At a recent board meeting of a multinational company there was a heated debate on whether the company should continue to invest resources in strategic planning processes. A section of the board members believed that it is worth to invest, whilst the other section opposed that decision because they considered such an activity as waste of resources.
Your task is to state:
a) FIVE reasons why you think the company must continue to invest in the strategic planning process. (10 marks)
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REASONS FOR CONTINUOUS INVESTMENT IN STRATEGIC PLANINING PROCESS
- Risk reduction: The continuous investment in the strategic planning process will help the company to reduce the risks associated with its operations by taking many factors into consideration.
- Reduction of uncertainty: The company will be able to reduce uncertainty because the personnel will be able to know the results expected of them.
- Realistic targets: The company will be able to set targets that can be achieved because it will consider its strengths and weaknesses before such targets are set.
- Guide: Investing in the strategic planning process will serve as a guide in the operations of the company.
- Commitment: The continuous investment in the strategic planning process will help the company to gain loyalty and commitment of employees because they will be involved in the planning process.
- Better decisions. The company will be able to make better decisions because managers will have a basis of measuring their performance.
- It will enhance the degree to which employees will accept change.
- The financial performance of the company will also increase. (Any 5)
b) FIVE reasons why it might not be necessary for the company to invest in the strategic planning process. (10 marks)
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- Waste of time. The company may consider the investment as waste of time due to the time involved in the planning process.
- Fear of failure. The company may not invest in the strategic planning process because they may fear that it will fail.
- Lack of expertise. The company may not invest in the strategic planning process just because they don’t have the personnel with the expertise to undertake such activity.
- The company may be satisfied with its current performance and may not see the need to plan.
- The company’s executives may refuse to plan strategically due to mere laziness.
- The company may not invest in any strategic planning process because the future changes so fast that it will not be necessary to plan. (Any 5)