ABSTRACT

Since the aftermath of global financial crisis in 2008, and its subsequent effect on the Nigeria

financial sector, relentless competition drive banks to constantly adapt, reconfigure and

renew, their core processes and capabilities in responses to market changes so as to improve

performance. These routine activities are in line with the notion of dynamic capabilities (DC)

in both theory and practices. However, there are still arguments on the mechanisms to which

DC relate to organisational performance. Some studies established no significant relationship

between DC and organisational performance, others reported that such relationship only exist

through a chain of intermediate variables. Consequent upon these, the objective of this study

is to examine the relationship between Dynamic Information Technology Capabilities (DITC)

and organisational performance, and the mediating effect of process improvement on the

relationship between DITC and organisational performance of banks. Also, to determines the

best DITC predictor variable on the relationship thereof. The study adopted descriptive and

correlation research design. Data was collected from the respondents at a point in time using

cross sectional survey research design. The data was analysed using descriptive statistics, and

correlation. Multiple regressions was used to test the hypotheses formulated, and the findings

revealed that there is a significant positive relationship between DITC and organisational

performance of banks in terms of marketing and customer services delivery in branches. The

most significant positive relationship was found between IT infrastructure flexibility,

followed by IT personal expertise, and then IT management capability. On the mediation test

this study revealed that process improvement significantly mediated the relationship between

DITC and organisational performance. Individually this mediation is higher in terms of

knowledge creation, IT personnel expertise and IT management capability. However, IT

infrastructure flexibility did not mediate the relationship between DITC and organisational

performance. It is recommended that bank managers should invest in terms of money, time,

xvi

and commitment to develop DITC to improve performance. For regulatory bodies, the goal of

achieving IT standards within the banking sector should