UNDERGRADUATE – SIMAD UNIVERSITY

ASSIGNMENT SUBMISSION AND ASSESSMENT

SRATEGIC MANAGEMENT

DECEMBER 2020

CLASS (BBA22)
GROUP B
1. ANISA MOHAMED YUSUF ELMI
2. ABDULLAHI DAHIR MOHAMED
3. FATIMA ABDULLAHI SHIRE
4. NASRA MOHAMED YASIN
5. YASMIN ABDIAZIIZ ABDULLAHI

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 The Role of Strategic Planning in Modern Organization (Case Study
Telecommunication In Somalia.

ABSTRACT
This study general objective is to establish the role of strategic planning in modernorganization
withspecial references to telecommunication industries in Mogadishu Somalia. Many Somali
business do not have formal strategic plans in their operations. The study is guided by objective
of establishing how strategic planning contributes to an organization’s performance, with special
interest on strategy formulation, business operations strategy implementation and strategy
evaluation affect. The study used descriptive study design. Thetarget population comprised of
100 telecommunications staff. The sample size is80employees from different departments within
the organization. The study carried out a pilot study to test the internal consistency of the
questionnaire. Data was collected using questionnaire for primary data while secondary data was
obtained through journals, books, and any other published works in the area of strategic
planning. Datacollected was analyzed using statistical software (SPSS v23) then presented as a
report. The study found out that11.7% of performance of Somalia telecommunication is
influenced by combination of all four independent factors investigated in this study. There was a
positive and significant relationship between strategy implementation and organization
performance, positive and significant relationship between strategy evaluation and performance
of However there was an insignificant relationship between strategy formulation and
performance and business operations with performance of Hormuud telecommunication.

ITRODUCTION

Organizations are facing of the study exciting and dynamic challenges in the 21st century. In the
globalized business, companies require strategic thinking and only by evolving good corporate
strategies can they become strategically competitive Time spent on planning how to implement
new technology is more valuable than time spent selecting new technology. A sustained or
sustainable competitive advantage occurs when a firm implements a value – creating strategy of
which other companies are unable to duplicate the benefits or find it too costly to initiate.

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Corporate strategy includes the commitments, decisions and actions required for a firm to
achieve strategic competitiveness and earn above average returns. The goals of corporate
strategy are challenging not only for large firms like Microsoft but also for small local computer
retail outlets or even dry cleaners.(Abdi & Sasaka, 2017)

Strategic planning is the process of defining an organization’s plans for achieving its mission. An
organizational strategy is a derived approach to achieving that mission. The product of a strategic
planning effort is typically a document (a strategic plan) that elaborates a high-level strategy and
articulates the elements that influence the performance of an [Link] planning is
an organization's process of defining its strategy, or direction, and making decisions on
allocating its resources to pursue Strategic planning is not just a cold technical undertaking that
spells out future objectives to be reached and actions to be taken.

The earliest concepts of planning were predicated on the assumption that the principles and
concept were right for all businesses, although there might be some need for minor adaptation to
fit the style and circumstances of particular organizations. Thus it was not expected that every
planning system would be applied in precisely the same way, but the concept would be
recognizable, and any differences would be in detail rather than the main ideas. This in fact was
never true, partly because the fit of the universal concept to particular circumstances was never
that precise, partly because new slants to the old concepts were being promoted all the time, and
partly because many companies neglected to include many of the key elements when they
applied the concepts.

In Africa As the strategic planning practices becomes more turbulent, found that the most
important issue the companies face is to use its strategic resources management that facilitate
them to achieve strategic management practices and this contribute long-term profit to
organizations. Strategic management practices considered to be a critical requirement for the
growth and performance of organizations in Africa specified that the capability to use strategic
resources is ever more viewed as the single most vital factor in developing and supporting
strategic management practices to increase firm’s performance in Africa. strategic planning
practices is a necessary ingredient for sustained success and is an integral part of the African
businesses performance. Specified that to support its growth and performance, African firms

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develop strategic management practices that enable service providers to generate higher revenue
streams(Mohamud, 2018).

