IMPACT OF STRATEGIC PLANNING ON BUSINESS GROWTH IN NIGERIA (A CASE STUDY OF AKWA IBOM WATER COMPANY LTD. UYO)
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This study is conducted to examine the Topic: Impact of Strategic Planning on Business Growth in Nigeria, A Case Study of Akwa Ibom Water Company Limited Uyo. To accomplish this, four objectives were set out. Data were collected from the primary and secondary sources. Two hundred and seven (207) people made up the population while Dangi Alli is used to arrive at sixty two (62) people as the sample size in the research work. Stratified random sampling method is used as the sampling technique. Co-efficient correlation analysis is use as the statistical tools. To achieve the aim of this study four research questions were stated and also tested respectively, using the correlation analysis technique. The study concluded that strategic planning can lead to business growth. It indicates that there is a need for strategic planning for the growth of the business. workers under employer should motivated towards efficiency by compensating them through various payment schemes, it is by so doing workers will realized that their efforts have recognized and considered of immense importance to the growth of the company. At this point the researcher has been able to arrive at a successful conclusion.
1.1 Background of the study
Planning is one of such important skill because planning is the pace-setter to other managerial functions. Strategic planning is important because it sees a business through its life intentions and ambition. It is a sinqua non to the survival and success of a business. (Egbo, Vin. O (2013).
Strategic planning determines where an organisation is going over the next year or more, how it’s going to get there and how it will know if it got there or not. The focus of a strategic plan is usually on the entire organisation, while the focus of a business plan is usually on a particular product, service or program. (Egbo, Vin. O (2012).
Whenever we are talking about strategy we are talking about the long-term goals and objectives of a business organisation. A strategic plan is a plan that deals with the long-term survival and existence of the business. Without thinking strategically and acting strategically, a business may not be able to survive and achieve it long-term.
Strategic planning is the process of formulating strategic plans. It involves deciding on the business objectives, on the changes in the objectives, on the resources to be used to attain these objectives and on the policies that are to govern the acquisition of resources. (Egbo, Vin. O (2012).
According to Mc Carthy (2010), strategic planning is a managerial process of developing and maintaining a match between the resources of an organization and its market opportunities. Harvell (2009) says that the strategic management process requires leadership roles in defining the business mission, analysis of the environmental competitiveness and business situation, developing objectives, goals and strategies and defining product market distribution and quality plans to implement the business strategies.
The definitions of strategy given by Chandler (2008), Thomas (2012) and Steiner and Minner (2013) are more of descriptions of what strategic planning is all about. They refer to strategic planning as the determination of the basic long-term goals and objectives and adoption of course of action and allocation of resources for carrying out these goals.
According to Imaga (2010) Christensen, et al (2010) conceive of strategic planning as divisible into six modes. These include:
Mode 1: strategic intelligence, organization profile, environmental analysis, and strategic forecasts.
Mode 2: Definition of purpose, concept of business objectives etc.
Mode 3: Strategic choice-selection of an internally consistent set of policies which best fits corporate resources and best serves corporate purposes.
Mode 4: Time sequencing designation of a timed sequence of conditional moves.
Mode 5: Policy analysis generation of comprehensive list of policy alternatives, assessment of the probability of consequences of each alternative, evaluation of each set of consequences for corporate objectives.
Mode 6: Strategy review
According to Vincent O. Egbo (2011) planning involves deciding today what will happen in the future. The future may be the immediate, short or long term future. Planning precedes all other management functions. Koontz O’Donnell and Wellrich (2012:159) state that planning is a function of all mangers, although the character and breadth of planning will vary with their authority and with the nature of policies and plans outlined by the amount it contributes to purpose and objectives as offset by the costs and other unsought consequences required to formulate and operate it. According to them, the purpose of every plan and all derivative plans is to facilitate the accomplishment of enterprise purpose and objectives.
Nutshell (2010) plan is a statement of the purposes and objectives of an organization and the method of achieving them. Planning is deciding in advance what to do, how to do it, when to do it and who to do it.
1.2 Statement of the Problem
Strategic planning is a systematic process designed through the most comprehensive nature leading to the realistic mapping out of long-term objectives, control and operational plans. The depends on proper determination of suitable idea to achieve profitability, return on capital employed, avoidance of lose and overall organization performance
In Nigeria today, the formulation of long term business strategy has remained a misplaced priority coupled with inadequate planning skill among managers which has been of growing concern among companies. This fundamental problem has been as important factors that militate against or limit growth and development of many organizations as well as making them not to achieve what the supposed to achieve in their organization.
It is therefore, of great important to determine to what extent does company appreciate the use of strategic planning in their investment and business decision towards achieving business performance in general.
1.3 Objectives of the Study
The objectives of this study are:
- To find out how long it will take before a strategy planning will be achieve for the business growth in the company.
- To know if strategy planning improve the productivity and the business growth of the company.
- To identify the need of strategic planning for the business growth in the company.
- To know the type of strategic planning used by the management for the business growth of the company.
1.4 Research Questions
The following research questions have been raised to guide the researcher.
