Influence of Strategic Planning Practices on Performance at Limuru Tea Company Limited

Abstract

For a company to achieve good performance, it has to formulate and implement strategic planning practices to be able to survive in the turbulent, unpredicted and ever changing business environment. Strategic planning practices are formulated and implemented in an organization to enable it achieve its objectives and gain competitive advantage over its rivals .Though Limuru Tea Company has been in operations since 1895,it has received tough competition from other companies that produce and manufacture tea. The demand of quality tea has also increased through the years and this has necessitated the investigation on the current strategic planning practices and how they improve their performance .The objective of this study was to establish the influence of strategic planning practices on performance at Limuru Tea Company Limited. The study was anchored on stakeholders’ theory and resource based view theory. The study applied a case study research design. The study collected primary data through interviews from five top managers of Limuru Tea Public Limited Company. The study analyzed data using content analysis because qualitative data was collected from the interviews. The study established that Limuru Tea Public Limited Company measures organization performance through sales volume, profit margins, employee satisfaction, customer satisfaction and return on assets. The study findings showed that Limuru Tea Public Limited Company attained good performance by scanning the internal environment using SWOT analysis and scanning the external environment using PESTEL analysis which helps the organization to achieve good results. The study also established that Limuru Tea Public Limited Company has formulated an organization direction which is the mission, vision and objectives that has been communicated to all the stakeholders that enables them to work towards achieving the organizations objectives and this has helped the company achieve good results. The study established that the management of Limuru Tea Public Limited Company participates in the process of formulation of strategic planning practices and this participation has helped the company get good results. The study determined that strategic planning practices implementation, evaluation and review was very crucial in enabling an organization to get good results and survive in the turbulent business environment. Based on the findings, the study recommends that Limuru Tea Public Limited Company should be involved more in the analysis of external environment through PESTEL analysis, and analyzing the political environment by being close to politicians even if they are not involved in politics so as to gain more from the opportunities that may come from the elected politicians and this may include, donations , subsidies, waivers , exemptions and inclusions in their activities, this should help them get resources for production of tea. Secondly, this study recommends that the company should also invest heavily in research and development when formulating and implementing strategic planning practices because it’s the only way that should ensure the company is innovative and introduce new products and to improve on existing products. Thirdly the study also recommends that Limuru Tea Public Limited Company and other firms in the tea and beverage sector should engage all stakeholders and train them in terms of what is expected from them that should enable the organization achieve its objectives Finally this study recommends the academics on strategic management to give this findings consideration in their future endeavors of research so as to help organizations achieve good results.