INFLUENCE OF PLANNING AND CONTROL ON ORGANIZATIONAL PERFORMANCE (A CASE STUDY OF 7UP BOTTLING COMPANY NIGERIA)

CHAPTER ONE

INTRODUCTION

1.1. BACKGROUND OF THE STUDY

Planning and controlling are inter-related to each other in that planning is the first function of management. The other functions like organizing, staffing, directing etc. are organized for implementing plans. Control records the actual performance and compares it with standards set. In the case that the performance is less than that of standards set then deviations are ascertained. Proper corrective measures are taken to improve the performance in future. Planning is the first function and control is the last one. Setting of goals for the organization is being made through planning and controlling ensures their accomplishment. Planning also decides the control process while controlling provides sound basis for planning. In reality planning and controlling are depending on each other. In the words of M.C. Niles, “Control is an aspect and projection of planning, where as planning sets the course, control observes deviations from the course, and initiates action to return to the chosen course or to an appropriately changed one”. Planning and control is concerned with the reconciliation between what the market requires and what the operation’s resources can deliver. Planning and control activities provide the systems, procedures and decisions which bring different aspects of supply and demand together. The purpose is always the same – to make a connection between supply and demand that will ensure that the operation’s processes run effectively and efficiently and produce products and services as required by customers. Organizations are committed to ensuring their customers get the best products they can offer using the most efficient systems put in place. Kemunto (2015) stated that organizations adopt new and emerging strategies that fit their type of business as they try to improve their production. The competitive business world brings about demands that affect the organization internally and externally and how organizations address these issues is what separates them from their counterparts (Harrington, 2012). Firms employ an operations strategy that is in reconciliation with the business strategy by guiding the day to day activities within the firm’s internal processes, the operations strategy being the maximization of customer value (Mwololo, 2015).Firms use the management approach of Total Quality Management (TQM) to ensure the whole organization runs its functions in a manner that will ensure the final product is of the required quality necessary for customer satisfaction. According to Kasongo and Moono (2011) it is an approach aimed at continuously improving the competitiveness, effectiveness and flexibility of the entire organization through total involvement of everyone in the organization led by the management. Planning and control of activities of the company are essential as the capacity available should be able to be converted into finished products to meet the demand of orders coming in and also be available for future demand for products (Jacobs, Berry, Whybark & Vollman, 2011). Manufacturing firms need to incorporate their supply chain with the strategies of the firm for better performance of the organization as these impacts positively in the overall performance of an organization and all the competitive priorities (Miguel & Brito, 2011). Organizational planning and control being a sub system in the organization, plays a major role in the operation efficiency. Chermack (2011) states that, depending with the existing economic climate, a business’s context may change quickly and regularly which results in a need for planning processes which take this new reality and its corresponding complexity and uncertainty into account. Firms can use different strategies as their competitive advantages. According to Murule (2011) a cost leadership strategy is based on lower overall costs than rivals and is designed to produce goods or services more cheaply than competitors by stressing efficient scale of operation. Besides providing products at lower cost, local manufacturers should focus on quality to gain advantage over the cheap imported products.

1.2 STATEMENT OF PROBLEM

Planning and Control in an organization has been pointed out as one of the pivotal infrastructure among the subsystems in an organization that firmly supports the organizations manufacturing strategy (Wacker & Hanson, 1997).Olhager and Seldin (2007) state that the choice of the planning and control approach, primarily at the sales, operations planning and master planning level, will greatly improve the organizational performance of a manufacturing firm. Howard, Kochhar and Dilworth (2015) noted that the different characteristic of different firms determined which activities would be beneficial to them. Supply chain performance, production flexibility and delivery performance being part of the performance measurements are undertaken by manufacturing firms like 7UP bottling company to improve their performance (Oketch, 2014). The choice of planning and control systems activities depends on individual companies (Kalunda, Nduka & Kabiru, 2012). Newman and Sridhan (2012) studied better execution of activities are enhanced by the planning and control system in use and how it relates to the manufacturing environment. The environmental conditions that organizations face can be characterised by product volume and variety, the competitive priorities and the technological processes. By undertaking a market survey of manufacturing firms in United States of America (USA), they were able to identify key linkages between the planning and control systems, the environment in which the firm was dealing and the organizational performance. Although a number of studies had been done on the concept and context of Planning and Control and manufacturing firms respectively, these studies have failed to cover the extent to which planning and control systems are implemented and their effects on the organizational performance of 7Up bottling company in Nigeria. Locally, researchers have not conclusively undertaken research on the planning and control systems as a whole but rather on individual ones. This gap therefore led to this study which attempted to answer the question;” What is the relationship between planning and control and the organizational performance of firms in Nigeria?”

