Strategic Planning in a Sustainable Economy:A pathway to Enhanced Productivity,Growth and Stability

Strategic Planning in a Sustainable Economy:A pathway to Enhanced Productivity,Growth and Stability

Author by Dr. Folajimi Festus Adegbie

Language: English

Abstract

The Nigerian Banker.Journal of Chartered Institute of Bankers of Nigeria,Lagos.July-September 2012 pp.34-42. Productivity, growth and business stability are known to have become a major phenomenon in the Nigerian financial sector. The financial system of any nation is a function of the size of its economy. A growing economy places more responsibilities on the financial sector to mobilize the needed capital to facilitate production, generate employment and income. An economy that does not experience growth on a sustained basis is likely to have a very passive financial sector as there are no incentives for investment. The paper focused on the financial sector as a representation of the economy. The following challenges were critically analyzed and discovered as issues affecting business stability, growth and productivity in the economy: Small assets-based banks that were not internationally competitive; inadequate capital to operate competitively in the international financial market; Liquidation of institutions in the Nigerian economy which according to CBN report 22banks were liquidated before independence, 3banks in 1992,4banks in 1994,26banks in 1998,14banks in 2005 after consolidation. In 2009, the CBN injected N620billion into the system to save 8banks from total collapse. Other issues discovered were technological revolution which has placed Nigeria in the back seat; high rate of financial and economic crimes; significant corporate governance issues, non-compliance with the monetary authorities’ policies and standards. The paper recommended the imperativeness of strategic planning in the financial sector which will result into strategic objectives of the institutions competiveness and long-term business position in its markets. The paper further recommended the following: infuse the organization with a sense of purpose and establishing a clear mission to be accomplished; convert the strategic vision and mission into measurable objectives and performance targets; reinvent strategies and avoid reengineering. The paper concluded that to support the Central Bank of Nigeria’s efforts to stabilize the financial sector, each organization in the sector should develop internal strategic planning that will be result oriented.


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