Strategic Planning, External Environment and Organizational Performance: a Case Study of Kcb Bank Kenya Ltd

Abstract

The objectives of this study are; to determine the influence that strategic planning has on organizational performance at KCB bank Kenya ltd and to establish the link between strategic planning, external environment and organizational performance. This was motivated by the fact that organizational performance has become a core item of study in the organization as a dependent variable. Despite attempts to demystify the core elements that influence organizational performance, none has been conclusive. This study was done to add onto the theory of the studies done on the same field so as to enable better results for organizations and what organizations should look at to maintain and improve their performance. The study was anchored on Contingency theory while the supporting theories were complexity theory as well as open system theory which takes a situational approach in how an organization is run and it indicates there is no best way to do it. It employed descriptive survey research design targeting 760 employees of KCB bank Kenya ltd where 10% of the population which is 76 staff members was sampled using purposive and convenience sampling methods to respond to the questionnaire which was the preferred data collection method. Descriptive data analysis method was used, correlation and regression were also employed to look at the extent of the relationship between the variables. The results clearly indicated external environment had an influence in the formulation of strategic plans and this in respective affected the organizational performance. It was also established that the involvement of staff members in all the processes is key to attaining good results. It was established that external environmental factors that cause turbulence and upheaval greatly affect organizational performance. Strategic planning forms the heart of an organization and the success of the plan is also dependent on various aspects of organizations like resources available, leaders and other factors. The study recommends that similar studies are replicated in other Kenyan banks or even in a different industry altogether.