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1.

BACKGROUND OF THE PROBLEM

The purpose of the research proposal is to assess the level of strategic


planning use by Sri Lankan companies utilize within their business
decision making determine how it affect the performance. The study will
be based on interviews, questionnaire, combined with current financial
data, on all diversified holding companies that are registered in Colombo
Stock Exchanged. (C.S.E) the participants represent all different sectors
of business in Sri Lanka. The primary goal of determining the level of the
strategic planning how does influence the Organizational performance.

Concerns of increased international competition abound not only in the


U.S. but also in Europe with the further expansion of the European Union
and in Asia and Latin America with increased economic integration
(Rugman, 2003) in those regions. Theorists (Goll & Rasheed, 1997;
Brews & Hunt, 1999) have argued that firms should respond to
environmental changes, such as increased competition, by engaging in
more systematic strategic planning to anticipate and respond to
changing events. There is evidence that U.S. firms have responded to
greater environmental uncertainty and complexity with more extensive
planning (Javidan, 1984; Kukalis, 1989). Furthermore, it appears that
formal strategic planning enhances firm performance although the
relationship is not unequivocal (Boyd, 1991; Capon, Farley & Hulbert,
1994; Miller & Cardinal, 1994).

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3. RESERCH QUESTION

How dose strategic planning influence an organization to improve its


performance?

4. RESEARCH OBJECTIVE

• To determine the direction and strength of the effect of strategic


planning on an organizational Performance
• To examine the importance and relevance of strategic planning business
organization.

• To see how strategic planning influence performance of the business


organization
.

5. LITERATURE REVIEW

There is a large volume of literature which contributes to planning as it


relates to strategic planning, development & implementation within
organizations. Some of the organization we found that even they
implemented Strategy management concept could not create significant
impact to the organizational performance & strength. But Effective
strategies position result in the company for long-term growth. However,
the terms "strategy" and "strategic planning" are often misunderstood
and misinterpreted. Some think of strategy as market position,
operational effectiveness or simply an idea or business model. (Mitchell-
2007)

"Strategy is choosing to perform different activities that can be preserved and that will
provide a sustainable competitive advantage. (Mitchell 2007)

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One of the biggest problems that companies are limiting future thinking based on current
reality. Instead of working from what could be, they are working from what is. They let the
problems of the past keep them realizing the vision of the future. Data shows that
90% of strategy plans are never effectively implemented and 30% of
those companies on the top of their industry won’t be there in five years.
2006 Helen M. Mitchell, Strategic Management Resources
http://www.straegicmgmtresources.com

"Ninety percent of strategic plans are not effectively implemented," said


Mitchell in delivering her February 27, 2007 message. "If you don't know
where you are going, then any road will take you there." Mitchell
advised “Strategies fail because one of three core elements is ignored,
not appropriately addressed, or not aligned with other core strategies or
the business's operations. In order to create an effective and successful
plan of action, you must balance all three components:

1. Business strategy

2. Operational strategy

3. Corporate strategy

When planning for the future, companies need to analyze the present,
identify the gaps and figure out a plan to manage growth. "The common
thread in all the organization we realized need to think strategically and
to simplify the complexity of their situation, some of the mistake we
realized

1. Lack of Integration
2. Looking at only a part of the business and not the whole.
3. Not thinking BIG enough.
4. Limiting future thinking based on current reality

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5. Not including key stakeholders.
6. Ignoring the very important data.
7. Not measuring key activities aligned with the vision.

Strategic management seeks to align the firm's activities with its external
environment. At the heart of this management approach is the strategic
planning system. As firms face increased environmental change (e.g., more
globalization) theorists (Grant, 2003) argue that firms benefit from strategic
planning.

