Radical Transformation of Small and Medium Financial Institutions: The effect of Change Management factors on Organization Performance

Abstract

The main objectives of this study are (1) to examine the effects of the change management factors on the Nigerian banks organizational performance and (2) to explore the implementation level of change management related factors among banks in Nigeria. Change Management factors are operationalised by reward and motivation, communication, empowerment, people’s involvement, training and education, creative culture for change and stimulating receptivity of organization to change. Data was sent and collected through a hand-delivery method. A proportionate stratified random sampling was used for sample selection. 500 questionnaires were sent to banks’ managers, but 392 of them were returned; giving a response rate of 78.4%. The findings were as follows: first, the findings showed that all dimensions of change management had a mean score of more than 3.00. These findings generally indicate that the bank managers perceived that their banks were implementing good change management practices related to reward and motivation, effective communication, training and education, employee empowerment, human involvement, creative organization culture and stimulating receptive to change factors of change management. Second, the results showed that change management factors such as revised reward system, people’s involvement, empowerment, training and education were significantly related to overall organisational performance in terms of turnover, profit margin, customer service delivery and operational cost reduction performance. The outcome of this study provides important insights to both academics and managerial implications.