strategy planning process and the challenges of implementation at ...

STRATEGY PLANNING PROCESS AND THE CHALLENGES OF IMPLEMENTATION AT YAKUTI VENTURES LIMITED

BY

KAREN A. MILANYA

UNITED STATES INTERNATIONAL UNIVERSITY AFRICA

SUMMER 2014

STRATEGY PLANNING PROCESS AND THE CHALLENGES OF IMPLEMENTATION AT YAKUTI VENTURES LIMITED

BY KAREN A. MILANYA

A Project Report Submitted to the Chandaria School of Business in Partial Fulfillment of the Requirement for the Executive Masters of Science in Organization Development (EMOD)

UNITED STATES INTERNATIONAL UNIVERSITY AFRICA

SUMMER 2014

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DECLARATION I, the undersigned, declare that this is my original work and has not been submitted to any other college, institution or university other than the United States International University in Nairobi for academic credit.

Signed: ________________________

Date: _____________________

Karen A. Milanya (ID 610962)

This project has been presented for examination with my approval as the appointed supervisor.

Signed: ________________________

Date: _____________________

Prof. Peter Lewa

Signed: _______________________

Date: _____________________

Dean, Chandaria School of Business

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COPYRIGHT No part of this project may be reproduced or distributed in any form or any means electronically, mechanically or photocopy, or stored in a database or retrieval systems, without prior permission of the author. Copyright © Karen A. Milanya All rights reserved.

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ABSTRACT The purpose of this study was to establish the challenges of strategy planning and implementation at Yakuti Ventures Limited. The specific objectives of the study were: to determine the strategy planning process and challenges, to establish the strategy implementation process and factors that aid this process, to examine the inhibitors of strategy implementation The focus of the research was Yakuti Ventures Limited (YVL) shareholders. The population consisted on 18 shareholders of YVL including the management and board of directors. The research methodology used included the descriptive design research as it exhibits the advantage of acquiring a lot of information through description and is therefore useful for identifying variables and hypothetical constructs. Data was collected using questionnaires which were both structured and unstructured so as to enable analysis using both the qualitative and quantitative methods. This was aided by the use of the Statistical Package for the Social Sciences (SPSS). The data was analyzed in form of frequencies, percentages and Pearson correlations. The findings were presented using tables and figures. According to the findings of the study, majority of the shareholders agreed that the organization has gone through the main phases of formulation of strategy. The plan has clearly stated in it; organization vision, organization mission, organization core values and goals linked to the financial implications. The plan also has outlined the SWOT analysis findings. The major challenges presented at the strategy planning workshop included: difficulty in finding a meeting venue as this had cost implications, difficulty in making sure all shareholders were present and active during the sessions, outsourcing of the services to assist in coming up with the plan. Challenges of diverse views and opinions also arose. Although the strategy document is seen as a mere document, the goals therein limit options for the company as it struggles to stay in line with strategies stated in the plan. The leadership aspect required for implementation failed to inspire and instill a sense of purpose. Thus, behaviors were not shaped in line with implementation initiatives. Failure to align the organizational structure to the set out strategies made implementation

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difficult. Resource and policy deployment was not effective as there was no action plan to implement strategies. Other factors that arose as the main inhibitors to strategy implementation include; lack of time, insufficient and ineffective coordination, lack of rewards in line with strategy execution, lack of feeling of ownership, unidentified problems, deviation from the original plan and other competing activities. Further still problems mentioned as derailing the implementation process incorporated; lack of a shareholders’ agreement or policy documents and lack of clear decision making mechanisms. Recommendations were made in order to change the current situation and get to a place of successful implementation of strategy. These were in line with working at reducing or eliminating the looming challenges within Yakuti Ventures Limited. Yakuti Ventures Limited needs to engage in increased innovativeness of organization strategy as well as narrow down on specific problems with a focus in important issues of the organization, industry and environment. Yakuti Ventures Limited should necessitate the continued reevaluation of the planning process in a bid to create one that is customized in nature and will cater to its specific needs. This process should include on-going review of the organization’s strategic direction focusing on general condition, progress monitoring and communication. This will be aided by having a support structure entailing the right leadership, governance, operations structure and the right people for the job. Finally, having an implementation plan in place as well as conducting regular assessments will enable the organization to be aware of what is expected and whether they are operating in line with the specifications.

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ACKNOWLEDGMENT My first appreciation goes to the Almighty God for giving me the opportunity to be a part of this process and for giving provision throughout. Special acknowledgement goes to my supervisor Prof. Peter Lewa who has provided invaluable direction and guidance during the research. I am grateful for your providing the time and support that was necessary. I would also like to acknowledge the support and prayers of my family and friends. Special appreciation goes to my mother, Josephine Odhiambo for holding my hand every step of the way. My Ombi prayer group, may God reward you for the prayers you made in my stead. Appreciation also goes to the USIU team that was a part of this process. Prof. Wambalaba, thank you for beginning the process. Dr. Amos Njuguna, Dr. Caren Ouma, Dr. Teresia Linge, Goerge K’aol, Stephen Nyamberega and Scott Bellows, your support before and during the study are well appreciated. Prof. Matthew Buyu, I appreciate the encouragement and laughter when times were seemingly difficult. Finally, my heartfelt gratitude goes to Yakuti Ventures Limited and Precise Communications Limited. Yakuti Ventures Limited, thank you for the opportunity to conduct the study. Mr. Kisuke Ndiku of PRECISE, I appreciate the intellectual challenges from you and the time allowed to study and conduct the research. I am forever indebted to you. I express my sincere appreciation to you all and may God bless you.

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DEDICATION I dedicate this research paper to the different families I have; Jordan Ministries, Ombi Girls, Heralds of His Coming Ministries, D.I.T.T.O and my biological family.

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TABLE OF CONTENTS DECLARATION................................................................................................................ii COPYRIGHT ...................................................................................................................iii ABSTRACT.......................................................................................................................iv DEDICATION..................................................................................................................vii LIST OF TABLES............................................................................................................. x LIST OF FIGURES........................................................................................................... x ABBREVIATIONS........................................................................................................... xi CHAPTER ONE.................................................................................................................1 1.0 INTRODUCTION........................................................................................................1 1.1 Background of the Study............................................................................................1 1.2 Statement of the Problem........................................................................................... 5 1.3 General Objective ......................................................................................................5 Specific Objectives...........................................................................................................5 Importance of the Study................................................................................................... 5 Scope of the Study............................................................................................................6 Definition of Terms..........................................................................................................7 Chapter Summary.............................................................................................................8 CHAPTER TWO................................................................................................................9 2.0 LITERATURE REVIEW............................................................................................9 2.1 Introduction................................................................................................................9 2.2 Strategy Planning in Organizations ...........................................................................9 2.3 Strategy Implementation.......................................................................................... 16 2.4 Inhibitors to Successful Strategy Implementation....................................................28 2.5 Chapter Summary.....................................................................................................34 CHAPTER THREE......................................................................................................... 35 3.0 RESEARCH METHODOLOGY..............................................................................35 3.1 Introduction .............................................................................................................35 3.2 Research Design ......................................................................................................35 3.3 Population and Sampling Design ............................................................................ 36 3.4 Data Collection Methods .........................................................................................38 3.5 Research Procedure ................................................................................................. 39 3.6 Data Analysis Methods ........................................................................................... 39 3.7 Chapter Summary.....................................................................................................40

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CHAPTER FOUR............................................................................................................41 4.0 RESULTS AND FINDINGS..................................................................................... 41 4.1 Introduction..............................................................................................................41 4.2 General Information of the Study and Study Group................................................ 41 Strategy Formulation......................................................................................................43 CHAPTER FIVE..............................................................................................................82 5.0 DISCUSSION, CONCLUSIONS AND RECOMMENDATIONS.........................82 5.1 Introduction .............................................................................................................82 5.2 Summary.................................................................................................................. 82 5.3 Discussion................................................................................................................ 83 5.4 Conclusions..............................................................................................................87 5.5 Recommendations.................................................................................................... 89 REFERENCES.................................................................................................................92 APPENDICES................................................................................................................ 100

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LIST OF TABLES

LIST OF FIGURES Figure 2.1: Strategic Planning Process Within Business Unit........................................... 11 Figure 2.2: SWOT Matrix..................................................................................................13 Figure 2.3: Benefits of Strategic Planning......................................................................... 15 Figure 4.1: Respondents Age............................................................................................. 41 Figure 4.2: Respondents Education Level..........................................................................42 Figure 4.3: Limitations of Strategic Plan........................................................................... 57

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ABBREVIATIONS PESTEL

Political, Economic, Social, Technological, Environmental and Legal

SPSS

Statistical Package for Social Sciences

SWOT

Strength, Weaknesses, Opportunities and Threats

YVL

Yakuti Ventures Limited

HBE

Harvard Business Essential

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CHAPTER ONE 1.0 INTRODUCTION 1.1

Background of the Study

Organizations are systems having the same features yet aspects of these features can make these systems operate differently, at different times. All organizations have a management structure that determines relationships between the different activities and the members, subdivides and assigns roles, responsibilities and authority to carry out different tasks. They are open systems which affect and are affected by their environment (Cummings and Worley, 2009). These various components allow the organization to function in a particular way in order to achieve the overall objectives or strategies it has set out to achieve. This research is about examining the challenges Yakuti Ventures is experiencing in implementing strategies. Strategy as a word comes from the Greek word strategos, referring to a military general and combining stratos (the army) and ago (to lead). The principal responsibilities of formulation include understanding the environment, defining organizational goals, identifying options, making and implementing decisions, and evaluating actual performance. Principally, strategic planning aspires to use innovative and diverse prospects of tomorrow, contrary to long-range planning, which optimizes for tomorrow the trends of today (Drucker, 1980). For strategies to be reached any organization needs to go through the strategic planning process. Strategic planning came into the scene in the 1960s and was embraced as "the one best way" to devise and implement strategies that would enhance competitiveness. This one best way separated thinking for doing and created a new function staffed by specialists: strategic planners. This scientific management was pioneered by Fredrick Taylor (Keller, 1997). However, it was later realized that strategic planning has not really worked as anticipated. In actual sense, we find that what has been known as strategic planning has really been strategic programming which is the articulation and elaboration of strategies or visions that already exist. An understanding of the difference between the

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two terms; strategic planning and strategic thinking, would enable organizations to get back to what the strategy-making process should be. This is capturing from all sources and then synthesizing that learning into a vision of the direction that the organization ought to pursue. (Mintzberg, 1994). Further still, if organizations essentially begin on the wrong footing, something must be done to reverse and stop this error before it's too late. How then do we begin to even approach this? Often times, ridding an organization of some of these issues would begin at the root. Where or what then is the root cause? Simply put, strategy is formulated from the thoughts of the organization (the people within the organization). Thus, the process of decision making in order to formulate or make strategy is as important if not more important. It is important to note that decision making is affected by numerous factors both internal (these may be perceptions or biases or a certain culture held within the organization) and external (these could be economic factors without or the environment). Making good decisions is a critical skill at every level (Drucker, 1980). Strategic planning can be defined as a systematic approach to developing long term plans to guide on organization over a period of time. The time frame may vary from one year to several. Strategy implementation on the other hand is the process of turning the above mentioned plans or strategies into actions that eventually lead to fulfillment of the overall objectives of the organization (Sage, 2010). Numerous results from studies confirm that many firms fail to produce superior performance due to unsuccessful implementation of strategy (Noble, 2009). An Economist survey found that a discouraging 57 percent of firms were unsuccessful at executing strategic initiatives. This is consistent with a survey of 276 senior operating executives in 2004 (Allio, 2005). According to a Whitepaper of Strategy Implementation of Chinese Corporations in 2006, strategy implementation has become "the most significant management challenge which all kinds of corporations face at the moment". The survey reported in the white paper indicates that 83 percent of the surveyed companies failed to implement their strategy smoothly, and only 17 percent felt that they had a consistent strategy implementation process (Yang, Sun and Martin, 2008).

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Research by Alexander (1985) identified twenty-two major obstacles to strategy implementation, of which ten were cited by over 50% of firms sampled as major problems. In a similar study, Salem Al-Ghamdi (1998) researched 15 implementation problems and found that six strategy implementation problems were experienced by over 70% of the sample group of firms as viewed in Table 1.1. Based on case studies, Hansen, Boyd and Kryder (1998) identified additional implementation problems as a) failing to periodically alter the plan or adapt it to changes in the business environment b) deviation from original objectives and c) lack of confidence about success. After examining and checking for redundancy, a list of twenty implementation obstacles emerged (see table 1.2). Fifteen of these strategy implementation obstacles are similar to those identified by previous research conducted by Alexander (1985) and Al-Ghamdi (1998), whereas there are five additional obstacles to strategy implementation that need to be included. Nickols (2000) on the other hand stated that strategy is execution. He discussed four cases of strategy execution: flawed strategy & flawed execution, sound strategy & flawed execution, flawed strategy & sound execution, and sound strategy & sound execution. Only when the strategy and the execution are sound the organization has a pretty good chance for success, barring aside environmental and competitive influences. Further, he contends that executing the wrong strategy is one of the major problems leading to unsuccessful implementation of strategies. Brannen’s (2005) survey based study concluded that in order to improve execution certain issues have to be tackled. These include inadequate or unavailable resources, poor communication of the strategy to the organization, ill-defined action plans, ill-defined accountabilities, and organizational/cultural barriers. Brannen’s survey unearthed another significant obstacle to effective strategy implementation namely, “failing to Empower or give people more freedom and authority to execute.” Welbourne (2005) observations of items on “what’s getting in the way of execution” point to “habit and past experience reflects on new strategy” as another factor that could affect strategy implementation. Thus, as illustrated, strategy implementation is viewed as being more difficult than formulating the strategy (Mankins Na Steele, 2005; Thomson and Strickland, 2003). After identification of potential obstacles of both planning and implementation, this research

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paper seeks to examine those relevant to Yakuti Ventures Limited, a company that has been in existence for three years. Recommendations will then be suggested to aid improvement of strategy planning and implementation. The idea of Yakuti Ventures Limited was birthed in 2010 by a group of ladies who all attended the same high school. After several meetings with prominent individual who were able to give direction on registration and other matters formal, the company was formally launched. The company began making contributions with a total of 20 members. This number later reduced to 18. In April 2011, the group was incorporated into a private limited company making it one of the investment clubs/groups (chama) to take the leap into becoming a fully fledged company. Out of the 20 shareholders, there are seven members who comprise the board, one being non executive. The company also has a management team of 5 members and different committees mandated to run the different departments of the company. In 2011, the company invested in a strategic planning workshop geared towards coming up with a blueprint for future endeavors. The strategic plan is for the period a period of five years (2012 – 2016). The plan used the SWOT analysis and clearly outlined investment initiates to be undertaken within the 5 year period breaking further into Short Term (1-2 years), Midterm (3-5 years) and Long Term (6-10 years) investments. However, these specified time periods may differ depending on an individual's investment appetite or risk averse nature. Short term could relate to less than four months, Mid Term being anywhere between four months and two years and Long Term extending beyond that (Hashemian, 2001). This drafting of a strategic plan enabled the company to set up flagship projects to take the lead in the plan. As at the point of conducting the study, the company has invested in the Nairobi Stock Exchange, the money market fund as well as purchased parcels of land across the country. This however does not form the set out plans within the strategic plan of the company. In addition, the communication when it comes to decision making has led to the shareholders taking long periods of time which causes a lag when it comes to realizing projects and thus bringing growth - increase in net worth. Thus, for the purpose of this study, the researcher will interview the 18 shareholders, management and board of directors.

