The strategic management
function is perhaps the most fundamental and most important aspect of
management and managing. It takes superior entrepreneurship and
competent strategic implementation and execution to produce superior
organizational performance over the long-run. A great strategic plan
that is flawlessly executed seldom produces gold star results either.
In the light of the above,
this chapter is to carry out a literature review on strategic
management and its impact on organizational effectiveness and
performance. It attempts to consider the nature and concept of strategic
management strategies used by organizations, the primary determinants
of strategy and the components of strategic management among others.
TABLE OF CONTENTS
Table of content
CHAPTER ONE: INTRODUCTION
1.0 Background of the study 1
1.1 Statement of the problems 3
1.2 Organizational performance s related to strategic
1.3 Objectives of the study 5
1.4 Research questions 6
1.5 Research hypotheses 6
1.6 Research Methodology 7
1.7 Limitation of the study 8
1.8 Definition of terms 8
1.9 Historical background of the Study 8
CHAPTER TWO: LITERAT REVIEW
2.0 Introduction 11
2.1 Organization needs analysis 12
2.2 Nature and concept of strategic management 13
2.3 Strategies used by organizations 14
2.4 The primary determinants of strategy 16
2.5 Organizational strengthening and capacity building 17
2.6 Matching strategy to an organization’s situation 20
2.7 Summary 26
CHAPTER THREE: RESEARCH METHODOLOGY
3.0 Introduction 27
3.1 Source of data collection 27
3.2 Research design 28
3.3 Instrument of data collection 28
3.4 Population and sample size 29
3.5 Sampling techniques 30
3.6 Method of data analysis 30
3.7 Limitation of the study 32
CHAPTER FOUR: DATA PRES NTATION AND INTERPRETATION
4.0 Introduction 33
4.1 Data presentation and analysis 33
4.2 Test of hypotheses 45
CHAPTER FIVE: SUMMARY, CO CLUSION AND RECOMMENDATIONS
5.0 Introduction 49
5.1 Summary 49
5.2 Findings 50
5.3 Conclusion 53
5.4 Recommendation 54
1.0 BACKGROUND OF THE STUDY
The performance of
organization is the focus of intensive research efforts; how well an
organization performs its mission and accomplishes is its goals of
programs delivery is to paramount concern.
The success of failure of a
strategy is significantly determined by the quality of leadership
displayed by the strategy leader normally the CEO, during the strategy
In today's increasingly
chaotic world and an ever changing environment, it is not enough to just
keep the organization afloat it is far more essential to make steady
progress toward some well- defined objectives.
knowledge based organization are ideal setting for the application of
strategic management practices strategy, in effect it's management's
game plans for strengthening the organization's position, pleasing
customers and achieving performance targets. Managers devise strategies
to guide how the organizations business win be conducted and to help the
make reasoned and make cohesive choices among alternative causes of
action. The strategic managers decides and indicates e path and action
the y could choose, they decide to tallow particular rate d conduct
their business in that particular manner without a strategy, a manage
has no roadmap to follow, to manage and no unified action programme to
produce the intended results.
Strategic management is
defined by thompson and Strickland (2001) as “the process whereby
managers establish an organization's ng-term direction, set specific
performance objectives, develop strategies to achieve these objectives
in the light of all the relevant internal and external circumstances and
undertake to execute the choose action plan”.
Strategic management has five critical and interrelated managerial tasks explained thus.
- Deciding (what business organization will engage in) and forming
a strategic vision of an organization wants to go) and human
resources development of those who are to get it there). It in effect
enhances productivity, providing long-term direction and establishing a
clear mission to be accomplished.
- Crafting a strategy to achieve e desired results.
- Implementing and executing the chosen strategy efficiently and effectively.
- Evaluating performance, reviewing developments and initiating
corrective adjustments in 10 g-term directions, objectives, strategy or
implementation in light of actual experience, changing condition new
ideas and opportunities.
- It involves a rational analysis and planning which provides the "road map" for fulfilling that future.
Furthermore, the task of
evaluation organization performance would entails a greater degree use
of strategic management practice and to initiate any corrective
adjustment lies both the end and the beginning of strategy management
In addition, strategic
management practices are hypothesized, and have an impact in the
organizational process and enhances coordination of work for a
well-designed productivity, therefore strategy managers must stay close
enough to the situation to detect when changing conditions requires a
strategic response and when they don’t. It is their job to sense the
winds of change, recognize significant changes and initiate adjustments.
