Influence of Strategic Planning Practices On the Performance of Commercial Banks In Juba, South Sudan

Abstract

Performing organizations exhibit high revenues growth, profits incline, enhanced customers’ satisfaction and market share. However, commercial banks in Juba paint a different picture of performance challenges related to profits decline, decline in customers’ deposit and stagnation in growth of products. This study established the influence of strategic planning practices on the performance (financial and customer-based) of commercial banks in Juba, South Sudan. It investigates the influence of strategic direction, environmental scanning, resource planning, and plan monitoring on performance. The study was guided by the goal-setting theory, resource-based view theory, contingency theory, and balanced scorecard model. The study adopted a cross-sectional research design. The unit of analysis comprised 31 licensed commercial banks, while the unit of observation included 186 managers. A stratified random sampling technique, in addition to the Taro Yamane formula, was used to select 128 participants. Data was collected using questionnaires with both open-ended and closed questions. The questionnaires were administered both physically and electronically. Descriptive statistics, including frequency, percentage, mean, and standard deviation, summarize the data, while a binary logistic regression model was applied for inferential analysis. The findings were presented in tables and narratives. Findings revealed that strategic direction setting, including well-documented vision, mission, and core values, positively and significantly improved performance, with banks having structured direction setting showing a 7.831 times higher likelihood of achieving better performance than unstructured ones. Environmental scanning, both internal and external data sources, showed a 49.204 times higher chance of improved performance than scanning that focused only on internal environment scanning. Also, plan monitoring had a significant positive influence on performance, with banks conducting regular monitoring experiencing a 10.289 times higher likelihood of better performance outcomes than ones that conducted irregular monitoring. However, resource planning showed no significant effect on bank performance. The study concluded that strategic direction, environmental scanning, plan monitoring positively and significantly influenced performance, however resource planning did not have a significant influence. The study recommends that managers of banks in Juba actively set strategic directions through the formulation of vision, mission, objectives, and core values statements. Additionally, managers should support both internal and external scanning of the environment to support decision making and enhance performance using AI-driven data analytics. Lastly regular plan monitoring is crucial in bolstering banks’ performance in Juba.