Improving The Performance Of An Organisation Through Effective Policy Formulation
Most organizations lack policy formulation for effective organizational performance is not usually carried out properly due to lack of appreciation and knowledge of the relevance of policy making and implementation on organizational growth. Descriptive research design was used in carrying out this research work and the regression analysis was used to analyse the data.
The specific objectives of the study were:
- To establish the prevalence of policy formulation as a tool for organizational performance,
- To determine the challenges facing policy formulation for organizational growth and
- To assess the effects of policy formulation on organizational performance.
1.1 Background to the Study
Every organization aims to survive and grow in a competitive environment. To do so, it must respond and adjust to the social, economic and political environmental changes that occur. The environments of public organizations according to (Bryson, 2004) have become not only increasingly uncertain in recent years but also more tightly interconnected; thus changes anywhere in the system reverberate unpredictably, and often chaotically and dangerously throughout the environment. This increased uncertainty and interconnectedness requires a response from public organizations. First, these organizations must think strategically as never before. Second, they must translate their insights into effective strategies to cope with their changing circumstances and lastly, they must develop the rationale necessary to lay the ground work for the adoption and implementation of their strategies.
For strategic planning to be effective and useful, there must be commitment and involvement across all levels of the organization, overcome inherent problems such as; rivalry among departments, projects, resistance to change, resource requirement, resources allocation and so on. The policy initiatives and directions set up by firm management in the form of mission and vision statements and targets for cost saving, debt/equity ratios embodied as argued by Grant (2003) “a framework of constraints and objectives that bounded and directed strategic choices.” Strategic policy formulation has been embraced by business enterprises, the public and private sectors as an important avenue that can be utilized to lead effective organization performance. Strategic policy formulation is the first phase in strategic management process and sets the basis for the other phases (Policy implementation, evaluation and control). (Steiner, 1979) argues that strategic planning system provides the framework for formulating and implementing strategies. However, it is argued that for strategic planning to translate into results, a facilitative internal environment and culture must be present. Ansoff (1990) notes that environment is constantly changing, and so it makes it imperative for organizations to continuously adapt their activities in order to succeed. Strategic planning introduces changes that sometimes encounter organizational resistance. Thompson and Strickland (1989) add that galvanizing organization-wide commitment to the chosen strategic plan is critical for effective performance.
There is always a need for policy making in the banking sector especially in First Bank of Nigeria due to the change in the administrative head. The integration brings about framing of policies to guide managerial action. Policymaking became the prime responsibility for effective management system. The implementation phase in strategic management process consists of a set of activities by which the top management assures that the strategic choice is communicated and related to both the organization and its people. This is to say that implementation encompasses the activity of developing the organizational structure and climate best suited for the implementation of the chosen or adopted policy. This task is therefore important in the life of any organization wishing to survive and to grow cannot be over-emphasized considering the dynamic nature of the world we are in today. However, for management system to effectively carry out this task of achieving their corporate objectives, the management must aim itself with the tools of strategic policy formulation and implementation to enable it to adjust to the environment changes surrounding them. It is in the light of this that the researcher aimed to investigate on improving the performance of an organisation through effective policy formulation using the First Bank of Nigeria as a case study.
1.2 Statement of the Problem
The management of most organizations in Nigeria today have been facing the problem of not knowing how to achieve their corporate objectives as a result of lack of proper strategic policy formulation. This problem which has defile may management approaches is what the researcher is aimed at solving. Many organizations spend most of their time realizing and reacting to ill expected changes and problems instead of anticipating and preparing for them. This is called crisis management. They use up their energy coping with inundated problems with little energy left to anticipate and prepare for the next challenges. This is however causing setbacks for some organizations. This study will therefore investigate on improving the performance of an organisation through effective policy formulation using the First Bank of Nigeria as a case study.
1.3 Research Questions
The following are some of the questions which this study intends to answer:
- What is the prevalence of policy making and implementation as a tool for organizational performance?
- What are the challenges facing policy formulation for organizational growth?
- What are the effects of policy formulation on organizational performance?
1.4 Objectives of the Study
The objective of this study was to investigate on improving the performance of an organisation through effective policy formulation using the First Bank of Nigeria as a case study. The specific objectives are:
- To establish the prevalence of policy making and implementation as a tool for organizational performance.
- To determine the challenges facing policy formulation for organizational growth.
- To assess the effects of policy formulation on organizational performance.
1.5 Research Hypotheses
The research hypotheses to be tested include:
- There is no significant relationship between policy formulation and organizational performance
- There is no significant correlation between policy formulation and top management subordinates on increase in performance
- There is no significant difference between employees commitment and policy formulation
1.6 Significance of the Study
The findings from this study will be of great value to policy makers, stakeholders, board of directors and Human Resource Managers, bankers, etc as it will assess the relevance of policy formulation on organizational performance, clarify the challenges and the ways to meet them. It will act as a useful resource for the banking sector in understanding the need and usefulness of adopting appropriate strategic planning that ensures improved organizational performance. Researchers in related areas will also find the study a useful literature for reference.
1.7 Scope of the Study
This study was limited to the First Bank of Nigeria staff and therefore the questionnaires will be distributed to the employees of the organisation.
1.8 Limitation of the study
The only constraint encountered by the researcher was finance. This limited the researcher to print just one hundred and twenty questionnaires as against the proposed two hundred and fifty questionnaires. The researcher, however, came up with findings that would be worth making reference to in future and also contribute to the existing literature.
1.9 Definitions of Terms
The following terms were used in the course of this study:
The making of ideas or plans that are used by an organization or government as a basis for making decisions
Summary, Conclusion and Recommendation
5.1 Summary of Findings
The following findings were made from the study.