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1.2

Statement of the Problem

Many organizations have strategic plans that are essentially formulated to guide an organization in achieving its overall mission. However, often times achievement is not realized due to time constraints, lack of organizational structure alignment, lack of understanding of objectives. According to reviews of literature not much is known concerning the specific steps that a investment group, commonly referred to as a chama in Kenya, would be expected to take in order to make the big leap into an investment company to grow its net worth. Being a small firm/ organization makes this a particularly attractive research area (Deakins & Freel, 1998). There is little or no information documented about factors affecting strategy implementation within Yakuti Ventures limited or the challenges faced thus no objective knowledge and direction to guide its growth. In this regard, the statement of the problem can be stated as follows: Examination of problems of strategy planning and implementation at Yakuti Ventures Limited. 1.3

General Objective

The general objective of the study was to examine the strategy planning process and investigate the challenges of strategy implementation within Yakuti Ventures Limited. Specific Objectives 1.4.1

To determine the strategy planning process

1.4.2

To establish the challenges and benefits of strategy formulation

1.4.3

To establish the strategy implementation process and the challenges and factors

that aid this process Importance of the Study 1.5.1

Significance to Yakuti Ventures Limited

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The study collected data that could be used in the future to inform the direction Yakuti Ventures Limited needs to take in trying to increase its net worth. The study revealed the possibility of a shortcoming in strategy implementation within the company and thus provided a focus for the company to work on re-evaluation. This will enable Yakuti to be able to give attention to the highlighted problems as well as seek to implement the suggested recommendations. 1.5.2

Significance to other Investment Clubs

The findings of this research can be a reference point to other investment clubs in their quest for growth and increase in net worth. The study will act as a guide to other investments clubs on the perils they may face as relates to strategy planning and implementation in the journey of growth. Other investment clubs will be able to implement strategies recommended within the study to assist them in curbing the already existing problems of strategy implementation. 1.5.3

Significance to other Academicians/ Researchers

The results of this research can be used as a guideline by researchers to further explore the factors that affect strategy implementation, how this relates to organizational growth and tactical ways to allay them. Scope of the Study The study focused on Yakuti Ventures Limited, a company limited by shares and registered under the Companies Act in Nairobi Kenya. The study will be conducted in Nairobi between January and March, 2014 which is a total of three months. Within the population, a sample size of 18 shareholders was used and the focus was on Yakuti Ventures Board of Directors, the management team, the company shareholders and the different investment advisors who have interacted with the company. The research foresees a couple of limitations to the study. First, the focus of the study is on one organization. Interviewing other organizations would lead to generalization as the study would be too broad. The research will be conducted on Yakuti Ventures Limited to

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obtain substantial information on decision/strategy implementation and its relation to organizational growth. Second, there is the likelihood of biased responses from the respondents as no one would want to paint a bad picture of Yakuti Ventures Limited. The researcher was required to assure the respondents of confidentiality so as to work at mitigating biased responses. Lastly, the Board of Directors as well as the Shareholders of Yakuti Ventures Limited are women and this may lead to some form of gender bias. Definition of Terms 1.7.1

Organization

An organization is a system of interdependent actors who collectively share the same goals towards creating and obtaining worth through their interactions (Sanchez and Heene, 2004) 1.7.2

Organizational Growth

Organizational growth refers to a business that generates significant positive cash flows or earnings, which increase at significantly faster rates than the overall economy (Roberts, 2004). 1.7.3

Strategy

A strategy is a pattern of purposes, policies, programs, actions, decisions, or resource allocations that define what an organization is, what it does, and why it does it (Nickols, 2012). 1.7.4

Strategy Planning

Strategic planning is a tool for organizing the present on the basis of the projections of the desired future. Thus, a strategic plan is a road map to lead an organization from where it is now to where it would like to be in five or ten years (Mintzberg, 1994). 1.7.5

Strategy Implementation

Strategy implementation describes the concrete measures that translate strategic intent into actions that produce results (Harvard Business Essential [HBE], 2005).

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Chapter Summary

With the looming pressure for organizations to move forward and grow, more concentration is being put on the need to have strategies within any given organization. The formulation of strategies is time consuming but enables an organization to have a set of guidelines which it needs to follow in the quest for attaining growth and visibility within its environment. The chapter has noted that as much as the formulation of strategy is important, implementation of strategy needs even more emphasis as many strategic plans simply gather dust in office lockers. Thus, this chapter has laid a basis on which the study is involved by introducing strategy implementation in a global as well as local context. The next chapter looks at the literature review in relation to the specific objectives highlighted within this chapter. Chapter three highlights the research methodology. Chapter four gives a detailed analysis of the findings of the research while chapter five provides a summary as well as any recommendations available to the company and other researchers.

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CHAPTER TWO 2.0 LITERATURE REVIEW 2.1

Introduction

Chapter two of the project opens us up into a literature review of the topic highlighting previous research and findings that will guide the study. Section 2.1 gives an introduction to the chapter. Section 2.2 highlights the role of strategic planning as well as the benefits and limitations of the strategy planning process. The drivers of successful strategy implementation are stated in section 2.3 and the subsections expound on specific drivers as indicated by research. Section 2.4 then illustrates the inhibitors of strategy implementation then highlights strategy executors before culminating with the different factors inhibiting strategy implementation. Finally, the chapter summary recapitulates what the chapter has brought out. 2.2

Strategy Planning in Organizations

Organizations live and thrive on strategy - their formulation and implementation. Formulation of the strategy for any organization is difficult but making the strategy work -implementing it throughout the organization is even more difficult (Hrebiniak, 2006). The best formulated strategies may fail to produce superior performance for the firm if they are not successfully implemented as Noble (1999) notes. An Economist survey found that a discouraging 57 percent of firms were unsuccessful at executing strategic initiatives according to a survey of 276 senior operating executives in 2004 (Allio, 2005). Planning is a vital part of any organization as it helps an organization chart a course for the achievement of its goals. Planning is deciding in advance what is to be done, when, where, how and by whom it is to be done. Planning bridges the gap from where we are to where we want to go (Koontz & O'Donnel, 1972). It includes the selection of objectives, policies, procedures and programmes from among alternatives. It is an intellectual process characterized by thinking before doing. It is an attempt on the part of manager to anticipate the future in order to achieve better performance (Haimann, 1978).

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Strategic planning is an organizational management activity (Bryson 1995) that is used to set priorities, focus energy and resources, strengthen operations, ensure that employees and other stakeholders working toward common goals, establish agreement around intended outcomes/results, and assess and adjust the organization's direction in response to a changing environment. It is a disciplined effort that produces fundamental decisions and actions that shape and guide what an organization is, who it serves, what it does, and why it does it, with a focus on the future. Effective strategic planning articulates not only where an organization is going and the actions needed to make progress, but also how it will know if it is successful. The development of a strategic framework is about the bigger picture. Often times, organizations get caught up in everyday problems that they do not think about the big picture. It is through strategic planning that an organization develops a strategic framework. This framework helps the organization determine its priorities and the strategies that are likely to help it achieve its vision of the future (Shapiro, 2001) The busy-ness of day to day activities is indeed important to an organization but time must be allocated to strategic thinking. It is argued that organizations with a clear strategy outperform organizations without (Karami, 2007). Planning in organizations is very important and must be done in concert with a strategy. From a macro perspective, business today gets done in a global marketplace. There was a time when strategic planning was done by the biggest companies, and those who lead change. Now it is a requirement just to survive. Leaders of business must be looking ahead, anticipating change, and developing a strategy to proactively and successfully navigate through the turbulence created by change. At a micro view, the level of any individual company, strategic planning provides a company purpose and direction (Lawor, 2006). A strategy is an overall approach, based on an understanding of the broader context in which you function, your own strengths and weaknesses, and the problem you are attempting to address. A strategy gives you a framework within which to work, it clarifies what you are trying to achieve and the approach you intend to use. It does not spell out specific activities. It is a plan of how to get where you want to go with a pattern in actions over time which gives positioning and perspective (Mintzberg, 1994). This designation is reiterated by Andrews (1980) and anticipates position as a form of strategy. Grundy and

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Rubenstein (1999) further delineate strategy as a guide to people and organizations toward not only creating more efficient and successful organizations, but also towards creating new knowledge and products, and improving the distribution of products and knowledge and improving the human condition as we know it or would like it to be. Strategic plans are thus defined as expressions of ownership dreams and visions of successful results. Strategic planning functions as the "design" just as a blueprint functions as the "how" to build something. The strategic plan displays the finished product or goal. Usually, in smaller businesses, strategic planning is focused on the overall company, not on a department or division (Pirraglia, 2005). Strategic planning is a pivotal process in organizations. It is the central activity that promotes the organization in getting from where it is now to the position where it wants to be at some established point in the future (Grundy & Rubenstein, 1999). 2.2.1

Strategy Planning Process

The strategic planning process begins with reviewing the current operations of the organization and identifying what needs to be improved operationally in the upcoming year. From there, planning involves envisioning the results the organization wants to achieve, and determining the steps necessary to arrive at the intended destination of success. The strategy planning or formulation process is further outlined in figure 2.1

Figure 2.1: Strategic planning process within a business unit

Source: Kotler & Keller, 2009

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2.2.1.1 Vision and Mission The vision of an organization simply translated the dream of an organization. Like most terms, there are several definitions of vision. Nanus (1992) defines it as a realistic, credible, attractive future for an organization. He further reiterates that it is "a signpost pointing the way for all who need to understand what the organization is and where it intends to go". However, vision is seen as more than an image of a desired future. As described by Manasse (1986), it is a force which molds meaning for the people of an organization. Thus, it acts to provide meaning and purpose for the organization. As such vision goes further to inspires people to work in order to achieve a desired end result that brings positive change. It is a hunger to see improvement (Pejza, 1985). A mission statement seeks to address why an organization exists. It is the fundamental purpose of the organization. According to David (2011) all mission statements broadly describe an organization's capabilities, customer focus, activities and business makeup. It is the current state of the organization. The mission statement states what an organization does, who it serves and how it serves them. 2.2.1.2 Environmental Scanning The strategic choices available to a company must be assessed from within and without. This is referred to as SWOT analysis. Strengths, Weaknesses, Opportunities and Threats. Strengths are capabilities that enable the company to perform well, weaknesses are characteristics that prohibit the company from performing well and need to be addressed. Opportunities are trends, forces, events and ideas that the company can capitalize on. Threats are possible events outside of the company’s control that need to be planned for. Considering both internal and external factors is essential because they clarify the world in which the business operates enabling it to better envision its desired future (HBE, 2005).

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Figure 2.2: SWOT Matrix

Source: Limkemann, 2009 According to Lawor (2006) strategic planning must be externally focused (to capture a market) and internally focused to ensure that the organization’s employees and systems will thrive along the way. It helps an organization paint the picture of the future it wants in a way that promotes progress toward achieving that future, then links what to do with how to do it. It creates and sustains organizational breakthrough (Grundy and Rubenstein, 1999). A good strategy will balance revenue and productivity initiatives. Without strategic planning, businesses simply drift, and are always reacting to the pressure of the day. Companies that do not plan have exponentially higher rates of failure than those that plan and implement well (Lawor, 2006). 2.2.1.3 Setting Objectives Objectives are the specific results an organization works at accomplishing in its quest to achieve its mission. An objective is a statement of the results to be achieved and includes a timeframe, target of change, specific results to be achieved, method of measuring the results and criteria for successful achievement. Objectives are a requisite for organizational success. They state direction, aid in evaluation, create synergy, reveal priorities, focus coordination and provide a basis for effective planning, organizing,

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motivating and controlling activities. It is important to note that objectives should not just be instituted for the overall organization but must also be planned for each division, sector or unit (Walker, 2002). 2.2.1.4 Developing the Strategy Strategies are the means by which long-term objectives will be achieved. Business strategies may include geographic expansion, diversification, acquisition, product development, market penetration, retrenchment, divestiture, liquidation, and joint ventures. They are potential actions that require top management decisions and large amounts of the firm’s resources. In addition, strategies affect an organization’s long-term prosperity, typically for at least five years, and thus are future-oriented. They have multifunctional or multidivisional consequences and require consideration of both the external and internal factors facing the firm (Barnat, 2005). 2.2.1.5 Executing the Strategy Execution is the successful implementation of a plan or strategy. Bossidy and Charan (2002) define execution as being influenced by three core processes: people, strategy and executions. Kaplan and Norton (2008) build on this by an execution premium highlighted in six stages: develop the strategy, plan the strategy, align the organization, plan operations, monitor and learn, test and adapt. Barrows (2010) sees strategy as a step by step approach and builds onto the approaches mentioned. The 10 step approach entails: Visualizing the strategy, measuring the strategy, reporting progress, making decisions, identifying strategic projects, aligning strategic projects, managing the projects, communicating the strategy, aligning individual roles and rewarding performance 2.2.2

Benefits of Strategic Planning

An important advantage of the strategic planning process is that it involves all stakeholders, is highly visual and it can be done quickly. The key of the planning session is that it forces all the participants to focus on what will have a real strategic impact on

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the movement. This process helps the team to visually conceptualize the key issues and to allow them to focus on those factors that are critical to accomplishing the mission.

Enhanced

Deeper/Impr

Greater

THE

Communicat

oved

Commitmen

RESULT

ion

Understandi

t To achieve objective s To impleme nt strategie s To work hard

ng Of others views of what the organizati on is Figure 2.3: Benefits of strategic planning doing/ planning Source: David, 2011 and why dialogue participa tion

All Managers and Employees on Mission Help

a to the

Firm

Thinking about the future is a stimulating and energizing process. It can create a shared Succeed

vision, with concrete ideas about how to surmount obstacles in order to achieve that vision. A common vision needs a planning team to better facilitate the process. Building a planning team is important. The strategic plan that emerges from the process is generally more realistic and achievable, and interdependent relationships within the organization are strengthened. Environments where there are people and relationships are not devoid of conflicts and issues. Confronting key issues and solving problems is a somewhat guided by the strategy an organization decides to embark on. (McNamara, 2007). Strategic planning sets in motion a dynamic process that allows the organization to continually reassess, confront change, and grow within an agreed-upon framework. The process helps in defining roles and responsibilities vital to the growth or progression of any organization. Measurable performance objectives are set and the individuals responsible for specific activities identified. The set objectives all seem to converge at a point because they all lead to achieving the common set goal or objective of the organization. This brings with it the notion of challenging the status quo where the process is seen as creating an open atmosphere, stressing the interests of the whole organization. It often answers the question “How can we do things better?” in a more systematic and thorough way. Finally, as stated, a thoughtful and clear strategic plan is a good marketing tool and can encourage donor support as well investor interests which in the long run are beneficial for

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the organizations future directions. Thus, developing a renewed sense of organizational mission and consensus encourages individual perspectives, roles, and problems are subsumed by an overall plan that coordinates all staff members and volunteers so that agreed-upon goals and objectives are achieved in a timely manner. (McNamara, 2007; William & Boulay, 1998). 2.2.3

Limitations of Strategic Planning

Strategic planning can be costly which is true in terms of staff time, costs of facilitation, venue, transportation, or materials, and “wear and tear” on interpersonal relationships as participants earnestly discuss differences in perspective. The costs may outweigh the benefits in some instances. This may create an impression of perhaps not being ready to engage in strategic planning. New or emerging organizations may find it more beneficial to focus on establishing efficient and effective systems, enhancing staff skills, consolidating the organizational image or good will and acquiring resources needed for current operations before embarking on a future-oriented exercise (Chetty, 2010). Sometimes, the plan itself becomes its own “raison d’etre” and a strait jacket on creativity or responsiveness; sometimes the plan is just a response to perceived or real donor requirements. In such an instance, participants are not really committed to the process and they do not feel “ownership” of the final plan. The language, terminology, and conceptual requirements associated with strategic planning are sometimes made too complex or difficult to be useful to staff or the organization as a whole. In addition to this, expertise to prepare, write, or monitor the plan is lacking and creating an “inclusive” process is interpreted as the need to close down the organization entirely during the process or to ask inappropriate staff to participate. This often creates confusion and resentment. However, the process can be representative and inclusive without necessarily having 100% involvement of class (Cleland & Ireland, 2006). 2.3

Strategy Implementation

Despite the experience of many organizations, great organizational performance is possible if strategies are turned into individual actions. As simple as this may sound, it's not easy. Time after time the people within these organizations have lacked motivation

16

towards corporate aims leading to failure of the organization. The knowledge of strategies required for organizational success does not automatically relate into growth or prosperity. Although most organizations have strategies and plans, the struggle towards achieving these is great. This theory is supported by various studies. A Fortune Magazine study suggested that 70% of 10 CEOs who fail, do so not because of bad strategy, but because of bad execution (Charan & Colvin, 1999). In another study of 200 companies in the Times 1000, 80% of directors said they had the right strategies but only 14% thought they were implementing them well. Despite 97% of directors having a 'strategic vision', only 33% reported achieving 'significant strategic success'. (Cobbold & Lawrie, 2001). It is evident that effective strategy implementation is key for achieving strategic success which in turn translates to organizational success. Before embarking on a journey of the factors that aid implementation of strategy let us delve into the strategy implementation process for a better understanding. 2.3.1

