Abstract
The study investigated the effects of strategic
planning on organizational performance with Nigerian Bottling Company Benin, as
a case in hand; the aim is to know whether strategic planning has effect on the
overall performance of the organization. The methodology that was used for the
study is survey design and the target population was 100 members of staff of Nigerian
Bottling Company Benin while the sample size was 100. The result of the
analysis indicates that there is relationship between effective strategic
planning and organizational performance and also that lack of accountability,
lack of commitment and lack of understanding of the role in the execution process
are challenges in the implementation of strategic planning and therefore
recommend among others that Nigerian firms should give more serious attention
to strategic planning and finally, employee welfare should also be given
adequate attention for efficiency and effectiveness in organization.
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE
STUDY
Business
environment is increasingly and constantly changing. There is therefore
uncertainty about the future as new situations such as technological
advancement, new societal trends, new economic forces or newly enacted
government regulations emerge. Nigerian
Bottling Company Limited also operating in markets where competition is keen
and many large competitors are present. In order to survive in a dynamic and
fast changing turbulent environment and therefore succeed in competitive
markets, an autonomous government institution must diagnose the changing
situation or circumstances and accordingly put in place strategic measures.
Very
simply put, strategic planning identifies where the organization wants to be at
some point in the future and how it is going to get there. The
“strategic” part of this planning process is the continual attention
to current changes in the organization and its external environment, and how
this affects the future of the organization. Strategic planning is a set of
managerial decisions and actions that determine the long-term direction and
survival of an organization. Strategic planning is also the activities that
lead to the statement of goals and objectives and the choice of strategies to
achieve them (Dubrin, 1998). It is
typically concerned with fundamental decisions about the future of the organization.
However,
formulating and implementing a strategic plan should not be the end of
strategic planning. Nigerian Bottling
Company Limited and other organizations need to know the impact or effects of
strategic planning on the organizational performance. The impact or effects
should be measured not only in terms of typical output-oriented quantitative
indicators, but also in terms of qualitative impacts of the strategic planning
process or activity itself. Measuring the impact of strategic planning in this
direction will enable management to know whether the resources devoted to
strategic planning are worth their value or not. The literature on the impact
of strategic planning has increasingly and exclusively dealt mostly with profit
or financial payoffs (Ramanujam and Venkatraman, 1987). Indeed, there has been
little or concern on measuring other qualitative aspects of the impact of the
strategic planning and the planning process itself on performance of
organization such as Nigerian Bottling Company. In other words, the act of
engaging in strategic planning is as valuable as the ultimate strategic
document and these needs to be measured. The present study has been stimulated
by this idea of measuring the qualitative impacts of strategic planning on performance
the Nigerian Bottling Company Limited.
1.2 STATEMENT OF THE
PROBLEM
Past
and recent research studies have made it clear that there is an increased
internal and external uncertainty due to emerging opportunities and threats,
lack of the awareness of needs and of the facilities related issues and environment
and lack of direction. Many organizations spend most of their time realizing
and reacting to unexpected changes and problems instead of anticipating and
preparing for them. This is called crisis management. Organizations caught off
guard may spend a great deal of time and energy playing catch up. They use up
their energy coping with immediate problems with little energy left to
anticipate and prepare for the next challenges. This vicious cycle locks many
organizations into a reactive posture.
This
research study is to assess the impact of strategic planning on organizational
performance, which at the long run enhances organizational survival. The first
planning-performance studies emerged after the rapid expansion of formal
strategic planning in the 1960s (Henry, 1999). Although the studies employed
diverse methodologies and measures, they shared a common interest in exploring
the financial performance consequences of the basic tools, techniques and
activities of formal strategic planning, i.e., systematic
intelligence-gathering, market research, SWOT analysis, portfolio analysis,
mathematical and computer modeling, formal planning meetings and written
long-range plans.
1.3 OBJECTIVE OF THE
STUDY
The
following are the objectives of the study
1. To investigate the impact of strategic
planning on the performance of organizations
2. To give a structural analysis of the
concept of strategic plan
3. To examine the relationship between
strategic planning and organizational performance
4. To observe the organization under study
and it performance resulting from strategic planning
5. To examine the advantage and the cost
involve in strategic planning
6. To examine the consequences of lack of
strategic planning in organizations.
7. To assess the qualitative impact of
strategic planning such as team building, common understanding of Programmes,
managerial decision making, organizational goals implementation, etc on the
performance of Nigerian Bottling Company.
1.4 RESEARCH QUESTION
1. Does strategic planning have positive
impact on organizational performance?
2. Does Nigerian Bottling Company Plc involve
in strategic planning?
3. Do most company plan for the future market
growth?
4. Is there any plan against competitors by
most organization?
5. To what extent are management and workers
involved in the implementation of strategic planning process in most
organizations?
1.5 SCOPE OF THE STUDY
The
scope of this research work focused strictly on the impact of strategic
planning on organizational performance using Nigerian Bottling Company Limited
as a case study. This work will lead us to the concept of strategic planning
and the process of strategic planning. The area covered in the research work is
limited to Bottling Company Limited, Benin City, in which the population of the
study and the sample size of the study were obtained.
1.6 LIMITATIONS O F THE
STUDY
On
the course of this research, the following problems were encountered, like
short time frame. Financing problem, scarcity of information or data, etc. this
is due to mainly, the wide scope of this study which emphasizes on a complex
institution like Nigeria. Now, the
implication is that the short time frame mapped out for this research work
posed a problem of assessing these programs as whole, but that doesn’t threat
the authentication and quality of this work.
Again,
enough finance for the accomplishment of this work became a problem in the
sense that gathering information was costly, the researcher needed enough money
to gather them.
1.8 SIGNIFICANCE OF THE
STUDY
This
research work will help the organizations and managers to understand those
benefits that strategic planning embodies which most organizations have
neglected and ignored in the past. In understanding this on the side of the
organizations, it will allow them to rethink and work towards a qualitative
strategic planning in order to enhance and increase the performance of the organizations.
1.9 DEFINITION OF TERMS
1. Planning: Planning (also called forethought)
is the process of thinking about and organizing the activities required to
achieve a desired goal. Planning involves the creation and maintenance of a
plan. As such, planning is a fundamental property of intelligent behaviour.
2.
Forecasting: Forecasting is the process of making statements about events whose
actual outcomes (typically) have not yet been observed. A commonplace example
might be estimation of some variable of interest at some specified future date.
Prediction is a similar, but more general term.
3.
Strategy: Strategy is a high level plan to achieve one or more goals under
conditions of uncertainty. Strategy is important because the resources
available to achieve these goals are usually limited.
4.
Productivity: this can be defined as efficiency with which work is done, the
amount of work done in a certain work.
5.
Organizing: this is determined of activities that need to be done in order to
reach the activities to the proper personnel.
6.
Responsibility: this is the duty to perform certain assigned tasks in a
satisfactory manner.
7.
Management: The organization and coordination of the activities of a business
in order to achieve defined objective.
Management is often included as a factor of production along with‚
machines, materials, and money. According to the management guru Peter Drucker
(1909-2005), the basic task of management includes both marketing and
innovation.
8.
Organization: A social unit of people that is structured and managed to meet a
need or to pursue collective goals. All organizations have a management
structure that determines relationships between the different activities and
the members, and subdivides and assigns roles, responsibilities, and authority
to carry out different tasks. Organizations are open systems–they affect and
are affected by their environment.