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Abstract
The study examined the relationship between strategic planning and organizational performance. (A case study of Petro-Chemical Indorama Eleme, Port Harcourt). The study proposed four research objectives with according four research questions and null hypotheses. The descriptive statistics was adopted. The population was made up of 24 staff Petro-chemical Eleme. The Taro Yemen’s formula was used to determine the sample size of 22. A Self-designed questionnaire was design on strategic planning and organizational performance, The simple percentage was used to analyze the research questions. The study concluded that strategic planning contribute immensely to enhanced organizational performance in Indorama petrochemical Eleme. It is therefore recommended that managers of organization should harness the benefits of strategic planning in order to improve organizational performance particularly in Indorama petro-chemical Eleme. The following recommendations were made amongst others that decisions should be both clear and attainable, should support one another, must be precise and measurable because the more precise the objective is, the more measurable goal it is and easier to achieve it, and should always remain valid. The objectives should convert the strategic vision into specific performance targets, results and outcomes the company management wants to achieve and then use these objectives as yardsticks for tracking the company’s progress and performance.
Table of Contents
Title Page i
Cover Page ii
Declaration iii
Certification iv
Dedication v
Acknowledgements vi
Abstract vii
Table of Contents viii
List of Tables x
List of figures xi
CHAPTER 1 1
INTRODUCTION 1
1.1Background of the Study 1
1.2 Statement of the Problems 3
1.3 Objectives of the Study 4
1.4 Research Questions 4
1.5 Significance of the Study 5
1.6 Scope of the Study 5
1.7 Limitation of the Study 6
1.8 Definition of Terms 7
CHAPTER 2 8
LITERATURE REVIEW 8
2.1 Conceptual Framework 8
2.1.1 Concept of Strategy 8
2.1.2 Dimensions of Strategic Planning 14
2.1.3 Concept of Organizational Performance 16
2.1.4 Measures of Organizational Performance 18
2.2 THEORITICAL FRAMEWORK 20
2.2.1Resource Based View Theory 20
2.2.2 BASIC STRATEGIC PLANNING MODEL 21
2.2.3 ISSUE – BASED (OR GOAL – BASED) PLANNING MODEL 22
2.3 Empirical Framework 24
CHAPTER 3 27
RESEARCH METHODOLOGY 27
3.1 Research Design 27
3.2 Population of the Study 28
3.3 Sample Size Determination 28
3.4 Sampling Techniques 29
3.5 Source and Method of Data Collection 29
3.6 Methods of Data Collection 30
3.7 Questionnaire Design 31
3.8Data Analytical Techniques 31
CHAPTER 4 31
DATA PRESENTATION AND ANALYSIS 31
4.1 Data Collection and Presentation 31
Table 4.1: Questionnaire Administration and Retrieval 31
4.2 Data Analysis 33
4.3 Discussion of Findings 36
CHAPTER 5 37
SUMMARY, CONCLUSION AND RECOMMENDATIONS 37
5.1 Summary 37
5.2 Conclusion 37
5.3 Recommendations 38
References 40
Appendix I 42
Appendix II 42
List of Tables
Table 4.1: Questionnaire Administration and Retrieval 41
Table 4.2: showing the age of respondents 42
Table 4.3: Showing the Gender/Sex of Respondents 43
Table 4.4: Showing the Marital Status of Respondents 44
List of figures
Fig. 2.1: A Conceptual framework showing relationship between strategic planning and organizational performance ………………………………………………….11
CHAPTER 1
INTRODUCTION
1.1 Background of the Study
Strategy is designed to help firms achieve competitive advantage. In the broadest sense, competitive advantage is what allows a firm to gain an edge over its rivals. Competitive advantage enables a firm to achieve high performance over an extended period of time. Strategic planning therefore is part of the contemporary managerial tool kits not only for dealing with the inevitable uncertainty in the management environment but also, for stimulating organizational performance (Schendel, 2009).