Strategy Implementation Process

Pearce and Robinson (2003) see strategy implementation as having three interrelated steps: Identification of measurable, mutually determined annual objectives, development of specific function strategies, development and communication of concise policies to guide decisions. In order to be effective, these must be institutionalized through the firm’s structure, leadership, culture and reward systems. In order to fit in or adapt to the dynamic environment, execution of strategy must be controlled and evaluated. Brodwin and Bourgeois III (1984) based on research of management practices identified five fundamental approaches to implementing strategy. These are: the commander approach, the organizational change approach, the collaborative approach, the cultural approach and the crescive approach. The Commander Approach: In this approach, the leader concentrates on formulating strategy. The leader is a thinker and planner rather than a doer. In this approach, once the best strategy is determined, the leader communicates it to subordinates who are instructed to execute the strategy. Thus, the leaders do not take an active role in implementation. This approach must satisfy three conditions to succeed: the leader must exert enough

17

power to command so that implementation takes place, the available information must be accurate and timely and the environment must be stable, the strategist much not have any personal biases or political influences. The commander approach can reduce employee motivation if the leader continually creates the belief that the only acceptable strategies are those developed at the top. This approach offers a valuable perspective to the CEO with strategic management being divided into two stages; thinking and doing. In addition, young managers have a preference for this approach as it allows them to focus on the quantitative, objective elements of a situation rather than the subjective and behavioral aspects giving them the feeling of being an all powerful hero with ability to shape numerous decisions (Wooldridge & Floyd, 1990; Davis, 2001). The Organizational Change Approach: This approach is generally seen to pick up where the commander approach left off. The leader concentrates on reorganizing resources in order to lead the firm in the right direction. Decisions concerning major strategic changes including structure, personnel, information and reward systems which are aligned to successful implementation are up to the leaders. This organizational change approach is more effective than the commander approach in that it is useful in implementing more complex strategies due to the use of several behavioral science techniques. These include: using demonstrations rather than words to communicate desired activities, focusing on needs that are already recognized as important, having solutions presented by those within the organization possessing high credibility. This approach, however, does nothing to help manager with dynamism within the environment and imposes a top-down approach (Carlopio & Harvey, 2012). The Collaborative Approach: This approach extends decision making to the top management team. Managers are allowed to contribute different view points towards the strategic planning process through group dynamics and brainstorming sessions. Capturing information contributed by mangers coupled with creation of forums for discussions and sharing ideas can ultimately increase the quality of timelines of information being incorporated into strategy. This gives a sense of ownership and

18

enhances commitment to the strategy thus increasing chances of effective implementation of strategy (Davis, 2001). On the flip side, the collaborative approach may lead to poorer strategy that may be more conservative and lack the visionary aspect. The brainstorming and continued sharing of ideas may take time and the organization may miss out on available opportunities. The Cultural Approach: Here, the collaborative approach is extended to lower levels of the organization. A clear mission is communicated and employees allowed to design their own work activities. The leaders are coaches and encourage individual decision making while giving general direction. This calls for creation of a strong corporate culture using tools that range from simple notions like publishing a company creed or having a company song to more complex techniques. The cultural approach employs a third order control concept. The first order is direct supervision; the second order involves use of rules, procedures, structure to guide behavior; the third order control involves influencing behavior through shaping norms, values, symbols and beliefs that managers use in making daily decisions. This approach breaks the existing barriers between thinkers and doers creating an organization wide unity of purpose and works best where the organization has adequate resources to build and maintain the value system. However, the approach only works with informed and intelligent people, consumes a lot of time to install and may become a handicap due to its fostering of very strong organizational identity among employees (Barney, 1986; Oliver, 1997). The Crescive Approach: The strategic leader encourages subordinates to develop, champion and implement sound strategies on their own. Crescive means increasing or growing. Thus, the leader is interested in both strategizing and in subordinates developing, championing and implementing strategies. The difference in this approach is that strategy moves upward from the doers; strategy is a computation of all individual proposals; tops management shapes notions of constituents of supportable strategic projects; the CEO’s role is of judgment in evaluating proposals than being a master strategist. According to Brodwin and Bourgeois III (1984), the approach best suits large,

19

complex and diversified organizations. As such the strategic leader may not be aware of and understand all strategic and operating situations that very department and/or division goes through. Certo and Peter (1988) recommend a five stage approach to implementation: strategic analysis (internal and external), determination of directions of company’s operations (missions and tasks), strategy formulation, strategy implementation and strategic control. It is important to note that a manager's actions in the quest for implementing strategy is shaped by six administrative tasks: building an organization capable of executing the strategy, establishing a strategy supportive budget, installing internal administrative support systems, devising rewards and incentives linked to objectives and strategy, shaping the corporate culture to fit the strategy and exercising strategic leadership (Bhandari, 2013). Strategy implementation cannot be tackled without looking at aspects that lead to successful implementation and change management. These elements are: leadership implementation, organizational implementation, and policy and resource deployment 2.3.1.1 Leadership Implementation Studies that have been conducted reveal that leadership involvement is required and necessary in not just formulating but also implementing strategy. Leaders ought to have different leadership behaviours for different change events (Fielder, 1967). Thach and Thompson (2007) in citing works by Bennis (1987) insinuate that leaders must show competence to be able to craft vision and set goals. This further means that leaders have to understand and know how to use the power available to them as well as formulate proficient communication strategies if they are to guide employees through the strategy change process (Hardy, 1996). This must also be translated to include application of technical, human and conceptual skills (Svetlik, 2005). Situational leadership style behaviours for different events are mandatory (House, 1971). These behaviours linked to long term change will be inclined towards initiatives that inspire, stimulate and instill a sense of purpose in employees. Shaping of behavior linked

20

to implementation initiatives will ultimately lead to effective strategies thus success in strategy implementation. Bennis (1978) and Thach et al (2007) argue that crafting of vision and setting goals are part of the leadership competencies that are necessary. This translates to change implementation by articulating clear vision, nurturing acceptance of group goals, providing individualized support and intellectual stimulation as well as clarifying performance expectations (MacKenzie, Podsakoff and Rich, 2001). Communication is another important aspect of leading change within an organization. Leaders must get the most precise and effective ways to present change to employees using the right channels (Larkin and Larkin, 1994). According to Sveltik (2005) competencies associated with successful implementation of strategy included: honesty, integrity, communication, technical competence, and problem solving, decision making, and political savvy, strategic or visionary thinking, customer focus, and intelligence, social and environmental responsibility. 2.3.1.2 Organizational Implementation The way that an organization is put together relates to its structure. The structure includes: reporting relationships, coordination, authority, and degree is centralization, degree of integration, formalization. This enhances control, coordination and motivation of employees and activities they perform in realizing implementation of strategy. In structuring the work effort, it is important to: decide activities that will be internally performed and those that will be outsourced, align structure to strategies, and decide how much authority to centralize and the top and how much to delegate to line managers and employees, facilitate collaboration with external partners and allies. According to Olson, Slater and Hult (2005), the three main structural dimensions that are important to strategy implementation are formalization, degree or centralization and degree of integration. Formalization refers to the degree to which working relationships and decisions are guided by formal rules and procedures. These rules determine the behaviors of employees and people within the organization. Following of these rules may ultimately lead to more efficiency and reduced administrative costs. However, Nordstrom’s employee handbook, encourages low formality and uses strategically

21

ambiguous language to empower employees at all levels in the organization. The main belief is that excessive rules are a hindrance to creativity. Centralization gives reference to whether authority of decision making is at the top level management or is delegated to middle and lower level managers. Organizations that are highly centralized are characterized by clear communication and decisions are made and adhered to faster. This is however easily realized in more stable, non-complex environments. Decentralized organizations on the other hand experience dispersed decision making leading to a lot of time wasting. However, contrary to the centralized organization, decentralization breeds more new ideas and the probability of actual program changes is much higher, in the long run (Olson, Slater and Hult, 2005). Finally, specialization is the degree to which activities and tasks are disseminated within the organization. Specialized organizations boast of a higher percentage of specialist who direct efforts towards well defined activity sets while organizations with a higher percentage of generalists have less knowledge about specific market segments and must do additional preparation work before responding to change. The latter, however, often reduce expenses by not hiring specialists (Olson et al, 2005). 2.3.1.3 Resource and Policy Deployment Policy deployment often referred to as Hoshin Kanri was first used in Japan to communicate an organization’s goals, policies and objectives throughout the organizational hierarchy with the aim of drawing focus to the key activities that lead to success (Lee and Dale, 1998). Policy deployment is an application of Deming’s Plan-DoCheck-Act (PDCA) cycle to the management process that represents a generic approach to continual improvement of activities and processes (Lee and Dale, 1998). According to Mizunode (Eureka and Ryan, 1990), the concept is elucidated as “deploy and share direction, goals, and approaches of corporate management from top management to employees and for each unit of the organization to conduct work according to the plan. Then evaluate, investigate and feedback the results or go through the PDCA process continuously and attempt to incessantly improve performance of the organization.

22

Policy deployment boasts of strengths such as: organizational cohesion providing consensus of organizational objectives at all levels, integration of organizational efforts into actions so as to meet organizational objectives, encouraging of interdepartmental cooperation that creates alignment through participation, responsive and flexible planning and implementation, identification of key problem areas and enabling prioritization within the organization (Tennant and Roberts, 2001; King, 1989). The shortcomings of policy deployment include a necessity of strict implementation which may sometimes not be possible as changes occur during the implementation process and require changes to be made in the action plans and implementation strategies. In addition, long term commitment is indispensable. This is relatively static stating that the breakthrough objective must be stable during a five year period (Akao, 1991; Sheridan, 1993; King, 1989). As much as this is feasible, organizational environments are dynamic in nature meaning that any unexpected changes may occur within the life cycle of strategy implementation. Conclusively, policy deployment can be summed up as: PLAN which is the development of an action plan to address a problem, DO which is implementation of the plan, CHECK which is a collection of information on control parameters and ACT which is an analysis of results and identification of corrective action (Colleti, 1995). A major task seen at the corporate level of an organization is allocation of limited resources to attend to the wide array of requests from lower levels of the firm. Top management is face with the decision of having to somewhat discriminate because of financial, technical and human resource available to the organization which may not necessarily be sufficient to support all initiatives and strategies. The focus continually remains on the organization’s bottom line for resource allocation which is value creation (Hax and Majluf, 1990). The resource allocation process must be understood from different standpoints. First, the decision process may not necessarily be cold, rational and analytical but involves emotion, self centered interests and biased positions that are part of the complex bargaining and power game (Hax and Majluf, 1990). According to Brealey and Myers (1988), the proportion of prepared projects having a positive Net Present Value (NPV) is

23

independent of top management’s estimate of the opportunity cost of capital. Thus, business managers can prove to top counterparts that their investments are acceptable regardless of the hurdle imposed on them. The various aspects of resource allocation can be summarized as diagnosis of value gap and consolidation of business and functional strategies at corporate level. Diagnosis of value gap is the ability of detecting the gap present between an organization’s current standing and its future potential. An organization must be in a position to respond to the following questions: Are there any businesses in the portfolio that significantly underperform competitors? Are there any businesses that are out of their start-up phase and still losing money? Are there any businesses that would clearly be worth more to someone else due to synergy or operating economies? Are resources allocated to businesses in a way that reflects their profitability potential, or do you tend to overfund losers and underfund winners? Is performance measured by using average costs, asset and debt allocations and an arbitrary corporate hurdle rate? Are any of your long term incentives tied directly to relative stock performance or indirectly to the drivers of shareholder value? Is capital spending driven mostly by capital budgeting rather than the strategic planning process? Is the company underleveraged? (McTargatt, 1988) There ought to be a critical review and endorsing of action plans by business and functional managers at the corporate level. This will require involvement of key executives who share the responsibility of shaping strategic direction of the organization. A meeting of these executives should lead to an emergence of a clear consensus and personal commitment of all participating managers. The meeting should address: resolution of non-concurrence conflicts, balancing of the organization’s business portfolio, defining availability of strategic funds as well as the debt policy and the maximum sustainable growth, evaluation of the proposed action plans and assignment priorities for resource allocation and definition of performance measurements for control management (MacMillan, 1982). That said, what then can we attribute to the success stories out there? What characteristics do organizations who successfully implement strategies have? What has aided or led to this success?

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2.3.2

Drivers of Successful Strategy Implementation

2.3.2.1 The Process of Formulation, Involvement, Ownership & Resources as Drivers of Strategy Implementation As discussed earlier in the chapter, good strategy must be present in order to achieve successful strategy implementation. If strategies formed are not worth implementing then failure begins right at the start. Although organizations may find it time consuming and often times expensive, strategy formulation plays a key role in the process of achieving success by implementing these very strategies. Resources play a major role in the implementation of strategies. Sufficient resources are a crucial factor in strategy implementation. First, because of the large scope of most strategic decisions, sufficient funding is needed for the implementation process. People are the second important resource. Key employees from different levels within the organization should be involved in the formulation process so as to ensure that the strategies can be implemented. This ensures that valuable knowledge from all organizational levels is used to create strategy that best fits the ultimate goals that can realistically be implemented taking into consideration the available resources and the market conditions. Involvement of personnel creates a sense of ownership of strategic decisions which is crucial for the success of the strategy implementation. Key implementation personnel should also be involved in the detailed implementation planning to increase their commitment (Giles, 1991; Hambrick & Cannella, 1989; Alexander, 1985). Another vital resource is time. Employees should have enough time available for the implementation. They should either be freed from other tasks or should understand the priorities given to their different tasks. Enough time should be allocated to the implementation process (Higgins, 2005; Beer & Eisenstat, 2000; Hambrick et al, 1989; Alexander, 1985). As illustrated, strategy execution is not the result of a solitary employee decision or action but the sequence of a series of coordinated, enterprise wide decisions and actions occurring over time (Hrebiniak, 2005). As such strategy implementation is a

25

comprehensive process involving the entire organization. The determination of strategic decisions and implementation planning should also include a thorough analysis of the obstacles and risks the organization may face when implementing the strategy. These risks can be both internal and external. Although it is not realistic to expect that all potential risks will be identified, it will give the organization the opportunity to create contingency plans for the identified risks, which could negatively impact the implementation of the strategy or the organization at large (Hambrick et al, 1989; Alexander, 1985). 2.3.2.1 Communication Once the strategy has been formulated, communication is one of the most important vehicles for successful implementation. First of all, management should inform all employees about the content, meaning of, and reasons for the new strategy. However, they should not only inform the employees, they should also leave room for questions from and discussion with the affected employees. Communication also involves the explanation of new tasks and responsibilities to the affected employees. Throughout the implementation process, communication should flow bottom-up to allow management to monitor the implementation process and determine whether changes to the approach are needed (Neilson, Martin, Powers, 2008. Beer et al, 2000; Hambrick et al, 1989; Alexander, 1985). 2.3.2.1 Implementation Plan Creating an implementation plan is necessary in order to aid the management of strategy implementation. Such an implementation plan should identify and explain a vast array of issues relating to; the scope and goals of the implementation, the main implementation activities and how they are supposed to be executed, key personnel involved and the responsibilities and authority they have, planned timelines for the total implementation and the individual activities, risks that could adversely impact the implementation, contingency plans which help to minimize impact in case risks occur, planned communication effort and reporting and monitoring of the progress of implementation. (Neilson et al, 2008; Alexander, 1985).

26

This said, plan should however be balanced with adequate detailed information . Having too little detail would not provide enough guidance to the involved employees and could lead to an ineffective and inefficient implementation. On the other hand, too much detail would make the plan rigid and would leave management and the employees unable to correctly respond to changes in the environment (Neilson et al, 2008; Alexander, 1985). The drivers of strategy implementation are however not limited to the above illustrated components. Other factors that would aid successful strategy implementation may include aspects such as motivational leadership and performance management. Motivational leadership concentrates on achieving sustained performance through personal growth, values-based leadership and planning that recognizes human dynamics. Real leadership is required to compete effectively and deliver growth. People look to leaders to bring meaning, to make sense of the seemingly unquenchable demand for results and the need for individuals to find purpose and value. Leadership is the common thread which runs through the entire process of translating strategy into results and is the key to engaging the hearts and minds of your people. Whether you are distilling strategy to achieve clarity of intent, engaging your people to drive the strategy into action process or performance managing the resulting actions, effective leadership will make the difference (Cummings and Worley, 2009). Performance management entails the construction of organizational processes and capabilities necessary to achieve performance through people delivering results. Too often great plans stay as 'plans'. Typically, the energy and enthusiasm generated during the planning process quickly dies out due to the load of day to day operational issues. Performance management is key in getting the whole organization aligned and working towards achieving organizational goals and working collaboratively to deliver results (Chetty, 2010). Effective performance management encompasses communicating strategy, measuring performance in real time, offering an integrated project management capability, acknowledging and enabling emotional contracting. Emotional contracting or better known as psychological contract is the crucial and powerful link between the organizational intent and the motivations, values and aspirations of the people.

