Non-Financial Performance Indicators and Operational Efficiency of Deposit Money Banks in Nigeria
- January 7, 2020
- Posted by: RSIS
- Categories: Accounting, IJRSI
International Journal of Research and Scientific Innovation (IJRSI) | Volume VI, Issue XII, December 2019 | ISSN 2321–2705
Non-Financial Performance Indicators and Operational Efficiency of Deposit Money Banks in Nigeria
Olalekan Oladipo Akinrinola
Department of Accounting and Finance, Caleb University Imota, Ikorodu, Lagos State, Nigeria
Abstract: This study examined the effect of non-financial performance indicators, based on balanced scorecard model, on operational efficiency of Deposit Money Banks (DMBs) in Nigeria with a view of evaluating the impact of the drivers of operational efficiency. Emphasis, from prior studies, on measuring operational efficiency have been on financial performance indicators with little or no consideration for the contributions of non-financial performance indicators (NFPIs) that drive the financial indicators. The study adopted a descriptive survey research design and a structured questionnaire was administered on sampled employees of the DMBs. Data collected were analysed with the mean of descriptive and inferential statistics. The study found out that internal control and business process, customer satisfaction and learning and growth of employees individually have significant effect on operational efficiency of DMBs in Nigeria. The study concluded that NFPIs have positive relationship with, have significant effect on operational efficiency of DMBs in Nigeria and explain about 56.9% variations in operational efficiency. The study contributed to literature on significance of NFPIs and recommended that DMBs should develop objective matrices to measure individual non-financial performance indicators that tend to contribute to their operational efficiency.
Keywords- Balanced scorecard; Financial performance indicators; Internal control and business process; Customer satisfaction; Learning and growth of employees
I. INTRODUCTION
Achieving operational efficiency in any organisation cannot be separated from performance management strategy of such an organisation due to the reason that only organisations that are ready to offer new products and services of high quality, while maintaining cost at its lowest ebb, will have the capacity to increase or at worse sustain market share and profitability level. Operational efficiency is a vital strategic initiative that can ensure sustainability of an organisation or dwindle the fortune of a business organisation if not properly addressed. Operational efficiency minimises wastes and improves the ability of a business to provide products of good quality and render services of high standards to their clients. It also recognised uneconomical processes that contributed negatively to the bottom-line and strategise on better processes that will enhanced output and quality (Devina & Gupta, 2012).