- How long will it take before a strategic planning will be achieved for the business growth in the company?
- Does strategic planning improve the productivity and the business growth of the company?
- What are the needs for strategic planning for the growth of the business in the company?
- What are the types of strategic planning used by the management for the business growth of the company?
1.5 Research Hypotheses
To guide this study, the following hypotheses have been formulated.
- Ho: Strategic planning cannot lead to business growth.
Hi: Strategic planning can lead to business growth
- Ho: There is no need for strategic planning for the growth if the business.
Hi: There is need for strategic planning for the growth of the business.
- Ho: there is no significant relationship between strategic planning and business growth.
Hi: There is a significant relationship between strategic planning and business growth.
1.6 Significance of the Study
On completion, this study:
- Would help staff of the Akwa Ibom Water Company to appreciate the need for strategic planning.
- Might also improve the use of organizational management strategies.
- Could benefit future researchers who will wish to conduct a similar or related study.
1.7 Scope and Limitations of the study
The study was limited to Akwa Ibom State Water Company in Akwa Ibom State. The researcher would have been interested in extending the data source to other department and other branches but due to financial constrained and anticipated time lag, it was not possible. Material needs for the project write up were not adequately available while the few available ones were not informative enough.
1.8 Historical background of Akwa Ibom Water Company Limited, Uyo
Before the creation of Akwa Ibom State on 23rd September 1987, what is now as Cross River State Water Board, with headquarter in Calabar, Cross River State. It had zonal offices in some key towns including Uyo, Ikot Ekpene, Abak, Oron, Itu, Eket, Etinan and Ikot Abasi among others.
In 1988 government enacted edict No.9 of 1988, which formally established the Akwa Ibom State Water Corporation, now defunct. During the actualization of the African Development Bank (ADB) loan in 1995, for which government started negotiation in 1992, one of the conditionality of the Bank was the incorporation of the Water Corporation as a limited liability company. Consequently, the Akwa Ibom Water Company limited (AKWCL) was incorporated in February 2001 under the corporate Affairs and Allied Matters Act 1990.
The Akwa Ibom Water Company Limited is committed towards providing effective and efficient services in water production and delivery to water consumers within Akwa Ibom State in keeping with its corporate mission statement and goals which as follows:
- To produce and distribute potable water that satisfies international quality standard.
- To ensure availability of safe and reliable water supply in urban and semi-urban communities.
- To always aim at improved water supply through the efficient utilization of resources and maintenance of service excellence.
- To promote a serious sense of commitment to professionalism, accountability and service, along with staff welfare.
- To operate a tariff system that guarantees long term sustainability.
To provide potable water to urban and semi-urban communities of Akwa Ibom State in efficient manner with a view to achieving continuous self sustenance for the benefit is stakeholders.
Challenges Facing the company
Like every other organization, the company is not without challenges, which explains the lack of adequate feasibility of the completed water project in the state, in terms of the civil engineering and pipelines installation works. Other problems and challenges of the company include:
- Lack of timely settlement of water rates by consumers.
- Damages to pipelines by members of the public through digging of soil or erection of structure on water pipes.
- No report of cases of broken down pipes to the company.
- Illegal connection
- Water wastages
1.9 Definitions of Terms
Strategy: According to Geisthorp, David D. (2003), strategy is the direction and scope of an organization over a long term. Strategy refer to comprehensive plan that is ended to achieve prescribe purpose or goals.
Planning: Nutshell (2010), planning is the management function that involves setting goals and deciding how best to achieve them. When we decide in advance what to do, how to do it, when to do it, who to do it and how result can be evaluated.
Growth: Hornby, A. S. (2013), growth in business term is an economic development as measured by any of a number of indicators, such as GDP. It is an investment style which looks for stocks with durable earnings and revenue growth capability.
Business: Baumbark (1988) business is an economic process of combining human and material resources to produce, distribute goods and services for the satisfaction of mankind at a reward.
Development: (Business dictionary.com (2014)) is an extension of the theoretical or practical aspects of a concept, design, discovery or invention.
Merriam-Webster, Inc (2014). It is a process of advancement taking from step one and to two. The act, process or developing or growth, progress.
Organization: Edgar Schem (2013) organization is defined as a system of consciously co-ordinated activities of forces of two or more persons.
Productivity: According to (Ande, 2008) productivity is the rate at which a worker, a company or a country produce goods and the amount produced, compared with how much time, work and money is invested to produce time.
1.10 Organization of the Study
In order to achieve the aim of this study, the researcher has organized the study into five chapters.
Chapter one (1) consist of introduction, background of the study, statement of the problem, objective of the study, research questions, research hypotheses, significant of the study, scope and limitation, historical background, definition of terms and finally organization of the study.
Chapter two (2) contains the reviews of related literature which provide concrete framework for the study.
Chapter three (3) deals with research design and methodology, which explains the framework for gathering, analysis and interpreting the research data.
Chapter four (4) is designed for data presentation, analysis and interpretation. It discusses the data collected in the course of the research. It present, analyze and interprets the data through the use of tools. The final chapter which is chapter five (5) consists of summary, conclusion and recommendation.