Strategic Planning As A Tool For Corporate Survival (A Case Study Of Cadbury Nig. Plc)
Strategic Planning As A Tool For Corporate Survival (A Case Study Of Cadbury Nig. Plc)
Abstract
This project is on strategic planning as a tool for corporate survival with reference to Cadbury Nigeria Plc ,Agidingbi, Ikeja, Lagos.
Effective management of business environmental changes depends on careful planning. Strategic planning has been the cornerstone of business organization survival, because of numerous benefits derived from a well formulated and implemented strategic planning.
In setting firms strategy, various elements such as objectives, resources and opportunities are put into consideration. The organization conducts its business environment situation analysis I order to identify its strengths, weakness, threats and opportunities (SWOT). Towards this, there are basic steps in strategic planning which enables the enterprise to develop strategic options. The chosen strategic options need to match organization opportunity with the strengths so as to achieve corporate objectives.
The process of strategic planning is a useful framework for business management. It bears heavily in organization success or failure, when all the spectrum of strategic planning are done well, an organization may overcome inefficient use of internal resources but it is unlikely for the organization to survive with poor strategies.
The project ends with recommendations of quantitative forecasting technique in addition to judgment and assumptions, which are common with some business organizations today.
Table Of Contents
Page
- Title page
- Certification/Approval
- Dedication
- Acknowledgement
- Abstract
- Table of Contents
- List of Tables
Chapter One
Introduction
- 1.1 Background of Study
- 1.2 Statement of Problem
- 1.3 Objectives of Study
- 1.4 Research Questions
- 1.5 Research Hypotheses
- 1.6 Significance of Study
- 1.7 Scope and Limitation of Study
- 1.8 Historical Background of Study
- 1.9 Definition of Terms
- References
Chapter Two
Literature Review
- 2.1 Nature of Strategic Planning
- 2.2 Corporate Planning Approach
- 2.3 How to Develop Strategic Plan
- 2.4 Strategic Planning Process
- 2.5 Characteristics of Strategy
- 2.6 Criteria for Effective Strategy
- 2.7 Types of Strategies
- 2.8 Strategic Management
- 2.9 Formulation of Strategy
- 2.10 Objectives and Goals
- References
Chapter Three
Methodology
- 3.0 Characteristics of Population
- 3.1 Research Sample
- 3.2 Methods of Data Collection
- 3.3 Procedure of Statistical Analysis
- 3.4 Research Design
Chapter Four
Data Presentation and Analysis
- 4.0 Data Analysis and Explanation of Data
- 4.1 Testing of Hypotheses
Chapter Five
Summary of Findings, Conclusion and Recommendations
- 5.1 Summary of Findings
- 5.2 Conclusion
- 5.3 Recommendations
- Bibliography
- Appendix A Questionnaire Cover Letter
- Appendix B Questionnaire
Chapter One
Introduction
1.1 Background of Study
In order for an organization to thrive succeed in its environment of operation and achieve its set objectives and goals, there exist fundamental environmental forces that influence management decision making (formulation and implementation of policy) process.
Organization must adapt to these environmental forces as they plan and carryout their strategies and activities.
The success of the organization or its failure is determined largely by how well it recognizes and adjusts to planning. Organization can predict changes in environmental forces that will influence business direction through strategic planning.
Planning covers the whole process of determining what purpose to pursue and the means of attaining them as well as the mechanism for monitoring results.
Planning helps organization define their purpose and activities. All managers at various levels in the organization plan. Planning is one of the important managerial functions. Its importance can be deduced from the popular adage – He, who fails to plan, plan to fail. Thus, for a manager to succeed, he has to plan.
It is therefore, the responsibility of managers to make use of a firm’s resources in adjusting to the changing environment. Activities carried out by the organization should stem from strategy. Non existent or poorly defined strategy results in ineffective utilization of resources.
This project therefore, attempts to study the significance of a well-formulated strategy as a basis for organizational success.
1.2 Statement of Problem
Managers are confronted with the problems of defining the company’s objectives, adoption of strategies and how to monitor results for the survival of their organization.
These problems of formulating strategies to deal with environmental changes require information and technique for good decision-making by managers.
This study therefore, is to identify how and why strategic planning is necessary for the survival of any corporate organization.
1.3 Objectives of Study
This project focuses on the extent to which strategic planning is a tool for corporate survival.