27

This emotional contracting element is commonly overlooked by organizations, and then they wonder why the people have 'failed' to do what the organization expected and asked them to do. 2.4

Inhibitors to Successful Strategy Implementation

The effectiveness and success of an organization is determined not just by the formulation of strategy but the implementation of these strategies. Many organizations fail not because of strategy formulation but because of insufficient strategy implementation. Previous research has identified individual factors that influence strategy implementation. Among these are strategy formulation process, the strategy executors (managers, employees), the organizational structure, the communication activities, the level of commitment for the strategy, the consensus regarding the strategy, the relationships among different units/departments and different strategy levels, the employed implementation tactics, and the administrative system in place (Yang, Sun and Martin, 2008). Strategy implementation as we know it is often times affected or hindered by a number of factors. These main factors are what we embark to illustrate. Once corporate and business strategies have been agreed upon and long-term objectives set, the strategic management process moves into a critical new phase – translating strategic thought into organizational action. They move from “planning their work” to “working their plan” as they shift focus from strategy formulation to strategy implementation (Pearce and Robinson, 2005). Implementing strategy is critical to a company’s success. It addresses the who, where, when, and how of reaching the desired goals and objectives. It focuses on the entire organization. Implementation occurs after environmental scans, SWOT (Strengths, Weaknesses, Opportunities, & Threats) analyses, and identifying strategic issues and goals. Implementation involves assigning individuals to tasks and timelines that will help an organization reach its goals (Lorette, 2009). A very common mistake in strategic implementation is not developing ownership in the process. Also, a lack of communication and a plan that involves too much are common pitfalls. Strategic implementation sometimes has little concrete meaning and potential, or

28

is presented with no way of tracking its progress. Implementation is usually addressed annually, allowing management and employees to become caught up in the day-to-day operations and neglecting the long-term goals. Another pitfall is not making employees accountable for various aspects of the plan or powerful enough to authoritatively make changes (Lorette, 2009). Over reliance on high-priced strategy consultants, many of whom do not provide clear value or return on investment, by decreasing the amount of time and resources they put into strategy or strategic processes is a mistake that several organizations make. Failure to build a solid strategic foundation is counter-productive, risking costly mistakes later on not only for marketing but also for the entire organization (Popky, 2006). This stated, let us embark on a journey of looking further into some of reasons why strategy implementation fails. 2.4.1

The Process of Formulating Strategy as a Inhibitor to the Implementation

Process Often times the formulation process does not produce results expected. What is viewed as strategy is sometimes simple tactics or objectives Strategy has a long term nature, is innovative, inspirational and stretching and has direct impact on the customer and competitor. (Corboy et al, 1999; Giles, 1991). Strategy is realistic to implement and should be formulated with the thought of the implementation that is needed to actually put the strategy into action (Giles, 1991). 2.4.2

Strategy Executors

Any organizational process requires the driver, components, resources that guide and enable the process to come into being. As such the leadership involved in strategy implementation is very important and vital to the process as they guide and always lead back to the min path in order to fulfill the set objectives. Ineffective leadership is a factor that is mentioned extensively as a reason hindering the successful implementation of strategy. Ineffective coordination of implementation activities is one of the causes of failure (Alexander, 1985). This is supported by Al

29

Ghamdi (1998) who performed a similar research in the United Kingdom. The quality of direction given is imperative as this defines many ways in which senior management can be effective or ineffective (Beer et al, 2000). All organizational levels are of importance and the moment senior management bypass middle level management to obtain information directly from the lower level employees, there begins to exist ineffective communication lines in the management team. In this leads to a situation in which conflicts are avoided and value-adding discussions on decision making are lost. Leadership does not seem to make the necessary trade-offs they face during the implementation. They create vague strategic objectives which do not provide direction for implementation (Beer et al, 2000). 2.4.3

Organizational Structure

Structures are an essential part of strategy implementation (Whittington 2002). Khandwala (1973) who showed that congruence between structure, processes and systems is more important for performance (sufficient condition) than organizational fit with environment (necessary condition). Organizations need to be configured as a whole and not treat structural elements as isolated factors. The role of managers in achieving this configurational congruence is due to the fact that managers are the first to notice salient differences in organizational performance; can also anticipate changes; strategize and plan structural changes and finally implement these changes. Research has either looked at strategy content-performance link without considering the organization variables which represent the implementation process or have tended to concentrate on variables of specific interest such as trust (in case of strategic alliances); culture (in mergers and acquisitions) or structural forms (in diversification) or concentrate on a list of variables at the individual level( as in innovations) due to a predominant emphasis on content (Dess, Hernatt and Hill, 1995). 2.4.4

Communication

Communication is a central activity in most human and organizational activities. Effective communication is a prerequisite for implementing organizational strategies as well as managing the day-to-day activities through people. According to Luthans (2002)

30

experts have not agreed on a definition of communication. However, most explanations of communication stress the use of symbols to transfer the meaning of information while still Ivancevich and Matteson (1993) state that communication among people does not depend on technology but rather on forces in people and their surroundings. It is a process occurring within people. Poor or ineffective communication across functions and divisions, could negatively affect the strategy implementation. When information is not flowing effectively from bottom to top, top management may not be aware of problems jeopardizing the implementation of the strategy, and therefore, not able to respond to these problems (Beer et al, 2000; AlGhamdi, 1998; Alexander, 1985). The information flow does not only include people communicating with each other but also information systems through which management is monitoring the implementation efforts. These, are in some cases, also not providing adequate information towards top management (Al-Ghamdi, 1998). When we are not enlightened as to what is expected of us, we simply do our best and follow our instincts to get the job done as best we can. This is why communication of plan details is so important. Additionally, we must make sure everyone on the team understands the big picture as well. Failure to communicate and educate is a huge factor in executing successfully. Employees who are responsible and accountable for their scope of plan execution must understand what is to be done, when and how that affects the overall outcome. 2.4.5

Commitment

Ownership the strategy and related implementation activities is another reason leading to failure of strategy implementation. Giles (1991) names ownership as the most important reason for failure. If the strategy is not owned by the employees involved in the implementation, it may lead to counter implementation, which causes the organization to move in the wrong direction. Moreover, when key people in the formulation of the strategy are not participating in the implementation, ownership is lost in many cases, causing the increase of time needed for the implementation, or overall failure of implementation (Corboy & O'Corrbui, 1999; Al-Ghamdi, 1998; Alexander 1985). The other way around, when the affected employees and managers are not at all involved in

31

the formulation of the strategy it is also more difficult for them to feel ownership of the strategy (Alexander, 1985). 2.4.6

Consensus

The literature on strategic consensus started as an attempt to look at factors affecting strategy formulation at the top management level. While majority of the studies have concentrated on consensus at the top management level; there has been a realization that consensus needs to be looked at in all levels of managers in an organization to explain the link between strategic consensus and performance (Markoczy 2001). However empirical testing of consensus-performance link is weighed down with procedural problems and has tended to be in form of bivariate relationships (Kellermanns et al., 2004). The importance of the strategic consensus is repeatedly stressed for development of theory about the strategy process (Priem and Dess 1995). Among the above examined hindrances to successful strategy implementation, many others exist including lack of resources and risk identification. Lack of resources, i.e. time and people, is another reason for failure of strategy implementation. For one, implementing strategy, in most cases, took more time than expected or planned beforehand (Al-Ghamdi, 1998; Alexander, 1985). In the research of Alexander (1985) some executives even stated that top management underestimates the time needed to complete a strategy implementation. Time is pressured even more if priorities are not set correctly. It should therefore be clear to all employees involved in the implementation, which activities have most priority for execution. This includes implementation activities but also regular work and other projects. If priorities are not defined properly, it could either cause loss of attention for the strategy implementation or loss of attention for the regular work and other projects. Both could lead to problems in the organization (Beer et al, 2000; Corboy et al, 1999; Al-Ghamdi, 1998; Alexander, 1985). The lack of the right skills and abilities of the people involved in the strategy implementation have also been found to cause problems (Beer et al, 2000; Al-Ghamdi, 1998; Alexander, 1985). Furthermore, employees do not always receive the correct training and instruction to be able to perform their work, which may have changed due to the newly implemented strategy (Beer et al, 2000; Al-Ghamdi, 1998).

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Important risks, due to internal and external factors, that could affect the implementation of strategy are not identified properly before the start of and during the implementation. Consequently, major problems can occur during the implementation, which causes delays or even inability to implement the strategy (Corboy et al, 1999; Al-Ghamdi, 1998; Alexander, 1985). Executives have stated that top management is likely to underestimate the likelihood of risks and may even be blind to the risks they face (Alexander, 1985). Table 2.1: Main Inhibitors of Strategy Inhibiting Force

References

Execution takes more time than planned

(Speculand,

2009;

Hrebiniak

2008;

Alexander, 1991) Lack of Communication

(Hrebiniak 2008; Hanely, 2007)

Lack of Coordination

(Beer & Eisenstat, 2000)

Resistance from lower levels

(Hanely, 2007; Okumus, 2003; Kotter,

Lack of control systems

2007) (Kaplan & Norton, 2008; Atkinson, 2006)

Execution viewed as isolated tasks

(Hrebiniak, 2008; Bassady & Charan, 2002)

Lack of Resources

Meull & Shani, 2008)

Challenge of building the future while (Franken, Edwards & Lambert, 2009) running Execution decisions pushed down to lower (Hrebiniak 2008; Speculand, 2009; Beer & levels

Eisenstat, 2000

Strategy not clear and actions not defined

(Kaplan & Norton, 2008; Corboy &

O'Corrbui, 1999) Rewards and incentives not aligned to (Kaplan & Norton, 2008) strategic plans Poor leadership

(Meull & Shani, 2008; Beer & Eisenstat, 2000)

Source: Chetty, 2010

Table 2.2 Why Implementation Stumbles

33

Why implementation stumbles Need to get back to my new job Cannot translate ideas into action No reward for sticking with it Lose tract/ Cannot easily monitor Everyone's responsible/ Nobody's responsible Reality intrudes: plans lose relevance Source: Allio, 2005 2.5

Chapter Summary

It is important to understand the limitations as well as the possibilities of strategic planning. A strategic plan is not a wish list, a report card or a marketing tool. If the board and staff are committed to its implementation, a strategic plan can provide an invaluable blueprint for growth and revitalization, enabling an organization to take stock of where it is, determining where it wants to go and chart a course to get there. Strategy implementation is important but difficult because implementation activities take a longer time frame than formulation, involves more people and greater task complexity, and has a need for sequential and simultaneous thinking on part of implementation managers. The topic of implementation is a neglected and overlooked area in strategic management literature. Published research reveals emphasis on strategy formulation. Strategy

formulation

and

implementation

are

complementary

and

logically

distinguishable areas of strategic management and part of the overall process of planning, executing and adapting. The importance of implementation shows that firms with unusually high performance and firms which turned around their performance relied upon key activities of strategic direction, building a fast and effective organization, establishing an adaptive culture and executing against focus of customer needs and cost. Chapter three looks into the research methodology used for the study.

34

CHAPTER THREE 3.0 RESEARCH METHODOLOGY 3.1

Introduction

Research methodology is a systematic way to solve a problem, a systematic effort to gain new knowledge (Redmann & Mory, 1933). It is a science of studying how research is to be carried out. It is the procedures by which researchers go about their work of describing, explaining and predicting phenomena. It is also defined as the study of methods by which knowledge is gained and aims at giving the work plan of research (Rajasekar, Philominathan, Chinnathambi, 2013). This chapter looked at the research design, population and sampling design, tools and methods of collecting data as well as a description of how the data was analyzed. It is organized as follows: Section 3.1 is an introduction. Research design is discussed in section 3.2. Section 3.3 discussed the populations and sampling design breaking it down further into section 3.3.1 which addressed the population, 3.3.2 which addressed the sampling design, section 3.3.2.1 which highlighted the sampling frame, 3.3.2.2 the sampling technique and 3.3.2.3 the sample size. The data collection methods are discussed under section 3.4 and the research procedures in section 3.5. Section 3.6 explained data analysis and section 3.7 gave a summary of the chapter. 3.2

Research Design

The research design constitutes the blue print for the collection, measurement and analysis of data (Cooper and Schindler, 2003). Mutai (2001) refers to research design as the procedures to be employed to achieve the objectives of the research. The study used both primary and secondary research. Secondary research involved gathering of information from previous research from journals, academic books and the internet. Primary research included the issuing of questionnaires in order to gather relevant information.

35

Descriptive studies often represent the first scientific toe in the water in new areas of inquiry. A fundamental element of descriptive reporting is a clear, specific, and measurable definition of the disease or condition in question (Grimes and Schulz, 2002). The Office of Human Research Protections (OHRP) defines a descriptive study as “Any study that is not truly experimental” (IRG Guidebook, 2005). In human research, a descriptive study can provide information about the naturally occurring health status, behavior, attitudes or other characteristics of a particular group. They are conducted to demonstrate associations or relationships between things in the world around us. Descriptive studies are aimed at finding out "what is," so observational and survey methods are frequently used to collect descriptive data (Borg & Gall, 1989; Bickman & Rog 1998). Descriptive research obtains information concerning the current status of the phenomena to describe "what exists" with respect to variables or conditions in a situation. The methods involved range from the survey which describes the status quo, the correlation study which investigates the relationship between variables, to developmental studies which seek to determine changes over time (Key, 1997). Descriptive research design is a scientific method which involves observing and describing the behavior of a subject without influencing it in any way (Shuttleworth, 2008). It describes data and characteristics about the population or phenomenon being studied, that is, answers the questions who, what, where, when and how. Descriptive design research exhibits the advantage of acquiring a lot of information through description and is therefore useful for identifying variables and hypothetical constructs. The choice of this technique is guided by the fact that the study aims to generate findings which would facilitate an understanding of the various factors that affect strategic implementation at Yakuti Ventures Limited. The dependent variable in this study is strategy implementation while the independent variables are: strategy formulation, drivers of successful implementation. 3.3 3.3.1

Population and Sampling Design Population

A population is the collection of elements about which we wish to make some inferences (Cooper and Schindler, 2003). Thus, a population is described as all the elements that

36

meet the criteria for inclusion in a study (Burns and Grove, 2003). The research population included the 18 shareholders of Yakuti Ventures Limited. This included the board of directors, management team and legal advisors. 3.3.1.1 Sampling Design Sample design is sometimes used in a clearly defined sense, with reference to a given frame, as the set of rules or specifications for the drawing of a sample in an unequivocal manner (The International Statistical Institute, 2003). Here, a sample gives reference to a proportion of a population (Polit, Beck, Hungler 2001). 3.3.1.2 Sampling Frame A sampling frame is a list or other device used to define a researcher's population of interest. The sampling frame defines a set of elements from which a researcher can select a sample of the target population. A researcher rarely has direct access to the entire population of interest and as such must rely upon a sampling frame to represent all of the elements of the population of interest. Thus, a sampling frame is the list of elements from which the sample is drawn (Cooper & Schindler, 2003). The sampling frame for this research was a list of shareholders which included the management and board. 3.3.1.3 Sample Technique According to Mugenda (2008), the reasons for sampling are lower cost, greater accuracy of results, and greater speed of data collection and availability of population elements. Clarkson (1995) argues that the quality of the study is often better with sampling than with a census. For the purpose of this study, the researcher looked at the entire population owing to the small size of the population. A census is an attempt to collect data from every member within a population being studied as opposed to choosing a sample (SAGE, 2006).

