EFFECTS OF STRATEGIC PLANNING ON THE PERFORMANCE OF SMES
CHAPTER ONE
1.1 Background To The Study
Strategic planning was particularly applied to organizations in the twentieth century. It is defined as the science and art of developing, implementing, and evaluating cross-functional decisions that enable an organization to achieve its goals. To achieve organizational success, strategic planning integrates all functional units in the organization, including marketing, finance and accounting, operations and production, and management. Strategic planning is an organizational process that aims to channel both human and other organizational resources in order to profitably meet the needs of customers and other key stakeholders. The stated policies, mission statement, and strategic goals and objectives guide strategic planning implementation. Top management’s and other key managers’ behavior in the organization. Strategic management necessitates the formulation of strategic goals and objectives in light of the organization’s internal and external resources. It specifies the target customers to be served with the appropriate product and services through effective and efficient resource allocation (Cole, 1997). According to Lamb (1984), strategic planning is essential for SMEs to be more proactive and secure their future. As a result, the research will look into the effects of strategic planning on the performance of SMEs in south-west Nigeria.
1.2 Statement of the Problem
The growing importance of SMES cannot be overstated in light of their contribution to the country’s economic growth through the provision of employment for a large segment of the population and revenue generation.
However, SMEs face difficulties in developing and implementing strategic plans. The inability of SMEs to be proactive and secure their future with success has resulted in many of them folding up, as well as their inability to grow rapidly. As a result, management experts have advocated for SME strategic planning as a measure to ensure the effective and efficient channeling of resources to profitably meet customers’ growing needs with innovative products and services. Many of the growing challenges confronting SMEs Management’s inability to support strategy, a lack of adequate resources, no alignment of activities with strategy, an inability to manage change, and a lack of human resources to implement strategic plans are all factors in the evolution and implementation of strategic planning. As a result, the research problem is to evaluate the effects of strategic planning on the performance of SMEs in south-west Nigeria.
1.3 Objectives of the Study
To assess the nature and impact of strategic planning on the performance of SMEs.
To ascertain the effects of strategic planning on the performance of small and medium-sized enterprises (SMEs) in south-west Nigeria.
To achieve organizational success, strategic planning integrates all functional units in the organization, including marketing, finance and accounting, operations and production, and management. Strategic planning is an organizational process that aims to channel both human and other organizational resources in order to profitably meet the needs of customers and other key stakeholders. The stated policies, mission statement, and strategic goals and objectives guide strategic planning implementation. Top management’s and other key managers’ behavior in the organization. Strategic management necessitates the formulation of strategic goals and objectives. of its internal resources and external factors. It specifies the target customers to be served with the appropriate product and services through effective and efficient resource allocation (Cole, 1997)
1.4 Research Questions
What exactly is strategic planning?
What is the impact of strategic planning on the performance of SMEs?
What impact does strategic planning have on SME performance in south-west Nigeria?
1.5 Significance of the Study
The study provides an opportunity for SMEs to understand the tools of strategic planning and strategic management in order to improve their performance.
The growing importance of SMES cannot be overstated in light of their contribution to the country’s economic growth through the provision of employment for a large segment of the population and revenue generation.
However, SMEs face difficulties in developing and implementing strategic plans. The inability of SMEs to be proactive and secure their future with success has resulted in many of them folding up, as well as their inability to grow rapidly. As a result, management experts have advocated for SME strategic planning as a measure to ensure effective and efficient operations. channeling of resources to profitably meet the growing needs of customers with innovative products and services.
1.6 Research Hypothesis
Ho Strategic planning has little impact on the performance of SMEs in south-west Nigeria.
Hi Strategic planning has a significant impact on the performance of SMEs in south-west Nigeria.
1.7 Scope of the Study
The research examines the effects of strategic planning on the performance of SMEs in south-west Nigeria.
1.8 Limitations of the Study
The study encountered some constraints, such as logistical and geographical factors.
1.9 Definition of Terms
ENVIRONMENT INTERNAL
The factors within the firm comprise the firm’s internal environment.
Its resources, culture, and structure, as well as its strengths and weaknesses (Beal, 2000)
MEASUREMENT OF PERFORMANCE
Performance measurement is the process of determining what to measure and how to measure it.
DEFINED OBJECTIVE
The firm’s objectives are regarded as the outcome or result of the firm’s planned activities, which must be consistent with the firm’s mission, targets, and objectives. Johnson and colleagues (2007).
DEFINITION OF STRATEGIC PLANNING
It is defined as the science and art of developing, implementing, and evaluating cross-functional decisions that enable an organization to achieve its goals. Strategic planning entails the integration of all organizational functional units, which include
To achieve organizational success, marketing, finance and accounting, operations and production, and management must all work together.
DEFINITION OF STRATEGIC MANAGEMENT
Strategic management consists of managerial decisions and actions that direct the firm’s resources toward the achievement of the firm’s long-term objectives, while taking into account both internal and external factors such as external opportunities and threats, as well as the organization’s strengths and weaknesses. Wheelen and Hungers’ research (2006),
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