The objective of this study is:
- To conceptualize what strategic planning is
- To know steps in strategic planning in running modern organization
- To learn why strategic planning takes place
- To know how strategic planning works towards corporate survival.
At the end of this project, it can be established that strategic planning is important to both small and large scale businesses because it determines its viability, continuity and profitability.
1.4 Research Questions
In order to probe into the research project comprehensively, the following questions were formulated:
- Who the people responsible are for formulated of strategic planning?
- What is the management policy employed by the organization?
- What is the existing state of the organization and the environment in which it operates and which likely to operate in future?
- How does the company obtain its raw materials and equipment?
- How does the company cope with change of government policy?
1.5 Research Hypotheses
For the purpose of this work the following hypotheses shall be tested:
Hypothesis 1
Null hypothesis:
Strategic plan will not enhance unity among the various units within an organization.
Alternative hypothesis:
Strategic plan will enhance unity among the various units within an organization
Hypothesis 2
Null hypothesis:
Strategic plan will not influence attainment of organizational objectives.
Alternative hypothesis:
Strategic plan will not influence attainment of organizational objectives.
Hypothesis 3
Null hypothesis:
A flexible strategic plan does not work better tan a rigid strategic plan.
Alternative hypothesis:
A flexible strategic plan does not work better tan a rigid strategic plan.
1.6 Significance of Study
This research work will be useful to various organization in Nigeria and the rest of the world.
Its findings and recommendations will guide corporate organizations on how to strategically plan their business to thrive in a depressed economy. It is a well-known fact that a problem whose causes are identified is almost completely solved. Since this study is carried out to identify the importance of strategic
planning for the survival of corporate organization it will then be a pointer to some of the solutions to problems faced by corporate organizations.
1.7 Scope and Limitation of Study
This research project is limited to Cadbury Nigeria Plc, due to the constraints faced by the researcher.
One of the limitation is that of time, secondly is financial constraint and also the problem of interviewing, distribution of questionnaires, tabulation and analyzing of data but for these constraints, the research would have taken a border dimension.
1.8 Historical Background of Study (Cadbury Nig. Plc.)
1965 may be considered the formal birth date of the corporate entity known today as Cadbury Nigeria Pc. In that year of incorporation of the then Cadbury Nigeria Limited, a purpose – built factory was commissioned at the present agidingbi, Ikeja headquarters and full scale production of pronto (introduced in 1956) and bournvita (1960) began, using Nigerian Cocoa products as basic raw material.
This event marked the beginning of a truly Nigerian company as opposed to the existing foreign trading.
Policy laid down from the very beginning and pursued with relentless dedication ever since was to make products wherever possible with locality sourced raw materials of the highest quality, primarily targeted to the Nigerian Market, taking cognizance of the Nigerian peoples’ total developmental aspiration.
Today the core business of the company is run in three streams namely Food Drinks, Confectionery and Foods. The epoch-making Cereal Conversion Plant also produces a range of intermediate products such as Sorghum Extract and Glucose; while the Jos Plant produces tomato paste. The Confectionery namely, Tom-Tom, Buttermint, Malta Sweet, Chocolate Eclairs, Luckies, Extra Strong Peppermint, Fruities Ginger Orange, Koff-stick, Tofi etc.
The Food Drinks consists of Pronto and Bournvita.
The subsidiary company, the Stanmark Cocoa Processing Company, Ondo, processes locally grown cocoa Butter and Liquor for export as well as Cocoa Powder for domestic consumption.
The company’s consistent record achievement and growth has been sustained primarily by the “Cadbury People”. They are guided by an enduring philosophy of integrity, respect and excellence.
All activities have a philosophical basis in the pursuit of excellence, and corporate social responsibility finds expression in generous and meaningful support for the Arts, Education, Charity and Sports. A substantial sum of money has been endowed to provide interest income to fund all corporate giving.
1.9 Definitions of Terms
It will not be sufficient to conclude this introductory aspect of strategic planning without explaining the meaning of those key terms which will be used over in the chapters.
Strategy:
Is the pattern of objectives, purposes, goals and the major policies and plans for achieving those goals stated in such a way so as to define what business the company is in or is to e and the kind of company it is or to be (Andrews, 1965).
Strategy can also be defined as schemes, methods, maneuvers which management hopes to deploy in order to move the organization from its present position to arrive at its target goal by the end of a specified period, recognizing that during the interviewing period a host of changes are going to take place in the environment (Amao, 1979)
Planning:
Is the process of predicting future events and using those predictions to set courses of action that will achieve the organization’s goals.
Strategic Plan:
Drucker (1974) ”the continuous process of making present entrepreneurial (risk taking) decisions systematically and with the greatest knowledge of their futurity, organizing systematically the efforts needed to carryout these decisions and measuring the results of these decisions against expectation through organized systematic feedback”.
Tactical Plan:
A short-term plan that specifies the activities necessary to carry out a specific plan.
Corporate Mission:
Is the specific and well-defined roles and activities on which the organization elects to concentrate its efforts.
Distinctive Competencies:
These are the activities an organization can perform better than other firms
Goal:
This is an expected result
Objective:
Is the derived state of affair or preferred results that an organization attempts to realized and achieve
Target:
This is a goal to be reached, a quantified expected result.
Chapter Five
Summary of Findings, Conclusion and Recommendations
5.1 Summary of Findings
The strategic planning process starts with the setting of objectives for the organization as a whole and continues with the development of departments or units goals that reflects overall objectives. The Chief Executive of the organization along with the Top Managers are the ultimate authority and are clad with the responsibility of goal setting, strategy formulation, strategy evaluation and strategy implementation.
The strategy planners conduct the situation analysis, beginning with an in depth look at the environmental trend that will affect the organization, they look through a strategic window viewing the past consider the present situation to predict the future.
They also analyze the strengths and weaknesses of the company. This is to assess the firm’s distinctive competencies.
Both external and internal environment analysis are the cornerstone of strategic planning, this is because they provide information upon which te rest of the process follows.
The facts-findings by the planners generate strategic options or alternative. It is necessary for the organization to collect enough data relating to its areas of operation.
All the strategies are tested to enable the organization choose the best option to achieve its target. The best options that matches organization’s opportunity with its strengths are chosen and budgeted for by the management.
The strategy plans are communicated to those who would be involved in the implementation and execution.
The strategy planners must seize opportunity as they arise so that organization could fulfill its corporate objectives.
5.2 Conclusion
The strategic planning has been a difficult task for organization’s management, whether organizations excel or fails depend on how effectives the strategic planning of the organization.
The need for strategy formulation and implementation usually takes form of incremental adjustment rather than grand design and grant leaps forward.
The environments in which the business operates are constantly changing. Whenever it changes, it may require adjustment or revision of strategies to deal with the environmental challenges
It therefore involves proper planning, management experience personality and foresight to enable the organization to predict the future.
Organization may have opportunities to pursue but without enough resources and poor strategic planning may cause the organization not to fulfill its expectations.
A study of the strategic planning process would have to involve an examination of the spectrum of management function via planning, staffing, directing, coordinating the activities of the organization. The organization must match its objectives, opportunity and physical and human resources so that the objectives are met, monitoring the results of the plans to ensure that the desired targets are being accomplished. When necessary adjusting the plans to conditions facing the organization to accomplish the objectives.
The process of strategic planning is a useful fool for the general management of organization because it bears most heavily an organization success or failure.
When these tasks are done well, the chances are that the organization will be one, which is engaged in doing the right thing which is well entrepreneurial effective, which is well administered, and well performed. This is what corporate survival as all about. The benefits of well designed strategic planning are very numerous and indispensable tool for corporate survival.
5.3 Recommendations
Strategic planning in Cadbury Nigeria Plc revealed some areas of potential improvement of the part of the management.
The following recommendations are offered on such improvements and it is believed that the acceptance and implementation would be of help towards improving a better strategic planning and hence maximize corporate objectives of the company.
The company should incorporate flexibility in its strategic planning.
The inherent uncertainty requires that the plan may need modification and adjustment in the light of unexpected major occurrences. The process of strategic planning needs to be dynamic and flexible rather than static and inflexible.
There is need for formal organization structure because the formal and informal relationship becoming complex, more departments should be created.
The sub-unit managers should be more involved in strategic formulations. Those who implement the plan must contribute to the formulation of the plan.
Sales forces should be given adequate training background information so that they will have knowledge and skill to handle consumer’s sales objective function.
The company should ensure that the price of their products are stable and conform with the aspirations to the consumers so as to maintain and improve on their market shares.
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