THE RELEVANCE OF STRATEGIC PLANNING ON ORGANIZATIONAL GROWTH

    CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND TO THE STUDY

Every organization wants to survive and grow in a constantly changing and competitive environment. To do so, it must respond and adjust to the social, economic and political environmental changes that occur.

Business environment according to (Bryson, 2004) have become not only increasingly uncertain in recent years but also more tightly interconnected; thus changes anywhere in the system reverberate unpredictably, and often chaotically and dangerously throughout the environment. This increased uncertainty and interconnectedness requires a fivefold response from organizations. First, these organizations must think strategically as never before. Second, they must translate their insights into effective strategies to cope with their changing circumstances. Third, they must develop the rationale necessary to lay the ground work for the adoption and implementation of their strategies. Fourth, they must build coalitions that are large enough and strong enough to adopt desirable strategies and protect themselves during implementation. 

And finally, they must build capacity for ongoing management of the strategic change.

Strategic planning can help leaders and managers of public organizations to think, learn and act strategically, (Bryson, 2004). The idea of strategic planning emerged in corporations that wanted to have a strategy as to how to maximize their profits. Today, the motivation is manifold and differs according to the type of organization.

The need for an organization to proactively respond to environmental challenges has now become imperative, as it offers the organization a competitive edge in business world. Thus, every organization regardless of its size must have some form of a strategic plan.

Both private and public sector have increasingly gained the attention of various developmental strategies especially in developing countries as a key for the advancements needed in the socio-economic emancipations of countries in Africa. The role of the state and its institutions has been identified as a key partner to these sectors in carrying out the developmental agenda. Indeed business organizations have been under scrutiny to adopt the approaches necessary towards growth and development.

Business organizations, in developing countries, can approach developmental issues especially, given the advancements in business management made in the world and the expected fast growths needed for quicker transformation in their economies.

As a result, various development experts have now resolved to strategically plan and roll out a coordinated and comprehensive strategy to harness their business potential as a pivot for growth.

1.2 STATEMENT OF THE PROBLEM

In view of the many challenges that business organizations are exposed to, it is imperative for them, both profit and nonprofit organizations, to anticipate challenges, identify their strengths to meet anticipated challenges and take control of available opportunities to obtain maximum productivity.

Unfortunately, in most organizations, especially in the public sector, strategic plans are not carried out and implemented properly.  Some public

organizations do not attach any importance to strategic planning and therefore do not have strategic plans for their organizations. This could be borne out of lack of appreciation and knowledge of the relevance of strategic planning to organizational growth.

In an attempt to address this unfortunate development, there is the need to critically assess the relevance of strategic planning on organizational growth to enable management appreciate its worth in gaining competitive advantage at the market place.

1.3 OBJECTIVES OF THE STUDY

The general objective of this study is an attempt to critically assess the relevance of strategic planning on organizational growth with particular reference to        First Bank of Nigeria Plc, Abuja.  

Specifically, the objectives of the study are as follows. To:

(i)    Examine the practices of organizations with regard to strategic planning.

(ii) Critically assess the relevance of strategic planning on the growth of organizations.

(iii)     Examine the challenges in the implementation of strategic plans and ways of meeting the challenges.

(iv)   Make suggestions for the formulation and implementation of strategic plans in public institutions.

1.4             RESEARCH QUESTIONS

(i)                What is the existing practice regarding strategic planning in business organization?

(ii)             Why is strategic planning relevant to the growth of     business organizations?

(iii)           Is there a relationship between strategic planning and organizational growth?

1.5     STATEMENT OF HYPOTHESES

This study “The Relevance of Strategic Planning on Organizational Growth; A Case Study of First Bank Plc, Abuja” will seek to test the following hypotheses.

Note that H₀ is the Null hypothesis while H₁ is the Alternative hypothesis.

Hypothesis One:

H₀: There is no existing practice regarding strategic planning in business organizations.

H₁: There is an existing practice regarding strategic planning in business organizations.

Hypothesis  Two:

H₀       Strategic Planning is not relevant to growth of business organizations

H₁       Strategic Planning is relevant to growth of business organizations

Hypothesis  Three:

H₀:  There is no relationship between strategic planning and organizational growth.

 H₀:   There is a relationship between strategic planning and organizational growth.

1.6 SIGNIFICANCE OF THE STUDY

The thrust of the study is aimed at contributing to knowledge with regard to strategic planning and its relevance on organizational growth in both private and public sectors of the Nigerian economy.

The findings of this study will be of great value to management and staff of  First Bank of Nigeria Plc, Abuja, as it will assess the relevance of strategic planning on organizational growth, clarify the challenges and the ways to meet them.

Also, Student researchers in related areas will also find the study a useful literature for reference.

Finally, the study will make contributions that will encourage managers in private and public sectors to adopt strategic planning in the management of their entities in order to have competitive advantages.

1.7 SCOPE OF THE STUDY

The research is actually to investigate the relevance of strategic planning on organizational growth in organizations in Nigeria.  However, to cover the entire business organizations in Nigeria will be cumbersome.  However, because of limited time, lack of resources, and access to information, the researchers selected First Bank of Nigeria Plc, Abuja which the researcher could conveniently cover as a case study. 

1.8 LIMITATIONS OF STUDY

To pretend that a research work of this nature suffered no impediments would be academically deceitful. Consequently, financial constraints, time factor and other factors posed formidable hurdles in the course of this research work.

Other problems are as follows:

a)        Data collection:  Many respondents could not feel free to express their opinion.

b)        Shortage of fund:  Fund which is needed for carrying out this project also constituted a problem to the researcher.

c)       Time frame: Going to the field, libraries and write the report and submit at the required time also constituted problem to the researcher due to work and preparing for final year exams.

In spite of all these problems or hindrances, the researcher gave the project its best.

1.9 DEFINITION OF TERMS  

Strategic Planning:-   This refers to an organization's process of defining its direction, and making decisions on allocating its resources to pursue this strategy. It may also extend to control mechanisms for guiding the implementation of the strategy..

 Performance:-     This refers to actual results obtained - sometimes used to devote the achievement of positive result.

Growth:-    refers to a positive change in size, often over a period of time. Growth can occur as a stage of maturation or a process toward fullness or fulfillment. It can also perpetuate endlessly, for example, as detailed by some theories of the

Efficiency:-    Output divided by input on the extent to which the result produced was at the least cost.

Relevance:-      is simply the noun form of the adjective "relevant," which means "important to the matter at hand.

Effectiveness:-      This is the extent to which the designed result is realized and it is frequently compared with efficiency.

Organization:-  Organization is a systematic way of arranging people so that the subordinate and superseding structure of authority are to utilized the available resources to achieve their goals.

Productivity:- This is the achievement target pen, period of time, pen person on the relative output for a given level of input, especially the production per productive employee.

FBN: First Bank of Nigeria Plc.

1.10   REFERENCE

Bryson John, M. (1995). Strategic Planning for Public and Non-profit Organizations. Revised Edition. San Francisco: Jossey-Bass.

Bryson John, M. (2004), Strategic Planning for Public and Nonprofit Organizations; A guide to strengthening and sustaining Organizational achievements, San Francisco Third Edition. Jossey-Bass.

Byars, L. (1984), Strategic Management, Planning and Implementation, New York, Harper and Row.

Daft Richard, L., (1993), Management, Third Edition. The Dryden Press, Harcourt Brace College Publishers.