In Somalia, after the fall of the autocratic regime of SiadBarre in 1991, Somali firms had an
opportunity to penetrate the market. Warsame (2015) indicated that the absence of taxes, lack of
laws, and inexistence of license providers and collapse of foreign exchange controls made things
easier in many respects. According to Ali (2014) the organizations in Somalia exploit their
strategic resources management to determine the most important strategic resources management
that enable them gaining strategic management practices to achieve higher profit, dominate and
lead the market.

The application of strategic Planning in business for various sectors has long been adopted as a
response to market demand, variations in clients’ taste and changing of technology.

Strategic planning can be used successfully by: an organization connected with a government,
that deals with providing service, department, or major organizational divisions, general
purposes governments such as city, country, state or tribal government, nonprofit organizations
providing what are essentially public services, and purpose-driven inter organizational networks
(such as partnerships, collaborations, or alliances) in the public and nonprofit sector designed to
fulfill specific purpose such as transportation, health, education or emergency services.

The telecommunications sector has flourished in a completely deregulated environment since the
collapse of central government in 1991. Several privately owned telecommunication companies
have developed and they provide extensive landline and mobile coverage throughout the country
– and beyond, although reliable statistics on mobile phone ownership in Somalia do not exist, the
International Telecommunications Union (ITU) estimated that there were 648,000 mobile phones
in Somalia in 2010, giving a mobile penetration rate of just 7%, but other estimates put the true
figure of mobile ownership much higher – at up to 39%, nevertheless access to mobile phones is
restricted amongst the very poor, especially displaced people and the inhabitants of remote rural
areas

Hormuud telecommunication is one of the biggest and well established telecommunication

companies in Somalia. It started its journey in the world of communications in April 2002 from
Mogadishu, the capital city of Somalia and since then it has earned name and fame with over

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5000 permanent employees and a varying number of temporary staff. The faith of people in
Hormuud Telecommunication can be assessed by the fact that about 4000 Somali
businesspersons have shares in the company. The telecommunication company offers a variety
of services which include Mobile service (GSM), landlines and mobile linked internet services
(such as Mifi4G, Adsl,W-dsl and Hotspot). The company covers Southern and Central regions of
Somalia and caters to people’s needs of communication. The company is focused on CSR
activities including educational advancements for all Somalis(Abdi & Sasaka, 2017)

The company’s vision is “To lead the telecommunication industry with reliable and efficient
services is our vision, fulfilling every need pertaining to communication of Somali people. “Its
mission statement is “to offer Somali people affordable, reliable and quality services of
telecommunication to make communication easier and effortless.

Top managers know well that the firm’s strategic resource management create strategic
management practices in general, in recent years Telecommunication companies in Mogadishu,
Somalia faced lower profits and intensive competition between them and they attempting to use
its strategic management practices to enhance its performance, so it is necessary that top
managers understand how the strategic resource management, organizational innovation, core
competencies & quality management practice generates strategic management practices and its
effects on organizational performance. A review of current studies indicates that there are very
few studies that have been conducted on the effect of strategic management practices on
organizational performance in telecom companies globally but in Somalia there is no researcher
who studied how strategic management practices effects on organizational performance in
telecom companies. Background of the study indicated that the unique, rare & in-imitable
resources can be a source of strategic management practices that enhances organizational
performance.

LITERATURE REVIEW

Strategic Customer Relationship Management

High quality service helps to generate good customer relationship management and growth of
market share by soliciting new customers, and improved productivity and financial performance.
Customer Relationship Management is a comprehensive strategy and process of acquiring,

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retaining, and partnering with selective customers to create superior value for the companyand
the [Link] relationship management enables an organization to work in a
competitive environment and manage to supersede competitor efforts with its customer centric
approach.