37

3.3.1.3 Sample Size The proposed sample size should not cover too large or too little of a sample (Kothari, 2004). According to Mugenda and Mugenda (2003) the population sample should cover 10% or slightly above 10% of the target population. For the purposes of this study, the researcher was interested in shareholders who deal directly with or aid the strategy formulation process. Following that description, the research proposed to collect data from shareholders as presented in Table 3.1 Table 3.1 Sample Size Strata

Number

Percentage

Other Shareholders

7

38

Board of Directors

3

17

Management Team

3

17

Heads of Department

3

17

Legal Advisors

2

11

Total

18

100

3.4

Data Collection Methods

Data collections tools are the instruments which are used to collect the necessary information (Mugenda and Mugenda, 2003). Data collection specifies the details of the task with emphasis on the data to be obtained and their sources (Cooper and Schindler, 2003). Data collection techniques can either the primary or secondary. Primary data collection methods were used in this research. Bryman & Bell (2007) explain that primary data is information that the researcher gathers on his own, for instance by using interviews, questionnaires and tests. The primary data was collected by use of semistructured questionnaires. Semi-structured questionnaires consisting of open and closed-ended questions were constructed and used to collect data from the Yakuti stakeholders. Relevant questions based on the research objectives were asked so as to obtain data on the factors that are hindering the successful strategy implementation of Yakuti Ventures Limited. The reason

38

for choosing the semi-structured questionnaire technique was essentially to encourage the respondents to discuss their own opinion on what was hampering the successful implementation of strategies at Yakuti. Semi structured interviews are more flexible than standardized methods such as the structured questionnaire or survey. The questions were a mixture of open ended, closed ended and scale questions. Strategy and implementation process variables were measured by using 5-point Likert scale indicating degree of agreement to statements operationalized to reflect the intended variable. The questionnaire had four sections. Section one collected demographic data of the respondents. Section two collected data on the strategy planning process and limitations and benefits and section three data on the strategy implementation process as well as factors aiding and factors hindering successful implementation. 3.5

Research Procedure

A pilot research is a trial run-through to test the research design with a subsample of the respondents who have similar characteristics to those identifiable in the main sample to be surveyed. Conducting a pilot before the main survey allows any potential problems in the pro forma of the questionnaire to be identified and corrected (Gill & Johnson, 2010). The questionnaires were distributed to a sample of randomly selected shareholders. They were asked to comment on the ease of completion, clarity of questions and whether any jargon had been used that was not easily understood. The recommendations were then incorporated to ensure the validity of the questionnaire. The questionnaires were selfadministered so that the researcher was able to explain or elaborate any problematic questions due to the semi-structured nature of the questionnaire. A cover letter was included in the questionnaire elaborating the purpose of the study and the respondents were assured of confidentiality and anonymity. 3.6

Data Analysis Methods

Data analysis is the organizing, analyzing and summarizing of the research findings. The data collected was tested and analyzed using the Statistical Package for the Social Sciences (SPSS). The data collected from the study was essentially qualitative and was presented using figures and frequency distribution tables. However, some of the data was quantitative in nature. In general terms, unstructured interviews (e.g. non-directive or

39

informal) lend themselves to qualitative analyses, whereas structured interviews lend themselves to quantitative analysis. Qualitative analysis was chosen as it is often less influenced by the biases and theoretical assumptions of the investigator. In addition, it offers the prospect of understanding the participants in a study as rounded individuals in a social context. This contrasts with quantitative analysis, in which the focus is often on rather narrow aspects of behavior. This said, the greatest limitation of the qualitative approach is that the findings that are reported tend to be unreliable and hard to replicate. Why is this so? The qualitative approach is subjective and impressionistic, and so the ways in which the information is categorized and then interpreted often differ considerably from one investigator to another. In order to try to show that findings are reliable, the research sought various ways available in doing the analysis (Coolican, 2005). The most satisfactory approach was to see whether the findings obtained from a qualitative analysis can be replicated. This can be done by comparing the findings from an interview study with those from an observational study. However, the fact that the research cycle is gone through more than once will help to increase reliability. 3.7

Chapter Summary

This chapter has analyzed the methodology that was used in conducting the research. The research design was descriptive and the population was drawn from the shareholders including the board of directors, management committees and legal advisors. The study was conducted on the entire population. Data was collected using questionnaires which had structured and unstructured questions. Data was analyzed both qualitatively and quantitatively and the findings of the research presented in chapter four. Chapter five then summarized the research project with recommendations to the organization and to researchers.

40

CHAPTER FOUR 4.0 RESULTS AND FINDINGS 4.1

Introduction

This chapter presents the results and findings of the study. The purpose of the research was to establish the challenges of strategy planning and implementation at Yakuti Ventures Limited. The analysis was done using SPSS and is presented using frequency and percentage tables. The study was a census of the 18 company shareholders. Questionnaires were issued to all shareholders and 17 valid responses were received yielding a response rate of 94%. 4.2

General Information of the Study and Study Group

This section gives general information about the study and the study group. Gender The study established that population only had female respondents. Age The study sought to find out the age of the respondents who took part in the research. The respondents vary in age between 29 -31 years of age with the distribution as shown. 6%

6%

18% 29 years old 30 years old 31 years old No response

70%

Figure 4.1 Respondents Age

41

Education Level From the findings, the respondents have attained tertiary education with 53% having attained postgraduate degrees. This shows that the population has understanding of the major concepts and processes concerning strategy and how this relates to the organization.

47%

Undergraduate Graduate

53%

Figure 4.2 Respondents Education Level Area of Expertise The respondents have different backgrounds and areas of expertise as illustrated. This implies that challenges in reaching a consensus may arise owing to the diversity in upbringing with every individual having their own priorities. This, however, could be advantageous as it implies a wide range of skills and expertise available for the organization. Table 4.1 Area of Expertise Expertise Administration Architecture Banking Business and IT Human Rights and Democratization Specialist Investment Banking Lawyer Nursing Quality Assurance Sales, Advertising, Marketing, Events, Planning 4.2.1

Section of YVL represented

42

Frequency 1 2 2 2 1 1 1 1 1 1

Percentage 5.9 11.8 11.8 11.8 5.9 5.9 5.9 5.9 5.9 5.9

The findings from the study reveal that 36% of the shareholders make up the board of directors while 18 % comprises of the management team. This indicates that the organization structure is well distributed. Table 4.2 Section of YVL Represented Section

Frequency

Percentage

Shareholders

8

47

Management

3

17.6

Board of Directors

6

35.4

TOTAL

17

100

Strategy Formulation The first part of this section sought to determine whether YVL has a strategic plan and if the shareholders are aware of what it in the plan. In the second portion, respondents were required to give their opinions on a five point Likert scale ranging from strongly disagree (1) to strongly agree (5). The results and analysis from respondents are presented in the tables. All the respondents retorted affirmatively to having a strategic plan and gave the listed items as being covered within the plan. Table 4.5 illustrates that the respondents are aware of the main items covered in the strategic plan. This is a clear indication that the shareholders know what is in the plan and in turn are aware of expectations. There is a clear roadmap or blueprint for the company. Table 4.3 What the Strategic Plan Covers

43

Items Covered in Strategic Plan

Frequency

Percentage

Mission, Vision

6

35.3

Mission, Vision, Core Values

7

41.2

Plan of Action for Five Years

1

5.9

SWOT

3

17.6

Goals, Areas of Investing

3

17.6

Goals, Objectives

2

11.8

Investment Objectives, Strategies

2

11.8

Investment options and timelines

2

11.8

Short, Medium, Long term Projects / Goals

3

17.6

Way forward, Outcome

2

11.8

4.3.1. Strategy Formulation Process The findings from the strategy formulation process further reveal that 88% of the respondents felt that they were involved in the Strategy Planning process, that their opinions were sort and taken into consideration in the planning process and are conversant with the organization’s opportunities and threats within the plan. 82% of the respondents retort that the plan clearly outlines the Vision and Mission Statements. All the respondents state that the plan clearly outlines the organization’s strengths and weaknesses and 94% agree to the plan having clearly stated objectives. However, 47% either disagree or are uncertain that strategies are formulated in line with the vision. 30% state that there are no designated individuals to run with the strategies and another 35 % state that there is no clear plan of action. The specific responses as stated by the respondents in relation to strategy formulation are outlined in the tables below:

4.3.1.1 Involved in Strategy Formulation Process

44

Majority of the respondents agreed that they were part of the strategy formulation process. Respondents were present during the strategy formulation process with stakeholders at all levels of the organization being well represented. Table 4.4Part of the Strategy Planning Process Category Strongly Disagree Agree Strongly Agree TOTAL

Distribution Frequency 2 6 9 17

Percentage 11.8 35.3 52.9 100.0

4.3.1.2 Opinions and Input Considered The strategy formulation process not only included but also involved everyone present at the workshop. As indicated, 88% of the respondents agreed that their opinions were sought after and considered during the strategy formulation stage. However, 12% felt that their opinions were not taken into consideration. This is an indication that there may be some form of bias against some shareholders or that some shareholders do not feel that they from an integral part of the strategy making process within the company. Table 4.5 Opinions and Input was considered Category Strongly Disagree Agree Strongly Agree TOTAL

Distribution Frequency 2 8 7 17

Percentage 11.8 47.1 41.2 100.0

4.3.1.3 Vision Formulation Of the 17 respondents, 14 of them agreed to having formulated a vision during the strategy planning workshop. This indicates that the company has a clear focus of what their main goal is. The company is aware of its destination.

45

Table 4.6 Plan included Formulating Vision Category Somewhat Agree Agree Strongly Agree TOTAL

Distribution Frequency 3 3 11 17

Percentage 17.6 17.6 64.8 100.0

4.3.1.4 Clear Mission Statement From the findings, 82% of the respondents agree to having a clear mission statement. This indicates that the shareholders are aware of how they plan on achieving the set vision, what they will use to achieve the vision. Table 4.7 Clear Mission Statement Category Somewhat Agree Strongly Agree TOTAL

Distribution Frequency 3 14 17

Percentage 17.6 82.4 100.0

4.3.1.5 Organization Strengths and Weaknesses From the findings 82% of the respondents agree to knowing the company’s strengths and weaknesses. This is an indication that the company conducted a SWOT analysis during its strategy planning workshop. Table 4.8 Aware of Strengths and Weaknesses Category

Agree Strongly Agree

Distribution Frequency 3

Percentage 17.6

14

82.4

46

TOTAL

17

100.0

4.3.1.6 Organization Opportunities and Threats From the findings 88% of the respondents agree to knowing the company’s opportunities and threats. This is an indication that the company conducted a SWOT analysis during its strategy planning workshop. Table 4.9 Aware of Opportunities and Threats Category

Distribution Frequency 2

Percentage 11.8

Agree

3

17.6

Strongly Agree

12

70.6

TOTAL

17

100.0

Somewhat Agree

4.3.1.7 Clear Objectives From the findings, 84% of the respondents agree that the company has clear objectives to govern its undertakings. This is an indication that the company has broken down its vision so as to be better understood and more easily achievable. Table 4.10 Objectives Clear Category

Distribution Frequency 1

Percentage 5.9

Agree

10

58.8

Strongly Agree

6

35.3

Disagree

47

TOTAL

17

100.0

4.3.1.8 Strategies Formulated in Line with Vision From the findings. 94% of the respondents agree that the company has set strategies that are in line with its vision. This is an indication that the company has broken down its vision so as to be easily understood and implemented. Table 4.11 Strategies in line with Vision Category

Distribution Frequency 1

Percentage 5.9

Somewhat Agree

7

41.2

Agree

5

29.4

Strongly Agree

4

23.5

TOTAL

17

100.0

Disagree

4.3.1.9 Clear Plan of Action for Strategies 35% of the respondents disagree that there is a clear plan of action for achieving strategies while 29% are uncertain. Only 36% agree to having a clear plan of action. This shows that the company may not have action steps or an action plan in place. Table 4.12 Clear Plan of Action Category

Distribution Frequency 6

Percentage 35.3

Somewhat Agree

5

29.4

Agree

2

11.8

Strongly Agree

4

23.5

Disagree

48

TOTAL

17

100.0

4.3.1.10 Individuals to run Activities in Action Plan 12% of the respondents disagreed that there were individuals to run activities within the plan while 18% were uncertain. However, 70% agreed to having a clear plan of action. This shows that only a portion of the shareholders feel that designated individuals run with activities. 4.13 Individuals to run Activities in Action Plan Category

Distribution

Disagree

Frequency 2

Percentage 11.8

Somewhat Agree

3

17.6

Agree

6

35.3

Strongly Agree

6

35.3

TOTAL

17

100.0

4.3.2

Overall Organization Goal

Below are the responses to what the respondents believe is the overall goal of the organization Table 4.14 Overall Organization Goal Organization Goal

Distribution

Comfortably retire in the future

Frequency 3

Percentage 17.6

Create Wealth and employment

2

11.8

49

Enhance financial person at group and individual level

3

17.6

Generate profit and positively impact society

1

5.9

Invest in various projects around the globe and have a 2

11.8

positive impact

Make money

1

5.9

Make profits and influence societies in African Region

2

11.8

To be a profit making conglomerate impacting societies in 3

17.6

the African Region

4.3.3

Achieving Organization Goal

The respondents were asked about the means of achieving the goals set out with the organization. Below are the findings of what the respondents believe to be viable ways in which the overall organizational goals can be achieved. Table 4.15 Achieving Goals Distribution By leveraging our diverse expertise and maximizing

Frequency 3

Percentage 17.6

1

5.9

opportunities in target markets through responsible and sustainable business Initiate and be part of viable investments

50

Investing in land, real estate and MMF and other profitable

3

17.6

Investing in profit generating activities and CSR

1

5.9

Investing in various projects to generate income and be

3

17.6

2

11.8

2

11.8

Total

15

88.2

Missing

2

11.8

areas of investment

profitable Researching for viable projects with various teams running different projects Use available skills/expertise of shareholders to invest in viable projects

4.3.4

Challenges in Formulation Process

The study sought to find out if there were challenges that arose during the strategy formulation process. From the findings, 88% of the respondents stated that they encountered challenges during the strategy formulation process. The challenges faced can be viewed in the next segment. 4.3.4.1 List of Challenges The respondents were asked to give a list of the issues they viewed as being the main challenges encountered during strategy formulation. The comprehensive list of responses from the findings are highlighted in the table below. Table 4.16 List of Challenges in Formulation Challenges

Distribution Frequency 3

Percentage 17.6

Availability of members

3

17.6

Different Risk appetites

1

5.9

Diverse background and expertise

2

11.8

Getting everyone to participate in strategic planning

1

5.9

Assistance in preparing document

meeting

51

Lack of cooperation

1

5.9

Meeting Venue

2

11.8

Venue for SP

2

11.8

Cohesion of strategic intent

3

17.6

Coming up with common investment ideas

1

5.9

Convincing others of business ideas

2

11.8

Different risk appetites

2

11.8

Different schools of thought

1

5.9

Diverse expertise

1

5.9

Lack of understanding of short, medium and long term

3

17.6

Cohesion of strategic intent

3

17.6

Coming up with common investment ideas

1

5.9

Convincing others of business ideas

2

11.8

Different risk appetites

2

11.8

Different schools of thought

1

5.9

Diverse expertise

1

5.9

Lack of understanding of short, medium and long term

3

17.6

projects Actual analysis of potential income from projects

2

11.8

Diverse passions

1

5.9

How to run project at the same time

3

17.6

projects

4.3.5

Strategic Plan

The study sought to find out what aspects had improved or been enhanced as a direct effect of having a strategic plan. 4.3.5.1 Enhanced Communication Fifty nine percent of the respondents felt that the presence of a strategic plan had not enhanced communication while 41% were uncertain. This is an indication that the presence of a strategic plan at Yakuti Ventures Limited does not serve as a communication tool between and amongst the company shareholders. Table 4.17 Enhanced Communication

52

Category

Distribution Frequency

Percentage

Strongly Disagree

1

5.9

Disagree

9

52.9

Somewhat Agree

7

41.2

Total

17

100.0

4.3.5.2 Understanding of Other’s views The findings indicated that 59% of the respondents felt that the presence of a strategic plan had not created a deeper understanding of others’ views while 41% were uncertain. The presence of a strategic plan did not work to bring cohesion or a sense of inquiry of other’s opinions, views or interests. Table 4.18 Deeper Understanding of Others views Category

Distribution Frequency Distribution 3 17.6 7 41.2 7 41.2 17 100.0

Strongly Disagree Disagree Somewhat Agree Total 4.3.5.3 Improved Understanding

The findings indicated that 23% further stated that the presence of a strategic plan did not enhance their understanding of what the organization is doing while 65 % were uncertain. This could mean that majority of the shareholders may not fully understand what the organization is doing or working towards. Table 4.19Understanding of Organization Plans Category

Distribution Frequency

Percentage

Strongly Disagree

2

11.8

Disagree

2

11.8

Somewhat Agree

11

64.7

53

Agree

2

11.8

Total

17

100.0

4.3.5.4 Commitment to Achieve Objectives Sixty five percent of the respondents stated that the plan did not enhance their commitment to achieve objectives whereas 35% somewhat agreed that it enhanced commitment to achieve objectives. The strategic plan is not working at directing majority of the shareholders towards achievement of objectives. Table 4.20 Greater Commitment to Achieve Objectives Category

Distribution Frequency

Percentage

Strongly Disagree

4

23.5

Disagree

7

41.2

Somewhat Agree

6

35.3

Total

17

100.0

4.3.5.5 Commitment to Implement Strategies The findings indicated that 82% of the respondents stated that the strategic plan did not enhance their commitment to implement strategies within the organization while 18% were uncertain. Majority of the shareholders are certain that the strategic plan does not engage them to implement strategies. Thus, the strategic plan is simply a document with company manifestos. Table 4.21 Commitment to Implement Strategies Category

