationship between Strategic orientation dimensions and performance and the moderating role of environmental turbulence in Ethiopian commercial banks. A quantitative, cross-sectional research design was adopted. This study used two sampling stages. The first one is to sample out the bank’s (strata’s) from the banking industry and secondly a number of respondents within the selected banks. Data were collected from the sample of 221 from four banks head office employees in Addis Ababa through questionnaire. Descriptive statistics, correlation, multiple regression analysis, and hierarchical regression analysis were used to analyze the data with the aid of SPSS version 27. In addition, Hayes process model 1 was used for computing and describing the moderation analysis. Evidence from the study showed that the study variables (EO, LO, TO) significantly influenced organization Performance but MO has found to be statistically insignificant in predicting the level of organization Performance. The study also finds that Environment turbulence has a moderating role on the effect between predictors (EO, LO, TO) on organization performance. The study also shows that low environment turbulence is more favorable for strategies than high environment turbulence. Based on the findings, it is recommended banks should practice strategic orientation in their businesses during low environment turbulence. However further research may consider investigating MO independently and further investigate the moderating effect of other factors in predicting bank performance
Keywords: Strategic orientation, Market orientation, Entrepreneurial orientation, Learning orientation, Technology orientations, environment turbulence, Bank performance