CRM consists of three components: The customer who is the only source of the company’s
present profit and future growth. However, a good customer, who supplies more profit with less
resource, is always limited since customers are well informed and the competition is fierce.
Information technologies can provide the abilities to distinguish and manage customers.
Secondly the relationship between a company and its customers involves continuous
bidirectional communication and interaction. The relationship can be short-term or long-term,
continuous or discrete, and repeating or one-time. Relationship can be attitudinal or behavioral.
Even though customers have a positive attitude towards the company and its products, their
buying behavior is highly situational. Finally management, CRM involves continuous corporate
change in culture and process. The customer information collected is transformed into corporate
knowledge that leads to activities that take advantage of the information and the market
opportunities. CRM requires a comprehensive change in the organization and its people

Strategic Technical Skills

Strategic Technical Skills It is important to recognize that skills development and other
investments in human capital comprise only one set of factors necessary for productivity growth.
Skills development alone cannot raise enterprise and national productivity. Other factors and
policies are likewise insufficient if they are implemented in isolation of skills development. One
of the messages of this report is that skills development must be an integral part of broader
development strategies if it is to deliver on its substantial potential to contribute to overall
productivity and employment growth . Skills are critical in the structural adjustment of
economies. As economies move from relative dependence on agricultural production to
manufacturing and service industries, workers and enterprises must be able to learn new
technical skills. Inability to learn new skills because of inadequate basic education or lack of
opportunity slows the transfer of all factors of production from lower to higher value added
activities. As consumption and production patterns change, work is reorganized to meet new
demands and technologies. However this reorganization is not instantaneous and rarely smooth.

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Enterprises and workers are affected differently. Some find their skills in short supply while
others may find their skills redundant. This dichotomy was brilliantly captured by Schumpeter,
who described the process of innovation in market economies as creative destruction.

Strategy Formulation and Organization Performance

One of the major concerns of the planning process, as argued is the formulation of a strategy.
This is a guide to the executives on how to define the business in the organization, what the
business aims to achieve and the means through which to accomplish the ends. This usually
entails defining the mission and to identify the scope of operations of the organization. To
accomplish this, the organization formulates appropriate strategies which will lead to
development of organizational structure through which organizations objectives can be achieved
(Journal & Ahmed, 2019)

Business Operations and Organization Performance

Business operations come to play when organizations are implementing set goals and objectives
thereby implementing the strategy. This entails policy formulation as part of planning., defines
policy as guidance to managerial action and limit within which the business operates in. that
guides administration in making decision. In this sense policies and guides carry out strategy by
setting boundaries and limits within which the business operates. This results in institutionalizing
and operationalizing the chosen strategy and getting the organization into position of being able
to execute the strategic plan in an effective and efficient way, as described the policy is the stand
line for employees and management(Omsa et al., 2018)

Strategy Implementation and organizational performance

Strategic implementation is the process of allocating resources to support the chosen strategies.
This process includes the various management activities that are necessary to put strategy in
motion, institute strategic controls that monitor progress, and ultimately achieve organizational
goals. The implementation process covers the entire managerial activities including such matters
as motivation, compensation, management appraisal, and control processes points out that
almost all the management functions - planning, controlling, organizing, motivating, leading,
directing, integrating, communicating, and innovation -are in some degree applied in the

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implementation process states that to effectively direct and control the use of the firm's
resources, mechanisms such as organizational structure, information systems, leadership styles,
assignment of key managers, budgeting, rewards, and control systems are essential strategy
implementation ingredients(Pirtea, 2009)

Strategy Evaluation and organizational performance

Organization’s strategy objectives must be consistent to the overall organizational objectives,

organizational culture, and organizational operationsand organizational spending patterns. A
strategy that contains goals, objectives and policies that are mutually inconsistent is null and
should be rejected. The challenge of inconsistency is mainly experienced in a multi-enterprise
organization with different units. One of the key issues faced by a business, particularly a multi-
enterprise one, is that of managing the internal units effectively. In order to deal with
inconsistency, strategic alignment of strategies to the broader organizational goals and vision is
employed. Shows that aligning operational strategies to the organizational strategy goals is
essential for improved business performance (Catherine, 2015)

They further defined alignment as the capacity to demonstrate a positive relationship between
operational strategy and the accepted organizational measures of performance. Ibrahim (2015)
states that strategy evaluation results helps in inspiring and motivating employee since it enables
employees measure their performance; helps employees in determining the nature of adjustments
needed; helps employees relate their objectives to that of the organization; good results inspires
hard work; and the information inspires better work. They further posit that strategy evaluation is
used to compare performance or peers; compares performance to industry standards; compares
performance among deportments; and compares performance between strategies.

