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Strategic Planning And Organizational Productivity
[NIGERIAN BOTTLING COMPANY PLC NGWO NINETH MILE ENUGU]
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2.4 LEVELS OF STRATEGY
The scope and complexity of strategic planning, formulation and decision vary from organization t o organization. This depends primarily on the levels within the organization at which strategic planning t akes place. These levels of strategy a re suggested by Kazmi (2008:13):
i. Corporate level strategy is an overarching plan of action covering the various functions that are performed by different Strategic B usiness units (SBUs) which are involved in a singl e line of business. The plan deals with the objectives of the company, allocation of resources and coordination of the SBUs for optional performance. There are five common corporate level growth strategies. According to Hell riegel (1990:223), they are forward integration, backward integration, horizontal integration , concentric diversification and conglomerate diversification. Hellriegel states that forward integration occurs when a company enters the businesses of its customers, moving it closer to the ultimate consumers while backward integration occurs when a company enters the businesses of its suppliers, usually to control component quality and ensure on-time delivery or stabilize prices.
Onwuchekwa (2000:39) , states that horizontal integration occurs when a company acquires one or more competitors to consolidate and extend its market share. While concentric diversification occurs when a firm acquires a business related to the organization’s existing business in terms of technology, markets or products. Generally, a related business enterprise acquires another company or start a new venture.
According to Nnabuko (1998:20), conglomerate diversification occurs when a firms adds unrelated goods and services to its line of business. One company generally ac quires another company and starts a venture in a totally new field.
ii. The second level of strategy according to Hellriegel ( 1990: 224), is the business level strategy which directs the o perations and performance of a Strategic Business U nit (SBUs) . Busi ness level strategy is the interconnected set of commitment and actions intended to provide value to customers and gain a competitive advantage by using the company’s core competenc ies in specific market. Kazmi ( 2008:13) states that the business level provides objectives for SBUs, allocates resources among functional areas and coordinates between the functional areas for making optimal contribution to the achievement of the corporate level objectives.
iii. According to Kazmi (2008:13), the functional level of strategy deals with a relatively restricted plan, providing objectives for a specific function, allocating of resources among different operations within that functional area and coordinating between the functional areas for optimal contribution to the achievement of the SBU and corporate level objectives. Hellriegel (1990:224) states that functional level strategy addresses the following issues; capacity requirement, facility location and size, technology, quality and environmental standards.
2.5 MODELS OF BUSINESS LEVEL STRATEGY
J ackson (1990:240) presents two mo dels of business level strategy: product life cycle model and the generic strategy model.
i. Product life cycle model according to J ackson identifies the market phases that products may go through during their life times. Product life cycle has five phases; introduction, growth, maturing, decline and termination phases.
At the introduction phase, Slocum (1999:300) states that the dominant strategies are with product development (R and D) , finding customers (marketing), paying for start up, expansion and marketing programmes. Marketing is often aimed at educating potential customers about the products rather than pointing out product differences or building identit y for the firm’s product. Risk and possibility of failure are great in the initial phase.
Nnabuko (1998:103) proposes four strategies at the introduction phase of a product. Rapid skinning strategy which consist of launching a new product at a high price and a high promotion level. The assumption here is that the firm faces potential competition and the large part of the market is unaware of the product. Slow skinning strategy consist s of launching a new product at a high price and low promotion level. The purpose of high price is to recover as much gross profit per unit as possible and low promotion keeps marketing expenses down.
Rapid penetration strategy consists of launching the products at a low price and spending heavily on promotion. This strategy according to Nnabuko bring s about the fastest productivity and the largest market share. The assumption is that most buyers are price sensitive, strong potential custo mers and the market is large. Lo w penetration strategy which is the last strategy consists of launching the product at a low price and promotion. The low price will encourage rapid product acceptance and low promotion to realize more net profit.
At the Growth Phase of a product, Hellriegel (1990:260) states that new distribution channel are sought and marketing activity tends to remain at a high level. The nature of marketing changes from educating customers to an emphasis on product differences and brand identity. The strategies are the firm improves product quality and add new features and model. During the maturity stage, Hellriegel states that a major strategic plan is the need to reduce per unit cost. Cost cutting involves closing plants, eliminating unprofitable locations, laying off employees and reducing level of management. Another strategy is to maintain or even try to increase the market share at the expenses of competitors.