Strategic planning is a vital instrument in an organizational setting. It is defined as the process of determining the future of overall goal or objective of a business. Planning therefore bridges the gap between where we are, and where we want to go (Adeleke, 2001). Planning can be a very difficult exercise because it requires that we consciously determine a course of action and base our decisions on hope, purpose, and knowledge on estimates.
Nevertheless, the performance of any organization depends on the extent to which the use of strategic planning is put in place in order to accomplish the set objectives and mission statement of that organization (Adeleke, 2001).
Strategic planning focuses upon long range objectives and short-term priorities. A properly structured strategic plan enables management to comprehend the relationship of goals, objectives and action attainment Dawson (2006).
In majority of organization in Nigeria, planning is the most important management tool for performance and for organizations to perform well, resources must be well utilized and customers well served. To achieve such ends, all of an organizations human and materials resources must be well utilized in the right way and the right time to create high quality products at minimal cost.
Productivity is a summary measure of the quantity and quality of work performance, with resources utilization taken into account. It can be measured at the individual, group, or organizations level, Productivity may be expressed as success into dimensions of organizations performance, effectiveness and efficiency (Dawson, 2006).
Planning on the other hand, is regarded as the most basic of all the management functions. It involves the selecting from among alternative future course of action for the organization as a whole and every department or section within it. Furthermore, it requires selecting organizational objectives and departmental goals, determines and provides a rational approach to pre-selected objectives. It strongly implies managerial innovation and the ability to create something (Dawson, 2006).
Organizational performance is derived from the word job performance that means real work produced an employee within a specific time period. Performance is a comparison between the works of the real compared to the standard set by the company (Dessler, 2000). Performance is the quantity and quality of produced or services rendered by a person in doing the job (Luthan, 2005). Performance is the work of behavior (Armstrong, 1999). Performance is the relationship between work and behavior. One way an organization can perform is through conflict resolution. Conflict occurs between people in all kinds of human relationships and in all social settings. Because of the wide range of potential differences among people, the absence of conflict usually signals the absence of meaningful interaction. Conflict by itself is neither good nor bad. However, the manner in which conflict is handled determines whether
Strategic Plan provides the basic direction and rationale for determining the focus of an organization; and also provides the specification against which any organization may best decide what to do and how to do it. Simply put, it is a process for creating and describing a better future in measurable terms and the selection of the best means to achieve the results desired. It is important to note that not all planning is actually strategic even though they may be termed so. It is said that failure to plan leads to planning to fail.
Strategic planning standardizes the processes of goal/objective setting, situation analysis, alternative consideration, implementation and evaluation that enable an organization to attain its goals and objectives (Tapinos et. al. 2005). Sarason and Tegarden, (2003) asserted to the positive correlation between strategic planning and performance achievements as very beneficial for organizations. In their studies Dyson, (2000); McAdam and Bailie, (2002) further emphasized the need for organizations to align their strategies with the organization performance measurement systems.
1.2 Statement of the Problems
This research is motivated by the idea that unsuccessful business organization especially in multinational firms and may rise from their poor planning. It could be noted that lack of proper planning under the development and effectiveness of the organization. Unfortunately, in most organizations, strategic plans are not carried out and implemented properly. Some 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.
There will be problem if an effective strategic planning are not introduced into the performance to examine the method of performance and work-flow procedure. When this is not done, the maximum benefit/objective would not be gained.
There will be problem when the work place is not planned in such a way that performance is integrated with other department and system in banking industries.
Problem may arise when the staff involved in production are not trained in the various skills required. The following are the problems identified in the study, poor policy implementation in the organizational, poor time management. ineffective decision-making process and lack of discipline among organizational members. Human resources managers need training to ensure that job design and job specifications are prepared in a suitable form and pattern. Hence, the study seeks to examine the relationship between strategic planning and organizational performance in petro-chemical Eleme, Port Harcourt.
1.3 Objectives of the Study
The main objective of the study is to examine the relationship between strategic planning and organizational performance in petro-chemical Eleme, Port Harcourt. The specific objectives are to:
1. Determine the relationship between mission and profitability in petro-chemical Eleme, Port Harcourt.
2. Ascertain the relationship between vision and profitability in petro-chemical Eleme, Port Harcourt.
3. Investigate the relationship between mission and productivity in petro-chemical Eleme, Port Harcourt.
4. Evaluate the relationship between vision and productivity in petro-chemical Eleme, Port Harcourt.
1.4 Research Questions
The following research questions were proposed to guide the study;
1. Does employee mission associate with profitability of petro-chemical Eleme, Port Harcourt?
2. How does vision associate with profitability in petro-chemical Eleme, Port Harcourt?
3. What is the relation between mission and productivity in petro-chemical Eleme, Port Harcourt?
4. What is the relationship between vision and productivity in petro-chemical Eleme, Port Harcourt?
1.5 Significance of the Study
The study will be beneficial to all service organizations especially the manufacturing firms as it emphasized the need and encourage the establishment of policy guidelines on the efficient and effective planning.
The study shall have a great impact on individuals, organization and the society at large. Subsequently, it will enhance good suggestions for achieving better performance through an effective training/development programmes. Moreover, the study shall provide framework which will assist business organization and the society as a whole on how to evolve an enduring planning programmes capable of achieving the desired result for an organization.
It will help managers of various organizations to generate ideas and solution to problems based on the best way to run training in their organization in order to achieve desired goals and objectives. It will equally be useful to small scale business, large corporations, management and consultants, practitioners, and universities, college of education and to the government.
It will also help researchers to know more about the relevance of strategic planning as it enhance organizational performance.
Finally, it will be of great value to management, researchers, investors, government and students as a point of reference and will equally form the basis for further research study.
1.6 Scope of the Study
The study is delimited under the following heading: content scope, geographical scope and unit of analysis.
1. Content Scope: The content scope of this study involves on investigation to ascertain the relationship between strategic planning and organizational performance. The dependent variable is organizational performance, measures by profitability and productivity. While independent variable is strategic planning with a dimension of mission and vision.
2.Geographical Scope:This study is delimited in Port Harcourt Metropolis with special reference to some selected petro-chemical, Eleme.
3.Unit of Analysis: The unit of analysis in this research involves the selected staff of petrochemical at the time the study carrying out.
1.7 Limitation of the Study
In course of carrying out this research, the researcher met with a lot of constraints. Among these constraints are; Time frame which this research is expected to be completed which was too short. Secondly, the cost in carrying out this research work act as a barrier as we were not financially buoyant to carry out all investigation. Finally, assembling the relevant materials needed for this work was a problem. It is difficult due to the fact that some of the respondents were not willing to give us the required cooporation.
Some of the participants were hesitant to provide information because they did not know why the information was needed. To address this concern, the researcher assured them that the information was meant for scholarly work alone. There were also concerns about the safety of the participants. To mitigate this challenge, the researcher assured the participants of utmost confidentiality and anonymity. As such the participants were not required to state their names in the data collection tool
1.8 Definition of Terms
PLANNING: This is a detailed arrangement for something for something you want to do in the future.
STRATEGY: This is a plan that is intended is to achieve a particular purpose.
The practice of making one’s living by engaging in commerce.
STRATEGIC PLANNING: Strategic planning is an organization’s process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy including its capital and people
MISSION: A mission statement defines what an organization is, why it exists, its reason for being.
ORGANIZATIONAL PERFORMANCE: It comprises the actual output or result of an organization measured against its intended output.
PROFITABILITY: Profitability is ability of a company to use its resources to generate revenues in excess of its expenses.
PRODUCTIVITY: Productivity refers to the physical relationship between the quantity produced (output) and the quantity of resources used in the course of production (input).