Strategic posture and financial performance of the banking industry in California: A strategic management study.

摘要

The problem. The environment of the banking Industry in the United States has been transformed from a fairly stable environment to a rapidly changing and highly competitive environment as a result of new challenges posed by new entities in the finance industry as well as by global banking operations. Established banking practices were conflicting with high-technology computer-driven techniques being used by institutions not bound by government regulations to which banks have to adhere. Furthermore, the deregulation of the industry had given rise to complexities in banks' cost structure.;The purpose of this study was to examine the strategic posture of banks in San Diego, California in relation to their financial performance by analyzing the relationship between: (1) Environment, strategy and capability. (2) Top managers' and outside observers' perceptions of the level of environmental turbulence. (3) Top managers' perceptions of their strategy and capability.;Method. The sample was composed of 22 banks representing 105 bank branches in San Diego, California. Data was collected through personal interview. A descriptive-elemental and descriptive-correlational approach was utilized in the analysis of the data.;Results. (1) Banks that misperceived the environment did not perform as well as those that perceived the environment correctly. (2) Banks that made the transition from pre-deregulation strategic posture to post-deregulation strategic posture performed better than banks that did not make the adjustment. (3) A low strategy-capability gap resulted in an increased profit potential of a bank. (4) Optimum financial performance occurred when the levels of environmental turbulence, aggressiveness of strategy and general management capability were aligned. (5) Decreases in any of the gaps contributed to better financial performance. (6) A validation was reached of H. I. Ansoff's strategic posture analysis.