Measurement of Organization performance

Measurement of Organization performance Organizational performance refers to how well an

organization achieves its objectives. common organizational objectives include shareholder
wealth maximization, profit maximization, increased market share and customer satisfaction.
Thus, any organizational initiative, including strategic planning, should ultimately lead to
enhanced organizational performance. Organization performance is evaluated on the basis of the
ability of an organization surviving the market, the market’s valuation of the firm’s securities as

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well as its reputation. Prior studies have measured organizational performance using different
metrics [Link] share; Return on investment; average annual market share growth; average
annual sales growth; overall product quality; profit margin on sales; and overall competitive
position(Kituu et al., 2013)

Strategic Planning and Information Resources Management (IRM)

Every organization should connect their investment in Information Technology with improved
program effectiveness and service delivery. The development of a Strategic Plan assist the
organizations to focus on results and performance, linking budgets, planning and performance
targets, and contributes to the recognition of information systems’ role in delivering improved
performance. From an Information Resources Management perspective, the strategic plan is a
mechanism that allows the Chief Information Officer (CIO) to connect the strategic objectives of
the organization to programs and initiatives that involve information systems. Establishing this
connection serves to make senior leadership aware of how information systems contribute to the
mission and vision of the organization. The characteristics of an organization's key decision-
makers influence strategy and subsequent organizational performance(Maleka & Technologies,
2015)

Organizational Innovation

Organizational innovation is the application of new ideas to the product, process or any other
aspect of a firm’s activities. By economic innovation, we refer to novel ideas that have been
implemented, producing more profit &financial value than has been invested in creating them.
The importance of organizational innovation can be realized on a number of stages(Mohamud,
2018)

Organizational innovation is important on a number of levels. It is important for nation and

region, for economic growth, and for firms for survival and growth profit and for nations and
regions, innovation is an important driver of economic growth and improvement of firm’
performance. there are a number of reasons, including survival, growth, and shareholder return
and increase firms’ performance, however the more the organization bring the market new
product and service, the more the organization gets major part of the customers, market share
and higher profit. Innovation has a considerable impact on corporate performance by producing

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an improved market position that conveys the strategic management practices (Abdalkrim & Bin,
2013)

There are several common business reasons for an organization to create a strategic plan,
including the need to:

 Clarify and facilitate the emergence of a consensus on the organization's strategy. The
strategic-planning process can help the organization's employees find answers to the big
questions about its purpose, meaning, and value.
 Communicate this strategy to all levels of the organization—and to its diverse
stakeholders and customers.
 Strengthen the fit between departmental and personal goals and the organization's
overarching vision.
 Identify and align strategic initiatives, so the strategic actions of one part of the
organization don't conflict with those of another (for example, so the team-based
incentive pay system developed by operations doesn't conflict with the knowledge-based
incentive program developed by human resources.

Importance of Strategic Planning

The strategic planning is a requirement for sustained competitive advantage on organizations.

Competitive advantage is what keeps great organizations ahead of their competitors. the
organizations, which has a competitive advantage, Strategic Management And Strategic Planning
Process: South African Perspective performs financially much better than other companies in the
industry or better than the industry average. Some organizations may achieve it without thorough
strategic plan but for the most players out there it is vital to plan strategically, i.e. analyses,
create, implement and monitor, and do this continuously. It is not guaranteed that organizations
will ever achieve competitive advantage conducting strategic planning but it is an essential
process if the organizations (Vasilescu & Codreanu, 2013)

The strategic planning also assists to view things from broader perspective. Johnson et al
(2008:12) argues that other reason why the organizations don’t simply rely on their finances,
marketing or operations functional areas to create competitive advantage is that managers of

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each area often view things only from their own specific angle, which is too narrow view for the
whole organization to rely upon. Only the managers (e.g. CEOs or strategic planners) who see
the whole picture of the company and its surrounding environments can make the decisions that
bring the competitive advantage.

