ABSTRACT

The study is on the impact of strategic management on organizational productivity in the firming sector, with Nigeria Breweries as the case study. The study is done with a view of identifying the major benefits of managing strategically and also highlights the challenges faced by organizations as a result of not applying strategic planning into its management process. The methodology adopted involved the use of primary data, through structured questionnaire collected from 160 respondents, randomly selected and determined through Taro Yamen’s rule. The data obtained were analysed and further subjected to Chi- square statistical tool in testing the hypothesis. The result obtained showed that productivity in the firming sector can be improved by the application of strategic management. We can therefore conclude that strategic management, if properly applied can be a major booster of organizational productivity.

CHAPTER ONE INTRODUCTION

1.1        BACKGROUND OF STUDY

The spate of competition among organizations has necessitated the need for improved performance if they are to realize their corporate goals. The socio-political environment of businesses is also ever changing and thus imposes upon these entities the challenges of managing that change in order to sustain performance. Resources are limited, consumer demands are primarily directed by prices, and as such businesses and firms could not sell everything they produced. Little attention being paid to competitors and relative competitive strength of the business, mainly due to the perception of the environment as being relatively stale and simple. “During and after the oil crises of 1973, the world economy virtually collapsed with both inflation and stagnation at the same time, leading consumer demands to change to high quality good and services, which in turn led to fierce international competition. (Garth, Andrea & Podolny, 2001: 25). This trend in the socio-economic environment unfortunately continued into the 1980s where western corporations could only look as their Japanese counterparts proved capable of combining high performance in areas of productivity, timeline and quality with a high degree of motivation and commitment from their employees. These developments resulted in both technological and economic changes that were difficult to predict with common forecasting methods. Techniques to

explain product/market cost behaviour and the dynamics of international business competition were developed and refined. One of such techniques for overcoming such problems posed by strategic changes is strategic management. Management researchers have maintained that at the heart of organizational performance and productivity are three determinants: Strategy, capacity and the environment. Strategy management harnesses these elements and thus provides organizations with a tool for managing and improving performance. Strategic management is simply a set of management decision and actions that determines the long-run performance of an organization that includes environmental scanning, strategy formulation, strategy implementation and evaluation and control. Wheelen and Hunger (2002) in Onodugo, (2002).

Strategic management is a process for developing and enacting plans to reach a long term goal that takes into account internal variable and external factors. It encompasses an integrated, future-oriented managerial perspective that is:

1.                 Outwardly focused

2.                 Forward thinking and

3.                 Performance based, (Kiggundu, 1996).

Strategic managers identify long-range targets, scan their operating environments, evaluate their organization’s structures and resources, match these to the challenges they face, identify stakeholders and build

alliances, prioritize and plan actions, and make adjustments to fulfill and improve productivity/performance objectives overtime.

According to Brinkerhoff (1994), strategic management is characterized as looking out, looking in and looking ahead. “Looking out” means exploring beyond the boundaries of the organization to set feasible objectives, identify key stakeholders and build constituencies for change. “Looking in” implies critically assessing and strengthening the organization’s systems and structures for managing personnel, finances and other essential resources. Finally, “looking ahead” entails melding your strategy with structures and resources to reach your policy goals, while monitoring your progress and adjusting your approach as needed. Balancing strategic management outward, inward and forward looking functions helps you develop a vision and a strategy for where and how to move the organization forward. Balancing these different perspectives is the essence of managing strategically. (Brinkerhoff, 1994).

1.2        STATEMENT OF PROBLEM

The Nigerian business environment like others, the world over, is very dynamic. Intense competition within industries coupled with on-going government reforms that affects the economic and socio-political life of the nation has put organizations on the threshold of managerial innovation to surmount the enormous environmental challenges on its productivity. It is common knowledge that organization must strategize in order to remain in

business amidst stiff competition such as is witnessed in the firming industry. Many organizations, especially in the firming industry, have spent significant human, financial and technical resources on planning, planning processes, environmental scanning, and all. Yet what effects have these plans and planning processes had on the productivity of the organization at the end of the day? Organizations need to be able to assess whether their planning efforts have been beneficial as it relates to productivity.

There is an underlying assumption that strategic management is good for an organization; and that by engaging in strategic planning, an organization can change and thereby, enhance both its effectiveness and culture. The question is why is there absence of literature on evaluating strategic plans? Is it because organizations have not integrated the strategic plan into its operations thereby making the strategic planning process sterile?

Nigeria Breweries embraces strategic management in running its operations. Strategy is at the heart of the firms competitive drive, but whether these strategic efforts are of any relevance to the firm’s productivity and performance present an opportunity for this inquiry. It is against this back-drop that this paper examines the relationship, if any, between strategic management and organizational productivity.

1.3        OBJECTIVES OF STUDY

This study aims to achieve the following:

1.                 To ascertain the existence of strategic management policies and procedures in Nigeria Breweries Plc.

2.                 To     assess        the     extent      of    employee       involvement        in     strategic management process.

3.                 To examine the extent to which strategic plans are implemented.

4.                 To evaluate the impact of strategic management on organizational performance.

5.                 To identify the challenges faced by management in managing strategically.

1.4        RESEARCH QUESTIONS

The following research questions are raised to guide the study:

1.                 Are there strategic management policies and procedures existing in Nigeria Breweries Plc.?

2.                 To what extent are employees involved in the strategic management process of the firm?

3.                 To what extent are the strategic plans of Nigeria Breweries Plc. implemented?

4.                 To what extent does strategic management impact on organizational performance?

5.                 What     are     the     challenges        faced     by    management         in    managing strategically?

1.5        FORMULATION OF HYPOTHESES

The following hypotheses were formulated to guide this study:

Hypothesis one

H0:       There are no strategic management policies and procedures existing in Nigeria Breweries Plc.

H1:       There are strategic management policies and procedures existing in Nigeria Breweries Plc.

Hypothesis two

H0:       Employees         are      not      significantly         involved       in      the      strategic management process.

H2: