CHAPTER ONE
Introduction
1.1 Background of Study
Corporate planning is the process of selected objectives, purpose or goals and deciding generally and specifically what should be done to attain these objectives. It is done at corporate level which covers the entire organization with due attention to various departments, sections, division and branches that up the organization. Corporate planning is also called strategic planning as a tool to aid management in strategic decision-making. The purpose of strategic planning thus to accomplish a sufficient process of innovation and change in the firm. It is a process a corporation follows thinking through before hand what is to be accomplished and to large extent how to accomplish it. This greatly simplifies the task of the manager and enables him to make most effective use of time, manpower and equipment, facilities and money. Corporate planning is a systematic study, which is designed to help identify the of any organization. It is also a determined effort to attain the desired target and needed effort to attain the desired Target and examine the likely constraints as well as device a plan in which a set of objectives can be achieved. Corporate planning is done on a long-term basis and it involves an integrated approach to all aspects of the company’s activities by treating the company as a corporate entity where all the different branches, department and units, which make up tile organization are collectively taken care of rather than a collection of separate outfits. Any activity that does not aid in the strategic decision making of the firm is not corporate planning, even though it may seem to involve many of the ‘’right’’ elements of planning such as elaborate five years plan often does not influence strategic decision making aids. Effective corporate planning does not have to elaborated or complicated, but must be logical and focused on the strategic decision that will be taken (Lorange, 1980).
A very important aspect of corporate planning is the study of the environment in which the organization operates. This kind of study will include the past history, the present activities as well as the projection into the future. The ultimate objective of the process is to match company’s strength and weakness with environmental opportunities and threats, this is in order to be able to complete favorably and efficiently in the environment and consequently lead to accomplishment of organizations objectives and goals. Corporate planning consists of two major components. They are operational and strategic planning. Operational planning deals with the day to day activities of the business and done along the Functional area like production planning, marketing planning, financial planning, manpower planning Etc. It also consist of single use plans which are developed to achieve specific purpose and dissolved when these have been accomplished for handling recurrent and predictable situations. Strategic planning on the other hand is the process of selecting an organization goals and also established, the methods necessary to ensure that the policies and programs are implemented. It is the formal process of determining long run objectives and how to achieve them. Corporate strategic planning in the pattern of decision in a company that determines and reveals its objectives, purpose or goals produces and the principal policies and plans for achieving these goals and define the range of business the company is to pursue the kind of economic and human organization, it is or it intend to be and the nature of economic and non- economic contributions. It intends to make to its shareholders, employees, customer and communities. It is the type of plan that embodies time span and strategic formulation. It is a long term planning that has a time horizon of at least three years. It is also a clever device with the potential of evolving in the long run creation of additional resources that will facilitate and hasten the attainment of long-term objectives and enable the organization to gain some relative advantages of current position and competitions.