Distribution Frequency

Percentage

Strongly Disagree

6

35.3

Disagree

8

47.1

Somewhat Agree

3

17.6

54

Total

17

100.0

4.3.5.6 Commitment to Work Harder Eighty two percent of the respondents stated that the strategic plan did not enhance commitment to work hard. Eighteen percent somewhat agreed that the plan enhanced commitment to work harder. The strategic plan did nothing to foster cohesion, team work, togetherness and hard work. Thus, the strategic plan is not an inspirational tool for YVL shareholders. Table 4.22 Commitment to Work Harder Category

Distribution Frequency

Percentage

Strongly Disagree

6

35.3

Disagree

8

47.1

Somewhat Agree

3

17.6

Total

17

100.0

4.3.5.7 Reassessing of Strategies Fifty three percent of the respondents said that the strategic plan did not create a platform for continued reassessing of strategies. Forty seven percent said that it somewhat created such a platform. This implies most of the shareholders feel that there is barely any reevaluation of strategies at the YVL. Table 4.23 Platform for Reassessing Strategies Category

Distribution Frequency

Percentage

Strongly Disagree

9

52.9

Somewhat Agree

8

47.1

Total

17

100.0

55

4.3.5.8 Marketing Tool 71% of the respondents disagreed that the plan acted as a marketing tool while 29% somewhat agreed. The strategic plan is an internal tool that is not working for YVL. Table 4.24 Good Marketing Tool Category

Distribution

Strongly Disagree

Frequency 10

Percentage 58.8

Disagree

2

11.8

Somewhat Agree

5

29.4

TOTAL

17

100.0

4.3.6

Benefits of Strategic Plan

Below is a list of the benefits the respondents felt they had from the presence of a Strategic plan. Table 4.25 Benefits of Strategic Plan Benefits Helped focus scope and objectives It's just a document None, do not follow it None, not practiced it None, only exists on paper Not effectively implemented, no tangible benefits Roadmap for making investment decisions Trying to evaluate projects in line with achieving goals Working toward vision Knowing what’s expected Total

Distribution Frequency Percentage 2 11.8 2 11.8 1 5.9 2 11.8 1 5.9 2 11.8 3 17.6 3 17.6 1 1 17

56

5.9 5.9 100.0

4.28

Limitations of having Strategic Plan

In response to whether there were limitations to having a strategic plan the respondents stated thus:

Limitations of HavingaStrategic Plan

29% YES NO

71% Figure 4.3 Limitations of Having a Strategic Plan 4.3.7.1 List of Limitations It was evident that there were certain limitations to having a strategic plan. As such, the respondents were asked to give specific reasons of the limitations of having a strategic plan. The items listed in the table below highlight the limitations as per the opinions and views of the respondents. Table 4.26

List of Limitations of Strategic Plan Limitations

Distribution

Do not refer to plan

Frequency 1

Percentage 5.9

Not using the plan

2

11.8

Stuck on following strategies recommended 3 years ago

2

11.8

57

Limiting selves by only looking at objectives in plan

2

11.8

Markets changing and presenting new opportunities we are

2

11.8

TOTAL

9

53.1

Missing

8

46.9

not pursuing

Strategy Implementation This section sought to determine various aspects about implementation of strategies at YVL. Statements were put forth and the respondents were required to give their opinions on a five point Likert scale ranging from strongly disagree (1) to strongly agree (5). The results and analysis from respondents are presented in the tables. 4.4.1

Measurable, Mutually Determined Annual Goals

From the findings, 42% of the respondents disagreed that there were annual goals which were measurable and mutually determined. 29% were not sure while another 29% agreed that there were measurable, mutually determined annual goals. This implies that YVL does may not have objectives that are broken down into smaller, easily manageable and achievable goals making it difficult to have a specific focus. Table 4.27 Measurable, Mutually Determined Annual Goals Category

Distribution Frequency Percentage 3 17.6 4 23.5 5 29.4 5 29.4 17 100.0

Strongly Disagree Disagree Somewhat Agree Agree TOTAL 4.4.2

Specific Function Strategies

58

41% of the respondents disagreed that there were specific function strategies developed within the organization. 24% were not certain whether there were specific function strategies or not while 35% agreed that YVL had specific function strategies developed. Functional strategies may be lacking or may not be clearly outlined at YVL. Table 4.28 Specific Function Strategies Category

Distribution Frequency 3

Percentage 17.6

Disagree

4

23.5

Somewhat Agree

4

23.5

Agree

6

35.4

TOTAL

17

100.0

Strongly Disagree

4.4.3

Concise Guidelines

In relation to development and communication of guidelines, 29% disagreed that the guidelines were in place to direct the achievement of strategy while 18% agreed that these were present. However, 53% of the respondents were not decisive as to whether these guidelines were in place or not. YVL does not seem to have clear guidelines leading it in achieving strategies. Table 4.29 Communication of Guidelines Category

Distribution Frequency Percentage 2 11.8 3 17.6 9 52.8 3 17.6 17 100.0

Strongly Disagree Disagree Somewhat Agree Agree TOTAL 4.4.4

Leaders Participation

When asked whether leaders only concentrate on strategy formulation, 65% strongly disagreed while 35% neither agreed nor disagreed. In relation to leaders actively participating in implementation, 53% strongly disagreed that leaders not participate, 6%

59

neither agreed nor disagreed and 41% agreed that leaders did not actively participate in implementation. Leaders in YVL participate in strategy formulation and are not only involved in formulation of strategy. However, leaders are not seen to actively participate in implementation. Thus, there is lack of proper leadership in implementation at YVL. Table 4.30 Leaders Only Formulate Category

Distribution Frequency Percentage 11 64.7 6 35.3 17 100.0

Strongly Disagree Somewhat Agree TOTAL Table 4.31 Leaders Don’t Participate Category

Distribution Frequency

Percentage

Strongly Disagree

9

52.9

Somewhat Agree

1

5.9

Agree

7

41.2

TOTAL

17

100.0

4.4.5

Leaders and Resources

35% disagreed that leaders reorganize resource, 18% agree and 47% were uncertain. Majority of the shareholders do not know whether resources are reorganized in relation to strategy or not. The shareholders of YVL may not be aware of available resources of the organization and how these are being used for the benefit of the organization. Table 4.32 Leaders Reorganize Resources Category

Distribution Frequency 1

Percentage 5.9

Disagree

5

29.4

Somewhat Agree

8

47.1

Agree

3

17.6

TOTAL

17

100.0

Strongly Disagree

60

4.4.6

Brainstorming and Group Discussions

From the analysis 47% of the respondents disagreed to there is group discussions and brainstorming sessions in formulating strategies. 12% were not certain while 41% agreed that YVL engaged in brainstorming and group discussions in formulating strategy. About half of the shareholders are not involved in the strategy formulation process. Thus, there is unequal representation of views at the point of formulating strategies which translates to only a select few having ownership of the strategies. Table 4.33 Group Discussions/Brainstorming Category

Distribution Frequency 3

Percentage 17.6

Disagree

5

29.3

Somewhat Agree

2

11.8

Agree

4

23.5

Strongly Agree

3

17.6

TOTAL

17

100.0

Strongly Disagree

4.4.7

Departmental Activities to Achieve Strategies

When asked about department designing activities towards achieving strategies, 18% disagreed while 47% agreed that this was the case. However, 28% were not certain. This is an indication that departments are allowed some autonomy to set strategies specific to what they do in line with the overall company vision. Table 4.34 Departments Design Their Activities Category

Distribution Frequency 3

Percentage 17.6

Somewhat Agree

6

35.4

Agree

5

29.4

Disagree

61

Strongly Agree

3

17.6

TOTAL

17

100.0

4.4.8

Departments Develop, Champion and Implement Strategies

When asked about whether departments develop, champion and implement strategies on their own, 18% disagreed while 29% agreed. However, a large percentage of 53% somewhat agreed. Table 4.35 Departments Implement Strategies Alone Category

Distribution Frequency 3

Percentage 17.6

Somewhat Agree

9

52.9

Agree

2

11.8

Strongly Agree

3

17.6

TOTAL

17

100.0

Disagree

4.4.9

Organization Structure Analysis

Findings from the respondents reveal that 53% disagreed that the organization structure analysis in order to align with strategies while 18% were in agreement that this was indeed the case. However, 29% were not too certain what the case is. It is mandatory for organizations to align their organization structure to better fit the strategies they plan to implement. This is not the case at YVL. Table 4.36 Organization Structure Analysis Category

Distribution Frequency 7

Percentage 41.2

Disagree

2

11.8

Somewhat Agree

5

29.4

Strongly Agree

3

17.6

TOTAL

17

100.0

Strongly Disagree

62

4.4.10 Evaluation of Results 53% agreed that results were evaluated while 35% disagreed. 12% were uncertain. In order to know if an organization is successful, results should be measured against preexisting set standards. This is not done at YVL as there is no monitoring and evaluation tool against which strategies and their results are measured. Table 4.37 Results Evaluated Category

Distribution Frequency 1

Percentage 5.9

Disagree

5

29.4

Somewhat Agree

2

11.8

Agree

6

35.3

Strongly Agree

3

17.6

TOTAL

17

100.0

Strongly Disagree

4.4.11 Internal Administrative Systems When asked about whether there were internal administrative systems to support strategy achievement, 47% disagreed, 29% were undecided and 23% agreed. Lack of internal administrative systems implies that YVL is not responsive to emerging needs, is not aware of skills and competencies required for the execution of specific strategies. Table 4.38 Internal Administrative Systems Category

Distribution Frequency 7

Percentage 4102

Disagree

1

5.9

Somewhat Agree

5

29.4

Agree

4

23.5

TOTAL

17

100.0

Strongly Disagree

63

4.4.12 Rewards 41% disagreed that there were rewards linked to objective and strategies, 29% were undecided and 18% agreed. 12% did not respond to the question. Lack of a reward system at YVL translates to a lack of motivation to work towards executing strategy as there is no recognition or compensation for a job well done. Table 4.39 Rewards Available Category

Distribution Frequency 5

Percentage 29.4

Disagree

2

11.8

Somewhat Agree

5

29.4

Strongly Agree

3

17.6

TOTAL

15

88.2

Missing

2

11.8

Strongly Disagree

4.4.13 Strategic Leadership When asked about strategic leadership to achieve strategy, 29% disagreed that this was the case while 35% agreed. The remaining respondents somewhat agreed. There is a disconnect as the findings indicate that strategic leadership is present yet implementation is lacking. Table 4.40 Strategic Leadership Category

Distribution Frequency 5

Percentage 29.4

Somewhat Agree

6

35.3

Agree

6

35.3

TOTAL

17

100.0

Disagree

64

4.5

Experiences during Strategy Implementation

The following section sought to inquire of challenges that YVL faced the most. Statements were made and respondents expected to rate each on the Linkert scale. The findings are presented below. 4.5.1

Strategy Took More Time to Implement

100% if the respondents agreed that the strategy took too long to implement. This could have translated to a de-motivation in working towards implementing strategy as there were no signs of achieving success. Table 4.41 Took More Time Category

Distribution

Strongly Agree

TOTAL

4.5.2

Frequency 17

Percentage 100.0

17

100.0

Unidentified Problems Derailed Implementation

88% of the respondents agreed that other problems derailed the implementation process. A shift in focus may have led to YVL dealing with other matters and not the major issue of implementing set strategies. Table 4.42 Unidentified Problems Category

Distribution Frequency 2

Percentage 11.8

Agree

6

35.3

Strongly Agree

9

52.9

Somewhat Agree

65

TOTAL 4.5.3

17

100.0

Coordination

All the respondents agreed that coordination was not sufficiently effective. This indicates lack of a working system within thus there is no clear flow of information at YVL. Table 4.43 Insufficient Coordination Category

Distribution Frequency 5

Percentage 29.4

Strongly Agree

12

70.6

TOTAL

17

100.0

Agree

4.5.4

Competing Activities

Sixty four percent of the respondents agreed that competing activities distracted the implementation process while 6% disagreed. The remaining 29% were uncertain. This stipulates that there was a problem of focusing on already set out strategies. Table 4.44 Competing Activities Category

Distribution Frequency 1

Percentage 5.9

Somewhat Agree

5

29.4

Agree

5

29.4

Somewhat Agree

6

35.3

TOTAL

17

100.0

Disagree

4.5.5

Insufficient Shareholder Capabilities

66

Thirty five percent of the respondents disagreed that shareholder capabilities derailed the implementation process while 35% agreed. Thirty percent of the respondents were not decided on the matter. Shareholders have required capabilities yet these are not being tapped into. Table 4.45 Insufficient Shareholder Capabilities Category

Distribution

Strongly Disagree

Frequency 6

Percentage 35.3

Somewhat Agree

5

29.4

Agree

2

11.8

Strongly Agree

4

23.5

TOTAL

17

100.0

4.5.6

Inadequate Training and Instruction

18% disagreed while 53% agreed that training and instruction was inadequate. 29% were not certain. YVL needs to identify lacking skills and work on engaging necessary sources in order to obtain these. Table 4.46 Inadequate Training Category

Distribution

Strongly Disagree

Frequency 3

Percentage 17.6

Somewhat Agree

5

29.4

Agree

4

23.5

Strongly Agree

5

29.4

TOTAL

17

100.0

67

4.5.7

Uncontrollable Factors in the External Environment

Forty Seven percent of the respondents disagreed that the implementation process was derailed by uncontrollable factors in the external environment while 18% said this was not the case. Thirty five percent of the respondents were however undecided. Mechanisms that deal with assumptions and risk management are lacking. Table 4.47 Uncontrollable Factors Category

Distribution

Strongly Disagree

Frequency 8

Percentage 47.1

Somewhat Agree

6

35.3

Strongly Agree

3

17.6

TOTAL

17

100.0

4.5.8

Inadequate Departmental Leadership

Thirty four percent of the respondents disagreed that there was inadequate leadership and direction within the departments while 35% agreed. The remaining respondents were uncertain. Adequate leadership is lacking at YVL. Table 4.48 Inadequate Leadership Category

Distribution Frequency 5

Percentage 29.4

Disagree

1

5.9

Somewhat Agree

5

29.4

Agree

3

17.6

Strongly Agree

3

17.6

TOTAL

17

100.0

Strongly Disagree

4.5.9

Tasks and Activities not defined

68

Fifty three percent of the respondents agreed that tasks and activities were not defined while 18% disagreed. Twenty nine percent of the respondents were however undecided. There is a lack of breakdown of strategies into activities and tasks and no clear indication of responsibilities. Table 4.49 Insufficient Definition of Tasks Category

Distribution

Strongly Disagree

Frequency 3

Percentage 17.6

Somewhat Agree

5

29.4

Agree

7

41.2

Strongly Agree

2

11.8

TOTAL

17

100.0

4.5.10 Inadequate Information Systems When asked about the inadequacy of information system for monitoring implementation, 41% disagreed while 59% agreed. There is no information systems set up to adequately measure progress at YVL. Table 4.50 Inadequate Information Systems Category

Distribution Frequency 7

Percentage 41.2

Agree

6

35.3

Strongly Agree

4

23.5

TOTAL

17

100.0

Strongly Disagree

4.5.11 Advocate and Supporters Left

69

When asked about whether strategic advocates and supporters of the implementation process left the organization, 94% disagreed while 6% agreed. The human resources necessary for the implementation process are available at YVL. Table 4.51 Strategic Advocates Left Category

Distribution Frequency 14

Percentage 82.4

Disagree

2

11.8

Agree

1

5.9

TOTAL

17

100.0

Strongly Disagree

4.5.12 Overall goals not understood When asked about whether overall goals were not well understood, 53% disagreed while 29% agreed. 18% were not certain. The organization goals are understood by majority of the shareholders of YVL. Table 4.52 Overall Goals Not Understood Category

Distribution Frequency 6

Percentage 35.3

Disagree

3

17.6

Somewhat Agree

3

17.6

Agree

3

17.6

Strongly Agree

2

11.8

TOTAL

17

100.0

Strongly Disagree

4.5.13 Changes in Responsibility Undefined

70

The study sought to find out whether changes in responsibility were undefined. According to the respondents, 70% disagreed that there were changes in responsibilities while 6% agreed. People are not doing what they have been mandated to do at YVL. Table 4.53 Changes in Responsibilities Category