1.3 AIMS OF THE STUDY

The major purpose of this study is to examine the influence of planning and control on organizational performance. Other general objectives of the study are:

1. To examine the extent of implementation of planning and control in the studied organization.

2. To examine the benefits of planning and control in an organization.

3. To examine the influence of planning and control on organizational performance.

4. To examine the challenges hindering the implementation of planning and control in the organization.

5. To examine the relationship between planning, control and organizational performance.

6. To proffer solutions to the challenges hindering the implementation of planning and control in the organization.

1.4 RESEARCH QUESTIONS

1. To what extent is the implementation of planning and control in the studied organization?

2. What are the benefits of planning and control in an organization?

3. What is the influence of planning and control on organizational performance?

4. What are the challenges hindering the implementation of planning and control in the organization?

5. What is the relationship between planning, control and organizational performance?

6. What are the solutions to the challenges hindering the implementation of planning and control in the organization?

1.5 RESEARCH HYPOTHESES

Hypothesis 1

1.  There is no significant influence of planning and control on organizational performance.

H1: There is a significant influence of planning and control on organizational performance

Hypothesis 2

H0: There is no significant relationship between planning, control and organizational performance.

H1: There is a significant relationship between planning, control and organizational performance.

1.6 SIGNIFICANCE OF THE STUDY

Planning and control has its real significance in the manufacturing firm as it is a key driver towards building and maintaining organizational performance. The performance of Human Resource Practice in manufacturing firm in Nigeria has improved and with licensing to most of the MNC’s from developed countries introduced the modern practices in Nigeria. So this research will absolutely give a positive path towards making manufacturing firms Human Resource competitive as compared to other sectors, as we will check that the manufacturing firm sector has an effect on their organizational performance by following the modern practices of HR. This study is necessitated by the urge and the need for the research, reader and organizations in general to understand the advantages of implementation of human resources on performance stem that will serve as tool for achieving higher organization performance. The following are the significance of study to the researcher:

• To serve as guide to corporate individuals, organization and student alike in furtherance to their research on the subject matter
• To help government in the determination of how productive is both public and private sector of the economy
• To serve as a reference materials for students who will wish to conduct similar studies on this topic.

1.7    SCOPE OF THE STUDY 

The study is based on impact of influence of planning and control on organizational performance, a case study of 7UP bottling company Nigeria in Lagos State.

1.8 LIMITATION OF STUDY

Financial constraint- Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).

Time constraint- The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.

1.9 DEFINITION OF TERMS

Organization: According to Stewart (2011) “organizations are set up to achieve purposes that individuals to achieve on their own organization they provide a means of working with others to achieve goal….like to determine by whoever is in the best position to influence them… A key characteristic of organization is their complexity”. Individuals in organization, depend on each other’s effort through interactions and which enable them work to words the realization of common goal. Laid down structures however fashion out how they relate to others. It can also be define as a group of people identified with shared interest or purposes, example business or school.

 Planning: This is generally recognized as the most difficult task facing a manager, and it is one on which it is very easy to predetermine future and initiate and negotiate actions. This indicates that planning is deciding in advance what to do, how to do it and who is to do it. Also, it can simply be seen as setting a goal or objective and devising the means, policies, programmes, and procedures through which to achieve the goals. Infact, it brings the gap between where we are and where we want to go. 

Control: Control may be defined simply as the action, necessary to ensure that objectives, plans, policies and standards are being attained. Control pre-supposes feed forwards, meaning that those objectives, plans and controls have been developed and communicated to those managers who have performance responsibility for accomplishing their work. Therefore, it can precisely be seen as the measurement of performance progress or output against a set standard or goal.