J ackson (1990:242) states that at the decline phase, the strategy emphasis on efficiency (reduced cost per unit). Product
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ABSRACT - [ Total Page(s): 1 ]ABSTRACTPoor productivity is a global problem that besets organizations. As a result, the research was set out to ascertain the effects of strategic planning through the effective use of manpower in the strategic planning development and the right choice of technology for strategic planning implementation on organizational productivity. To solve the problem of the study, three hypotheses were formulated. The statistical tools applied for testing the hypotheses are mean, standard deviation and T ... Continue reading---
APPENDIX A - [ Total Page(s): 1 ]APPENDIX A SAMPLE OF INTRODUCTORY LETTER Department of Business Administration, Faculty of Management Scienc ... Continue reading---
TABLE OF CONTENTS - [ Total Page(s): 1 ]TABLE OF CONTENTTitle page Approval page Certification Dedication Acknowledgment Abstract Table of ContentCHAPTER ONE: INTRODUCTION 1.1 Background of the Study1.2 Theoretical Framework1.3 Statement of the Problem 1.4 Objectives of the Study 1.5 Research Questions1.6 Research Hyp otheses 1.7 Significance of the Study 1.8 Scope of the Study 1.9 Limitation of the StudyCHAPTER TWO: LITERATURE REVIEW2.1 ... Continue reading---
CHAPTER ONE - [ Total Page(s): 2 ]CHAPTER ONE : INTRODUCTION1.1 BACKGROUND OF THE STUDYStrategies and Strategic planning in the context of business organization refer to major programmes used by organizations to achieve their missions and goals.Strategic planning is a systematic process which influences the choice of the long term goals that define the corporate strategy of every firms. The corporate strategy, if adequately implemented, through projects, policies and budgets, helps to determine whether an enterprise ... Continue reading---
CHAPTER THREE - [ Total Page(s): 1 ]CHAPTER THREE – RESEARCH DESIGN AND METHOD OLOGY3.1 INTRODUCTIONResearch design, which entails the acquisition and analysis of necessary data through the application of approved standard techniques, contains in details, the methods and procedures employed.The type of research design used was sur vey. The survey research design does not require laboratory experimentation.The design served as a plan, which helped the researcher to conduct an in-depth and thorough study.3.2 ... Continue reading---
CHAPTER FOUR - [ Total Page(s): 6 ]Table 4.6 shows that 80 (62% ) of the respondents strongly agreed that strategic planning enhances productivity in their organization while 24 ( 18.6% ) of the respondents agreed. Only 10 (7.8% ) and 10 (7.8% ) of the respondents belonged to the undecided and disagreed category respectively while 5 (3.9% ) of the respondents strongly disagreed.Table 4.7 shows that 60 (46.5% ) of the respondents stron gly agreed that appropriate technologies d oes guarantee the implementation of strategic plannin ... Continue reading---
CHAPTER FIVE - [ Total Page(s): 1 ]CHAPTER FIVE – SUMMARY OF FINDINGS, CONCLUSIONAND RECOMMENDATION5.1 INTRODUCTIONThis chapter summarizes the findings from the study, draws conclusion therein and makes some recommendations.5.2 SUMMARY OF FINDINGSBased on the research investigation through the data collected from the questionnaires, the following findings were observed:I. The introduction of strategic planning that is long range planning is highly necessary in organization. Table 4.4 supported this ... Continue reading---
REFRENCES - [ Total Page(s): 1 ]
REFERENCES
Alkhafaji, A. F. (2004). Strategic management, formulation ,
implementation and control in a dynamic environment . Binghamton (NY): Haworth Press
Inc.
Drejer A. (2002). Strategic management and core competencies,
theory and application . Westport (CT): Quorum Books.
Dwivedi, R.S. (1980). Manpower management . New Delhi: Prentice
Hall of India.
Ewurum , U. and Unamk a, P. (1995). Busin ... Continue reading---
