Strategic Profit Planning and Organizational Performance in Public Sector Commercial Banks of Nepal

Abstract

This study aimed to examine strategic profit planning and its effect on the organizational performance of the public sector commercial banks of Nepal. Using a standardized questionnaire, primary data was obtained. Based on a judgment sampling method, 450 employees were taken for the sample. 72.70 percent of senior and middle-level employees participated in this study. In this study, budget planning, budget participation, budgetary sophistication, and budgetary control were considered as the independent variables and organizational performance was a dependent variable. The findings showed that the dimensions of strategic profit planning had a positive and important impact on the organizational performance of public commercial banks in terms of budget planning and budget participation. However, the other two dimensions of strategic profit planning like budgetary sophistication and budgetary control had a negative impact on the organizational performance of these banks. In such realities, companies need to focus on other factors that contribute to better performance apart from strategic profit planning dimensions, like employee motivation and invest more in staff development to enhance their organizational performance.

Keywords: Budgeting, Commercial banks, Organizational performance, Public sector, Strategic profit planning

DOI: 10.7176/RJFA/11-22-01

Publication date: November 30^th 2020