Empirical Study of the Moderating Effect of Organisational Culture on the Strategy-Performance Relationship in Nigerian Banks

Organisational culture is theorised to moderate the relationship between strategy and firm performance, yet empirical investigation of this moderating role in the Nigerian banking sector, where diverse cultural configurations coexist with competitive strategic pressures, fills an important research gap. This study empirically investigated the moderating effect of organisational culture on the strategy-performance relationship in 18 Nigerian commercial banks. Strategy was operationalised by strategic posture (Miles and Snow typology: Prospector, Analyser, Defender, Reactor), measured through a structured questionnaire administered to senior bank executives (n = 90). Culture was assessed using the Competing Values Framework (Clan, Adhocracy, Market, Hierarchy configurations). Financial performance was measured by return on equity and net interest margin for the period 2020 to 2023. Moderated regression analysis and subgroup analysis were employed. Results showed that strategy type significantly predicted financial performance in the absence of culture moderators (R2 = 0.38). Adding culture interaction terms significantly improved the model (change in R2 = 0.19, F = 11.6, p < 0.001). Prospector strategy produced the strongest performance when combined with Adhocracy culture (beta = 0.61, p < 0.001). Defender strategy was most effective within Hierarchy cultures (beta = 0.52, p < 0.001). Strategy-culture misalignment significantly reduced performance in 6 of 18 banks. The study provides the first empirical evidence of culture moderation of the strategy-performance relationship in Nigerian banking and recommends culture assessment as a prerequisite for strategic planning reviews. Keywords: organisational culture, strategy-performance relationship, Nigerian banks, Competing Values Framework, moderated regression