ABSTRACT
The study examined the effects of Strategic Planning on Corporate Performance using Babcock University as the case study. It further probed into how this has impacted on the management efficiency and effectiveness as strategic planning is essential in corporate organisations. Primary and secondary data were used for the study. The study made use of questionnaire to elicit information from employees of Babcock University. Data collected were analysed using descriptive and inferential statistics. The hypotheses were tested using the using the Pearson’s Product Moment Correlation Coefficient to establish the significance of relationship between the various variables used in measuring performance. The results of the hypotheses revealed that there is a significant positive correlation between strategic planning and corporate performance. The study therefore, concluded that strategic planning is beneficial to organisations in achieving set goals and recommends that universities and other corporate organisations alike, should engage in strategic planning in order to enhance corporate performance.
Key Words: strategy, strategic planning, performance, organisation, university
INTRODUCTION
Strategic planning is a forward-looking exercise and all managers should be involved with it. If strategic plan is available and well implemented, an organization will have little or no challenge in managing external changes. For businesses to survive, it should be able to operate successfully with environmental forces that are unstable and uncontrollable and which can greatly affect decision making process. Organizations adapt to these environmental forces as they plan and carry out strategic activities. It is through strategic planning that an organization can predict changes in the environment and act pro-actively. (Adeleke, Ogundele and Oyenuga, 2008; Bryson, 1988 in Uvah, 2005). .
However, It has been observed that most organizations are more concerned with the formulation of strategic plan and not how to implement them (Douglas (2003).He therefore concluded that “plan without effective and measurable implementation is no plan at all.”
No matter how super a plan is, it has to be well implemented to achieve the desired result (Phillips and Petterson, 1999). St-Hilaire (2011) believes that the usage of strategic plan is very important to organization’s ability to achieve and maintain competitive advantage over other organizations.
Several studies have concluded that there is a positive relationship between strategic planning and corporate performance. (McIlquham-Schmidt (2010), Robbins, Bergman, Stagg and Coulter (2008), Silverman (2000) Pearce and Robinson (2007) Smith and Golden (1989) Hill, Jones and Galvin (2004) Danso (2005)
Veskaisri, Chan and Pollard (2007) posited that without a clearly defined strategy, a business will have no sustainable basis for creating and maintaining a competitive advantage in the industry where it operates. They are also of the opinion that effective planning and implementation has positive contribution to the financial performance of organizations. In the same vein, Aremu (2000) states that some Nigerian business organizations are without formal plans or where there are formal plans, organizations operate without adhering to them. Dauda, Akingbade and Akinlabi (2010) Metropolis concluded that strategic management practices enhance both organizational profitability and company market share and therefore suggest that strategic planning concepts should be adopted by business organizations. On the other hand, Miller and Cardinal (1994) and Rogers, Miller and Judge (1999) concluded that the role of formal planning systems in business management is only informational.
Fehnel (2000) in his position paper on “Strategic Planning and the Nigeria University System Innovation Project” observed that many Vice- Chancellors “now appear willing to consider the use of strategic planning as an important tool in determining how best to revitalize and modernize their institutions”.
It was however observed that most researches on strategic planning and performance relationship focused on organization’s profitability, market share, earnings per share, net asset, working capital, expansion, etc. as the performance measurement. The performance indicators in the business sector may not necessarily be applicable to the higher educational institutions, therefore, strategic planning seems not to be too popular in the university system. This may be attributed to the lack of understanding of the concept of strategic planning by the university internal stakeholders, especially the employees. The lack of involvement of this particular group may make the plan unpopular, thereby making compliance a difficult issue. This study therefore tried to fill this gap by investigating the relationship between strategic planning and corporate performance in the university system.
The lack of a strategic plan which covers all aspects of the university community may be what is responsible for the challenges being faced in the sector. The challenges suggested by past studies includes but are not limited to distorted academic calendar, industrial disputes, inadequate water supply, decayed facilities - hostel accommodation, laboratories, classrooms facilities, unhealthy rivalry among staff, shortage of qualified teachers, challenges of accreditation, deteriorating quality of graduates, the list seems to be endless. It is important to discover whether the concept of strategic planning is understood and embraced in the university system. The role of the staff in the planning process and the effect of compliance on performance should also be investigated.