Distribution Frequency 11

Percentage 64.7

Disagree

1

5.9

Somewhat Agree

4

23.5

Agree

1

5.9

TOTAL

17

100.0

Strongly Disagree

4.5.14 Key Formulators not playing Active Role Forty Seven percent disagreed that key formulators did not play an active role in implementation while 35% agreed. Eighteen percent were undecided. All shareholders have a role to play in the implementation process. Table 4.54 Formulators Not Playing Role Category

Distribution Frequency 5

Percentage 29.4

Disagree

3

17.6

Somewhat Agree

3

17.6

Agree

3

17.6

Somewhat Agree

3

17.6

TOTAL

17

100.0

Strongly Disagree

4.5.15 Problems Requiring Board Involvement not Communicated

71

When asked about whether problems requiring board involvement were not communicated, 76% disagreed while 18% agreed. 6% was undecided. The Board was aware of all undertaking within the organization. Table 4.55 Problems Requiring Board Involvement Not Communicated Category

Distribution Frequency 11

Percentage 64.7

Disagree

2

11.8

Somewhat Agree

1

5.9

Agree

3

17.6

TOTAL

17

100.0

Strongly Disagree

4.5.16 Deviation from Objectives Sixty four percent of the respondents agreed that there was deviation from the originally planned objectives while 18% disagreed and another 18% were undecided. YVL does not have a clear focus and clearly indicated timelines and as such deviation from already set objectives often shifts focus. Table 4.56 Deviation from Original Objectives Category

Distribution Frequency 3

Percentage 17.6

Disagree

3

17.6

Somewhat Agree

6

35.3

Agree

5

29.4

TOTAL

17

100.0

Strongly Disagree

4.5.17 Lack of Rewards

72

Ninety four percent of the respondents agreed that people are not measured or rewarded from plan execution while 6% disagreed. Lack of rewards at YVL may relate to lack of motivation to take part in the implementation of strategy. Table 4.57 No Rewards Category

Distribution Frequency 1

Percentage 5.9

Agree

1

5.9

Strongly Agree

15

88.2

TOTAL

17

100.0

Strongly Disagree

4.5.18 Lack of Feelings of Ownership Ninety four percent agreed that there was lack of feelings of ownership of the execution plan while 6% disagreed. Lack of ownership could stem from not being included in formulation. This translates to lack of concern for the said strategies. Table 4.58 Lack of Ownership Category

Distribution Frequency 1

Percentage 5.9

Agree

5

29.4

Strongly Agree

11

64.7

TOTAL

17

100.0

Strongly Disagree

4.5.19 Lack of Understanding Organization Structure Role

73

Forty two percent of the respondents agreed that there was lack of understanding of organization structure and design in the implementation process while 35% disagreed. 24% were not certain. The organization structure and design is therefore not aligned to strategies or organization objectives. Table 4.59 Lack of Understanding Role of Organization Structure and Design Category

Distribution

Strongly Disagree

Frequency 6

Percentage 35.3

Somewhat Agree

4

23.5

Strongly Agree

7

41.2

TOTAL

17

100.0

4.5.20 Insufficient Financial Resources Forty three percent of the respondents agreed that there were insufficient financial resources to execute strategy while 12% disagreed. Thirty five percent of the respondents were undecided. This translates to inability to engage in strategies that require large amounts of financial resources thus slowing down the implementation process. Table 4.60 Insufficient Financial Resources Category

Distribution

Strongly Disagree

Frequency 2

Percentage 11.8

Somewhat Agree

6

35.3

Agree

3

17.6

Strongly Agree

6

35.3

TOTAL

17

100.0

4.6

Other problems faced

4.6.1

Leadership Implementation Challenges

74

Problems related to leadership implementation that arose were; lack of commitment and transparency, leaders role not clearly stipulated and lack of using the strategic plan. Table 4.61 Problems of Leadership Implementation Category

Distribution Frequency 3

Percentage 17.6

Leaders didn't push for implementation

1

5.9

Leaders not aware of Job Descriptions, a lot of delegation

1

5.9

Leadership role not clearly stipulated

2

11.8

Not using Strategic Plan as a guide

2

11.8

Transparency, Commitment

3

17.6

TOTAL

12

70.6

Missing

5

29.4

Lack of commitment

4.6.2

Organizational Implementation Challenges

Problem related to organizational implementation included: lack of allocating responsibilities, lack of commitment with the highest frequencies. Table 4.62 Problems of Organization Implementation Problem

Distribution Frequency 3

Percentage 17.6

2

11.8

Lack of commitment

3

17.6

Lack of ownership

1

5.9

Lack of participation leading to death of projects

2

11.8

No sense of ownership and buy in

1

5.9

No sense of ownership or responsibility in realizing set

2

11.8

1

5.9

Allocating responsibilities BOD and Management was the same, caused strain and was hard

objectives Shareholders didn't push for implementation

75

Total

15

88.2

Missing

2

11.8

4.6.3

Policy and Resource deployment Challenges

Problems related to policy and resource deployment highlighted with the most in frequency are: lack of shareholders agreement, ability to take risks and invest funds, insufficient resources. Table 4.63 Problems of Policy and Resource Deployment Problems

Distribution Frequency 3

Percentage 17.6

Insufficient resources-time and money

3

17.6

Issues with SHA

2

11.8

Lack of income flow

1

5.9

Lack of policy documents e.g. SHA

2

11.8

Lack of SHA slowing certain processes

2

11.8

No clearly outlined policies in document

2

11.8

No concise implementation plan

1

5.9

None

1

5.9

Total

17

100.0

Ability to take risks and invest funds

4.7

Factors that aided Implementation of Strategy

The study sought to find out if there were any factors that aided the implementation of strategy. The responses obtained from the respondents were favorable as they listed down

76

the factors they saw as having aided the successful implementation of strategy within YVL. These are listed in the table below. Table 4.64 Factors Aiding Implementation Factors

Distribution Frequency 2

Percentage 11.8

Leadership intervention

3

17.6

Not implemented anything

1

5.9

Strategic Plan never been implementation

1

5.9

Willing proactive members

2

11.8

Willingness to succeed

3

17.6

Yet to successfully implement strategy

2

11.8

Total

14

82.4

Missing

3

17.6

Clearly defined decision making mechanisms and timelines

4.8

Other Comments

The responses from the respondents reveal that Yakuti Ventures Limited is not using the strategic plan. And 6% felt that study ought to have concentrated on other areas and aspects of YVL and not the strategic plan. Decision making also came up as an aspect that needs review. Table 4.65 Other Comments Comment

Distribution Frequency 1

Percentage 5.9

Review decision making within organization

2

11.8

SP plan simply a document. Not working for us

2

11.8

Total

5

29.4

Missing

12

70.6

Questionnaire should concentrate on other areas of YVL as Strategic Plan isn't used

77

4.9

Pearson Correlation

4.9.1

Pearson Correlation of Section represented versus Strategy planning

processes On overall the sections of YVL represented in this research were five. An analysis was then carried out to establish the correlation between the five represented sections and the feeling of the respondents on strategic planning processes. All factors did not show statistically significant relationships, except being aware of organizations opportunities and threats. The strongest correlations were found in only one factor; Aware of the organizations opportunities and threats (p<0.005) and section represented. The detailed analysis is presented in Table 4.69 Table 4.66 Pearson Correlation of Section represented versus Strategy planning processes

Strategy planning processes

Mean

r

P value Significance at <0.05

I am aware of the organizations

4.59

-0.494

0.04*

opportunities and threats

*. Correlation is significant at the 0.05 level (2-tailed). 4.9.2

Correlation of section that the respondents represented with presence of a

strategic plan within the organization improving/ enhancing certain aspects in the organization On overall the sections of YVL represented in this research were five. An analysis was then carried out to establish the correlation between this five represented sections and the

78

feeling of enhanced or improved aspects in the organization due to the presence of the strategic plan. Analysis was carried out to establish the specific factors which were more correlated to the overall score. The strongest correlations were found in three aspects; There being a greater commitment to achieve objectives (p<0.001), There being a greater commitment to implement strategies (p<0.001)

and There is a greater commitment to

work harder (p<0.001). The detailed analysis is presented in Table 4.70. Table4.67 Pearson Correlation of Section Represented with Presence of a Strategic plan in Improving Organization Enhanced

aspects

Mean

r

due to presence of

P value Significance at

strategic plan

<0.05

There is a greater commitment

2.12

0.648

0.0049*

1.82

0.494

0.0439*

1.82

0.494

0.0439*

to

achieve objectives There is a greater commitment

to

implement strategies There is a greater commitment to work harder *. Correlation is significant at the 0.05 level (2-tailed). 4.9.3

Correlation of limitations that have arisen because of having a strategic plan

with the obstacles that have arisen in working at achieving set strategies There were twenty obstacles listed in the questionnaire that could have arisen due to there being a strategic plan. These obstacles would limit the process of achieving the set strategies. An analysis was then carried out to establish the correlation between the respondents feeling that there were limitations that arose due to the strategic plan and these listed obstacles. Analysis was carried out to establish the specific factors which were more correlated to the overall score. The strongest correlations was found in competing activities distracting attention from implementing decisions (p<0.001). The detailed analysis is presented in the table below.

79

Table 68 Pearson Correlation of limitations that have arisen because of having a strategic plan with the obstacles that have arisen in working at achieving set strategies Obstacles that have

Mean

r

P value

arisen in working at

achieving

Significance at

set

<0.05

strategies

Competing activities distracted from

3.94

-0.729

0.0009*

attention

implementing

decisions

*. Correlation is significant at the 0.05 level (2-tailed). 4.9.4

Pearson Correlation of Section that the Respondents Represented with

Strategy Implementation Analysis of the sections represented with the sixteen (16) strategy implementation factors revealed 4 statistically significant responses. At a mean of 2.98 group discussion and brainstorming sessions in formulating strategies revealed a very strong connection with sections represented by the respondent at (p<0.05). Analysis of the organization structure in order to align with strategies also showed strong correlation of (r=0.520, P=0.032). Internal administration system to support strategy achievement strategic leadership to achieve each strategy also showed significantly strong correlation with sections represented by the respondents. The findings were as shown in the table below. Table 69

Pearson

Correlation

of

Implementation

80

Section

Represented

with

Strategy

*. Correlation is significant at the 0.05 level (2-tailed). Strategy implementation Mean r Group

discussions

brainstorming

and 2.98

sessions

P value

0.603

Significance at <0.05 0.01*

0.520

0.032*

0.551

0.022*

0.566

0.018*

in

formulating strategies Rate

-

Analysis

of

the 2.89

organization structure in order to align with strategies Rate - internal administrative 3.45 systems

to

support

strategy

achievement Rate - Strategic leadership to 4.21 achieve each strategy

4.10

Chapter Summary

The chapter presented the findings of the study based on the research questions. The results were attained from questionnaires which were administered to the shareholders of at Yakuti Ventures Limited. The outcome was categorized in proportion to the research questions. The findings revealed that the strategy formulation process was detailed and went through the main stages involving all relevant parties. Although challenges were evident these were overcome and YVL were able to have a five year strategic plan. The strategy implementation process was however not smooth sailing as numerous challenges derailed the process. The findings were presented in frequency and percent tables. The next chapter presents discussions, conclusions and recommendations for further study.

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CHAPTER FIVE 5.0 DISCUSSION, CONCLUSIONS AND RECOMMENDATIONS 5.1

Introduction

This chapter presents the summary, discussions, conclusions and recommendations of the study. The first section gives a summary of; the purpose of the study, research design and major findings. The second section discusses the findings of the research questions based on the literature review. The consequent section gives conclusions drawn from the discussions and concludes by giving recommendations guided by the research questions. 5.2

Summary

The purpose of this study was to establish the challenges of strategy planning and implementation at Yakuti Ventures Limited. The specific objectives of the study were: to determine the strategy planning process and challenges, to establish the strategy implementation process and factors that aid this process and to examine the inhibitors of strategy implementation. The study used the descriptive research design. The population included the 18 shareholders of Yakuti Ventures Limited which includes the Board of Directors and the Management Team. Data was collected using a questionnaire that was both structured and unstructured. It was processed using SPSS. The data was analyzed in form of frequencies and percentages and was presented using tables. The findings of the study reveal that the strategy planning process was adequate and followed the main steps necessary in coming up with a strategy plan. The components within the strategy document suggest that there is an organization mission and vision, that the organization conducted a SWOT analysis and set specific objectives to this end. However, the presence of the plan has not been seen to have major benefits for the organization. In relation to the limitations of the formulation process, it is clear that the plan is a document that the organization can boast that they have. The strategies remain on paper.

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This has been a barrier as the shareholders seemingly limit investment opportunities to what the plan has and may end up losing out on other viable prospects of investment. Regarding, strategy implementation, there was no clear defined plan of action which translated to having a goal and not knowing how to achieve it. This can be likened to someone wanting to travel to Mombasa from Nairobi yet not knowing the direction or the means to get there. Lack of concise plan led to a myriad of challenges key among them ineffective coordination, strategies taking too long to implement, lack of rewards and lack of feelings of ownership. 5.3 5.3.1

Discussion Strategy Planning Process and Challenges

Koontz and O’Donnell (1972) clearly stated that planning is the bridge that gets us form where we are to where we want to get. It is a vital part of the organization and is characterized by thinking before doing. Yakuti Ventures Limited stated affirmatively to having a strategic plan meaning that they were anticipating the future in order to achieve better results. This is according to Haimann, (1978). In looking at the strategy planning process, Yakuti Ventures Limited formulated a clear strategy as they sought to outperform other organizations (Karami, 2007). This provided purpose and direction. The shareholders have an idea of what their organization vision is and this serves as a signpost for them as they can always refer back to it and find direction (Nanus, 1992). In addition, the organization mission gives Yakuti Ventures Limited a reason for existence by describing the capabilities, customer focus, activities and business make-up of the organization. The mission has stated what Yakuti Ventures Limited does, who it serves and how it serves them (David, 2011). Yakuti Ventures Limited sought from the very beginning to look at the bigger picture so as not to get caught up in the everyday organizational problems. This framework allowed them to set priorities and strategies most likely to help Yakuti Ventures Limited achieve its vision of the future (Shapiro, 2001).

83

Yakuti Ventures Limited being a small company, focused on the strategic plan for the overall company and not the different departments (Pirraglia, 2005). Yakuti Ventures Limited was involved in environmental scanning which enabled assessment of the company from both within and without. Yakuti Ventures Limited conducted a SWOT analysis that enabled it to know what Strengths, Weaknesses, Opportunities and Threats it has. The planning was not just internal but was also externally focused (Lawor, 2006). This was able to clarify the world in which Yakuti Ventures Limited operates enabling it to better envision its desired future (HBE, 2005). The findings indicate that the strategic plan had short term, medium term and long term, objectives. This designates a timeframe to the objectives that were laid out in the plan. In addition, the respondents affirmatively stated that objectives were also formulated for individual departments (Walker, 2002). However, Yakuti Ventures Limited shareholders state that execution has not been forthcoming as the plan is not followed. YVL has failed to utilize well the three core process: people, strategy and executions (Bossidy and Charan, 2002). YVL failed to adhere to the six stages highlighted by Kaplan and Norton (2008); develop the strategy, plan the strategy, align the organization, plan operations, monitor and learn, test and adapt. This is further exacerbated by the lack of evaluating the strategy thus inability to determine its utility, truth and efficacy (Rumelt, 1974). The findings reveal that the strategic planning process has had few benefits to the organization as a whole. Majority of the respondents state that there has been no enhanced communication; no improved understanding of others views or organization’s plan; no greater commitment to achieve objectives, implement strategies or work hard. The major limitation of the plan is that it has become its own “raison d’etre” and a straight jacket on creativity or responsiveness. The shareholders express non-committal to the process and do not feel ‘ownership’ of the final plan. 5.3.2

Strategy Implementation Process and Factors that Aid this Process

According to Pearce and Robinson (2003), strategy implementation is seen to have three interrelated steps: identifying mutually determined annual objectives; development of