1.1 STATENMENT OF THE PROBLEMS
Those engaged in strategic
management practices need to be aware of certain often, organization’s
external environment poses. externally imposed threats may stem from
cheaper technologies, the advent of new substitute products, adverse
economic trends restrictive government action, changing consumer va1ves
and lifestyles, projection of natural resources depletion, unfavorable
demographic shifts, n w sources of strong competition and the likes;
such threat can be a major factor in shaping organizational strategy.
As it occurs with all
management techniques, individual will need extensive training and
refresher training to answer unforeseen questions that arise in response
to implementation, conflict, confusion and chaos will prevail initially
and for sometimes therefore, only individual learn how to do it and see
its valve will the benefit of strategic management be realized.
In an empirical study
noting e impact of strategic management on organizational performance,
the m [or problems that are associated with bad performance and lack of
strategic management can be highlighted below.
- Lack of internal career leader: A career system is necessary to
focus individual attention on the strategic issues facing an
organization over the long term. A long-term perspective induces
organizational commitment and loyalty. It enables individuals and
organizations to invest training and productivity improvements knowing
that they will reap the benefits from that enhanced knowledge and
- Lack of formal training system: the importance of training has been a
Neglected area and too much of what goes on in today's organization
requires specific adaptation. Therefore managers' functions is the
development the people for future advancement.
- Lack of employee voice/participation: A theory of individual self-
interest, which not only operates in terms of the economic market but
with respect to socio-political values is primary an attempt to explain
an organization survival.
- Lack of broadly defined jobs: problems arise when individuals are
designed to jobs officially having lower grades, and a lower grade
assignment might be seen psychological as a career setback.
- Lack of performance-based compensation: strategic pay requires that
all decisions relation to compensation and benefit are designed to
attracts, retain or motivate employees as such the entire organization
rewards structure is designed to fully serve its mission or purpose.
In addition, strategic
management remains undeniable considering the fact that resources are
inadequate in scope, volume and composition to meet the varying wants of
individuals. Organizations and society couple with the present rapid
realization that the environment is increasingly becoming unpredictable
where nothing has an air of certainty.
1.2 ORGANIZATIONAL PERFORMANCE AS RELATED TO STRATEGIC MANAGEMENT
The desired organization performance and financial result has achieved through the following:
- Growth in revenues and earnings
- Return on investment (ROI)
- Financial strength (capital base)
- Earning power and stability
- Technological and improvement.
- Strategic objectives convert the strategic mission into specific
targets, specific market standing and competitive position, and specific
committed to action thus ensuring that the intentions of the intentions
of the mission are achieved.
- The market share position has be seen and recognized as the leader.
- The organization has high degree of reputation with customers and the public.
- The overall Size and degree of diversification has become a highly diversified enterprise.
1.3 OBJECTIVES OF THE STUDY
The objectives of any research study is to find a solution to the problem or to
find relationship that
exist between the problem and other problems or breaking the problem
into its components parts through an exploration or analysis so that the
superior and readers alike will understand the problem more clearly
with the hope that it will eventually be solved through the present
The main objective or
purpose of I the study is to conduct a research on the impact of
strategic management on organizational effectiveness and performance.
1.4 RESEARCH QUESTIONS
A research question serves
as a guide to the researcher in his guess for answer to the problem
being investigated. Research question should therefore focus on the
problem and should be general enough to give rise to other minor
research questions. In case, the research question in which answer will
be provided at the end of the study are as follows:
- Is there any significant relationship between strategic management and organization effectiveness?
- How strategic management could be effectively used.
- To what extent does competitive advantage enhances superior profitability and long-term performance.
- To what extent doses management devise strategic to effectively
guide how the company business will be conducted and to help them make
reasoned, cohesive choices among alternative courses of action?
1.5 RESEARCH HYPOTHESES
A hypothesis is the
statement of relationship between variables. To understand better what
aspect of the relationship between the variable that the researcher is
interested in she makes a conjectural statement or tentative statement
about this relationship. This conjecture or tentative statement is the
hypothesis in this case, the research hypothesis under study area as
1. Ho: There is no significant relationship between strategic management
and organizational effectiveness and performance.
Hi: There is significant relationship between strategic management and organizational effectiveness and performance.