Strategy is choosing to perform different activities that can be preserved and


that will provide a sustainable competitive advantage. It is a mental exercise.
It is a way of thinking about the world and approaching business. Strategic
planning is a process to produce innovative and creative ideas which serve as
the core framework for the company and designing its’ future. 2006 Helen M.
Mitchell, Strategic Management Resources
http://www.straegicmgmtresources.com

The importance of strategic planning in any business organization can


not be overemphasized. Most of the organizations recently recognized
the role of strategic planning to the long range growth and survival of
their business organization. Most of the managers have observed that
by specifically defining the mission of their organization they are better
able to give it direction and focus its activities.

There are many benefits to developing a strategic plan for your company.
Here are four primary benefits of strategic planning:
(http://www.orgresuls.net/newsblog)

• First, an effective strategic plan allows your organization to chart its own
course instead of allowing your competitors to decide what customers they will
take while leaving you with the leftovers.

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• Second, the goal of the strategic planning effort is to identify not only markets
where you can compete, but also to identify market segments in which you can
dominate. If you can dominate a market segment, you are driving what
happens in that segment. You’re not one of the “also rans” left to compete for
business solely on the basis of the cheapest price.

• Third, an effective strategic planning process focuses your company on its


strengths instead of trying to be all things to all people. In addition, it relieves
you of the temptation to be consumed by fixing your company’s weaknesses.
The real return on investment is not in fixing your weaknesses. The real ROI is
achieved by focusing on your strengths.

• Finally, the strategic planning process forces you to live in the real world. If a
train is headed right for you, an effective plan gives you the time to see it and
do something about it. Do your customers see the strengths that you say you
have? Is the market opportunity as large as your sales manager says it is?
Will there ever be a return on investment for a product that requires a capital
intensive investment on the front end?

6. EXPECTED OUTCOME

• Importance of Strategic Planning for business organization for in


current competitive business environments.

• Identify the gaps between proper Strategic planning & current


practices.

• How strategic planning is improve the organizational performance


in highly competitive business environment.

7. RESEARCH METHODOLOGY

Data is expected to be collected through following recourses.

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• General details of the Strategic Planning
1. Journals & secondary research article downloaded form the
Word
Wide Web.
2. Text books (Refer Reference list)
3. Discussion with consultant & lectures etc.

• Information (data) on Sample


1. Company’s Annual reports
2. Press articles
3. Interview with employee
4. Questionnaires

We collected and analyzed data using both qualitative and quantitative


methods. Data will be collected in-depth interviews for 30 minutes with
45 senior management team who are taking strategic decision within
the organizations. We use content analysis to synthesize all data
gathered from the interviews & questionnaires. Also when analysis the
strategic planning in a company in a company considering the most
form and other relative information is important. Also adoptions of
strategic planning also vary from organization to organization. Therefore
in the process of analysis it is very important to use of to the articles,
journals and other data which are published recently.

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8. REFERENCE:
• Journal Article 2006 Helen M. Mitchell, Strategic Management
Resources http://www.straegicmgmtresources.com

• Journal Article a Framework for Improving Performance -


International Development Research Centre.
http://www.idrc.ca/openebooks/998-4/

• Gerry Johanson & Kevan Scholes Exploring Corporate Strategy


– Seventh Edition

• Jordan, J. Lower & Taylor P (1998) “Strategy and Financial


Policy in UK Firms”Journal of Business Finance and Accounting
25(1) January – February p. 122.

• Modern Management: Problems, Faculty of Management State


University – Higher School Of Economics, Moscow -
November
24 – 26, 2009

• Silas Titus, Key Reasons Why Small Businesses Fail -


Accredited Associate of the Institute for Independent
Business

• Hoffman R (2007) Journal of Business Strategies Spring

• JimConnolly (May 2009) Organizational Performance


Comment.

• (February 2009) International Business & Economics Research


Journal

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• Richard B Chase & Robert Jacobs - Operations
Management for competitive advantage, Eleventh
Edition

• Lynda M Applegate & Robert D Austin - Corporate


Information
Strategy Management, 7th Edition.

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