Furthermore strategic planning also facilitates collaboration. Nowadays, most companies involve
middle managers of functional areas into the process of formulating strategic plan. Middle
managers are the people who implement the strategies set out in a plan and if they aren’t
involved in making the plan, then they aren’t so committed to support it. Thus, strategic planning
is used to achieve the competitive advantage and to integrate all the functional areas of the
company by facilitating the communication between the managers of all levels.

Organizational Performance

Organizational Performance is the end result of the organization’s activities; it includes the
actual outcomes of the strategic planning process. The practice of strategic planning is justified
in terms of its ability to improve the organization’s performance. Organizational performance
comprises the actual output or results of an organization as measured against its intended outputs
(or goals and objectives) profitability is the ability of a business to earn a profit. It is the primary
goal of all business ventures and increases organizational performance. Without profitability the
business will not survive in the long run. So measuring current and past profitability and
projecting future profitability is very important. Sales are an important factor in determining
profitability.

METHODLOGY

Research Design

Descriptive studies are more formalized and typically structured with clearly stated hypotheses
or investigative questions. It serves a variety of research objectives such as descriptions of
phenomenon or characteristics associated with a subject population, estimates of proportions of a
population that have these characteristics and discovery of associations among different
variables. This study therefore adopted a descriptive research design that is said to help

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researchers to describe the population using measures of central tendencies such as mean, mode
and median as well as measures of dispersion and distribution.

Population of the Study

Populations are the entire group of individuals or items under consideration in any field of
inquiry and have a common attribute. The population of interest in this study is composed of all
the firms in the telecommunication industry in Somalia.

Sample Size and Selection

A simple random sampling technique was used to select a representative sample of the desired
firms. Five of the telecommunication companies in Somalia were randomly selected to be
representative of the other similar firms. The firms selected include, Hormud Telecom, Somtel,
and Somnet . A sample of 27 staff was selected from each of the three companies to represent
human resource, finance, sales and marketing, procurement and information technology
departments. The sample size for this study was therefore comprised of a total of 80 top staff
respondents

Data Collection

The study will use both primary and secondary data sources. The primary data will collect using
questionnaires while the secondary data will collect from existing materials. Secondary, means
“next after the first” or “derived defines secondary data as data previously assembled for some
project other than the one at hand. The study mainly relied on primary data which will collect via
questionnaires. The instrument will be a semi-structured questionnaire having both open and
close-ended questions in one questionnaire. Structured questions necessitate getting as much
information as possible from the limited space on the form. All the 15 respondents selected for
this study filled the questionnaires offering their quantitative and qualitative views and
experiences on strategic planning practices. The questionnaires will administered to the
respondents through drop and pick method, then the respondents will give time to fill, after
which the filled questionnaires were collected within a period of three days and follow up made
to ensure that there was an adequate completion rate.

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Data Analysis

Since the instrument of choice for this research was a semi-structured questionnaire, data
analysis had both quantitative and qualitative analysis. The quantitative analysis was done to
establish the measures of central tendency that include the mean, mode, and median highlighting
the key findings. The quantitative data was edited and coded into Statistical Package for Social
Sciences (SPSS) for analysis. SPSS generated descriptive statistics such as frequencies, mean
and standard deviation. The qualitative data was analyzed by means of content analysis. This
process uses inductive reasoning, by which themes and categories emerge from the data through
the researcher’s careful examination and constant comparison. ata was presented inform of
frequencies, percentage, averages and measures of variation, such as the means, variances and
standard deviation. Diagrammatically, the data will be presented in bar graphs, histograms,
tables, and pie charts.

CONCLUSIONS

In conclusion, the study has established strategic planning practices were significant both to
individual and to the organization. The study concluded that in Hormud telecommunication had
benefited greatly by using strategic planning practices in the management of its core business.
The study further found out that strategic planning activities could be useful in understanding
where an organization is at a particular time, where it is headed and what are the future
opportunities it can explore.

Reference

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