- Ho: Competitive advantage does not effectively enhance superior
profitability and long-term performance.
Hi: Competitive advantage effectively enhances superior profitability and Long-term performance.
3. Ho: strategic management device cannot effectively guide how the
company business will be conducted and help make choice among alternative courses of action.
management device cannot effectively guide how the company business will
be conducted and help make choice among alternative course of action.
1.6 RESEARCH METHODOLOGY
The: method of data
collection that would be employed in the study would be through primary
source of data collection. The primary source would be survey through
administration of questionnaire, the data that would be gathered through
the questionnaire would be analyzed and in analyzing it the following
statistical techniques would be used:
- Simple percentage: It would be used to analyze the bio-data statistics and section B to the questionnaire,
- Chi-square statistical techniques: It would be used to test the hypothesis, the formular is]
Where X2 =chi-square
O= observed frequency
E = Expected frequency
∑ = Summation
The study would be
conducted at 5% level of significance and the model for the degree of
freedom would be (r-l) (c-l) 'r' and 'c' indicate row and column
1.7 LIMITATION OF THE STUDY
This study hopes to focus
on strategic management practices and external environmental threats of
companies and how they affect their performance and effectiveness.
However, there is no study without areas of limitating factors, the
major limitation of the study is financial inadequacy as well as
inadequacy of personnel carryout the research, other are time constraint
and inadequately of data on the subject matter.
Despite all these limitations, the study will provides the basic foundation required for future research.
1.8 DEFINITION OF TERMS
means ~hat an organization is able to establish and disseminate a clear
sense of purpose and direction, establish an appropriate structure with
effective legislative and administrative frameworks, Organizational
strengthening and capacity building means building an effective
organization capable of identifying, choosing and implementing
activities that will enhance its long-term performance.
Strategic management enhances productivity and the effectiveness of organizations.
Strategy is management's
game plan for strengthening the organization's position, pleasing
customers and achieving performance targets.
1.9 HISTORICAL BACKGROUND OF THE STUDY.
Nigerian breweries plc,
the pioneer and largest brewing company in Nigeria was incorporated in
the 1946 and recorded a landmark when the first bottle of STAR larger
beer rolled off the bottling lines in its Lagos brewery in June 1949.
This was followed by Aba brewery which was commissioned in 1957, Kaduna brewery in 1963 and Ibadan brewery in 1982.
In September 1993, the
company acquired its fifth brewery in Enugu while in October 2003, a
sixth brewery sited at Ama in Enugu state was commission Ama brewery is
the biggest brewery in Nigeria and the most modern in the world.
Operations in Enugu
brewery was discontinued in 2004. Thus from its humble beginning in
1946, the company now has five operational breweries from which its high
quality products are disturbed to all parts of this great
country. Nigerian breweries plc has a rich portfolio of high
quality brands: star larger beer (1992); Amstel Malta (1994); Heineken
larger (1976) legend extra strut (1992); Amstel Malta (1994); Heineken
larger (1998); fayrouz (2006); Nigerian breweries plc has an increasing
export business that dates back to 1986 currently, the company export to
the U.k, Europe and the West African sub-region.
Nigerian breweries plc
keeps pace with key international developments, thus ensuring that its
systems, processes and operational procedures are always in conformity
with world class standards. It is in line with this policy that the
company established a research and development center in 1987 to enhance
its research activities in all aspect of brewing operations. As a major
brewing concern, the company encourages establishment of auxiliary
Many of these
organizations and individuals depends largely on the company for their
means of livelihood these include manufacture of bottles, crown corks,
labels, cartons, plastic crates and such services as hotels clubs and
our key distributors. Nigerian breweries plc is a socially responsible
corporate citizen with a very good record of corporate philanthropy in
the areas of education, the environment and sports, among others. The
company in 1994 established an education trust fund of N100 million and
research facilities in higher institutions all in an effort to provide
and encourage academic excellence in Nigeria.
This is in addition to its
secondary and university scholarship programme for children of its
employees Nigerian breweries plc is the foremost sponsor of sports by
variety in the country with sponsorship covering football, athletics,
table tennis, long tennis, cycling, chess, golf, badminton, dash and
The aims is to develop
Nigerian sportsmen and women to participate in national and
international sports and boost the sports profile of the country. The
company is also involved in the development of musical talents through