The Effect of Strategic Management Practice on Organizational Performance
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Date
2025-06-23
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A.A.U
Abstract
This study aims to understand the effectiveness of strategic management practice in selected commercial banks in Ethiopia. Most of studies show that there is a remarkable relationship between strategic management practice and organizational performance. This study tried to show how these practices affect the performance of organization. The primary data was collected through 107 structured questionnaire distributed to employees directly involved in strategic management process across seven selected Private Banks. Secondary data source was gathered from five years of audited bank reports and publications from regulatory bodies. The research used purposive sampling to select participants and inferential statistics for correlation and multiple regression analysis. The result of the correlation and regression analyzed using SPSS version 30 and presented as tables for analysis. By providing empirical evidence the study addresses a gap on how strategic management practices affect organizational performance, with practical implications for executives and policymakers seeking to improve operational effectiveness in this sector. The result of this study shows that environmental scanning and strategic formulation have strong positive and statistically significant effect on organizational performance. On the other hand strategic implementation and strategic evaluation and control while correlated, did not show significant effect in regression model. The finding demonstrates the importance of proactive environmental analysis and inclusive strategy development while showing constant gaps in implementation and evaluation process. These findings offer practical benefits for banks managers and policy makers who want to increase operational effectiveness and competitiveness in Ethiopian’s banking sector.
Keywords: Environmental scanning, Strategic formulation, Strategic implementation, Strategic evaluation and control.