84

specific function strategies; development and communication of concise policies to guide decisions. Majority of the respondents said that the organization lacked all of these; lack of measurable, mutually determined goals, lack of specific function goals and lack of concise guidelines. Lack of institutionalization of these through the organization structure leadership and culture and rewards systems has translated to lack of implementation as execution of strategy must be controlled and evaluated in a dynamic environment. According to Grodwin and Bourgeis III (1984), strategy implementation is based on five fundamental approaches; commander approach, organizational change approach, collaborative approach, cultural approach and crescive approach. Yakuti Ventures Limited can be seen to somewhat possess the cultural approach to implementing strategy where employees are allowed to design their own work activities. The approach tends to work to a great degree owing to the shareholders being well informed and intelligent people. Although this creates a strong corporate culture, the approach uses up a lot of time to install and becomes a handicap due to its fostering a very strong organization identity (Barney, 1986; Oliver, 1997). Yakuti Ventures Limited has not taken into account the five stage approach recommended by Certo and Peter (1988). Yakuti Ventures Limited has conducted strategic analysis, determined direction of the company’s operations and formulated strategies. However, the final two stages have not been considered. Lack of an implementation plan has led to YVL deviating from previously set objectives. In addition, lack of strategic control means that there is no measurement and evaluation of whether strategies are implemented in the said manner and the stipulated time. The leaders within Yakuti Ventures Limited have not been shaped by all the six strategic administrative tasks that assist in implementing strategy (Bhandari, 2013). Lacking among the six are: installing internal administrative support systems, devising rewards and incentives linked to objectives and strategy, shaping a corporate culture to fit the strategy and exercising strategic leadership. When it comes to leadership implementation, the leaders at Yakuti Ventures Limited have neither used the power available to them nor formulated proficient communication strategies to guide the change process (Thach and Thompson, 2007). This means that

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there is a lack in using technical, human and conceptual skills (Svetlik, 2005). Failure to use the most precise and effective ways has led to current looming problem of nit implementing strategies. Organizational Implementation is seen as an important aspect of successful strategy implementation. Three main dimensions here are formalization, degree of centralization and degree of integration. Too many rules within the structure have led to a hindrance to creativity and feeling of taking too much time or following too many processes to get something done or approved. Decision making is done by a majority vote within Yakuti Ventures Limited. This leads to a lot of time wasting even though there are more ideas generated (Olson, Slater and Hult., 2005. Although Yakuti Ventures Limited is highly specialized, it is to using this to its advantage. Activities have been centered on specific few areas of which some shareholders have no interests in and as such receive little or no support. 5.3.3

Inhibitors of Strategy Implementation

Majority of the respondents stated that major inhibiting factor to implementing strategy was time as shown in Table 4.5.1. As the literature suggests enough time needs to be allocated to the implementation process (Higgins, 2005; Beer and Eisenstat, 2000; Hambrick et al, 1989; Alexander, 1985). Lack of assigning of tasks and timelines which help an organization achieve its goals were lacking (Lorette, 2009). Failure in assigning responsibilities may ultimately lead to feelings of lack of ownership as stated by respondents. The findings of the study show that 94% of the shareholders agreed that there was a lack of feelings of ownership. Ownership is seen as one of the main reasons leading to failure in strategy implementation (Giles 1991). Lack of ownership of strategy ultimately leads to counter implementation which may lead the organization in the wrong direction. As the study reveals, shareholders who are key to implementation were not participating thus loss of ownership which causes increase in time needed to implement the strategy or overall failure to implement (Corboy & O’ Corbuii, 1999; Al-Ghamdi, 1998; Alexander, 1985).

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According to findings of the study, leadership implementation emerged as a major challenge to the implementation process. Ineffective leadership is an issue hindering the strategy implementation process. This, as respondents stated is characterized by ineffective coordination of implementation activities (Alexander, 1985). The quality of direction given defines effective or ineffective leadership (Beer et al, 2000). It was noted that organizational implementation was lacking as is evident in the challenges of organizational implementation. According to Khandwala (1973) congruence between structure, processes and systems is more important for performance than organizational fit with the environment. Inability to assess certain risks due to internal and external environment likewise affects implementation as was the case with Yakuti Ventures Limited. As such unidentified problems lead to delays or inability to implement strategy (Corboy et al, 1999; Al-Ghamdi, 1998; Alexander, 1985). According to Kaplan and Norton (2008), Lack or rewards and incentives in alignment with the strategic plan are a main inhibitor to strategy. As stated by Yakuti Ventures Limited shareholders, 94% of the shareholders agreed that there was no reward system present. 5.4 5.4.1

Conclusions Strategy Planning

According to the findings of the study, majority of the shareholders agreed that the organization has gone through the main phases of formulation of strategy. They further retorted that the strategy document was present. The plan has clearly stated in it; organization vision, organization mission, organization core values and goals linked to the financial implications. The plan also has outlined the SWOT analysis findings. Although YVL was able to have majority of the shareholders present at the strategy planning workshop, there were certain challenges that arose prior to having the sessions. These included; difficulty in finding a meeting venue as this had cost implications, difficulty in making sure all shareholders were present and active during the sessions, outsourcing of the services to assist in coming up with the plan. The planning sessions

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were insightful but experienced challenges of diverse views and opinions which may have been triggered by the diverse backgrounds and upbringing. According to the findings, the strategy document is seen as a mere document seen to be gathering dust on some shelf. However, the goals within the plan somewhat limit shareholders as they are simply trying to stay in line with investment options that were stated in the plan as at the time of planning. 5.4.2

Strategy Implementation and the Factors that Aid this Process

Strategy implementation at YVL seems to be a word the shareholders are not familiar with in the sense that strategies are simply not executed within the organization. The organization did not have a clear action plan at the point of planning and this rendered implementation difficult as there was no guide. Leadership is a key factor in working towards achieving a common goal or purpose. Although leadership implementation was somewhat present within YVL, the leaders failed to inspire and instill a sense of purpose. This meant that behaviors were in turn not shaped in line with implementation initiatives. This was exacerbated by the fact that the organizational implementation was also lacking. The leaders failed to align the organizational structure to the set out strategies thus making implementation difficult. Resource and policy deployment was not effective as there was no action plan to implement strategies. This meant that control parameters were not in place thus analysis was not possible 5.4.3

Inhibitors of Strategy Implementation

Owing to the fact that strategy at YVL is mostly not implemented, various factors arose as the main inhibitors to the execution process. Key among this was by and large the lack of an implementation plan or action plan. The other factors that arose as the main inhibitors to strategy implementation include; Lack of time, insufficient and ineffective coordination, lack of rewards in line with

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strategy execution, lack of feeling of ownership, unidentified problems, deviation from the original plan and other competing activities. Further still other problems mentioned by the shareholders as derailing the implementation process included; lack of a shareholders’ agreement or policy documents, lack of clear decision making mechanisms. 5.5

Recommendations

5.5.1

Recommendations for Improvement

The following recommendations were made based on the findings and conclusions of the study.

5.5.1.1 Strategy Planning A major factor the shareholders may have been lacking at the onset is a solid understanding of the business, the proposed strategies and the assumptions that were behind the strategy. This understanding would enable the shareholders to identify and respond to both the challenges and opportunities as they are presented before in real time. In order to get ahead and regain optimism within YVL, there is a need to increase the innovativeness of the organization’s strategy. The planning process is not a guarantee of creative insight. Thus, avenues must be created to open up shareholders to new thinking and challenging assumptions. The organization needs to consider using the appropriate process for handling issues. YVL must narrow down on selected problems and barriers in relation to the organization’s planning demands. Then focus must be shifted to important issues of the organization, industry and environment. YVL should reevaluate and create a customized planning process that offers the most possible benefits.

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5.5.1.2 Strategy Implementation and the Factors that Aid this Process When dealing with strategy implementation, YVL will need to consider the general conditions, progress monitoring and all matters communication. General conditions are essential for the successful achievement of strategy implementation. The board and management must take on the responsibility of being role models by supporting strategy and clearly expressing it at all times to all. This should be further meshed by linking all shareholders with the implementation. Everyone should understand the rationale behind the strategy. Thus, effective communication is paramount. A communication strategy is necessary at YVL so as to work towards building commitment. This will ensure that all are motivated and engaged. As a follow-up, specific measures should be put in place so as to be able to assess the desired change.

5.5.1.3 Inhibitors of Strategy Implementation Facilitation of effective execution of strategy is imperative in being successful as an organization. As a first step, YVL needs to implement a support structure. As such the organization needs to inquire: whether the organization has the right leadership, governance and operational structure required to support effective implementation; whether the right people are serving in the right departments. This will entail job analysis of the different aspects that need leadership and direction. This will ensure there is the proper job-person fit so as to better work towards effective implementation. Implementation planning needs to take a priority at YVL. Implementation planning will require a detailed outline of the specific actions and sub-actions, responsibilities, deadlines, measurement tools and follow-up required to achieve each of the firms identified strategies. This can be presented in form of detailed charts which plot the course of action for leaders over a period of 1-2 years. The attention to detail makes provision for a tangible and measurable guide which can assess progress in implementation over time. Another key constituent in implementation involves holding leaders accountable for actively driving and supporting the process. This will require assigning implementation activities and participation in efforts to support strategic initiatives. Follow-up and

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assessing progress at regular intervals enable the organization to determine whether the current implementation activities and assignments are working or whether an alternative approach is necessary. These assessments can be done monthly or quarterly and reports written for future reference. As an immediate step, YVL needs to necessitate ongoing review of the organization’s chosen direction. Sporadic evaluation of the organization’s strategy considering internal and external changes and incorporating lessons learnt into the implementation plan. This will ensure dynamism and drive competitiveness. 5.5.2

Recommendations for Further Studies

Formulation of strategy is important for any organization with the aim of attaining certain specific goals. However, it is important to note that implementation of strategy is also equally if not more important. Thus, further studies ought to take into consideration the specific different elements that come into play when analyzing an investment company or organization. Researchers should consider the options of customized strategy planning to fit an investment firm. This will include clearly outlined analysis and planning templates of execution which can aid investment firms.

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APPENDICES

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Appendix 1 Table 1.1: List of Implementation Obstacles 1 2 3 4 5 6 7

Implementation Obstacles Took more time than originally allocated Major problems faced which had not been identified earlier Coordination was not sufficiently effective Competing activities distracted attention from implementing this decision Capabilities of employees involved were insufficient Training and instruction given to lower level employees were inadequate Uncontrollable factors in the external environment had an adverse impact on

8 9 10 11

implementation Leadership and direction provided by departmental managers were inadequate Key implementation tasks and activities were not sufficiently defined Information systems used to monitor implementation were inadequate Advocates and supporters of the strategic decision left the organization during

12 13 14

implementation Overall goals were not sufficiently well understood by employees Changes in responsibilities of key employees were not clearly defined Key formulators of the strategic decision did not play an active role in

15

implementation Problems requiring top management involvement were not communicated early

16 17 18 19

enough Deviation from original plan objectives People are not measured or rewarded for executing the plan Lack of feelings of ownership of a strategy or execution plan among key employees Lack of understanding of the role of organizational structure and design in the

20

execution process Insufficient financial resources to execute the strategy

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Appendix 2: Cover Letter Karen Milanya USIU P.O.Box 14734 Nairobi Dear Respondent RE: REQUEST FOR PARTICIPATION IN RESEARCH I am carrying out a research on challenges of strategy implementation at YVL and how these can be addressed. This is in partial fulfillment of the Executive Master of Science in Organizational Development at USIU-A. You have been selected as one of the respondents in the study. I would be grateful if you could spare some time to provide information in the attached questionnaire. The results of this study will strictly be used for academic purposes. You kind participation is therefore sincerely appreciated. Thank you, Yours Sincerely,

Karen Milanya RESEARCHER

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Appendix 3 Questionnaire General Information: Please answer the following questions about yourself: 1. Gender Male Female 2. Age............................................ 3. Highest educational level attained Primary Secondary Undergraduate Graduate PhD Other If other, please specify ................................................................................................................................................ 4. Area of expertise.............................................................................................................. .......................................................................................................................................... 5. Section of YVL you represent Board of Directors Management Team Shareholder Other. Specify........................................ Strategy Formulation 6. Does YVL have a strategic plan? Yes

No

7. If there is a strategic plan, what does it cover?................................................................

.......................................................................................................................................... .......................................................................................................................................... 8. Rate the strategy planning process on a scale of 1-5 (1 being least favorable and 5 being most favorable): 1 2 3 4 a

I was part of the strategy planning process

b

My opinions and input was considered

c

The plan included formulating a vision

d

There is a clear mission statement

e

I am aware of the organizations strengths and weaknesses I am aware of the organizations opportunities and threats

f

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5

g

Objectives set out were clear and well understood

h

Strategies were formulated in line with vision

i

There is a clear plan of action for the strategies formulated There are specific individuals selected to run with the different activities within the action plan

j

9. What is the overall goal of the organization? .......................................................................................................................................... .......................................................................................................................................... 10. How does the organization plan to achieve its vision? .......................................................................................................................................... .......................................................................................................................................... 11. Did you encounter any challenges while drafting the strategic plan? Yes No List some of the challenges i). .................................................................................................................................... ii). .................................................................................................................................... iii)..................................................................................................................................... 12. Has the presence of a strategic plan within the organization improved/ enhanced any of the aspects (give a rating of 1-5, with 1 being the least favorable and 5 being the most favorable) 1 2 3 4 a

There is enhanced communication

b

There is a deeper understanding of others views

c d

There is a improved understanding of what the organization is doing There is a greater commitment to achieve objectives

e

There is a greater commitment to implement strategies

f

There is a greater commitment to work harder

g

Created a platform for continued reassessing of strategies

h

The plan has been a good marketing tool

13. What benefits have you experienced because of having a strategic plan?

.......................................................................................................................................... .......................................................................................................................................... .......................................................................................................................................... 14. Are there any limitations that have arisen because of having a strategic plan? Yes No Please state if any .......................................................................................................................................... .......................................................................................................................................... ..........................................................................................................................................

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5

Strategy Implementation 15. Rate the following statements in line with the organization. (use a scale of 1-5, with 1 being the least favorable and 5 being the most favorable) 1 2 3 4 a

There are measurable, mutually determined annual goals

b

Specific function strategies are developed

c

Development and communication of concise guidelines are in place to direct in achieving strategies The leaders only concentrate on formulating strategies

d e f g h i j k l

The leaders do not take active participation in implementation The leaders reorganize resources to lead the organization in the right direction There are group discussions and brainstorming sessions in formulating strategies Each sector/department designs its own activities towards achieving strategies Each sector/department develops, champions and implements strategies on their own There is analysis of the organization structure in order to align with strategies Results are always evaluated

n

The organization establishes a supportive budget in line with strategies There are internal administrative systems to support the achievement of strategies There are rewards linked to objectives and strategies

o

There is strategic leadership to achieve each strategy

m

5

16. As an organization have you experienced any of these factors in working at achieving set strategies: Obstacles 1 2 3 4 5 a Took more time than originally allocated b Major problems faced which had not been identified earlier c Coordination was not sufficiently effective d Competing activities distracted attention from implementing decisions e Capabilities of shareholders involved were insufficient f Training and instruction was inadequate g Uncontrollable factors in the external environment had an adverse impact on implementation h Leadership and direction provided by departmental heads was inadequate i Key implementation tasks and activities were not sufficiently defined j Information systems used to monitor implementation

105

k l m n o p q r s t

were inadequate Advocates and supporters of the strategic decision left the organization during implementation Overall goals were not sufficiently well understood Changes in responsibilities within the organization were not clearly defined Key formulators of the strategic decision did not play an active role in implementation Problems requiring board involvement were not communicated early enough Deviation from original plan objectives People are not measured or rewarded for executing the plan Lack of feelings of ownership of a strategy or execution plan Lack of understanding of the role of organizational structure and design in the execution process Insufficient financial resources to execute the strategy

17. State any problems that you faced in the process of implementing strategy in terms of:

i). Leadership implementation ......................................................................................................................................... ......................................................................................................................................... .. ii). Organizational implementation ......................................................................................................................................... ......................................................................................................................................... .. iii).Policy and Resource deployment implementation ......................................................................................................................................... ......................................................................................................................................... .. 18. State the factors that aided implementation of strategy ............................................................................................................................................... ............................................................................................................................................... ............................................................................................................................................... ... 19. Any other comments ......................................................................................................................................... ......................................................................................................................................... ......................................................................................................................................... ... Thank you for your time and willingness to participate in this study.

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Appendix 3 Work Plan Task Description/ Sep

Nov

Dec

Jan

Feb

Mar

Apr

May

June

Duration

201

201

2013

2014

2014

2014

2014

2014

2014

3

3

Proposal Development Pre-test Data collection Data Analysis Revising,

Editing

& Submitting Final Report

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Appendix 4 Budget TASK DESCRIPTION Proposal Development: Stationery,

COST (Kshs) 1,000.00

Printing & Binding Data Collection: Stationery, Printing &

4,500.00

Binding Data Analysis: Stationery & Printing Final Report: Printing & Binding Travel Expenses Communications: internet web research

1,500.00 12,000.00 2,500.00 1,500.00

and telephone Miscellaneous TOTAL

2,000.00 23,000.00

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