- Majority of the respondents were male
- Majority of the respondents were between the age 20-30years
- The study also revealed that majority of the respondents were married
- It was also evident that majority of the respondents had HND/B.SC qualification
- Also majority of the respondents have been in service for 0-5years
- There is relationship between effective policy formulation and organizational productivity in First bank Plc Enugu
- There is relationship between effective policy formulation and employees‟ performance in First bank Plc Enugu.
- The study also revealed that lack of accountability, lack of commitment, inadequate instructions to employees, information system used for implementation is inadequate and lack of understanding of the role in the execution process were challenges in the implementation of effective policy formulation in First bank Plc Enugu.
Based on the literature review and above discussion on effect of policy formulation and organizational performance, it can be concluded that, effective policy formulation has important contributions in order to achieve a better organizations and employees‟ performance. Therefore, the relationship of each dimensions of effective policy formulation was tested toward performance of the organization. It is hoped that the findings of this study will be able to help the organization to understand how the effective policy formulation can help to make better decision in the future.
In the light of above findings, some pertinent recommendations were made. These recommendations are geared towards assurance of organizational and employees‟ performance, growth through effective policy formulation.
This study recommends the following:
- That Nigeria firms should give more serious attention to effective policy formulation, separate other types of planning from effective policy formulation, endeavor to choose appropriate strategies that matches for every strategic plans and as well adopt and effectively implement the full tenets of effective policy formulation.
- Employee welfare is an indispensable factor of effective policy formulation as all tenets of effective policy formulation (formulation, implementation, evaluation and control) must be executed through its human capital, therefore every organization must endeavor to take the welfare of its human resources very serious for assurance of effective policy formulation. In other words, for organizations to survive through attainment of its objectives, employees must play an indispensable role.
- Those Organizations should endeavor to capture more or at least maintain its market especially through merger and acquisition because larger market share lead to high turnover, higher profit and better performance.
- Technological changes affect product quality and price therefore organizations should endeavor to rapidly respond to technological changes.
Organizations should endeavor to adopt appropriate training because appropriate training provides a solid foundation for employees‟ performance.
5.4 Recommendations for Policy and Practice
The study makes a number of recommendations. First, the study recommends that the FBN should continually enhance the strategy communication process within the organisation to assist in effective coordination of effective policy formulation in a turbulent environment.
As our research result shows that high employee performance relates to involvement in strategy formulation, adequate training and development and adequate incentives and recognition once they effectively and efficiently implement strategies.
Lastly, the study recommends that banking sector have an adequate strategy implementation process that is agile enough to align the organisation to its environment in a way that ensures it takes full advantage of its strength and opportunities in the industry in order to gain a competitive edge while mitigating against the effect of its weaknesses and the threats posed by the industry.
5.5 Suggestions for Further Research
More studies should be done to examine other factors that may influence performance. Further, future studies should obtain a large population of banks to determine whether the results can be generalized as this case only used one bank. The study suggests that a similar study to be done on all commercial banks in Nigeria for the purposes of benchmarking. This would allow for generalization of study findings.
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Frequently Asked Questions
How do you build competitive differentiation in your organization?
Focus each department on improving its procedures and targeting its activities on better-achieving the company’s competitive differentiation through what people do and how they do it. 2. Leverage high-impact leadership practices.
What makes a performance audit effective?
For this type of audit to be effective, the auditor must be objective and not assess a one-size-fits-all approach when evaluating, for example, a new program or process against one that has been in existence for a long time. Performance audits can lead to more effective, data-driven results for your organization.
What is evidence-based policymaking?
Evidence-based policymaking uses the best available research and information on program results to guide decisions at all stages of the policy process and in each branch of government.
How can performance audits drive results for government?
Performance audits can help organizations and governments become more efficient, drive better performance and provide more value. Organizations who utilize a performance audit have a forward-looking approach to their operation. We recently looked at how performance audits can drive results for governments.
What is a performance audit & why does it matter?
Performance audits and operational reviews can improve the efficiency and effectiveness of operations. This allows you to identify and seize opportunities for increasing customer quality, improve service and even increase positive cash flow. Learn more about the different types of audits.
What are the benefits of an audit?
There are also audits focused on helping the organization become more efficient and effective. These audits have become extremely popular and may be beneficial for any organization. Through performance audits and operational reviews, your organization will improve the efficiency and effectiveness of operations.
How do you measure the effectiveness of a performance audit?
One way to measure the effectiveness of a performance audit is by understanding the skill sets of those performing the audit. Megan knows there are several questions that can help determine how capable the auditors are. How many years have they been doing audits?
What is the outcome of an audit?
The outcome of an effective audit includes financial statements that present a true and fair view, and advice on how the company’s processes may be improved. An effective audit is completed to schedule, and with minimal disruption to the company. Prerequisites for an effective audit are an effective audit firm and team.
What is good evidence for policy?
“good” evidence for health policy as a question of appropriateness. Rather than adhering to a single hierarchy of evidence to judge what constitutes “good” evidence for policy, it is more useful to examine evidence through the lens of appropriateness. The form of evidence, the determination of relevant categories and variables, and the
What is evidence based decision making?
Evidence-based decision making is a process for making the best decisions possible using the evidence available. It avoids decision making that is based on gut feeling, intuition, or instinct and instead relies on data and facts.
Who are the policy makers?
High-level development of policy, especially official government policy. Of, relating to, or involving the making of high-level policy: policymaking committees; policymaking decisions.
What are the Government Auditing Standards?
These generally accepted government auditing standards issued by the U.S. Accountability Office are also known as GAGAS or Yellow Book standards. These standards apply to both financial and performance audits.