Managing Change And Innovation, A Panacea To Improve Organizational Performance. [A Study Of First And Union Banks Owerri Imo State]

ABSTRACT

This study examined managing change and innovation a panacea to improve organizational performance in financial institutions in Nigeria, a study of First and Union banks of Nigeria in Imo state.  The study set out to determine the effect of structural mechanism on organizational performance in financial institutions, examine the effect of change resistance on organizational performance in financial institutions, ascertain the impact of collaboration on organizational performance of financial institutions. The study adopted the descriptive research design. Data was collected through survey method. Primary and secondary data were collected for this study using self-administered questionnaire and other means, such as text books, journals among others. Data was analyzed with the Kruskawallis test using 15.0 version of the Minitab statistical software (MSS). The study results showed that Nigerian banks currently operate in a rapidly changing environment as compared to the previous years and the rapidly changing environment motivated banks to be more proactive in generating new ideas and improving performance. The study results showed that change in the Nigerian banks was positive and acted as leverage for success and the change management practices used by the banks reduced the chances of resistance associated with adoption on new ideas. The results also indicated that successful change management and innovation could be measured by the level of performance of the banks. The study results revealed that Nigerian banks had a clear plan of managing change and innovation and that change management plans were well known and communicated to all employees. The study findings also indicated that management was always strictly focus on their determination to implement change processes and innovations in various phases in order to subdue any change resistance in financial organizations.

KEYWORDS: Management, Change, Innovation, Banks and Employees.

SECTION 1

INTRODUCTION

• Background of the Study

The present day financial institutions, quite unlike before 21^st century are operating in a very dynamic marketplace and this requires the ability to choose the right change opportunities while demonstrating the necessary degree of flexibility to meet the fluid requirements of the organization over time. The ability to select change management initiatives that are aligned with the organization’s strategic direction is fundamental for success. The world of banking and finance has been in a state of constant change. On the one hand, heightened regulations pose a significant challenge; just as customer behavior has changed massively (Kaiser and Ringlstetter, (2010). Private customers are fleeing into low-risk and liquid investments which lead to reduced demand for high-margin products and services. The persistently low levels of interest continue to exert additional pressure on yields (Barratt-Pugh, Bahn, and Gakere, 2011).

Barbaroux, (2011) stated that strategies and business models are being adapted to suit the changing customer behavior and to adjust the cost structures in line with the long-term lower profit expectations.

Jorgensen, Owen, and Neusn, (2009) Organizations that are successful with large-scale change initiatives have several things in common; primary among them is a defined governance structure encompassing the entire change cycle. Successful structures begin with the decision process and continue through final execution of the change initiative.

Hurn, (2012) Organizations need to adapt their structures and processes in a flexible way in order to gain a competitive edge and cope with the evolution of markets. This can be effectively achieved through redefining how they design and distribute tasks, allocate roles and responsibilities and coordinate dispersed decisions and activities. However, they also need to find means to maintain the reliability of their structures so as to ensure the continuity of their actions, particularly in hypercompetitive environments (Barbaroux, 2011). The main challenge here is to find a suitable balance between adapting to the flexible environment and maintaining reliability.

• Statement of the Problem

Change management and innovation is a fundamental cum critical factor for organizational survival in any economy like Nigeria. Thus change management and innovation demand an effective and efficient execution through staff collaboration, structural mechanism and possible resistance arising from the staff left behind by the development. One of the most recent change and innovation management in the financial sector in Nigeria was the e-banking, which recorded both negative effects such as increase in unemployment, internet fraud, among others and positive effects like customer satisfaction, increase in profits of the financial institutions, reduction in money laundry, etc.

But notwithstanding the invention and wave of change management and innovation in organizations, the performance of financial institutions in Imo state and Nigeria at large, especially the rate of efficiency and effective satisfaction of customers and general operations of financial institutions in Nigeria is still not encouraging at all. Most of the time these financial institutions throw blames on the government for not providing adequate basic social and infrastructural facilities, security among other reasons why they do not perform.

Bryman and Bell, (2003), Change management in financial institutions demand that they should have effective systems in place to counter unpredictable events that can sustain their operations, while minimizing the risks involved through innovations. Only financial institutions that are able to adapt to their changing environment and adopt new ideas and business methods have guaranteed survival (Deresky, 2008). Some of the forces of change which have impacted the performance of financial institutions mainly include technological advancements such as use of mobile phones and the internet (Bhattacharya and Thakor, 2003).

It is crucial that change management in financial institutions be made through sound analysis of how to properly implement changes cum innovations to avoid harm on their performance (Central Bank of Nigeria Bulletin, 2009).

Bank performance is directly dependent upon efficiency and effectiveness of change management and innovation, on the other hand tight control in standards to prevent negative performances associated with change management and innovation. This study therefore studied how well the financial institutions impaired on their prosperity, as a need for customers satisfaction and to strike a balance between tight control and standards in efficiency and effectiveness of change management and innovation in Nigeria, a study of Union  and First bank Banks, Owerri.

1.3 Objectives of the Study

The main objective of this study was to determine the effect of change management and innovation on the performance of financial institutions in Owerri, using First and Union Banks of Nigeria as a study.  Other specific objectives include:

1. determine the effect of structural mechanism on organizational performance in financial institutions.
2. ascertain the effect of change resistance on organizational performance in financial institutions.
3. examine the effect of collaboration on organizational performance in financial institutions.

1.4 Research Questions

This study sought to find answers to the following questions below;

1. How structural mechanism affected the organizational performance of financial institutions in Nigeria?
2. To what extent has change resistance affected the organizational performance of financial institutions in Nigeria?
3. To what extent has collaboration of staff affected the organizational performance of financial institutions in Nigeria?
   • Research Hypotheses

The hypotheses formulated from the research study are as follows

1. H₀₁ Structural mechanism has no significant effect on organizational performance of financial institutions in Nigeria.
2. H₀₂ Change resistance has no significant effect on organizational performance of financial institutions in Nigeria.
3. H₀₃ Collaboration of staff has no significant effect on organizational performance of financial institutions in Nigeria.
   

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   Pages:  51

   Category: Project

   Format:  Word & PDF               

   Chapters: 1-5                                          

   Source: Imsuinfo                            

   Material contains Table of Content, Abstract and References.